As a state that has part of its pension funds under BlackRock's management, South Carolina might want to consider whether BlackRock’s strategy aligns with what its citizens want.
BlackRock has taken a public stance on net-zero energy, a move that has elicited criticism from a consumer advocacy group. Some states that are heavily reliant on energy production also are rethinking their investments with BlackRock.
Consumers’ Research Executive Director Will Hild noted in an interview posted on YouTube that BlackRock CEO Larry Fink is taking actions that "are betraying the American consumer.” Regarding Fink and BlackRock pushing Americans toward green energy, Hild said, "He's not doing anything like that to the Chinese Communist Party. They're invested in PetroChina there and don't mess with any of their assets.”
Consumers' Research sent a letter to the 10 states with the most money from state pension funds invested with BlackRock, according to Palmetto State News. Four of those 10 states have Democratic governors: Jay Inslee (D-WA), Kathy Hochul (D-NY), Steve Sisolak (D-NV) and Tom Wolf (D-PA). The other six have Republican governors: Ron DeSantis (R-FL), Pete Ricketts (R-NE), Henry McMaster (R-SC), Kevin Stitt (R-OK), Greg Gianforte (R-MT) and Jim Justice (R-WV).
After Consumers’ Research brought to light the hypocrisy of BlackRock’s actions, several states have taken action to edge away from the investment firm.
Texas Lt. Gov. Dan Patrick (R) sent a letter to the Texas comptroller earlier this year. In it, he requested that the state pull its funds from BlackRock because of the firm’s stance on energy.
"As you prepare the official list of companies that boycott energy companies, I ask that you include BlackRock, and any company like them, that choose to hurt Texas oil and gas energy companies by boycotting them in violation of Senate Bill 13,” Patrick wrote in his letter to Texas Comptroller Glenn Hegar.
In the letter, Patrick went on to cite several instances where he believes Fink has directly discriminated against the oil and gas industry.
"These statements indicate that BlackRock is capriciously discriminating against the oil and gas industry by exiting investments solely because companies do not subscribe to a ‘net zero’ policy beyond what is required by law,” Patrick wrote, according to Houston Daily.
Elsewhere, West Virginia State Treasurer Riley Moore announced in January that the Board of Treasury Investments, which manages the state's $8 billion in operating funds, will no longer invest with BlackRock. The move was inspired by recent reports that BlackRock was urging companies to embrace “net zero" investments and investment strategies, according to Moore. This would harm the coal, oil and natural gas industries, which West Virginia heavily relies on. It was also motivated by BlackRock's investments in Chinese firms that pose investment risks and are not in the interests of the U.S., according to Mountain State Times.
South Carolina is the state with the sixth-most amount of money — $9.3 billion — under BlackRock’s control.
The U.S. Energy Information Administration (EIA), using estimated data from 2019, says that South Carolina’s end-use consumption by source, excluding losses, breaks down as follows: 0.4% from coal, 14.9% from natural gas, 50.7% from petroleum, 8.5% from renewables and 25.5% from electricity.
Electric power sector consumption by source was dominated by nuclear power (59.7%). Coal accounted for 15.9%, natural gas for 19.1%, renewable energy for 5.1% and petroleum for 0.1%. When it comes to natural gas consumption, South Carolina is in the lowest 10 states in the U.S., the EIA says.
The agency says the state’s four nuclear plants supply 55% of the total electricity, making South Carolina the third-largest nuclear power producer in the country.
BlackRock’s strategy came to light after Fink wrote a 2022 outlook letter to companies BlackRock has invested in. In the letter, he said businesses not anticipating a carbon-free future risk being left behind and that it was a focus of BlackRock to help lead the transition to “net zero,” according to Palmetto State News. The letter also said that "climate rise is investment risk" and BlackRock would be "exiting investments that present a high sustainability-related risk" while "launching new investment products that screen fossil fuels."
BlackRock Inc. is an investment management corporation based in New York City. Founded in 1988, BlackRock is the world's largest asset manager, with $10 trillion in assets under management.