Four major Nordic pension funds - PensionDanmark, Industriens Pension, AP2 and AP4 - are investing in Copenhagen Infrastructure Partners’ (CIP) new fund - CI Advanced Bioenergy Fund I (CI ABF I) - a mid-cap green fuel strategy with a target size of €1bn.
Their investments, along with commitments from CIP itself and Danish wind turbine manufacturer Vestas, amount to €375m at the first close of the fund, according to CIP, and PensionDanmark revealed it had invested €100m of that.
Industriens Pension said they made a €60m commitment in the first close. AP2 and AP4, however, declined to reveal the amounts they had individually committed.
Torben Möger Pedersen, chief executive officer of PensionDenmark, said: “Advanced biofuels will provide a strong impact for the green transition of the transportation sector and will furthermore support an even faster independence from Russian natural gas.”
CIP said its fund would focus on equity investments in advanced bioenergy infrastructure in Europe and North America, and would allow institutional investors to contribute to the decarbonisation of “hard to abate” sectors through the production of advanced biofuels and biogas.
It said all investments would be “dark green” - as defined by the EU - and based on sustainable feedstock such as waste wood, and agricultural, household and industrial biowaste. The resulting products would include green gas and green fuels, such as renewable natural gas, liquified natural gas, and 2nd generation bioethanol, the firm said.
Before the fund’s first close, CIP said it had secured ”an attractive portfolio of development stage advanced bioenergy projects in Europe with diverse exposure to feedstock, production technologies, and offtake markets” for CI ABF I.
Jan Østergaard, head of real assets at Industriens Pension, said: “There is no doubt that there are really great prospects in an efficient conversion of organic waste to green gas and green fuel.” This was the first specialised fund in the field, he said.
CIP was established in 2012 by senior executives from Denmark’s Dong Energy (now called Ørsted) in partnership with PensionDanmark, the founding investor.
PensionDanmark said it has invested more than €3bn alongside CIP since 2012.
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