Green bonds will be issued by a pension fund in a world first for the sector.
The Canada Pension Plan Investment Board (CPPIB) will become the first pension fund to increase its holdings in renewables and energy efficient buildings.
CPPIB, which handles a total of $356.1bn assets, says the sale will put more than C$3bn into the renewable energy sector through environmentally friendly products.
"The issuance of green bonds is a logical next step to CPPIB's investment-focused approach to climate change, and we are pleased to be a pioneer amongst pension funds in this regard," said Poul Winslow, senior managing director & global head of capital markets and factor investing.
"The capital raised will help support strong, long-term investments in eligible green assets that position the Fund for continued success."
It said that renewable energy, sustainable water and wastewater management schemes, and green buildings would all be eligible for investment from green bond proceeds.
Green bonds are nothing new in the financial sector, but CPPIB is the first pension fund to support environmentally friendly investments.
In August, SSE issued the largest ever green bond from a UK business, worth around £552m to go towards the development of UK capital in green products.
Major bank Barclays has also thrown its weight behind environmentally friendly products, issuing a £441m green bond designed to finance mortgages on English and Welsh residential mortgages in the 15 per cent of properties with the highest energy efficiency.