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World’s Largest Sovereign Wealth Fund Faces Vote on Renewables

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It has been a year of global change as investors begin to move money out of fossil fuels and into renewable energy - one of the most needed actions on climate change. One of the potential key players is Norway, home of the largest sovereign wealth fund in the world, which today faces a vote of whether it could be mandated to invest directly into renewable energy.

WWF has long called for Norway to invest up to 5% directly into renewable energy infrastructure. In a survey last year, WWF revealed that the majority of political parties that now make up the coalition government supported direct investments in renewable energy. WWF along with a coalition of organizations, investors and business have called on the Government of Norway to invest into infrastructure for renewable energy.

In response, the government passed a proposal last year saying they would “consider” a mandate for direct investment in renewables. In March, the Government raised expectations saying such a mandate would be made. April’s announcement of fractional increases to renewable stock investments did little to move this forward. Three weeks ago, the Prime Minister’s party (Høyre) passed a position that they would work for a mandate for the Fund to invest directly in renewables.

Last week, a proposal was tabled by opposition parties in Norway challenging the Fund to invest directly in renewable energy, as well as end investments in coal.  Read WWF’s response here The proposal goes to a vote today, June 3. Whether this proposal is passed, or whether the government comes forward with their own proposal, it is clear that there is now an active political majority to move on mandating the Fund to invest directly in renewable energy, potentially redirecting up to 5% of its $838 billion USD in assets.

Nina Jensen ©WWF

Every decision Norway makes on the investments of this fund sends a powerful global signal. A direct renewable energy mandate could be a landmark shift if legislated and implemented at the scale and speed required in the face of climate change.

Nina Jensen, CEO, WWF-Norway

 

Norway’s original proposal of April 4 was to “double” of its renewable energy investments. This was from current stock investments in environmentally related companies, only a fraction of which were renewable energy companies. If implemented based on current practices, the gross impact of that decision will be an an additional $0.6 billion USD to renewable energy, from a current $1 billion USD. Last week’s proposal seeks to amend that by going beyond stock investments and including direct investment in renewable energy infrastructure, such as solar and wind power plants.

Watch WWF’s video on infrastructure versus stocks renewable energy investment:

WWF now expects all political players in Norway who have expressed support for such a progressive move on investing directly in renewable energy to move forward quickly with this existing majority. Mandating the fund to do this would be a breakthrough for Norway’s sovereign wealth fund and for renewable energy worldwide. And, if this progresses positively, it would be a particularly strong signal in advance of the UN climate change summit led by Ban Ki-moon this September in New York, where the world will be watching.

Samantha Smith ©WWF

The climate on energy investment is shifting globally, and it is shifting in Norway now too. Smart investors are looking at their carbon risk and looking to invest in climate solutions. And, should Norway go ahead with really big investments in renewables, it will also bring critical and very concrete positive momentum to global climate negotiations.

Samantha Smith, Leader, WWF’s Global Climate & Energy Initiative

 

More information:

WWF international press release - May 28, 2014

WWF’s full submission to Norway’s parliament

WWF’s global campaign, Seize Your Power

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