UNEQUAL BURDENS: PRIVATE EQUITY-BACKED FOSSIL FUEL ASSETS AND THE GLOBAL SOUTH

The report analyzes the role of Global North private equity firms in maintaining fossil fuel assets across the Global South, highlighting a pattern of extracting profits while offloading environmental and social risks onto local communities. Using data from the 2024 Climate Risk Scorecard, it identifies 13 firms with assets in 32 Global South countries, with a significant concentration of risky assets in Latin America, particularly Mexico. The document details specific instances of pollution in India, social displacement in Brazil, and financial instability in the Philippines, while providing a comprehensive case study on Mexico's LNG and pipeline infrastructure. It concludes that the private equity model's lack of transparency and short-term focus exacerbate climate injustice and expose institutional investors, such as public pensions, to significant financial risk.

• Of 20 top private equity firms analyzed in the 2024 Climate Risk Scorecard, 13 maintained investments in fossil fuel projects in the Global South through 29 portfolio companies as of July 2025. The majority of these firms are headquartered in the United States.
• The report identifies 123 private equity-owned fossil fuel assets across 32 Global South countries. Nearly half of these (57 assets) have demonstrated or alleged financial, social, or environmental risks, with the highest concentration of these risky assets located in Mexico.
• In India, the Talwandi Sabo Power Station, owned by Vedanta Resources (a portfolio company of Brookfield's Oaktree Capital), failed sulfur dioxide emission tests 42 out of 42 times between April 2022 and August 2023.
• In Brazil, the Energos Winter FSRU, owned by Apollo Global Management via Energos Infrastructure Management, was accused by the Colônia de Pescadores Z-02 of operating without proper environmental licensure and prohibiting artisanal fishermen from passing through safety zones.
• In the Philippines, KKR-backed First Gen Corporation faces financial risks including a 12 percent year-over-year profit drop by 2025, caused by costly repairs to the Avion plant and declining electricity sales from the San Gabriel plant.
• Mexico serves as a hub for U.S. natural gas re-exports to Asia via private equity-backed LNG terminals. Projects like Saguaro LNG and Energía Costa Azul face significant delays, with Saguaro requesting a seven-year export deadline extension in June 2025.
• The Saguaro LNG project in Mexico is criticized for its location in the Sea of Cortés, a UNESCO World Heritage site, with opponents warning it could cause fatal ship-whale collisions and destroy marine biodiversity.
• The Guaymas-El Oro pipeline in Mexico, owned by KKR-backed Sempra's subsidiary IENova, has been offline since 2017 following sabotage by the Yaqui indigenous tribe due to a lack of free, prior, and informed consent.
• Naturgy, backed by BlackRock's GIP, voluntarily lowered the value of its Mexican fossil fuel power plants by approximately $199 million (€168 million) in late 2023 due to the increasing competitiveness of renewable energy.
• The report argues that the private equity model—characterized by high debt burdens for portfolio companies and short holding periods (averaging five years)—increases climate risk and leaves limited partners, particularly public pension funds, exposed to financial losses.

APA

Duong, D., & Meraay, H. (2025). UNEQUAL BURDENS: PRIVATE EQUITY-BACKED FOSSIL FUEL ASSETS AND THE GLOBAL SOUTH. Private Equity Climate Risks. https://www.peclimaterisks.org/wp-content/uploads/2025/12/Unequal-Burdens-Private-Equity-Backed-Fossil-Fuel-Assets-and-the-Global-South.pdf

Chicago

Duong, Dustin, and Hibba Meraay. UNEQUAL BURDENS: PRIVATE EQUITY-BACKED FOSSIL FUEL ASSETS AND THE GLOBAL SOUTH. Private Equity Climate Risks, 2025. https://www.peclimaterisks.org/wp-content/uploads/2025/12/Unequal-Burdens-Private-Equity-Backed-Fossil-Fuel-Assets-and-the-Global-South.pdf.

Wikipedia

{{cite report |last1=Duong |first1=Dustin |last2=Meraay |first2=Hibba |title=UNEQUAL BURDENS: PRIVATE EQUITY-BACKED FOSSIL FUEL ASSETS AND THE GLOBAL SOUTH |publisher=Private Equity Climate Risks |date=December 2025 |url=https://www.peclimaterisks.org/wp-content/uploads/2025/12/Unequal-Burdens-Private-Equity-Backed-Fossil-Fuel-Assets-and-the-Global-South.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{duong2025unequal, author = {Duong, Dustin and Meraay, Hibba}, title = {{UNEQUAL BURDENS: PRIVATE EQUITY-BACKED FOSSIL FUEL ASSETS AND THE GLOBAL SOUTH}}, institution = {Private Equity Climate Risks}, year = {2025}, month = dec, url = {https://www.peclimaterisks.org/wp-content/uploads/2025/12/Unequal-Burdens-Private-Equity-Backed-Fossil-Fuel-Assets-and-the-Global-South.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }