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A few weeks after the Norwegian government proposed that its $ 1 trillion fund divest of exploration and production companies, the firm announced on Friday that it would allow the world's largest sovereign wealth fund to invest in unlisted renewable energy infrastructure.
"The government is now allowing investment in the Global Government Pension Fund in unlisted renewable energy infrastructure." Investments must be made under special environmental mandates, "the Norwegian government said in a statement.
Norway also doubles the maximum limit for unlisted green energy investments from USD 7 billion (NOK 60 billion) to USD 14 billion (SEK 120 billion).
"The renewable energy market is growing rapidly. Much of the renewable energy investment opportunity is in the unlisted market, particularly in unlisted infrastructure projects. Significant future investment expectations mean that this market is of interest to institutional investors such as the government pension fund, "according to the Norwegian government.
"We do not stipulate that the Fund will be invested in unlisted renewable energy infrastructure, but we allow Norges Bank to make these investments if they are deemed profitable," said Norway's Finance Minister Siv. Jensen.
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The world's largest sovereign wealth fund – created three decades ago to protect and manage Norway's oil wealth for future generations – made headlines last month, when the government proposed the fund to divest Oil and gas exploration.
The decision by the Norwegian government and the fund comes at a time when investors are increasingly asking major oil companies to take climate change seriously and prepare their business portfolios for a world of high-tech oil demand. , whenever that happens.
Norway baderts, however, that its decision is motivated by financial reasons, as the country aims to reduce its exposure to oil price risk. More importantly, the fund will not divest itself into any of the major oil companies.
By Tsvetana Paraskova for Oilprice.com
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