SAN FRANCISCO (Bloomberg) - The California Public Employees' Retirement System (Calpers) is forming a US$764 million (S$1.02 billion) partnership with Australian firm QIC Ltd. to invest in infrastructure projects in Asia.

The largest U.S. public pension intends to steer money to water, power, transportation and energy projects, the Sacramento-based fund said Wednesday in a news release.

"This is a great opportunity to expand our infrastructure portfolio and to enter the Asia-Pacific market," Paul Mouchakkaa, Calpers' senior investment officer for real assets, said in the release.

Calpers has US$2.1 billion in infrastructure investments as a hedge against inflation; it provides a long-term source of income. The pension bought a stake in London's Gatwick airport in 2010 and invested in an underwater power cable between New York and New Jersey in 2011. Calpers, which has 0.7 per cent of its US$307 billion portfolio in infrastructure, wants to increase that to 1 per cent.

Spokesman Joe DeAnda declined to say what portion of the partnership will come from the pension.

The partnership offers an opportunity to "deploy capital across the core infrastructure sectors of transport, energy, utilities" and public private partnerships, said Ross Israel, QIC's head of global infrastructure, which manages A$72.9 billion (S$76.76 billion) in funds.