This page is part of our public exclusion list — a transparency tool that shows which companies we screen out and why. It is not investment advice, and it is not an accusation. But it is subject to change as our understanding of the facts evolves.
Energy Recovery Inc. manufactures pressure exchanger technology used in industrial fluid processes. Its core product line includes turbochargers and desalination systems, but a significant portion of its business historically serves the oil and gas industry. The company's technology is used in hydraulic fracturing operations to improve efficiency and reduce costs for fossil fuel extraction.
The company was the subject of a 2016 class action lawsuit alleging executives made false and misleading statements regarding contractual negotiations with prospective customers in the oil and gas sector. The litigation centered on representations about the commercial adoption and revenue potential of its technology for fossil fuel applications.
While the provided evidence references broader trends in climate litigation against fossil fuel companies, specific details regarding Energy Recovery's current revenue mix, scale of operations, or direct involvement in fossil fuel infrastructure are not detailed. This record requires updated financial and operational data to determine its appropriate classification under a specific fossil fuel sub-category.
Energy Recovery manufactures and sells pressure exchanger technology used in hydraulic fracturing (fracking) operations for oil and gas extraction. Its flagship product for this market, the VorTeq system, is designed to protect fracking equipment from abrasive materials. While the company also sells technology for desalination and other industrial processes, its historical and ongoing business model is materially tied to servicing the upstream fossil fuel sector. A 15-year exclusive contract with oilfield services giant Schlumberger for the VorTeq, announced in 2015, was a central part of this strategy, though that agreement was terminated in 2020. The company continues to market its pressure exchangers as critical components for reducing maintenance costs and downtime in oil and gas production.
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A digest of changes to our exclusion list — new additions, removals, and the evidence behind them. We review the list continuously as new evidence surfaces.
Companies appear on our exclusion list based on our investment judgment — not because they've done anything illegal. This is a difference of values and opinion, not an accusation of wrongdoing. Exclusion does not constitute a recommendation against investing in any company, and absence from the list does not constitute a recommendation to invest.
This information is provided for educational and transparency purposes only and should not be relied upon as investment advice. Data is drawn from independent watchdogs, NGOs, government registries, and Ethical Capital's ongoing research — see Research Sources for the full list.
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