Fund to put $600M in ‘global transition fund,’ while treasury warns investments can’t be used solely to speed move to carbon-free future
By JOHN REITMEYER, BUDGET/FINANCE WRITER/ NJ Spotlight
New Jersey’s public-worker pension-fund managers are preparing to make another big climate-related investment while they continue to resist calls to immediately divest all holdings in fossil-fuel companies.
Up to $600 million in pension-fund assets will be committed to a Canada-based investment firm’s “global-transition fund,” according to a proposal reviewed on Wednesday by members of the New Jersey State Investment Council.
The fund administered by Brookfield Asset Management is looking to turn a profit by backing renewable energy utilities and other companies pursuing decarbonization, according to the investment proposal.
That investment marks the pension fund’s latest attempt to generate returns by pursuing opportunities related to climate change and the shift away from fossil fuels that have been linked to global warming. Earlier this year, pension-fund managers also announced they were pursuing a $200 million stake in a California-based private-equity fund called TPG Rise Climate.
But the latest policies drafted by the state Department of Treasury’s Division of Investment indicate fund managers will not be pursuing an immediate fossil-fuel divestment strategy, one many environmentalists have been pressing them to do. In recent months, New Jersey has faced everything from air-quality alerts triggered by wildfires to widespread flooding caused by hurricanes and other major storms.
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