Denmark-based Copenhagen Infrastructure Partners (CIP) has secured Euro 4 billion from investors in commitments for its new renewable energy fund, Copenhagen Infrastructure IV (CIP IV). The Danish investment firm – which specialises in renewable infrastructure projects, particularly wind power – has attracted investors from across the Nordic countries, as well as the UK and Australia. Expected to be one of the largest ever funds of its kind, CIP IV was launched five months ago with a target between Euro 5 billion and Euro 5.7 billion, and will focus on greenfield investment in energy infrastructure around the world. It expects to reach its by end-December 2020, in what it claims would be the world’s largest renewable energy fund.
The project will see CIP adopting investments across a range of climate-conscious technologies, such as: contracted offshore wind, onshore wind, solar PV, transmission, storage, and waste-to-energy in low-risk Organisation for Economic Co-operation and Development (OECD) countries in the Northern Hemisphere, as well as developed countries in Asia and Australia.
CIP expects up to one-third of the fund to be invested in Asia, with a plan to pour up to 10 per cent of the fund into Taiwan because of its high potential for renewable energy projects. The new fund is already involved in offshore wind projects in Taiwan, Japan and Australia. The fund will also look at countries like South Korea.
“Tailored to institutional investors with a long-term investment horizon”, CIP has described the scheme as a “promising” addition to a market which has “proven resilient and functioned well over the last six months, despite Covid-19 and market turmoil”. Among the contributors to the fund are two Danish pension funds, PensionDanmark and AP Pension, as well as an assortment of other pension and life insurance companies based in the region. “Several new prominent institutional investors from across the Nordics, Continental Europe, the UK, Israel, Taiwan, Japan, and Australia” have also submitted plans to commit to the project, CIP said in a statement on its website.
Jakob Baruël Poulsen, Managing Partner at CIP, commented on the firm’s announcement, saying, “As a renewables market leader and pioneer, we are very happy to observe continued strong appetite for renewables. The investment outlook for CI IV is very promising and we expect the fund to become fully committed within approximately three years and with investments in attractive projects with similar characteristics to our existing investments”.
REGlobal’s Views: Concerns about the emerging climate crisis are beginning to flavour investment portfolios around the world. A number of climate focused funds have sprung up in recent months such as the UK’s own leading pension scheme Nest pledging to pump 5.5 billion punds into “climate aware” investments, and committed to decarbonising its entire portfolio by 2050. While renewable energy investments in Europe are maturing, the focus of these investors is now shifting to Asia which is having a stronger growth in renewables.