UK local government pension schemes (LGPS) pool LGPS Central has joined forces with infrastructure investor CVC DIF to co-invest in Low Carbon, a renewables independent power producer.
Last month, global mid-market infrastructure fund manager CVC DIF said it was acquiring a majority stake in Low Carbon, the renewable energy company backed by Massachusetts Mutual Life Insurance Company (MassMutual).
At the time, CVC DIF said insurer MassMutual, a significant shareholder in Low Carbon after forming a strategic partnership in 2021, would continue to support the growth of the business with additional investment.
Low Carbon, which currently manages a 16GW pipeline and a 1GW operational and under-construction asset base, and plans to grow its presence in core markets such as the UK, Germany and Poland.
The company, founded in 2011, aims to bring a 3GW portfolio of operational utility-scale solar, onshore wind, battery storage and co-located assets online in these regions in the coming years.
LGPS Central, investing on behalf of eight LGPS, said the latest investment is part of a wider infrastructure strategy, which “emphasises productive real assets, resilience and the long-term transition to a low-carbon economy”.
Financial details were not disclosed.
The latest partnership extends LGPS Central’s relationship with CVC DIF beyond existing private credit and infrastructure commitments to further scale its dedicated co-investment strategy, the £50bn (€57.8bn) pension pool said.
Nadeem Hussain, head of private markets at LGPS Central, said: “This investment sits at the heart of our infrastructure strategy. Low Carbon’s vertically-integrated model and strong contract profile provide the kind of long-term, productive exposure we seek for our partner funds. At the same time, it supports the UK’s transition to clean energy, contributing to national resilience and the development of a modern, sustainable power system.
“Our partner funds want assets that deliver strong, stable returns alongside broader system benefits, and this opportunity achieves both. We are pleased to expand our relationship with the manager and continue building a diversified portfolio of energy transition assets.”
LGPS Central provides investment management services to its current partner funds, comprising Cheshire Pension Fund, Derbyshire Pension Fund, Leicestershire County Council Pension Fund, Nottinghamshire Pension Fund, Shropshire County Pension Fund, Staffordshire Pension Fund, West Midlands Pension Fund and Worcestershire Pension Fund.
Seven pension funds for Gloucestershire, Hampshire, Isle of Wight, Norfolk, Oxfordshire, Suffolk and Wiltshire, respectively, which were previously part of ACCESS and Brunel Pools, have formally confirmed their intention to join the central England-based pool, bringing the total number of partner funds to 15. Together, they will take LGPS Central’s total managed assets to around £100bn.
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