The HSBC UK pension scheme will invest £250m in renewable energy in Britain, following a competitive tender process.
The funds will be invested into large-scale solar assets and smaller onshore wind farms.
HSBC Bank Pension Trust (UK) Ltd managing director, Mark Thompson commented: “We’re looking at new green opportunities because they make clear financial sense. Schemes such as ours want steady, inflation-adjusted income streams. Renewable infrastructure assets provide this return profile and are largely uncorrelated with traditional capital markets.”
The pension scheme, which manages assets on behalf of 190,000 members, held a competitive tender for the mandate, which was won by Greencoat Capital.
The scheme will acquire solar plans and wind farms from developers in Britain. It has not yet selected its acquisitions but aims to have a portfolio capable of generating energy for an area of homes the size of Oxford.
Greencoat Capital managing partner, Richard Nourse added: “We’re delighted to be partnering with one of the country’s largest pension funds and helping to finance the implementation of the UK’s climate objectives. HSBC UK Pension Scheme has been at the forefront of responsible investment with a very large allocation to ESG factor equities through LGIM and now a significant push into low carbon real assets.”
HSBC made the announcement during the government’s initiative to raise awareness of the benefits of renewable energy: “Green GB Week”.
Thompson concluded: “Greencoat Capital are highly experienced managers in this sector and we look forward to building a long-term relationship.”