Alpha Real Capital’s (Alpha) Wind Renewables Income Fund (WRIF) has secured an GBP80million follow-on subscription from existing investors including the Towers Watson Secure Income Fund and Yorkshire & Clydesdale Bank Pension Scheme, together with new investment from Croda Pension Scheme.
WRIF invests predominately in sub 5MW onshore Feed In Tariff (FIT) wind assets in the UK, providing UK pension fund investors with secure inflation-linked income (circa 80 per cent) and with a current duration in excess of 20 years.
In the 12 months to December 2020, WRIF’s fleet of 40 turbines generated over 50GWh of clean energy which delivered a favourable outperformance against budget, exceeding its power generation target by 4 per cent and EBITDA by over 7 per cent.
WRIF’s ESG credentials are attractive to pension fund investors and Alpha. Once fully invested, the Fund will have deployed £180m, which is expected to generate 90MWh per annum of clean energy which would power approximately 29,000 homes.
Alpha expects appetite for renewable investments to grow amongst institutional investors, as they seek secure income that also delivers favourable ESG outcomes. FIT wind assets are particularly desirable for pension funds given the long duration fully amortising nature of their cash flows.
Will Morgan, Head of Renewables at Alpha Real Capital, says: “Following successful deployment of GBP100 million across 14 transactions and 40 operating turbines since initial launch in June 2018, we are delighted to have retained these substantial commitments that will allow WRIF to capitalise on our immediate pipeline of exclusive opportunities within the UK’s addressable market of circa GBP2 billion.”
Scott Gardner, Partner Investment Capital, adds: “The renewable energy sector continues to offer secure income and good relative value for investors, as they seek a cash flow match to their pension payment liabilities. The sector also provides significant ESG benefits for pension schemes on their journey to becoming carbon-neutral.”
Phillip Rose, CEO, says: “Following this latest renewables fund closing, Alpha will have around GBP700 million committed to renewable energy infrastructure across the group, in wind, solar and hydro projects capable of powering close to 100,000 UK homes with clean energy.”
