New Zealand's government has partnered with U.S. investment firm BlackRock to supercharge its efforts to become one of the first countries in the world to reach 100% renewable electricity.
The government and BlackRock have announced a NZ$2 billion ($1.2 billion) fund that will provide access to greater pools of capital for New Zealand businesses to accelerate investment in green energy such as solar, wind, green hydrogen and battery storage.
"This is a first-of-its-kind fund in the country that demonstrates the huge economic potential of New Zealand being a climate leader," Prime Minister Chris Hipkins said Tuesday in Auckland. "This fund is a massive opportunity for New Zealand innovators to develop and grow companies."
New Zealand already generates more than 80% of its electricity from renewable sources such as hydro-electric dams, and it aspires to reach 100% by 2030. That will require significant investment to replace fossil fuel-fired turbines with more wind, solar and geothermal plants, as well as improved transmission and storage.
BlackRock estimates the transition to 100% renewable electricity will require investment running to NZ$42 billion. The new fund will provide a platform through which institutional investors can invest in that transition, it said in a statement.
The fund is the firm's "largest single-country low-carbon transition investment initiative" to date, BlackRock CEO Larry Fink said in a post on Linkedin.
Minister of Energy and Resources Megan Woods said the so-called "New Zealand Net Zero Fund" will look to attract investment from Crown companies and entities, including superannuation funds, and private sector funds.
"This arrangement means we will get there faster, with opportunities for local investment in a low emissions economy," she said. "That will be a significant selling point for New Zealand businesses as consumers demand more sustainable products and services."