“We wish to substantially increase our investments in green infrastructure, in the form of long-tenor debt. We were, even after a thorough search, not able to find a solution of this type that was sufficiently green, so we had to develop it ourselves. The result is an investment strategy that is tailormade to our green requirements. It is the first time that KLP has made an investment of this kind”, says Aage Schaanning KLP’s CFO.
KLP has partnered with Macquarie Asset Management, the asset management arm of the Australian headquartered Macquarie Group, to establish a platform that will make investments in green infrastructure debt. Macquarie Group is the world’s largest infrastructure manager and through its Green Investment Group, established in 2012 by the U.K Government to accelerate green investment, is a leading global developer and investor in the renewable energy sector.
There has been a strong alignment of interests between Macquarie Asset Management and KLP in developing the strategy for these green infrastructure investments. The partnership with Macquarie Asset Management will enable KLP to invest in green loans, with the characteristics we need to fulfil our ambitions.
“We perceive the strategy as “dark green” as we will aim to make investments in long-term green investments that are aligned with the EU Taxonomy for Sustainable Activities. We have been very ambitious with regard to fulfilling the EU’s requirements while seeking to ensure that our climate focus does not impair investment performance. The approach with Macquarie Asset Management aims to achieve this by investing in loans with very long tenors, a segment of the market that it is expensive for banks to hold on their books due to high capital charges”, says Schaanning.
The platform will target investments in debt assets across the solar power, wind power, hydropower, and sustainable energy storage sectors. KLP will commit 200 million euros to these investments, which corresponds to approximately two billion kroner. A framework has been established to enable the platform to demonstrate, in a verifiable manner, that its investments contribute towards the achievement of international climate goals.
Tim Humphrey, Co-Head of Macquarie Asset Management’s Private Credit team, said: “Considerable investment is needed in green infrastructure if we are to mitigate the effects of climate change and accelerate our transition to a Net Zero society and economy. Our partnership with KLP represents an exciting development for the sector and underlines the significant opportunity that exists for institutional investors to help finance the global shift to renewable energy.”
KLP has for several years had a goal to increase its climate friendly investments, with six billion kroner in investments made each year. In 2020, these investments increased to 8.8 billion kroner. The investments made in partnership with Macquarie Asset Management will form part of these allocations.
For further information, please contact:
Group Chief Financial Officer/Executive Vice President, Finance Aage Schaanning: tel. +47 905 24 312