CalPERS’ Infrastructure Program to Purchase Stake in California Solar Power Generation Company
The California Public Employees’ Retirement System (CalPERS) today announced that it has entered into an agreement to purchase up to a 25 percent ownership stake in Desert Sunlight Investment Holdings, LLC (Desert Sunlight), which owns two solar photovoltaic power generation facilities near Palm Springs, California.The facilities began commercial operations in late 2014 with a capacity of 550 MWac, selling all of their output to California utility companies under long-term contracts.
“Desert Sunlight presents a great opportunity for CalPERS, allowing us to invest both in California and in clean, renewable energy,” said Ted Eliopoulos, CalPERS Chief Investment Officer. “Infrastructure has been one of our best performing programs and is an important part of the CalPERS portfolio.”CalPERS will purchase the ownership stake from Sumitomo Corporation of Americas through its Gulf Pacific Power, LLC (GPP) account, a partnership between the Pension System and Harbert Management Corporation, one of its external infrastructure investment managers. GPP was formed to make equity investments in North American power assets.
The role of CalPERS’ Infrastructure program is to hold ownership of essential infrastructure assets that provide predictable returns with moderate long-term inflation protection. Infrastructure also acts as an economic diversifier to equity risk in the portfolio. The program currently makes up approximately one percent of the Total Fund, with a net asset value of approximately $2.3 billion as of January 31, 2016. Not including Desert Sunlight, investments in California infrastructure assets total approximately $118 million.
For more than eight decades, CalPERS has built retirement and health security for state, school, and public agency members who invest their lifework in public service. Our pension fund serves more than 1.7 million members in the CalPERS retirement system and administers benefits for nearly 1.4 million members and their families in our health program, making us the largest defined-benefit public pension in the U.S. CalPERS’ total fund market value currently stands at approximately $290 billion.