International Inexperienced Asset Supervisor makes first US investments and expects extra curiosity underneath Biden’s presidency
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President-elect Joe Biden’s rise to the presidency will fuel more renewable energy projects in the United States. International investors take note of this.
Greencoat Capital, a global renewable energy investment manager with $ 8 billion in assets under management, has just announced its first U.S. investment after eight years in the UK and Europe.
The company has a 24% stake in four onshore wind farms on the coast of South Texas, which together have a total installed capacity of 861 megawatts. That’s about enough to run all of Houston for a year, the company said.
Greencoat Capital has been keeping an eye on the US for the past 18 months, said partner Laurence Fumagalli.
“It’s a great time, it’s a turning point in the market,” he said. “I think Biden is a massive boost. It will significantly increase the investment opportunities available over the next five to ten years.”
The German-based company RWE was previously the sole owner of the development in Texas. The company will keep a 25% stake in the project and continue to operate the four wind farms. The other 51% stake is held by a subsidiary of Algonquin Power & Utilities Corp of Canada, which was announced in December.
The Greencoat investment is valued at approximately $ 160 million and RWE intends to use the capital inflow to fund further growth in its renewable energy business.
According to Fumagalli, this model, where a utility company sells some of its business assets and then uses the money to fund new projects, is a common model in Europe and is growing in popularity in the US
Biden has outlined ambitious initiatives to help the nation’s transition to clean energy – including a $ 2 trillion climate bill – and Fumagalli said this creates particularly attractive terms for investors.
“In any normal economy like Europe or the US, it is the private sector that really mobilizes the large amounts of capital involved in this energy transition,” said Fumagalli, who led Greencoat’s US expansion. You could expect more to follow us. “
Half of Greencoat’s assets under management are publicly traded and the other half are private money.
For this particular investment, the capital came from the British Aerospace Pension System (BAPFIM) as well as from pension funds managed by the Willis Towers Watson Funds.
Overall, Greencoat aims to provide investors with stable and stable long-term income. “It’s usually on a buy-and-hold forever basis,” said Fumagalli of the company’s investments.
After Greencoat takes its first steps in the US, the fund will continue to look for compelling opportunities in the US. Ultimately, the company hopes to deploy approximately $ 1 billion a year nationwide.
“We want to mobilize large-scale wind and solar capital in the US, which is exactly what we did in Europe. There will be many more of these newly built assets in the Biden era.” “Said Fumagalli.
The announcement comes as U.S. renewable energy projects attract foreign interest. In early January, the Norwegian company Equinor won one of the largest renewable energy contracts in the United States