OTPP joins KKR as investor in Australia's GreenCollar
Ontario Teachers’ Pension Plan (OTPP) has made an investment of undisclosed size in KKR-backed GreenCollar, an environmental services provider that helped establish Australia’s carbon credit market.
OTPP has committed to having zero greenhouse gas emissions in its portfolio by 2050. In September, it set interim targets: to reduce portfolio carbon emissions intensity by 45% by 2025 and 67% by 2030, compared to a 2019 baseline.
GreenCollar is the largest operator in Australia’s carbon credit space. It is best known for helping landowners develop carbon storage projects on farms, then helping sell the resulting carbon credits to private and public organizations seeking to manage their environmental impact. The concept has been expanded from carbon to water quality, biodiversity, and plastics markets.
KKR invested a reported A$100 million ($71 million) in the company in 2020 via its global impact fund, which closed earlier that year at $1.3 billion. The mandate is to invest about one-third of the corpus in Asia, targeting middle-market companies addressing the UN’s sustainable development goals (SDGs).
GreenCollar was said to contribute to three SDGs, including action on climate change, and land and marine conservation. Traction on these fronts since the KKR investment includes the acquisitions of carbon advisory and trading firm Sigma Global, carbon farming business, Devine Agribusiness Carbon, and consumer-facing offsets platform Go Neutral.
The company has also recently formed a partnership with soil carbon operator AgriProve and launched pilot projects targeting biodiversity outcomes and reduction in plastics waste. Earlier this year, it established a reef credits program, which it calls a world-first water quality offset market targeting the Greet Barrier Reef.
OTPP is expected to support ongoing diversification through its agriculture, timberland, and seafood sector networks. Part of the plan is to help GreenCollar launch plastics recovery projects in West Africa and the Pacific, as well as a cookstoves project in Southern Africa and a forest protection project in Southeast Asia.
“KKR is aligned with Ontario Teachers’ in our commitment to drive positive environmental impact and we are confident this new strategic partnership taps into our collective strengths to position GreenCollar for its next stage of growth,” George Aitken, a director on KKR’s Australia PE team said in a statement.
“Carbon credits and environmental offsets remain an important part of the transition towards sustainability and GreenCollar’s continued growth will help to scale this effort further.”
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