Opperman calls for pension schemes to invest in renewable energy

Pensions Minister, Guy Opperman, has called for pension schemes to increase their investments in renewable energy sources to help the UK achieve a net zero economy.

In an essay series published by the Chartered Banker Institute and the Social Market Foundation, Opperman said that if the “productive power” of UK pension funds is “unleashed” by financing green tech and energy, they can be at the forefront of seizing sustainable opportunities.

He noted that, as the UK is hosting the COP26 in Glasgow next year, it was “vital” that the UK becomes a “world leader” in promoting sustainable and ethical investments.

“So we can harness the financial muscle of our massive pension portfolios going forward, I want to see our British pension funds investing in new technologies such as wind, solar, and hydrogen,” Opperman wrote.

“These innovative technologies can turbo charge the way we travel, help us achieve net zero, and provide the long-term return that savers need.”

However, Opperman noted that he did not believe forcing pension trustees to divest from high-carbon stocks as the way forward in achieving net zero.

He stated that selling high-carbon assets to others without the same environmental concerns “is counterproductive”.

“By investing in assets, trustees can nudge, cajole, and vote firms towards lower-carbon business practices,” Opperman continued.

“Collaboration is the best approach. The UK can and will lead the way both in terms of achieving net zero, but also in the provision of green tech and the financial know-how to get us there.

“Net zero is a long-term challenge facing our country. By unleashing the productive power of our pensions and engaging with savers, we can get there.”

    Share Story:

Recent Stories

Sovereign bonds and climate change considerations
In Pensions Age's latest podcast, Laura Blows is joined by Hilary Norris, Product Manager, Sustainable Investment, EMEA, FTSE Russell, to discuss sovereign bonds and climate change considerations

Climate Investing
Laura Blows speaks to Aled Jones, Head of Sustainable Investing for Europe at FTSE Russell, and Adam Matthews, Director of Ethics and Engagement for the Church of England Pensions Board, about the role of climate investing within a pension fund portfolio.

Managing volatility
In the latest Pensions Age podcast, Laura Blows speaks to Cambridge Associates head of European pension practice, Alex Koriath, about the Covid-related market volatility and how pension funds can prepare for the challenges ahead

Risk transfer opportunities
Laura Blows speaks to Lisa Purdy, Head of Fiduciary Distribution at Legal & General Investment Management and Gavin Smith, Pricing and Execution Director - UK PRT at Legal & General, about the impact of the recent market volatility on the bulk annuity and risk transfer market and the potential opportunities for the future

De-risking options for pension schemes
In this latest Pensions Age podcast, Linklaters' Sarah Parkin talks to Laura Blows about the wide range of choice available to pensions schemes for the partial, or full, removal of their risks