In 2010, Pensiondanmark invested DKK 700 million in the wind farm Nysted in Denmark. However, the pension fund had to write down the project by about DKK 100 million (EUR 13.4 million) last year due to expected lower electricity costs in the future.
"This has to do with the period during which the electricity generation from the park can be sold at a fixed, guaranteed settling price running out as expected in 2016. Concurrently with the falling electricity costs, expectations for the park’s future revenues have been reduced, which has caused the devaluation of the park’s estimated market value, and that particularly affected the 2016 results," says Claus Stampe, CIO at Pensiondanmark, to Inside Business.
Furthermore, Pensiondanmark has, along with PKA, experienced a decline in profits from Anholt Wind Farm, and PKA, Industriens Pension, Lærernes Pension, and Lægernes Pension have shown a total deficit of DKK 135 million on an investment in German wind farm Gode Wind 2 due to technical problems.
English Edit: Marie Honoré
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Grant-making association Realdania has its roots in the history of Danish housing needs -- all the way back to the devastating Copenhagen Fire of 1795. But with his eye firmly fixed on today's financial market challenges, CIO Peter Johansen tells AMWatch the private philanthropic organization is now set for a big boost in its alternative assets.
Both Alecta and AMF are busy shifting assets into new investment types: Alecta has more than doubled its green bonds investments in 2017, while AMF’s CIO says her fund has been working to manage assets outside the traditional asset classes.
Over the years, Pensiondanmark has built up a large portfolio of alternatives, which in 2017 yielded a return that compares with equities. Investments in infrastructure, property and non-listed assets will help protect the savings of more than 700,000 members against future equity unrest and interest rate hikes.
Spiralling costs for government pensions, a large sector of the population with scant pension savings, particularly poor pensions among women -- and a group with no pension coverage at all. The latest OECD pension report lays bare the fact that Germany has a steep hill to climb, with pensions in need of far-reaching reforms.