PGGM, a co-operative pension fund based in the Netherlands, has bought a 49% stake in Dutch carbon capture company Carbon Collectors, on behalf of Pension Fund Zorg en Welzijn (PFZW).
PGGM manages assets worth €261bn for various pension funds, representing 5.6m participants.
The funding means that Carbon Collectors is now fully financed to complete its technology for CO2 collection, transport and storage and prepare for market launch.
This is the fourth investment made under PFZW’s special energy transition mandate. Set up in 2024, the mandate earmarks €1bn mainly to young companies with promising, commercially viable solutions for the energy transition.
PGGM has also acquired the exclusive right to invest up to €200m as equity in projects to build the necessary infrastructure to collect, transport and inject CO2 into suitable permanent geological storage sites, such as depleted offshore gas fields. These investments will help Carbon Collectors realise its first projects and accelerate project delivery.
Carbon Collectors aspires to “introduce a realistic, competitive, flexible and scalable solution" that in the short term can help Europe meet its climate goals, according to the company press release. It aims to bring its first batch of captured CO2 into permanent storage before 2030, and expects this to quickly grow to around 6m tonnes per year.
The EU aims to capture and store 50m tonnes of CO2 per year by 2030. Supported by European laws and regulations, this is expected to increase more than fivefold by 2040.
Carbon Collectors targets clients in the so-called “hard to abate industries”. These are often sectors that are particularly difficult to decarbonise because of their high energy consumption and/or the nature of their production processes. Examples include the steel and cement industries, as well as the waste treatment, recycling and pulp and paper industries.
While proponents see carbon capture, utilisation, and storage (CCUS) as essential for decarbonisation where alternatives are scarce, critics argue that the developing technology is expensive, has yet to prove its effectiveness at scale, and may perpetuate reliance on fossil fuels, diverting resources from more effective solutions like renewable energy and electrification
Simon Nicolaas, investment director at PGGM Infrastructure described the Carbon Collectors investment as “a perfect fit” with PFZW’s ambition to “capitalise” on the opportunities presented by the energy transition.
“We are looking for companies that ... achieve the long-term returns we need to pay successive generations of workers in the health and social care sector a good pension,” he said. “Carbon Collectors also contributes to PFZW’s goal of achieving a net zero investment portfolio by 2050, in line with PFZW’s commitment to the Paris Climate Agreement.”
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