Expanding Investments in Renewable Energy and Natural Resources for a UK Pension Fund
The Yorkshire Pension Authority (SYPA) has announced a series of investments aimed at supporting its net zero goals and combating climate change.
One significant investment is a £50 million commitment to a forestry fund managed by Gresham House. This fund will focus on acquiring forestry assets in Scotland and Wales, with returns expected through sustainable harvesting and the sale of timber. SYPA has also invested £130 million in two other forestry funds, further diversifying its portfolio.
In line with its climate-focused strategy, SYPA has invested around 6% of its portfolio, totalling £695 million, in "climate opportunities". This includes a £595 million investment in Border to Coast's Climate Opportunities fund and close to £100 million in other mandates.
The Border to Coast opportunities portfolio invests in a variety of projects, such as hydrogen technology, synchronous condensers, battery storage systems, and lithium-ion battery creation. SYPA has also committed £175 to a side-car arrangement with Border to Coast, demonstrating its ongoing commitment to addressing climate change.
In April 2024, SYPA made an additional £100 million investment in Border to Coast's UK Opportunities Fund. This fund, launched by the UK Local Government Pension Scheme (LGPS), has already secured a £300 million first close. This is the first close for Border to Coast's energy infrastructure fund, as mentioned in the article.
Jayne Dunn, chair of SYPA, reiterated the pension fund's dedication to investing in diverse solutions aimed at combating climate change. She highlighted that the investments in the forestry funds and Border to Coast's Climate Opportunities fund underscore their ongoing efforts to mitigate greenhouse gas emissions throughout their investment portfolio.
The Bank of England has also joined the fight against climate change, investing £50 million in a forestry operations fund. This move is part of the Bank's strategy to support sustainable economic growth and combat climate change.
With these investments, SYPA is not only securing resilient, diversified sources of returns but also contributing to the global effort to combat climate change, support biodiversity, and achieve its net zero target by 2030.
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