Norway‘s Sovereign Wealth Fund Intensifies Investment in Global Electrical Networks
OSLO - Norway’s Government Pension Global Fund, the world’s largest sovereign wealth fund, is substantially expanding its investments in electrical networks and related infrastructure, citing the critical need for capital to support the global energy transition. The fund, managing over $1.6 trillion in assets, views investment in grid infrastructure as equally crucial as investment in renewable energy generation.
This strategic shift comes as the fund seeks to diversify its renewable energy portfolio beyond offshore wind,where it has historically focused. While currently representing approximately 0.4% of its total investments, the fund’s renewable infrastructure holdings include ten investments across five countries, beginning with a first foray into the sector in 2021 through participation in the Borsselle 1 and 2 marine wind farms in the Netherlands. Recent additions include a €1.4 billion ($1.6 billion) stake in the Nordsecluster and Thor projects of RWE AG, and investments in solar projects in Spain.
“Until now it has been invested a lot in marine wind energy” and the background now seeks to diversify,” said Nicolai von Heyden during a Pareto Securities Energy conference in Oslo. He emphasized that the capital needs for network infrastructure are estimated to be as substantial as those for energy generation overall.
The fund’s increased focus aligns with broader industry trends, as evidenced by recent transactions such as Apollo Global Management’s acquisition of a stake in a joint venture to invest in the German electricity grid, and interest in German Tennet Holding BV. The fund also recently purchased reduced Colombian debt, according to Bloomberg Linea.