November 24th, 2024

Budget 2023: New Zealand's green investment finance receives $300 million boost to tackle climate change

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The capital boost will support existing and future projects, including transport, process heat, infrastructure, and early-stage companies.
The capital boost will support existing and future projects, including transport, process heat, infrastructure, and early-stage companies.

New Zealand Green Investment Finance Ltd (NZGIF) is set to receive a $300 million boost from Budget 2023, according to Climate Change Minister James Shaw.

The increased funds aim to support low carbon projects, reduce emissions, and create green jobs.

“Pioneering green investor, NZGIF, will be provided with an additional $300 million to invest in solutions to stimulate clean, green investment into low carbon companies and projects, and mobilise private capital," stated Shaw.

Since its establishment in 2019, NZGIF has emerged as a significant player in the work to finance and incentivise climate innovation and reduce emissions. This funding increase takes NZGIF's pool of capital to $700 million, making it one of the largest direct investors in New Zealand focusing on climate change.

"New Zealand’s challenge is not just about financing the climate transition, but the maturity of the markets that are expected to provide that finance. Public funding alone will not finance the scale of investment that’s needed, with the urgency required, to address the climate crisis," said Shaw.

Over the past four years, NZGIF has accelerated New Zealand's transition to a low carbon future through diverse investments, including electric vehicle charging infrastructure, solar power in schools, and electric buses.

The capital boost will support existing and future projects, including transport, process heat, infrastructure, and early-stage companies. In turn, NZGIF will be able to attract larger sums of private capital.

As of June 2022, the total estimated lifetime emissions reductions of its investments were 580,000 to 710,000 tonnes of CO2e, equivalent to the annual energy use of 480,000 to 590,000 homes.

“In addition to generating a rate of return on investments, the capital is recycled and can be invested into other projects. It’s a win-win," said Shaw.

NZGIF has demonstrated that it is possible to deliver low carbon benefits alongside investment returns, supporting the notion that capital coupled with purpose is economically viable.