NBIM says the investment will broaden its exposure to global energy transition projects and decarbonisation initiatives.
Norges Bank Investment Management (NBIM), manager of Norway’s $1.9trn (€1.6trn) sovereign wealth fund, has made a $1.5bn commitment to Brookfield Asset Management’s second global energy transition fund. The investment marks NBIM’s first investment in an energy transition fund.
NBIM said that the investment will enable it to invest in projects that develop renewable energy infrastructure while also supporting the broader transition to low-carbon solutions across industries.
The Brookfield Asset Management’s Global Transition Fund II (BGTF II), which targets investments in clean energy and decarbonisation, has a $17bn fundraising target.
Speaking to Impact Investor, Harald von Heyden, NBIM’s global head of energy and infrastructure, said: “BGTF II complements our existing direct investment portfolio strategically. Our direct investments have so far focused primarily on renewable energy production in Europe, but this fund investment expands our exposure to a broader range of global energy transition projects and decarbonisation solutions.”
The BGTF II fund will invest across North and South America, Europe, and Asia Pacific, focusing on clean energy, industrial decarbonisation and business transformation projects.
Von Heyden said that the agreement does not signal a shift away from NBIM’s preference for direct ownership, but instead provides the portfolio with exposure to broader range of global energy transition projects and decarbonisation solutions, as well as technologies and project types that fall outside its direct investment mandate. Indirect fund commitments will remain capped at 15% of the unlisted renewables mandate, he said.
“At this stage, having built a portfolio of direct investments and with a growing team, we consider the timing right to complement the portfolio with selective fund investments,” he said. “This aligns with our Strategy 25, where we stated that we would consider fund investments to gain exposure to new markets and technologies.”
Measuring impact
Asked how NBIM would ensure the investment genuinely drives decarbonisation, von Heyden pointed to Brookfield’s impact measurement framework, which he says sets “robust quantifiable climate impact targets” for every deal. “We have conducted thorough due diligence on Brookfield and BGTF II to ensure the fund contributes to decarbonisation,” he said.
Furthermore, von Heyden added that NBIM places great emphasis on transparency having “secured a high degree of openness for this investment in our agreement with Brookfield”, he said.
