As a net-zero fund, the climate infrastructure fund is not looking to invest in fossil fuels, Megan Woods says. Photo: RNZ / Nate McKinnon
A lot of consideration was given to BlackRock's investment profile in fossil fuels before the government decided to partner with the company for a climate infrastructure fund, Energy Minister Megan Woods says.
BlackRock - one of the world's largest investment companies - has launched a $2 billion fund to help New Zealand reach 100 percent renewable electricity.
The pool of money will be available for green energy projects like solar, wind, battery storage, and electric vehicle charging.
Greenpeace says it is concerned about the heavy reliance on private investment and a lack of policy details with the announcement.
Energy Minister Megan Woods told Checkpoint the fund was largely directed towards private businesses.
"We're not talking about the transmission and distribution, or even the ability really to invest in our mixed ownership model energy companies, it's what are all ready private businesses that are looking for capital to be able to expand and to do what they need to do, not only for New Zealand, for the world."
BlackRock said it wanted to crowd-in investment in New Zealand, Woods said. There was a lot of money in Aotearoa that could be pointed towards backing local business, she said.
Asked if there were any restrictions on international investments and where money came from, Woods said there were "no restrictions".
"But with the conversations that we've had with BlackRock is there is significant interest in New Zealand ... to cover off that $2 billion fund.
"What we have is we have some of our own sovereign funds looking for investments in other countries in renewable energy because there haven't been investments of that scale in New Zealand to date."
Asked what consideration was given to the fact BlackRock was one of the world's biggest investors in oil, gas and fossil fuel, Woods said "A lot of consideration was given to that".
"We've made it really clear that anything that the government in New Zealand would be encouraging was very much directed towards what we needed to do to expand renewable energy in New Zealand around what it is that we need to do investing in the likes of solar, wind, green hydrogen, battery storage and what part that could play in our decarbonisation."
As a net-zero fund, it was not looking to invest in fossil fuels, she said.
Speaking from Hamilton earlier in the day, National Party leader Christopher Luxon said he welcomed Labour's plan for renewables investment but the world was awash with investment money.
The real challenge for projects was the time it took to get consent, he said.
It took eight years to consent a windfarm, Luxon said, adding that the current government had a consenting problem.
Under a National government Luxon would ensure a one-year consenting time frame for renewables, which would double the number of renewable projects, he said.
On Monday Hipkins announced wind farm projects in Southland, south of Auckland and Manawatū were being fast-tracked through consenting.
Govt needs to make sure its goals align with BlackRock - John Berry
Pathfinder Asset Management chief executive John Berry said BlackRock was a large US-based asset manager with about $NZ12 trillion under management.
"It's a massive global investor."
While investment in New Zealand was welcome, Berry said we need to be aware of the bargaining power and sophistication the company will have.
While it could be a positive thing, "we also need to recognise that they are profit orientated ...they're investing around the world to make money for their investors", he said.
"We just need to be aware that the goals we're trying to achieve are matched with the deal we're agreeing with them," he said.
It would be interesting to know which part of the life cycle the money would be directed, he said.
"It's called the climate infrastructure fund, which implies it's building infrastructure but they're also talking about battery storage, green hydrogen, so it's not entirely clear...
"If you think of the stage of building infrastructure you have the technology development, so that's venture capital and high risk investment, we welcome that investment in New Zealand to develop technologies here, is it that part of the investment stage, as well as the development?"
BlackRock was considered a global leader in environmental social and governance investing (ESG), Berry said.
"It is a global investor with investments in fossil fuels, investments in renewable energy, we just need to make sure the investment they're making in New Zealand makes sense for us as a country."
