The Columbia Threadneedle European Sustainable Infrastructure Fund (ESIF) is pleased to announce the recent acquisition of two renewable energy assets as it builds a diversified, clean energy portfolio for the fund.
The first asset is a portfolio of mini hydropower plants in the Marche region of central Italy. Harnessing the gravitational flow of a river, the plants provide cost effective, flexible, high-efficiency, low-carbon energy production. The second acquired asset is Storrun Windkraft, an onshore wind farm located in Sweden’s Sundsvall area in the SE2 Nord Pool price area. Operational since 2010, the farm comprises 12 Nordex SE 2.5MW turbines.
Together, the wind farm and mini hydropower plants produce circa 70GWh of electricity every year. Benefiting from long economic lifecycles and fully matured technologies, the assets offer ESIF’s investors the potential for stable and attractive cash flows. They are climate-friendly energy sources with no air pollution or toxic byproducts, supportingthe “Affordable and Clean Energy” goal of the UN Sustainable Development Goals (SDGs). There are also social benefits in bringing electricity, industry and commerce to local communities.
Heiko Schupp, Global Head of Infrastructure at Columbia Threadneedle Investments, said: “The ESIF investment team is excited to add the first renewable energy assets to the fund’s portfolio, together generating electricity to power more than 7,000 households. The assets present an attractive investment opportunity for the fund’s investors, enabling them to support Europe’s energy transition away from fossil fuels. Hydropower, for example, accounts for a third of the total electricity generated from renewable energy sources in Europe but is an often-overlooked source of return which is lowly correlated to both traditional asset classes and other types of renewable energy generation. The new investments complement ESIF’s existing sustainable holdings, and we look forward to further building the fund’s clean energy portfolio.”
ESIF is Columbia Threadneedle’s open-ended, evergreen fund investing in European mid-market sustainable infrastructure equity assets. Targeting investments that have the potential to deliver measurable positive environmental and social outcomes, the fund holds a majority stake in Lefdal Mine Datacenter, a unique ‘green’ data centre based in an underground mine in Norway. In consortium with Brittany Ferries, ESIF also owns Condor Ferries, an operator of lifeline freight and passenger ferry services between the Channel Islands, France and the United Kingdom.
Columbia Threadneedle’s infrastructure capability is part of its global alternatives business, offering investorsless liquid, diversifying assets, both as standalone strategies and within bespoke solutions. With the acquisition of BMO's European asset management business completed on 8 November 2021, Columbia Threadneedle manages more than £29.5bn/ €35bn in alternative assets including infrastructure, real estate (UK, Europe and US), real estate securities, private equity, hedge funds and absolute return. The expanded alternatives business is headed by Stewart Bennett, Global Head of Alternatives at Columbia Threadneedle Investments, subject to regulatory approval.
The two renewable energy assets have been sourced bilaterally, building on ESIF’s existing industry relationships, and have been funded on an ungeared basis.
1 https://www.iea.org/reports/hydropower-special-market-report/executive-summary2 Source: Columbia Threadneedle Investments, 31 January 2022
3 https://ec.europa.eu/eurostat/web/products-eurostat-news/-/ddn-20220126-1
4 As at 31 December 2021, Columbia Threadneedle Investments including BMO GAM (EMEA)
5 Source: Ameriprise Financial Q4 2021 earnings release
