New Zealand Green Investment Finance
New Zealand Green Investment Finance (NZGIF) was an investment bank established by the Sixth Labour Government in early 2019 as part of its climate change plans to invest in low-emissions investments. In late 2024, the company attracted criticism for its NZ$145 million loan to failed solar company SolarZero, leading to the resignation of the chair Cecilia Tarrant. In April 2025, the Sixth National Government confirmed that it would disestablish the NZGIF. [1]
History
[edit]Sixth Labour Government, 2018–2023
[edit]On 9 December 2018, the Sixth Labour Government announced plants to create a green investment bank called the New Zealand Green Investment Finance. According to the Government, the bank's four objectives were to make investments that reduce domestic emissions, crowd-in private finance, invest on a commercial basis, and undertake a market leadership role in green investments. The entity would be funded by the Government.[2][3]
The NZGIF was legally incorporated in April 2019. During the winter of 2019, the bank recruited a leadership team consisting of a chief executive officer, chief investment officer, chief operating officer, and a head of government relations and communications. By late 2019, the NZGIF had entered the investment market with a start-up investment of NZ$100 million.[3]
In early May 2023, Climate Change Minister James Shaw announced that the New Zealand Government would invest NZ$300 million in the New Zealand Green Investment Finance, boosting its total budget to NZ$700 million.[4] By November 2023, the NZGIF's chief investment officer Jason Patrick said that the NZGIF had become the largest direct investor in New Zealand companies and technologies seeking to reduce the country's carbon emissions. Notable investments have included investing NZ$2.5 million in Waikato-based Ruminant BioTech's methanne inhibiting bolus for livestock, a $2.5m equity stake in Total Nutrient Use Efficiency's (TNUE) new biodegradable fertiliser processor plant near Taupō and NZ$15 million in Lodestone Energy's five solar farms, a NZ$25 million loan for Eastland Generation's geothermal power station in Kawerau, NZ$150 million to acquire 150 zero emission buses for bus company Kinetic and NZ$3.5 million in Kayasand's high-technology manufacturing demonstration plant.[5]
Sixth National Government, 2023–2025
[edit]By late July 2024, the NZGIF had invested NZ$50 million in various decarbonisation investments including fertiliser application, methane emissions, on-farm energy and milk chilling systems. By that time, the bank had acquired a 36.9% stake in TNUE with a NZ$4.5 million equity investment, loaned NZ$10 million for Rural Energy to install 285 solar generators in nearly 200 farms, loaned NZ$25 million for Lightyears Solar to build solar farms, and loaned NZ$10 million for Coolsense to produce low emissions milk chilling units for dairy producer Fonterra.[6]
In late 2024, the NZGIF came under scrutiny for its role in directing the financing of NZ$365 million worth of public and private funding (including NZ$145 million in taxpayer funding) into covering the debts of ill-fated solar energy manufacturing company SolarZero in October 2024.[7][8] SolarZero's American investment partner BlackRock had closed the company down, citing unsustainable operating losses and constrained liquidity. Due to SolarZero's liquidation, 25 solar panel installation companies were left with hundreds of thousands in unpaid work and the company's redundant staff were owed NZ$1.5 million in unused annual leave. In response to the SolarZero investment, NZGIF's shareholding ministers Nicola Willis and Simon Watts ordered the New Zealand Treasury and the Ministry for the Environment to conduct the annual strategic review of NZGIF's mandate.[7]
On 5 December 2024, Willis and Watts summoned NZGIF chair Cecilia Tarrant for a "please explain meeting." By early December 2024, NZGIF acknowledged that it had been informed of BlackRock's liquidation of SolarZero on 22 November, four days prior to the company's liquidation on 26 November. The bank subsequently admitted that it had been aware since early November 2024 that SolarZero did not have the support of its owner BlackRock.[9] On 12 December, Tarrant resigned as chair of the NZGIF in response to criticism of the bank's role in loaning NZ$145 million into SolarZero.[10]
On 8 April 2025, Watts announced that the Government would disestablish NZGIF, citing limited results and the existence of over 20 government funds with similar objectives to the bank. He confirmed that NZGIF would be developing a disestablishment plan over the next 90 days.[1]
References
[edit]- ^ a b "Government's green investment bank to be shut down". Radio New Zealand. 8 April 2025. Archived from the original on 8 April 2025. Retrieved 30 April 2025.
- ^ "NZ $100m green bank set to open tills late 2019". Investment News New Zealand. 9 December 2018. Archived from the original on 19 February 2021. Retrieved 30 April 2025.
- ^ a b "green bank to watch in 2020: New Zealand Green Investment Finance Ltd". Coalition for Green Capital. 17 December 2019. Archived from the original on 15 February 2025. Retrieved 30 April 2025.
- ^ Cardwell, Hamish (9 May 2023). "Green investment bank's pool of capital now $700m after government cash injection". Radio New Zealand. Archived from the original on 3 December 2024. Retrieved 30 April 2025.
- ^ "Sustainable Business and Finance: Making an investment in changing the way we live". The New Zealand Herald. 9 November 2023. Archived from the original on 19 April 2025. Retrieved 30 April 2025.
- ^ Skellern, Graham (25 July 2024). "Agribusiness and Trade: New Zealand Green Investment Finance makes inroads on the farm". The New Zealand Herald. Archived from the original on 24 September 2024. Retrieved 30 April 2025.
- ^ a b Milne, Jonathan (28 November 2024). "Minister seeks 'urgent advice' on $115m at risk in SolarZero collapse". Newsroom. Archived from the original on 22 February 2025. Retrieved 30 April 2025.
- ^ Brettkelly, Sharon (10 December 2024). "Behind SolarZero's collapse". Radio New Zealand. Archived from the original on 9 April 2025. Retrieved 30 April 2025.
- ^ Milne, Jonathan (6 December 2024). "Disingenuous, or careless? Pressure on Govt green bank over SolarZero collapse". Archived from the original on 4 February 2025. Retrieved 30 April 2025.
- ^ Edmunds, Susan (12 December 2024). "NZ Green Investment Finance chairperson resigns amid SolarZero collapse". Radio New Zealand. Archived from the original on 9 April 2025. Retrieved 30 April 2025.