Calpers Expands Low-Carbon Portfolio With $10B Investment

Calpers Expands Low-Carbon Portfolio With $10B Investment - Carbon Herald

Calpers, the California Public Employees’ Retirement System, has recently made a significant investment in a move towards increasing their involvement in the transition to a greener, low-carbon economy. 

The pension fund has revealed its plans to invest close to $10 billion in initiatives aimed at promoting environmentally friendly practices and combating climate change. 

Calpers’ initiative to expand its low-carbon portfolio is part of a larger strategy to diversify its investments and increase its exposure to opportunities in the growing sustainable economy. 

This recent decision follows the approval of a climate investment plan by the Calpers Board of Administration back in November, signaling the fund’s commitment to aligning its projects with global environmental goals.

At the start of the plan in November, Calpers reported approximately $47 billion invested in climate solutions. The organization anticipates this figure will more than double, while also projecting a reduction of at least 50% in the carbon intensity of its portfolio by 2030.

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With the aim of reaching $100 billion in climate-related investments by 2030, the pension fund’s move to allocate significant funds towards this cause signals its interest in leveraging the expanding climate solutions industry and its support for further development of the sector. 

To secure transparency and accountability, the fund will implement stricter measures to ensure that companies disclose their strategies for adapting to the changing energy landscape and make improvements where necessary. 

Additionally, a special Climate Transition Index will be created to monitor the potential risks and benefits of the worldwide shift towards renewable energy.

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So far, the fund has pledged $5 billion in public equity investments towards a more adaptable approach than traditional capitalization-weighting methods.

It has also made a $1.1 billion commitment in private market investments across sectors that support energy development and is planning on an additional $3.6 billion in private market investments to continue its growth and influence in the investment market.

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