DENMARK - The DKK355bn (US$61.3bn) ATP pension fund has invested US$400m in renewable energy technology.
Denmark is set to host the United Nations 2009 Climate Change Conference in Copenhagen in December, aimed at forging a successor agreement to the Kyoto Protocol, although ATP chief executive Lars Rohde said this was not a consideration in deciding upon the investment.
Speaking to Global Pensions, Rohde said: "We have not been pout under [social or political] pressure - we are investing in the way in line with the funds objectives."
The allocation, which forms part of the inflation component of the fund's five risk classes, alongside real estate and infrastructure, will invest directly in proven assets in Spain, Germany and the UK.
Rohde explained these were countries which promised the most attractive sources of return: "there are minimum guarantees for prices in some places - its simply a question of where is best from an investment perspective, but of course it is possible that in the future we will invest in [similar projects] in Denmark."
The fund said a "large portion" of the investment would be channelled into the expansion and development of "less tested" power generation technologies, including biomass and biofuels.
The power generated through the investment would support the equivalent of 2.5 million Danish households.
Rohde also said the ATP 'new model' pension, which provides members with a highest level of market guarantee based on the interest rate at the time when contributions are made was unaffected by the global economic crisis (Globalpensions.com ; 14 April 2008)
Rohde commented: "It's doing very well [for ATP] and going according to plan. It's still what we expected it to be, because it's fully hedgeable, using the full market interest rate. Protecting performance and future pensions is high on the agenda."
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