London-based fund manager Glennmont Partners announced Tuesday that it had successfully raised €850 million ($957 million) during its Third Fund investing in clean energy infrastructure projects in Europe, the largest amount that has ever been raised for a green energy only fund with a European mandate.
The largest fund managers focusing exclusively on investment in clean energy infrastructure in the world and boasting over €2 billion in assets under management after only 11 years in business, Glennmont Partners has invested in 192 megawatts (MW) of solar projects, 548 MW of wind, and 119 MW of biomass. Formerly BNP Paribas Clean Energy Partners, before a management buyout renamed the company to Glennmont Partners, the team has been working together since 2007.
This Third Fund (Fund III), which originally sought to raise €600 million, reached such a high level through increased interest in sustainable themes among investors and due to the demonstrated success in investment, operations, and divestments in the assets in Fund I and Fund II.
“We are delighted to announce the successful closure of our Third Clean Energy Fund which has raised over three-quarters of €1 billion,” said Glennmont CEO Joost Bergsma. “Institutional investors globally recognise that the energy transition and climate change is of key relevance to the performance of their portfolio. Glennmont’s investment strategy has proven to deliver good performance and predictable returns, and this strong demand from investors underlines the quality of the assets it invests in.”
Over 70% of Fund III will apparently be invested in the Eurozone — those countries of the European Union which have adopted the Euro as its major currency — though the United Kingdom will also be an important market for the funds raised.
Further, Fund III will for the first time invest funds into offshore wind projects across the European Economic Area (EEA), in addition to targeting solar PV, onshore wind, bioenergy, and small-scale hydro. Fund III will span ten years and target to-be-built and recently-operational assets with stable, predictable cash yields underscored by regulated and contracted revenues.
The €850 million was committed by a combination of new and existing investors from Glennmont’s previous two funds, and included investors such as UK Local Authority Pension Plans such as Surrey Council, Southwark Council, and East Riding Council, as well as the European Investment Bank (EIB).
“Climate change is the biggest environmental crisis of our age,” said Andrew McDowell, EIB Vice President responsible for renewable energy. “As the EU bank we know that mobilising private capital is key to address this challenge. This is the second time we partner with Glennmont in the Clean Energy Fund, which will invest in key technologies necessary to drive the clean energy transition. We are particularly pleased to see the fund surpass its initial target size. This shows the impact public investment like the EIB’s can have.”