Pension fund presents four key investments for net-zero targets
Ontario Teachers’ Pension Plan (OTPP) has released their report on investments in renewable energy, noting their intention to scale renewables and address key challenges in expanding its utilization.
In 2021, the pension fund committed to helping achieve net-zero greenhouse gases by 2050. It had put 2025 and 2030 as initial targets to achieve a net-zero portfolio.
Almost 90 countries responsible for around 80% of global emissions have committed to achieving net-zero targets. According to the International Energy Agency (IEA), global spending on renewable energy reached US$600 billion, with total investments reaching US$1.6 trillion, in 2022.
In the OTPP report, four case studies have been presented in the pension fund’s efforts to reach net-zero targets: Corio Generation (Scotland), Mahindra Susten (India), Equis Development (Australia), and ACES Delta (USA).
Last year, OTPP entered a joint venture with Corio Generation to fund its offshore wind projects, committing to invest up to US$1 billion. The project aims to produce electricity to power two million homes and ultimately make Scotland a leader in offshore wind technology.
A 30% equity stake was also acquired to help Mahindra Susten set up an Infrastructure Investment Trust (“InvIT”), which was proposed to comprise renewable power assets.
OTPP also invested in a stake in Equis Development to develop a portfolio of battery energy storage projects across Australia. Its vision is to complete a Melbourne Renewable Energy Hub, which will become the biggest battery in Asia, serving over one million households.
Another notable investment is an allocation of US$650 million to fund the Advanced Clean Energy Storage (ACES) Delta project, which aims to create the largest green hydrogen storage facility in the world. The caverns created will hold up to 11 million kilograms of clean hydrogen for long periods at a low cost before they are used to become electricity.
In a press release, OTPP noted, “Expanding renewable energy will have many benefits, from reducing air pollution and mitigating climate change to creating millions of skilled jobs. Investing in renewables is just one way in which we are using our capital to make a lasting, real-world impact as we create value for our members.”
