Stockholm (NordSIP) – Varma, the largest pension company in Finland, has announced that it will reduce emissions on its total housing stock by an estimated 48% by 2023. The installation of heat pumps and solar panels in 36 apartment buildings will support the achievement of this goal.
At the end of 2018, the value of Varma’s real estate portfolio was €3.8 billion out of a total €44 billion portfolio. The majority of Varma’s assets are mainly allocated to listed equities and bond holdings. Varma is one of Finland’s largest real estate investors and owns 61 apartment buildings, comprising approximately 4,000 flats. The energy overhaul will be planned and implemented by LeaseGreen, a cleantech company.
“We will substantially reduce the carbon footprint of Varma’s residential properties through energy-efficient and digital solutions. Varma’s inspiring example proves that we can reduce emissions while at the same time increasing financial well-being,” says LeaseGreen’s CEO Thomas Luther.
Immediate Emission Reductions
Varma expects the transition to the new energy sources to take place during 2020-2021, beginning with 13 of the 36 buildings. In 2020, eight apartment buildings will already give up district heating and switch to geothermal heating. In some apartment buildings, geothermal heating will entirely replace district heating. The resulting emission reductions will correspond to the annual use of more than 1,700 petrol-fuelled cars or 7,600 return flights from Helsinki to Spain.
“These energy-saving measures are worthwhile on many levels, in terms of both profitability and environmental impacts,” says Varma’s Real Estate Manager Matti Lindfors. “The reduction in emissions in individual buildings may be a full 100%, which means in the future, residents may be living in buildings that are carbon neutral in terms of energy consumption.”
Varma’s Climate Targets
This recent announcement builds on the broader climate targets that Varma set at the end of 2019. Overall, the pension company’s goal is to achieve a climate-neutral investment portfolio by 2035. To this end, Varma aims to reduce emissions by 50% by 2027 from the 2016 level. The pension company expects this milestone to follow a shift in capital allocation that will see one-fifth of its balance sheet represented by assets that directly or indirectly mitigate climate change.
“Over the past year, it has become clear that emissions must be cut much faster than previously thought in order to keep global warming within the two-degree limit,” says Varma’s CIO Reima Rytsölä. “New information about climate change and its impacts has come to light, which means we must also renew our climate targets.”
Image courtesy of Varma