Energy policy should lower costs, not score points

OPINION:

In February, Vanguard chose to settle with a coalition of Republican-led state attorneys general that had accused it – along with asset managers BlackRock and State Street – of conspiring to drive the coal industry out of business.

But the most interesting part of the settlement is what it didn’t do. It did not require the companies to divest from coal.

While that is good news, it also raises questions about the original intent of the lawsuit, especially with two asset managers still in the crosshairs.

Filed in November 2024 by 11 GOP attorneys general, the lawsuit alleged the three asset managers used their coal company holdings to pressure those firms to significantly reduce coal output by 2030.

According to the complaint, this coordinated effort – carried out through climate-focused organizations – artificially constrained coal supply and raised energy prices for consumers.

As I’ve said before, if there were real evidence of collusion – which there is not – the remedy would and should match the rhetoric.

Instead, what we’re seeing looks less like principled antitrust enforcement and more like coercion masquerading as conservatism.

If the AGs truly believed there were an antitrust conspiracy aimed at kneecapping coal production, divestment – which they requested in their original complaint – would seem to be a logical remedy. Make no mistake; I don’t support that, and luckily, Vanguard’s settlement does no such thing.

Instead, Vanguard agreed to pay $29.5 million and can maintain its coal holdings. The firm did not admit wrongdoing, but agreed to separate certain investment stewardship functions and made other investment commitments.

Nowhere in the settlement is there mention of forced coal divestment or any structural remedy tied to the core allegations.

The headline was about saving coal, but the settlement reads like a political press release. It raises a valid question: Did these attorneys general truly believe they uncovered collusion, or was this lawfare designed for a headline and a payout?

With BlackRock and State Street still active defendants, the stakes remain high. If the coalition succeeds in forcing divestment or capping holdings, the consequences could ripple across the energy sector.

Large index fund investors pulling back from publicly traded coal companies would create downward pressure on those firms and send a chilling signal to already disrupted markets: Engage in energy investing at your own legal risk.

That’s not protecting coal. That’s destabilizing capital markets and injecting politics directly into private investment decisions. Even without admitting fault, Vanguard’s settlement alone may cause investors to hesitate.

There’s also a broader inconsistency at play among Republicans. President Trump has repeatedly championed “energy dominance” and expanded fossil fuel production. Yet this lawsuit runs counter to that philosophy.

Rather than encouraging a competitive marketplace where energy sources succeed based on cost and efficiency, it risks politicizing capital allocation. Investors may hesitate to fund energy projects if they fear legal consequences for supporting – or not supporting – particular fuels.

True energy dominance requires market stability and confidence in the rule of law, not state-driven pressure campaigns that substitute politics for policy. And this uncertainty comes at a precarious time.

With the artificial intelligence boom accelerating and global data center electricity demand projected to grow dramatically – estimated to increase 3.5 times by 2030 – America needs more reliable energy.

It’s basic supply and demand: When demand outpaces supply, prices rise. Any policy that chills investment in generation capacity – including coal, which is still responsible for a large portion of energy generation – risks putting additional strain on the grid and driving up costs for consumers.

Energy policy should lower costs, not score points. And for seniors living on fixed incomes, higher energy prices aren’t abstract; they’re a direct hit to monthly budgets.

Public policy should be focused on lowering costs and strengthening grid reliability, not creating new uncertainties in the marketplace in the name of politics.

The bottom line is simple. The Vanguard settlement revealed the apparent political nature of this lawsuit, even as these attorneys general continue pressing their case against BlackRock and State Street – where a more aggressive outcome could damage coal supply, disrupt capital markets and hurt consumers who depend on affordable, reliable energy.

Conservatives should be leading the charge for affordable energy and advancing Mr. Trump’s energy goals, not advancing lawsuits that are government overreach more than anything.

• Saul Anuzis is president of 60 Plus, the American Association of Senior Citizens.