The Pension Infrastructure Platform (PIP) will avoid construction risk and offer both debt and equity investment portions for UK investors, plan organisers say.
The PIP is Chancellor George Osborne's plan to secure £20bn in pension fund investment for UK infrastructure projects.
Pension Protection Fund (PPF) chief executive Alan Rubenstein and National Association of Pension Funds NAPF) chief executive Joanne Segars said the platform would bypass greenfield investments due to pension schemes' hesitance on infrastructure construction risk.
They also announced the PIP would aim for a January 2013 launch with £2bn of capital invested from pension schemes.
The organisations are currently in talks with ten to 12 schemes about committing money to the project.
The platform will aim for a 50/50 equity-debt split.
Rubenstein (pictured) said: "One of things pension funds have said is they do not want to take greenfield risk, the actual construction risk.
"Pension funds really want to buy assets once they are built so we will no't get involved in the construction risk and that is why there is talk of guarantees of government."
He said pension funds are not able to "understand or manage" construction risk.
The PIP, which developed from a Memorandum of Understanding signed between Treasury, NAPF and PPF, would seek to target £1bn from the ten to 12 funds currently in talk and a further £1bn from additional schemes when the project is launched.
The platform is aiming to use leverage to get up to a size of up to £4bn.
It will be aimed at both large and small pension schemes.
Segars said: "One of the beauties is smaller pension funds will be able to invest in this."
She also clarified speculation the PIP would have a low cost charge of 0.5% annual management charge and bypass the fund management industry to appoint its own manager.
"We have not decided on management charges and it will be for the PIP to decide," she said.
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