A 1st of its kind NZD 2 billion ($1.2 billion) climate infrastructure fund has been launched in New Zealand with the government joining hands with the US based global investment group BlackRock to help the country become one of the earliest nations to reach 100% renewable electricity target.
It will mobilize investment to accelerate solar, wind, green hydrogen and battery storage among other green options, providing access to greater pools of capital for local businesses while generating jobs.
New Zealand's Prime Minister Chris Hipkins said, "The New Zealand net zero Fund will look to crowd in investment from Crown companies and entities, including superannuation funds, and private sector funds to accelerate New Zealand's transition to 100% renewable electricity."
While details about timeline and how the fund will work were scarce in the government announcement, it said the fund will supercharge investments in clean technology 'that might otherwise not have happened'.
It will speed up the country's journey to reducing its emissions by funding projects that decarbonize the country's energy use.
In a LinkedIn post, BlackRock Chairman and CEO Larry Fink called it the largest single-country low-carbon transition investment initiative by the group to date.
New Zealand has also launched a consultation on 5 streams of energy policy to seek stakeholder feedback on its plans for 100% renewable energy. Submissions will help the country develop a Hydrogen Roadmap, Gas Transition Plan, offshore renewable regulatory regime, identify priority electricity market measures and support implementation of ban on new fossil fuel baseload electricity generation.
Submissions will be accepted till November 2, 2023. Details are available on the website of the Ministry of Business, Innovation & Employment.
According to the International Energy Agency (IEA), New Zealand covers over 80% of its electricity from renewable sources, especially hydropower, and has the potential to exceed 90% based on existing policies. However, it needs to prepare for possible loss of hydropower in times of climate change and also adapt the electricity system to greater share of variable renewables.