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IPE special report May 2018

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Norway's KLP names 27 coal company exclusions

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Norway’s largest pension fund manager KLP has excluded 27 coal companies from its investment portfolio.

The local authority pension provider announced on 19 November that it would divest from companies that derive a substantial proportion of their revenues from coal, while investing an extra NOK500m in the development of new renewable energy capacity.

KLP’s first evaluation of coal holdings has now resulted in divestment of equities and bonds in 27 companies for a total amount of NOK386m (€44m).

The KLP Group has total assets of NOK470bn.

The list covers companies across the globe, including those based in the US, China, India and Japan.

Among the names are Peabody Energy Corporation – the world’s largest private-sector coal company – and electric utilities company American Electric Power.

The list also includes coal mining company China Coal Energy Company, and China Resources Power Holdings Company, which develops and operates coal-burning power plants.

Other names are Tata Power, India’s largest integrated power company, and Exxaro Resources, the South Africa-based diversified resources group.

Jeanett Bergan, head of responsible investment at KLP, said: “This is the first step in an effort to purge our investments of coal.

“We have attempted to establish a sensible balance between investments in new renewable energy production, divestment of coal companies and the exertion of shareholder influence.”

Bergan added: “The next step now is to press companies to move in a more climate-friendly direction and reduce their carbon emissions.

“Companies with substantial coal-based operations that prove unwilling or unable to change will run the risk of being excluded.”

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