The momentum driving the move away from coal has just been given a boast with the announcement that Norway’s largest pension fund will sell off all of its coal investments. KLP will divest $75 million from coal companies and reinvest these funds in renewable energy. KLP will invest $64 million to increase renewable energy capacity in emerging economies. This will further help to decrease global demand for coal where its low price point makes it an attractive option.
KLP holds $84 billion in assets and represents the majority of country’s public sector employees. This move from Norway’s second largest wealth fund will add to the fossil fuel divestment pressure already being exerted on Norway’s sovereign wealth fund, the largest fund in the nation. The government has put together an expert panel to review their investments and they are expected to make an announcement soon.
KLP’s decision follows a similar move by Norwegian insurance company, Storebrand, which sold 10 coal companies in its portfolio at the beginning of 2015.
“We are divesting our interests in coal companies in order to highlight the necessity of switching from fossil fuel to renewable energy.” KLP’s CEO Sverre Thornes said. “”We’re quite convinced that we will manage to deliver the same returns in the future without those from coal companies. We want our owners and customers to feel secure about that.”
Between 20 and 30 companies will be sold by KLP this includes Peabody Energy Corp, CONSOL Energy Inc, Coal India Ltd, Shougang Fushan Re and China Coal Energy Co Ltd.
KLP’s announcement comes in response to an enquiry from Alfred Bjørlo the mayor of the Norwegian community of EID.
“KLP’s move sends a powerful signal to other financial players both nationwide and internationally. The green shift has started, and now the transfer of capital from the fossil fuel sector to the renewable sector is beginning to roll.” Bjørlo said.