California's Retirement Fund Lost 71% Of $468M Investment In Clean Energy And Won't Say How

CalPERS lost 71% of its $468 million investment in a clean energy fund, raising concerns about its private equity strategy. The Clean Energy & Technology Fund's value plummeted despite overall positive returns for CalPERS' 2024-2025 fiscal year. Experts question the value of private equity's complexity and illiquidity compared to public equities, especially given comparable returns. The fund's losses are attributed to a narrow focus on solar projects that struggled against Chinese competition. CalPERS defends its private equity strategy, citing diversification, better managers, and reduced fees. However, CalPERS remains underfunded, leaving taxpayers exposed to potential shortfalls. The pension fund has increased its allocation to private equity, despite concerns about transparency and valuation methods. High fees associated with private equity require significant outperformance to justify the risk and cost. CalPERS denied a public records request for details on the fund, raising transparency concerns. An S&P 500 investment would have yielded significantly greater returns, highlighting the long-term impact of investment losses.