BlackRock, the world’s largest asset manager (NYSE:BLK), has unveiled plans to generate up to $7 billion for its fourth Global Renewable Power Fund as investors increasingly prioritize climate-friendly ventures.
This fund will primarily focus on initiatives within the Organisation for Economic Co-operation and Development (OECD) countries, encompassing renewable energy projects like wind and solar, as well as other clean technologies such as batteries and grid infrastructure.
According to David Giordano, BlackRock’s Global Head of Climate Infrastructure, institutional investors have shown growing interest in supporting such projects as they aim to align their portfolios with the global shift toward a low-carbon economy.
This surge in demand has been further propelled by evolving policies, including significant financial backing for clean energy by both the United States and the European Union, aimed at combating carbon emissions and climate change.
Giordano emphasized the rising trend of portfolio construction, where investors are increasingly focusing on different sub-sectors within infrastructure. Pension schemes, in particular, are attracted to assets that align with their long-term liabilities.
Despite opposition from certain U.S. Republicans who resist climate-related restrictions on fossil fuel companies, Giordano affirms that institutional investors remain deeply committed to investing in both present and future infrastructure.
Consequently, BlackRock aims to raise between $5 billion and $7 billion for its fourth fund, following the successful closure of its predecessor, which garnered $4.8 billion in April 2021.
To achieve the goal of reaching net-zero emissions by 2050, the International Energy Agency has highlighted the need to triple annual investments in clean energy to $4 trillion by the end of the decade.
The third fund’s investments included contributions to the high-power charging network IONITY, which secured 700 million euros in November, as well as support for the Waratah Super Battery in Australia, set to become the world’s largest grid-scale battery.
Approximately one-third of the forthcoming fund is likely to be allocated to each major region—Europe, the Americas, and Asia—though specific targets have not been established.
Depending on the amount raised, the fund could finance around 18-22 investments, encompassing both early-stage and developed projects. BlackRock also remains open to considering co-investments in its pursuit of sustainable infrastructure ventures.
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