BlackRock Launches New Zealand Strategy for Institutional Investors

BlackRock is working with the New Zealand government to launch a platform for institutional investors that aims to raise NZ$2 billion ($1.2 billion) to invest in the country’s climate infrastructure. The country’s prime minister, Chris Hipkins, and minister of energy and resources, Megan Woods, made the announcement alongside BlackRock representatives in Auckland on Tuesday.

The initiative, which the firm is conducting through its climate infrastructure group, is intended to allow institutional investors to invest in New Zealand’s transition to a low-carbon economy. The strategy seeks to take advantage of climate-related investment opportunities in a country that is looking to transition to a 100% renewable energy-powered electricity grid by the end of this decade and to reach net zero carbon emissions by 2050.

BlackRock Chairman and CEO Larry Fink said in a LinkedIn post that it is the asset manager’s largest single-country low-carbon-transition investment initiative.

“It will enable New Zealand companies to access greater pools of capital to build out climate infrastructure across the country’s energy system,” he said.

Hipkins emphasized New Zealand’s commitment to addressing climate change.

“This is a first of its kind fund … that demonstrates the huge economic potential of New Zealand being a climate leader and our goal of generating 100% renewable electricity,” the prime minister said. “This is a game-changer for the clean tech sector and another example of the pragmatic and practical steps the government is taking to accelerate climate action while growing our economy.”

According to BlackRock, New Zealand already has an 83% renewable energy penetration rate but will need as much as NZ$42 billion ($25.5 billion) in investment in renewable power generation, distribution and battery storage to boost that to 100%.

The target sectors for the strategy include wind, solar, batteries, electricity storage, electric vehicle charging, natural capital projects and green hydrogen, along with their associated infrastructure. The idea, according to the firm, is to provide New Zealand companies with access to larger pools of capital to help accelerate growth and the build-out of climate infrastructure.

“This pioneering initiative between BlackRock and New Zealand is a powerful example of the public and private sectors joining forces to mobilize capital and help a country achieve its energy transition goals,” Rachel Lord, chair and head of BlackRock Asia-Pacific, said in a release. “We believe New Zealand is at the forefront of low-carbon transition, and investors will benefit from the opportunities it creates.”