Written By: Emma Websdale
Two prominent Norwegian investment funds with combined assets under management of 780 billion Norwegian kroner ($129.7 billion) demand that the newly elected government should invest the nation’s $750 billion oil-wealth fund into renewable energy infrastructure.
Kommunal Landspensjonskasse (KLP) and Storebrand ASA have joined Oslo’s Catholic Church and several environmental organizations in calling upon the newly elected Prime Minister Erna Solberg to use the nation’s $750 billion oil-wealth fund in providing safer alternatives to its bond and stock investments.
Several prominent environmental groups, including the World Wildlife Fund (WWF), Greenpeace and Friends of the Earth Norway, have already supported the proposal. However, with heightened pressure from the two big Norwegian asset managers, the government of Norway may have to see the Government Pension Fund consider new investment strategies including moving funds into renewable energy infrastructure.
“The [oil fund] should be allowed to invest in infrastructure, including renewable energy and [energy] distribution in emerging markets”, said KLP’s chief executive officer, Sverre Thornes.
According to The Wall Street Journal, the government on two occasions in 2006 and 2010 rejected the attempts of the Norges Bank Investment Management (managers of the oil fund) to invest in infrastructure, saying it wanted the fund to gain experience from other real asset investments first.
The announcement follows a coalition of 10 of the largest green NGOs calling on the European Bank for Reconstruction and Development (EBRD) to phase out fossil fuels from its lending portfolio to avoid loans to energy sources contributing to climate change.