French sustainable investment manager Mirova has become the largest renewables fund in Europe after its fourth funding round.
The Natixis Investment Managers subsidiary on Tuesday said it had closed a financing round worth €857 million for its Eurofideme 4 clean energy fund. The latest backing takes Mirova’s portfolio to €1.3 billion worth of unlisted renewable energy assets.
Regular backer the European Investment Bank was again involved, as part of the Investment Plan for Europe – the “Juncker Plan” – but Mirova said it had also attracted new investors.
Mirova opened its renewables funding pot to invest in France’s nascent wind market in 2002, raising an initial €46 million. A second funding round secured €94 million in 2009 and Eurofideme 3 generated €350 million in 2016. Thus far, Mirova has invested in 180 clean energy projects with a total generation capacity of 1.8 GW and the rising volume of contributions indicates increased confidence by institutional investors in renewables.
“Institutional investors’ interest in Mirova Eurofideme 4 provides evidence of the relevance of renewable energy as an uncorrelated and efficient asset class in a context of low interest rates,” said Raphaël Lance, head of Mirova’s energy transition funds. “This also demonstrates the increasing need, regarding climate emergency, to target investment towards [being] in line with the [maximum] 1.5 degrees Celsius [global temperature rise] objective.”
The Mirova-Eurofideme 4 fund will invest in solar, onshore wind, hydropower, biomass and biogas projects with the possibility of venturing into e-mobility, hydrogen and battery storage.
Having been authorized to accept investors from France, Italy, Spain, Luxembourg, Slovenia, South Korea and the U.K., Mirova has already allocated €300 million of the €857 million raised for 600 MW of renewables generation capacity in France, Portugal, Norway and Spain.
The French fund is doing its bit to reverse a slight fall in European investment for renewables with Bloomberg New Energy Finance in July publishing figures which indicated finance was down 4% in the first six months of the year, compared to the same period of last year. Spain bucked the overall European trend, according to BNEF, with a 235% first-half increase to $3.7 billion (€3.36 billion), followed by Sweden, with a 212% jump to $2.5 billion. The U.K. also saw increased investment, up 35% to $2.5 billion and Ukraine performed well, with a 60% increase to $1.7 billion.
France saw first-half renewables investment fall 75% to $567 million according to July’s figures, and Germany lost 42% to $2.1 billion. The Netherlands’ performance mirrored Germany, with a 41% retreat to $2.2 billion.
BNEF reported global financing for utility scale renewables projects fell 24% to $85.6 billion, a development the consultant attributed mainly to falling levels of investment in China. By contrast, investment for small scale systems – those with less than 1 MW of generation capacity – rose 32% to $23.7 billion.