Blackstone Raises $7.1 Billion for Sustainable Development Goals
The Blackstone Green Private Credit Fund III has successfully raised $7.1 billion, surpassing its $6 billion goal. This fund aims to provide financing for solar companies, electric car parts makers, and technologies that reduce carbon emissions. The achievement highlights Blackstone Inc.’s commitment to supporting the Sustainable Development Goals (SDGs) and its belief that the global economy will increasingly rely on lower-carbon sources.
Blackstone’s Focus on Sustainable Development Goals
Blackstone, primarily known for its buyouts, has expanded its role as a major source of financing. With nearly a third of its $1 trillion assets dedicated to credit, the company aims to build up its lending business as traditional banks face new regulations. President and CEO-heir apparent Jon Gray has urged dealmakers to focus on significant themes and fast-growing sectors of the economy to sustain the company’s financial success.
The Blackstone Green Private Credit Fund III represents the firm’s first lending pool with a formal mandate to profit from the transition to alternative energy sources. This move aligns with Blackstone’s decision to refrain from supporting oil and gas exploration and production since 2022, as the returns for such investments have been volatile.
Blackstone has set a target to invest $100 billion in various companies that are poised to benefit from the rise of alternative energy sources. Unlike some rivals and hedge funds that continue to invest in oil, Blackstone believes in the long-term profitability of green energy. However, this stance may attract criticism from ESG (Environmental, Social, and Governance) critics who accuse money managers of promoting “woke” capitalism.
Transforming the Economy with Sustainable Resources
Robert Horn, who oversees Blackstone’s credit arm focused on renewable companies and related plays, emphasizes the immense capital needs for the energy transition. He sees this as an opportunity to use Blackstone’s capital and resources to transform significant sectors of the economy while generating attractive returns for investors.
Horn, formerly the co-head of Blackstone’s energy lending arm, now leads the “sustainable resources platform” that reflects the company’s focus on renewable energy. This platform has the capacity to connect Blackstone’s borrowers with other portfolio companies, ranging from power-hungry data centers to urban warehouses.
One example of Blackstone’s involvement in sustainable projects is its support for Altus Power. The firm provided investment-grade debt and preferred equity to Altus Power and connected the solar power company with a Blackstone-backed warehouse operator. Together, they initiated solar projects across New Jersey.
US Policies and Favorable Economics
Blackstone’s $7.1 billion fund for sustainable lending will benefit from US policies that incentivize electric carmakers and other renewable energy companies. The Inflation Reduction Act, signed by President Joe Biden, provides incentives over the next decade, offering “10 years of certainty,” according to Horn. The underlying favorable economics of these sectors contribute to their success.
By raising significant funds for sustainable development, Blackstone demonstrates its commitment to the SDGs and its belief in the potential of alternative energy sources. As the world’s largest alternative asset manager, Blackstone’s focus on green energy may attract both praise and criticism from various stakeholders.
Sources:
- Bloomberg: Blackstone Raises $7.1 Billion for Green Energy Credit Fund
- Bloomberg: Blackstone Said to Seek $7 Billion for Green Energy Credit Fund
- Bloomberg: Blackstone Retreats From Oil-Patch Investing, Widening Private Equity’s Exit
SDGs, Targets, and Indicators
1. Which SDGs are addressed or connected to the issues highlighted in the article?
- SDG 7: Affordable and Clean Energy
- SDG 9: Industry, Innovation, and Infrastructure
- SDG 13: Climate Action
2. What specific targets under those SDGs can be identified based on the article’s content?
- SDG 7.2: Increase substantially the share of renewable energy in the global energy mix.
- SDG 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes.
- SDG 13.2: Integrate climate change measures into national policies, strategies, and planning.
3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?
- Investment amount raised for financing solar companies, electric car parts makers, and technology to cut carbon emissions can be an indicator of progress towards SDG 7.2 and SDG 9.4.
- The shift of Blackstone’s lending focus from oil and gas to alternative energy sources can be an indicator of progress towards SDG 13.2.
Table: SDGs, Targets, and Indicators
| SDGs | Targets | Indicators |
|---|---|---|
| SDG 7: Affordable and Clean Energy | 7.2: Increase substantially the share of renewable energy in the global energy mix. | Investment amount raised for financing solar companies, electric car parts makers, and technology to cut carbon emissions. |
| SDG 9: Industry, Innovation, and Infrastructure | 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes. | Investment amount raised for financing solar companies, electric car parts makers, and technology to cut carbon emissions. |
| 9.4: Upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes. | The shift of Blackstone’s lending focus from oil and gas to alternative energy sources. | |
| SDG 13: Climate Action | 13.2: Integrate climate change measures into national policies, strategies, and planning. | The shift of Blackstone’s lending focus from oil and gas to alternative energy sources. |
Behold! This splendid article springs forth from the wellspring of knowledge, shaped by a wondrous proprietary AI technology that delved into a vast ocean of data, illuminating the path towards the Sustainable Development Goals. Remember that all rights are reserved by SDG Investors LLC, empowering us to champion progress together.
Source: finance.yahoo.com
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