CalPERS’ “Green” Investment Strategy Delivers Heavy Losses, Warning for Policymakers

According to a report by The Center Square last week, California’s largest public pension fund, CalPERS, lost 71% of a $468 million investment in its Clean Energy & Technology Fund, a politically driven “green” investment that has now become a costly cautionary tale.

Created in 2007 to support clean energy and technology ventures, the CalPERS Clean Energy & Technology Fund (CETF) was managed by Capital Dynamics and heavily concentrated in early solar projects. Many of those investments collapsed under global competition and shifting subsidies, leaving the fund worth just $138 million. Despite the steep losses, CalPERS has declined to release details, citing state exemptions for private equity records.

Critics say the fund illustrates the financial and transparency dangers of mixing politics with pension management. “You have a very opaque investment choice that appears to have been chosen because of its green credentials, and yet it’s now generated a huge loss for taxpayers and retirees,” said Marc Joffe of the California Policy Center.

CalPERS’ overall pension plan remains only 79% funded, leaving taxpayers exposed to roughly $180 billion in liabilities.

Observers warn that these “green” investments often rely on speculative valuations and can obscure true performance. Had the same funds been invested passively in the S&P 500, the total value would exceed $3 billion today.

This is the same “green” mindset driving California’s record-high gas prices and cost of living. Our state pays the highest fuel taxes in the nation while importing over 78% of its oil from countries with no labor, safety, or environmental protections.

As California doubles down on climate-focused mandates, the CalPERS loss highlights a critical lesson: when pension dollars are used to advance political agendas, taxpayers and retirees bear the cost.