The response from BlackRock

BlackRock provided detailed answers to our questions.

  1. Do you measure the carbon footprint of your infrastructure portfolio? And do you measure your footprint at the GP level?

Reporting around a broad array of ESG metrics, including equivalent carbon emissions, is a key part of BlackRock Real Assets’ sustainability strategy. This includes, where possible, the collation of data pertaining to energy consumption, energy output, renewable energy output, greenhouse gas emissions, water consumption and waste management. Key data points are measured at an individual asset or project level and aggregated for portfolio-wide reporting.

Across our infrastructure portfolio, we continue to evolve our ESG and Impact Metrics.  Recent strategies are taking an even more granular approach to data collation and utilising proprietary impact reporting methodologies to align our reporting with UN SDGs contribution and dollarize our environmental and social impact. Our impact reporting looks at both carbon emissions and carbon savings (in the context of our renewables portfolios).

Each year we submit a number of our real estate and infrastructure portfolios in to GRESB, the leading sustainability benchmark. This provides an independent assessment of the sustainability performance of our assets, relative to the benchmark.

As a firm, we also track the carbon footprint of our activities and have set targets to reduce our emissions and increase renewable energy. See

  1. Do you have any fossil-fuelled energy generation/transmission assets in your infrastructure portfolio? If so, what percentage of your portfolio do they represent?

Yes, we invest in natural gas generation and have some exposure to oil infrastructure assets.

As outlined in January’s open client letter, as we move to a low-carbon world, investment exposure to the global economy will mean exposure to hydrocarbons for some time. While we believe the low-carbon transition is well underway, the technological and economic realities mean that the transition will take decades. Global economic development, particularly in emerging markets, will continue to rely on hydrocarbons for a number of years. As a result, the portfolios we manage will continue to hold exposures to the hydrocarbon economy as the transition advances.

We have however committed to divesting from companies that generate more than 25% of revenues from thermal coal, because the risks associated with investing in thermal coal producers outweigh any potential expected return.

  1. Do you have any energy-transition assets in your portfolio? If so, what percentage of your portfolio do they comprise?


The transition to a lower carbon future is providing attractive investment opportunities in renewable power and natural gas infrastructure. We have set out below some of the structural dynamics that is driving this investment opportunity.

By 2050, 65% of the world’s energy demands will be met by renewables, compared to just 25% today.  That global shift towards cleaner sources of power has driven a rapid growth in our renewable power platform. As an early mover in renewables investing, BlackRock now has over $6 billion invested in over 270 wind and solar projects across the globe on behalf of our clients.

We also believe that natural gas, which generates 50% less carbon emissions than coal and 30% less emissions than oil, will play a critical role in the global energy transition, not only in helping to reduce emissions but also as a back-up for intermittent renewables. New efficient natural gas infrastructure is driving CO2 reductions in major markets like the US as it displaces other fossil fuels. Our Global Energy and Power Infrastructure team has investments in natural gas infrastructure, including midstream and power plants, and we believe it will remain a growth opportunity within energy transition investing.

  1. Have you implemented or do you have plans to implement emissions-reduction targets across your infrastructure portfolio?

As part of our commitment to embed sustainable investing principles across our Real Assets investment strategies, including our asset management activities, we’ve established key performance indicators and targets where is it possible and practical to do so. We track and review performance against key indicators including renewable energy output, energy efficiency and reduction, carbon emissions reduction, water efficiency and reduction, zero waste to landfill and community engagement and support.

To date our renewables investments have generated more than 20,000,000 MWh of renewable energy, contributing to the displacement of almost 9 million tonnes of carbon dioxide emissions. Our natural gas investments have also contributed to the reduction of over 16 million tonnes of carbon dioxide emissions, when compared to like-for-like coal combustion energy generation.

  1. How resilient is your infrastructure portfolio to climate change?

Investment teams consider climate risk in the due diligence process, and evolving our climate risk assessment is a key area of focus for the business. Building on our work in 2019 we are looking to provide our investors with more advanced data/tools to assess and [quantify] climate risk (

We are a founding member of the Task Force on Climate-related Financial Disclosures (TCFD), and a signatory to the UN’s Principles for Responsible Investment. We are privileged to be part of UN PRI’s Infrastructure Advisory Committee and GRESB’s Advisory commitment as we also view that collaboration across industry is key to advancing this topic.

We consider both physical risk or climate risk driven physical location of the asset, and transition risk which are risks arising from new legislation associated with transition to lower carbon economy. We also examine issues such as exposure to increased storm intensity, sea level rise, flooding, water stress and wildfires. We consider the impact of changing regulation, technological developments and consumer preferences.

  1. Could climate change adversely impact the valuation of your infrastructure portfolio?

Climate change has the potential to impact all asset classes, including infrastructure, and so it is an increasingly material investment consideration.

As outlined in Larry Fink’s 2020 CEO letter we believe the investment risks presented by climate change are set to accelerate a significant reallocation of capital, which will in turn have a profound impact on the pricing of risk and assets around the world.

That is why we also wrote to our clients explaining a number of initiatives that BlackRock is undertaking to place sustainability (including climate change assessment) at the centre of our investment approach, including: making sustainability integral to portfolio construction and risk management; exiting investments that present a high sustainability-related risk, such as thermal coal producers; launching new investment products that screen fossil fuels; and strengthening our commitment to sustainability and transparency in our investment stewardship activities.

  1. Have you adopted a strategy for future assets you will be investing in? For example, investing less in fossil fuel-based assets and more or only in clean energy?

Yes, we will continue to evaluate high-risk sectors that are exposed to a reallocation of capital, and we will take action to reduce exposures where doing so can enhance the risk-return profile of portfolios. Earlier this year we announced that we […] will exit investments in companies that generate more than 25% of their revenue from thermal coal production. Thermal coal is significantly carbon intensive, becoming less and less economically viable, and highly exposed to regulation because of its environmental impacts. With the acceleration of the global energy transition, we do not believe that the long-term economic or investment rationale justifies continued investment in this sector.