LGIM and NTR raise €390m for Clean Power Fund

Legal & General Investment Management (LGIM) and renewable energy investor NTR said they have raised €390 million in committed capital and co-investment opportunity in the first close of the L&G NTR Clean Power (Europe) Fund.

LGIM is the largest UK-based asset manager with assets under management of £1.2 trillion.

The Luxembourg-based fund invests in clean power infrastructure assets across wind, solar and energy storage.

It is classified as an Article 9 fund under the European Union’s Sustainable Finance Disclosure Regulation.

The fund is designed for institutional investors with a focus on pension funds, insurers and endowments.

At first close, the fund has raised commitments from a range of sources including European asset managers, Japanese institutional investors and theNatWest Group Retirement Savings Plan, which utilised LGIM’s life company platform to gain exposure to the fund.

This is in addition to €50 million of co-investment from Legal & General (L&G).

“In a drive to boost energy independence and reduce emissions, governments across Europe are looking to accelerate the rollout of clean energy generation technologies and energy efficiency investments — all of which require significant investment and asset creation,” said LGIM.

“The fund has already started to deploy capital in support of this programme, announcing its first asset acquisitions in January 2023 — three Spanish pre-operational solar projects from global renewable energy developer BayWa r.e.

“L&G and NTR have worked together since 2015, when L&G became a cornerstone investor in NTR’s first two funds.

“For the Clean Power (Europe) Fund, the trusted stewardship and institutional network of one of the world’s largest investment managers is brought together with the nimble, specialist expertise of a leading clean energy asset manager.

“As the asset manager, NTR sources the pipeline of assets for the fund to invest in, as well as applying its construction and asset management expertise across the life cycle of clean energy infrastructure.

“As fund manager, LGIM provides the scale of its distribution, stewardship and investment capabilities to facilitate the vital role that institutional finance is playing in funding clean power generation.”

Bill Hughes, Global Head of Real Assets at LGIM, said: “This marks LGIM’s first infrastructure equity raise and we’re delighted to announce first close of the Fund.

“This milestone is particularly pleasing given the recent private markets backdrop in Europe and Asia, and demonstrates the value of assets that combine stable and robust sources of income with clear sustainability credentials.

“Deploying private capital will be vital to deliver the pipeline of assets we need to reach net zero – this partnership aims to do just that, filling the funding gap and accelerating the construction and operation of clean power infrastructure.”

NTR CEO Rosheen McGuckian said: “We’re delighted to have secured such strong interest from a wide range of European and Asian institutional investors to progress our strategy to invest in clean power assets across Europe, focusing on proven technologies to address the energy transition.

“The fund aims to offer exposure to a portfolio of assets across the full lifecycle of clean power projects in Europe, providing diversification across technologies, regulatory regimes and climate profiles.

“Our ability to acquire early in the life cycle and use innovative engineering to optimise assets, combined with LGIM’s stewardship, unlocks additional value for investors.”