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RNS Number : 2076X NextEnergy Capital Limited 25 August 2022
NextEnergy Capital Announces First Close of its UK Subsidy-Free Solar Fund,
NextPower UK ESG, at over 65% of Target
NextEnergy Capital ("NEC"), a global leader in the renewables sector, is
pleased to announce the first close for NextPower UK ESG ("NPUK ESG") at £327
million, which is over 65% of NPUK ESG's target of £500m. The fund has a hard
cap of £1 billion.
Since it officially launched in December 2021, NPUK ESG has enjoyed
significant fundraising momentum against a challenging backdrop. The
commitments in this first close have been made from investors in the UK and
the Middle East including the UK Infrastructure Bank ("UKIB"), LGPS Central
Limited, Merseyside Pension Fund and Brunel Pension Partnership. The UKIB is
the cornerstone investor for the fund and plans to invest up to £250 million
on a match funding basis. The fund is targeting both UK and international
institutional investors, with further investors currently in due diligence,
and the fundraising period is 2 years from 1(st) close.
NPUK ESG is a private 10-year solar infrastructure fund focused on investing
into new-build utility scale, subsidy-free solar in the UK. It is the first
subsidy-free private solar investment fund in the UK and has an expected
generation capacity of c. 2 Gigawatt of power at hard cap. It aims to double
the amount of subsidy-free solar power in the UK and, at hard cap, it will
produce enough clean electricity to power the equivalent of nearly 500,000
households or offset nearly 200,000 carbon-emitting cars on the road each
NEC has developed a pipeline of projects for the fund including two seed
assets which are now in operation. This creates a significant advantage for
investors by largely removing bid and pipeline risk for the fund. NPUK ESG's
two operational seed assets are at sites in Llanwern, South Wales, and
Strensham, Worcestershire, which together have an installed capacity of 115MW.
The Llanwern plant is the UK's largest operating solar power plant.
The fund is targeting highly attractive investor returns by creating long-term
stable cashflows through a contracted revenue model with robust, credit-worthy
Power Purchase Agreements, helping to provide UK off-takers with power price
certainty whilst allowing them to achieve and manage their carbon footprint
and sustainability goals.
This first close comes at a highly relevant time for the UK, not only in
contributing to the UK Government's net zero goals but providing well needed
new-build investment into a sector that delivers new-build lower-price power
in contained time frames and increases the country's energy independence from
fossil fuel imports.
Michael Bonte-Friedheim, CEO and Founding Partner of NextEnergy Capital, said:
"I am delighted to announce the first close of NPUK ESG, which comes at a
crucial time to help strengthen the UK's energy independence. NPUK ESG is
the first UK fund that targets purely new-build subsidy-free utility scale
solar assets, and I am proud that NextEnergy Group is driving this forward,
showing how solar assets in the UK can provide investors with a significant
return while reducing the carbon footprint of the UK. NPUK ESG marks the
Group's fourth fund, backed by an impressive track record since 2007. We
continue to offer investors access to our specialist focus across the solar
power spectrum, from construction, investment management and operations."
Shane Swords, NextEnergy Capital Managing Director and Head of Investor
"We are delighted to welcome our new investors into NPUK ESG, and to have
cleared over 65% of the fund's target at the very first close. It demonstrates
investors' demand for new-build subsidy-free, unlevered UK solar, but also
highlights NextEnergy Capital as the go-to solar renewables manager. We have
onboarded the investors with a very detailed and timely due diligence process,
having formally launched NPUK in December 2021. It has been a pleasure to work
with them and I look forward to continuing the fundraising momentum and
announcing the second close of the fund in the next few months."
Georgina Whittle, Partner, Camarco
+44 (0)7835 770 967
Owen Roberts, Partner, Camarco
+44 (0)7890 869 288
NextPower UK ESG
NPUK is a 10-year closed-ended private fund managed by NextEnergy Capital.
It is a private unlevered fund investing in greenfield subsidy-free solar
projects, with PPA's, in the UK.
· NPUK was launched in December 2021.
· Targeting £500m, to invest into unsubsidised solar plants in the UK
with contracted revenues.
· The UK Infrastructure Bank is providing cornerstone match-funding
capital for up to £250m.
· Offers investors the opportunity to earn attractive risk-adjusted
returns from solar PV infrastructure in the UK.
· Secured a pipeline of c.1.2GW alongside access to an immediate
cash-generating, operational seed portfolio of 115MW.
· Target gross unlevered IRR of 9-11% and annual yields of 4.5-6.5%
with a full pay-out strategy.
· Real, measurable additionality ESG impacts, including biodiversity
measures and community engagement
· Fund returns are enhanced through NextEnergy Capital's expertise in
technical outperformance, private wire agreements, repowering and storage
NextEnergy Group was founded in 2007 to become a leading market participant in
the international solar sector. Since its inception, it has been active in
the development, construction, and ownership of solar assets across multiple
jurisdictions. NextEnergy Group operates via its three business units:
NextEnergy Capital (Investment Management), WiseEnergy (Operating Asset
Management) and Starlight (Asset Development).
NextEnergy Capital is the investment arm of the NextEnergy Group, to date it
has invested in over 325 individual solar plants for a capacity in excess of
2.3GW across it institutional funds;
· NextPower UK ESG ("NPUK"), a private unlevered fund investing in
greenfield subsidy-free solar projects, with PPA's, in the UK.
· NextEnergy Solar Fund ("NESF"), a solar infrastructure investment
company focused on the UK and other OECD countries, which is listed on the
premium segment of the London Stock Exchange. It currently owns 865MW spread
among 100 individual operating assets in the UK and Italy, comprising a gross
asset value of £1,150m. NESF is one of the largest listed solar energy
investment companies in the world.
· NextPower II ("NPII"), a private fund made up of 105 individual
operating solar power plants and an installed capacity of 149MW, focused on
consolidating the substantial, highly fragmented Italian solar market. NPII
was successfully divested in January 2022, a 2016 vintage vehicle that
generated net IRRs in excess of its gross target of 10-12%.
· NextPower III ESG ("NPIII"), a private fund exclusively focused on
the international solar infrastructure sector, principally targeting projects
in carefully selected OECD countries, including the US, Portugal, Spain,
Chile, Poland and Italy. NPIII is a fund that provides a positive social and
environmental impact to the countries it has and will invest into. NPIII
completed its fundraise with a total of $896m, including a SMA raised. The
target of the fund was $750m.
Further information on the NextEnergy Group is available at:
WiseEnergy® is NextEnergy Capital Group's operating asset manager.
WiseEnergy is a leading specialist operating asset manager in the solar
sector. Since its founding, WiseEnergy has provided solar asset management,
monitoring and technical due diligence services to over 1,400 utility-scale
solar power plants with an installed capacity in excess of 1.8GW. WiseEnergy
clients comprise leading banks and equity financiers in the energy and
Further information on WiseEnergy® is available at: www.wise-energy.com
Starlight is NextEnergy Group's development company that is active in the
development phase of solar projects. It has developed over 100 utility-scale
projects internationally and continues to progress a large pipeline of c.5GW
of both green and brownfield project developments across global geographies.
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