The London Pensions Fund Authority (LPFA) has committed to investing around £400m, approximately 5 per cent of the fund's current value, in climate solutions by 2030.

Building on an existing holding of around £150m in existing climate solutions assets within LPPI’s equity and corporate fixed income holdings, the £400m goal also includes an additional £250m investment announced in April 2025, which saw the LPFA adjust its strategic asset allocation and make a specific allocation to environmental opportunities, reaching the 5 per cent goal.

The fund said that the investment is part of its broader efforts to capitalise on investment opportunities presented by the net-zero economy, highlighting a report by the UK’s Confederation of British Industry (CBI) as evidence of the economic benefit of net zero.

According to the CBI's ‘The Future is Green’ report, the net-zero economy grew 10.1 per cent between 2023 and 2024, and now generates £83.1bn in gross value added, with £28.8bn directly from net-zero businesses.

Commenting on the commitment, LPFA CEO, Jo Donnelly, said: “Net zero is a strategic priority for us and investing in climate solutions is a vital part of that strategy. It’s about ensuring that we invest in opportunities that help us pay members their pensions when they retire.

"We are pleased to be able to commit to a goal combining existing investments and a specific allocation to Environmental Opportunities. Fund investments do evolve, of course, but we are clear about the opportunities that exist in a low-carbon future.”

Adding to this, LPFA responsible investment manager, Paul Hewitt, said: “To set this initial goal, we’ve used current IIGCC guidance to identify existing listed equity and corporate fixed income assets that can be described as climate solutions. We’ve then built on that to reach the full 5 per cent goal.

"It’s worth pointing out that, until last week, there's been no definitive guidance on how to approach classifying Infrastructure or real estate assets as climate solutions.

"This means, that our actual investments in this area are likely to be much higher. For example, through our investment in GLIL, we’re invested in projects like Hornsea 1, one of Europe’s largest windfarms.

"While 5 per cent is a great start, we’ll be revising our targets as we get to grips with the new guidance and as the climate solutions market evolves.”

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