UK pension funds commit £1.1bn to Greencoat Solar platform

UK pension schemes have backed Greencoat Capital to raise more than £1.1bn (€1.25bn) for its solar funds.

In September last year, Greencoat Capital raised £262m capital by the first close of its Greencoat Solar II fund from some of the biggest UK corporate pension schemes. It also had £295m of capital raised for the previous fund, Greencoat Solar I – a segregated vehicle managed on behalf of a “top tier” corporate pension scheme.

The specialist asset manager dedicated to the renewable energy sector said Greencoat Solar, the platform for Greencoat Solar I and Greencoat Solar II, now has over £1bn in assets under management.

Investors adding to the platform include M&S Pension Trust. 

According to company filings, Solar II has received contributions from the British Coal Staff Superannuation Scheme, the Mineworkers Pension Scheme, and Whitbread Pension Trustees.

Lee Moscovitch, the portfolio Manager and partner at Greencoat Capital, said: “We are really pleased with the reception for Greencoat Solar. To reach over £1bn within two years for what is effectively a new institutional asset class is fantastic and demonstrates the quality of the asset class and the faith our clients have placed in us.”

Simon Lee, the head of M&S Pension Trust and chief investment officer, said: “This asset class is attractive as it provides the opportunity to deliver predictable regulated sterling cashflows and returns in a low rate environment.

“It offers inflation protection so we can meet the Scheme’s liabilities over the long term. We are also supporting the transition of UK energy production to a sustainable low carbon future.”

Solar II is focused on buying for and managing a portfolio of mixed scale, ground mount solar panels in the UK. The fund aims to produce predictable cash flows with high inflation protection and low or zero leverage and intends to hold the assets for their full life.

To date, Greencoat Solar has invested more than £610m of the £1.1bn committed, with 62 projects in the UK and 476MW of solar generation capacity.