• Nest has committed £200 million, equal to about $254 million, to next-generation climate technologies through IFM Investors.
• The strategy targets growth-stage infrastructure and industrial businesses across power, energy, sustainable transport, circular economy and industrial innovation.
• Nest plans to invest £5 billion through IFM by 2030, as it raises private market exposure from about 18% to 30%.

Nest Targets Climate Scale-Up Capital

London pension capital is moving deeper into the climate infrastructure market, with Nest committing £200 million to a new credit strategy with IFM Investors.

Nest, the UK’s largest pension scheme by membership, will invest in next-generation climate technologies through a mandate with the global infrastructure specialist. The strategy is designed to finance growth-stage companies that sit beyond early venture risk but still struggle to access traditional infrastructure debt.

For pension funds, that is an increasingly important gap. Many industrial climate technologies have moved from proof of concept into commercial deployment. Yet they often need flexible capital before large banks or conventional lenders are prepared to step in.

Nest’s mandate aims to fill part of that financing gap. It will focus on international lending opportunities across developed markets, supported by a strong UK pipeline.

Backing Proven Climate Technologies

The next generation infrastructure credit strategy will target industrial and infrastructure-oriented businesses that need capital to scale. These include venture-backed companies with proven technologies, clear market demand and potential for real economy decarbonisation.

The strategy will invest across power and energy, sustainable transportation, digital circular economy and industrial innovation. Nest said it wants to support companies positioned to benefit from the transition to a lower-carbon economy.

Rachel Farrell, Director of Public and Private Markets at Nest Invest, said: “This investment represents a compelling opportunity to generate returns for our members by tapping into some of the most exciting and innovative climate technologies in the world, including those right here in the UK. 
It is made possible through our strategic partnership with IFM, which enables us to seed new strategies like this and help unlock wider capital flows from other investors.

“We’re here to support entrepreneurs in accessing the capital they need to scale their ideas into real-world solutions. Alongside financial returns, this investment is also putting members’ money to work in ways that move the dial on climate actions — a clear ‘win win’ for both our members and the wider market.”

“The globally-focussed strategy aims to back companies, asset-backed debt, across power and energy, sustainable transportation, digital circular economy and industrial innovation sectors, backing innovators that deliver measurable, low-carbon outcomes across the real economy.”

Private Markets Push

The commitment follows Nest becoming the first international owner of IFM last year. Nest joined 15 Australian superannuation funds as an owner of the infrastructure investment platform.

That ownership position gives Nest access to IFM’s global investment capabilities. It also strengthens the pension scheme’s ability to seed new private market strategies.

Nest intends to invest £5 billion through IFM by 2030. The latest mandate also fits its wider plan to lift private market allocations from about 18% to 30% in the coming years.

For large pension schemes, private markets are becoming a central tool for portfolio diversification. They also offer access to infrastructure assets tied to energy security, supply chain resilience and industrial competitiveness.

The challenge is governance. Pension trustees must balance long-term climate exposure with liquidity, fees and risk-adjusted returns. That balance is now a defining issue for asset owners entering climate infrastructure credit.

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Infrastructure Debt Meets Climate Transition

IFM said the mandate builds on its global infrastructure debt platform and experience financing essential assets.

Rich Randall, Global Head of Debt Investments at IFM, commented: “We’re pleased to partner with Nest on this next generation infrastructure credit strategy, reflecting our long-standing relationship and shared conviction in the role long term capital can play in infrastructure markets. Building on IFM’s global infrastructure debt platform and decades of experience financing essential assets, this mandate expands our focus to innovative infrastructure and industrial technologies that support economic resilience, energy security and supply chain strength.

“As a pension fund owned institution, IFM is focused on delivering strong long-term outcomes for working people’s retirement savings through investments with resilience, durability and lasting value. Through this partnership, we aim to provide flexible growth capital to high quality businesses helping drive the transformation of critical infrastructure systems, while delivering attractive risk adjusted returns for investors.”

What Investors Should Watch

The mandate highlights a key shift in climate finance. Institutional investors are moving beyond listed equities and green bonds into private credit structures tied to industrial deployment.

That matters for executives and investors tracking the next phase of the energy transition. The winners will not only be early-stage innovators. They will be companies able to turn proven technology into bankable infrastructure.

Nest’s commitment also shows how retirement capital can shape the climate investment pipeline. By backing scale-up finance, pension funds can help move technologies from niche solutions into mainstream deployment.

For the UK and other developed markets, the stakes are strategic. Climate infrastructure now sits at the intersection of decarbonisation, energy security and industrial policy. Nest’s £200 million mandate places pension capital directly inside that shift.

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