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Norway’s $1 Trillion ‘Green’ Wealth Fund Boosts Its Coal Exposure


Norway’s massive sovereign wealth fund has increased its exposure to coal reserves even after imposing restrictions on investing in the fossil fuel that’s seen as one of the main catalysts for global warming, according to a report.

The findings are another illustration of how the ban, which restricts investments in companies that get more than 30 percent of their activity or revenue from coal, still allows investments in giants such as trader Glencore Plc and miner BHP Group Ltd. Opposition politicians and environmental groups have called on Norway to close “loopholes” as the government prepares to present a review of the rules this year.

The Norwegian parliament decided on the coal ban in 2015. Yet from the end of that year to the end of 2017, the fund’s share of reserves of mining companies that it was invested in rose by 10 percent, or 12 percent when adjusted for outflows, the U.K. non-profit InfluenceMap said in a report published on Wednesday.

The analysis also shows that the Norwegian fund has gone a long way in scrubbing itself of coal, mainly through divestment before parliament imposed its restrictions. The fund’s reserves fell 63 percent over 2014 and 2015, while its coal intensity — its reserves as a share of its assets — is less than half the average of the world’s 60,000 largest listed funds.

The findings also don’t suggest the fund isn’t complying with the restrictions. Yet it highlights that the ban still allows the fund to invest in some of the world’s biggest producers of coal since their output falls short of the 30 percent threshold, even if they exceed other miners or utilities in absolute terms.

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