US multinational investor BlackRock and New Zealand’s government have announced plans to establish a climate infrastructure fund valued at NZD2bn (USD1.22bn), as reported by Reuters on August 8. The primary goal of the initiative is to support New Zealand’s transition to becoming a 100% renewable energy-powered country by 2030. To achieve this ambitious objective, the fund will allocate investments to a range projects including solar, wind, green hydrogen, battery storage, and electric vehicle (EV) charging infrastructure. Notably, this marks the first instance of BlackRock launching a country-specific fund focused on decarbonization. The firm has stated that this venture will broaden the financing avenues available to New Zealand businesses, thereby fostering the growth of climate-focused infrastructure throughout the country’s energy system.

While New Zealand already boasts an impressive 83% penetration rate of renewable energy, the transition to an entirely renewable electricity mix is projected to necessitate an investment of NZD42bn (USD26bn) in renewable power generation and distribution, and battery storage for grid reliability. Before collaborating with BlackRock on this initiative, the New Zealand government established the Government Investment in Decarbonizing Industry (GIDI) Fund to help New Zealand-based businesses reduce their emissions and maintain global competitiveness. This fund, established in 2020, has accumulated NZD650m (USD395m) in capital and has funded 67 projects aimed at reducing emissions as of May 2023.

S****ources:

https://www.reuters.com/sustainability/sustainable-finance-reporting/new-zealand-blackrock-launch-122-bln-climate-infrastructure-fund-2023-08-07/

https://technode.global/2023/08/08/blackrock-targets-1-21b-for-climate-infrastructure-strategy-to-support-new-zealands-net-zero-goals/

https://esgclarity.com/blackrock-launches-low-carbon-strategy-in-new-zealand/

https://www.mbie.govt.nz/about/news/government-announces-emissions-reduction-partnership-with-new-zealand-steel/