Major Canadian pension fund CDPQ plans to invest 70 billion yen ($474 million) in Shizen Energy, a Japanese developer of renewable energy.
Demand is increasing for environmentally conscious investing globally. If Japanese renewable energy companies can build a track record at home and abroad, they will be able to attract global decarbonization money.

CDPQ will invest 20 billion yen by subscribing to Shizen Energy convertible bonds in October. In addition, 50 billion yen has been set aside for an investment framework in which Shizen will develop renewable energy power generation in Japan and overseas. The Canadian fund will dispatch a director to the Japanese company’s board to determine which development projects to invest in.

“What we saw in Shizen is energy transition in Japan but also roots in Southeast Asia and all the way to Brazil,” said Emmanuel Jaclot, executive vice president and head of infrastructure at CDPQ, in a recent interview with Nikkei.

CDPQ manages the pensions of over 6 million people, and its net assets reached around 420 billion Canadian dollars ($308 billion at current rates) as of the end of 2021. The fund has shifted focus to decarbonization from companies involved in crude oil production and will invest 54 billion Canadian dollars in renewables-related projects by 2025.

This will mark the fund’s first time investing directly in a Japanese infrastructure company. It has invested in companies in the U.S., Europe and India. It has been seeking fresh opportunities to invest in Asia.

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