ENERGY STORAGE

NextEnergy Capital solar and battery storage fund hits $745 million 

April 30, 2024

Global renewables manager NextEnergy Capital (NEC) has reached a second close of $265 million for its solar and battery storage fund NextPower V ESG (NPV ESG), which has now secured $745 million in total commitments to date and is targeting $1.5 billion with a $2 billion hard cap.

The new capital includes commitments have come from a UK LGPS [local government pension scheme] investment pool, a Dutch pension fund, and another re-up from an existing NextPower III ESG investor.  These new investors join existing NPV ESG investors KLP, a German occupational pension fund, and a large Nordic pension fund. “NPV ESG will continue welcoming further capital, with several investors currently active in due diligence,” a statement said.

NPV ESG’s investment strategy targets the solar and infrastructure sector in “carefully selected” OECD markets, with the objective of building significant portfolios in each target market, establishing an operational track record and divesting the portfolio at the end of the fund’s holding period in 2033, the statement added.

NPV ESG has started its investment cycle with a 100MW utility-scale solar project under construction in Highland County, Florida, USA, and has several other investment opportunities from its 18GW pipeline that are currently under exclusivity and will close shortly, including 118MW of operational projects with CfD contracts.  The fund is expected to pay dividends, even during the investment phase.  NPV ESG’s pipeline includes projects in Spain, Poland, Italy, Canada, and the US.

Upon reaching its investment ceiling and delivering around 4GW, NPV ESG is forecast to generate enough clean energy to power the equivalent of up to 1.1 million households per year and avoid an estimated fossil fuel consumption of up to nearly 220 million metre-cubed of natural gas annually.

Michael Bonte-Friedheim, CEO and founding partner of NextEnergy Group, said: “I am delighted to announce the second close of NextPower V ESG, with commitments from both new and existing institutional investors.  Our continued fundraising progress demonstrates that NextEnergy Capital’s strategies continue to offer attractive investment opportunities for investors alongside making a sustainable long-term impactful investment.

Shane Swords, NextEnergy Capital managing director and global head of investor relations, added: “We are pleased to announce another strong close for NextPower V ESG, bringing commitments to $745 million, and would like to welcome and thank our new and existing investors in the fund. NextPower V ESG is our largest international fund to date that continues to deliver on NextEnergy Capital’s exemplary track record by showcasing positive fundraising momentum and portfolio growth.  NextPower V ESG provides a real impact and tangible benefits to the communities and countries where its assets are located, whilst also providing an opportunity for investors looking for strong and stable renewable energy returns.”