Norway has mandated its sovereign wealth fund to increase investments in renewable energy but has stopped short of requiring it to invest directly in infrastructure projects.
The Norwegian government has announced that stock investments made by the fund will grow from approximately $5 billion to approximately $8.4 billion under the new mandate. Norway’s central bank, Norges Bank, will also report on the fund’s clean energy investments.
Norway’s $840 billion sovereign wealth fund was built largely on revenues from the country’s oil and gas industry but renewable energy currently accounts for only a small fraction of its investments. In contrast investments in coal, oil and gas account for ten per cent of its business.
Environmental groups have lobbied for the fund to invest directly in renewable energy projects as this would have a major impact on global renewable energy investment, according to WWF. Norway’s environment agency says that the country needs to make "powerful and quick" cuts to greenhouse gas emissions in order for the country to meet its climate goals.
WWF has called on Norway to commit five per cent of its sovereign wealth fund to renewable energy infrastructure. "This was Norway’s chance to deliver on climate change, the same week that world scientists have released their report on intense impacts of climate change," says Samantha Smith, leader of WWF’s Global Climate & Energy Initiative.
Norway has set a target of reducing greenhouse gas emissions by 30 per cent from 1990 levels by 2020. Bloomberg reported that in 2012 the country’s emissions were 4.6 per cent higher than in 1990.
Sian Crampsie
