Ontario’s University Pension Plan is strengthening its commitment to climate solutions with a new data center co-investment.
The CAD$11.7 billion (US$8.5 billion) pension fund said on Monday that it partnered with Quinbrook Infrastructure Partners to co-invest in Rowan Digital Infrastructure.
The deal builds on UPP’s investment in Quinbrook’s Net Zero Power Fund in 2023. According to UPP’s head of private markets Peter Martin Larsen, the deal adds to the over $1 billion UPP already has invested through private market partnerships and co-investments since its inception three years ago.
“We are excited to partner with Quinbrook in their mission to support the transition to a net-zero future, in line with our own climate-related commitments,” Larsen said in a statement. “Beyond adding important inflation-hedging properties to UPP’s investment portfolio, our investment in Rowan Digital Infrastructure provides a unique opportunity to help fund the critical infrastructure required for the growth of data centers with renewable energy sources.”
The first of UPP’s co-investment deals was an allocation to European rail service Angel Trains alongside Arjun Infrastructure Partners, made in March of this year.
Rowan is not a transit-focused investment, though. The company builds out the infrastructure necessary for businesses that require data centers for large-scale workloads. This includes building facilities across the United States, leasing already-built sites, and providing renewable energy access to customers.
UPP sees this deal as an inflation-hedging play, noting that it aligns with the fund’s strategy “to offer members pension security while reducing inflation risk.”
Quinbrook, meanwhile, invests exclusively in infrastructure necessary for the energy transition. It provides capital to develop some of the largest renewable power generation and storage projects in the United States, United Kingdom, and Australia.
“UPP’s investment in Rowan will allow Quinbrook to further advance its efforts to provide innovative solutions that help support the net-zero transition in high growth, energy-intensive industries,” said the company in an announcement.
According to John Lucas, managing director and North America regional lead at Quinbrook, Rowan will likely benefit from increased demand for data centers powered by renewable energy in the coming years.
“The large load requirements of new-build data centers means that there is likely to be increasing investment in and demand for data centers powered by renewable energy,” he said in a statement. “Rowan’s platform has been built and well placed to capture hyperscale customers’ demand for ‘build ready’ sites powered by renewable energy solutions.”