Norway’s municipal pensions giant Kommunal Landspensjonskasse (KLP) and banking group DNB have finally signed a cooperation pact to invest NOK12bn (€1.1bn) jointly in renewable energy infrastructure projects over the next two years.

After two years of negotiations, the two major Norwegian investors – which compete for the country’s municipal pensions business – said they had formed a partnership to provide debt financing for wind farms, hydropower plants and solar energy both at home and abroad.

KLP’s group finance director Aage Schaanning said: “KLP and DNB coming together makes us both stronger, and being partners gives us a good position on the international market.”

Of the planned NOK12bn, KLP said it would provide at least half of this investment sum. The financial heavyweights said renewable energy and infrastructure were focus areas for both companies, in Norway as well as internationally.

The cooperation agreement concerns project financing, with the bulk of the anticipated loans going to international projects, mostly to solar and wind power projects, as well as some hydropower installations, KLP said.

Schaanning said KLP had been aiming to increase investments that promoted sustainable development and supported its financial goals for several years.

“That is why we are pleased to be able to establish a new partnership in renewable energy with an experienced player like DNB to further increase investments in this sector,” he said.

Working together strengthened both KLP and DNB and gave them a joint position in an international market, he added.

“It will give us more investment opportunities, so that together we can take part in this growth area and help increase renewable energy production to reach the climate target,” Schaanning said.

KLP said it currently had NOK30bn invested in climate-friendly assets and was increasing this each year with NOK6bn of new money.

At DNB, head of future and tech Trine Loe said her firm wanted to help the business community put the climate and environment high on the agenda, both in Norway and internationally, and had set targets at a high level on behalf of its customers.

“Among other things, we will contribute to financing NOK450bn in renewable energy and renewable infrastructure by 2025,” she said, adding that the collaboration with KLP was important in being able to achieve these goals because KLP had capital, expertise and experience.