Octopus Renewables has invested in two UK biomass plants on behalf of its funds, one of which is backed by UK workplace pension provider Nest.
The specialist clean energy investor arm of Octopus Group has paid an undisclosed sum to buy the plants with a combined capacity of 85.7MW from a joint venture by Copenhagen Infrastructure Partners and Burmeister & Wain Scandinavian Contractor. The two plants are located in Brigg, North Lincolnshire and Snetterton, East Anglia.
The joint venture completed construction of the £162m (€186m) Brigg plant and the £175m Snetterton plant in 2016 and 2017 respectively.
Octopus Renewables said it will manage both sites, adding to the five biomass plants that it currently manages across the UK.
Last month, Octopus Renewables was hired by Nest to help invest £250m (€287m) of UK defined-contribution pension capital in clean-energy infrastructure this year.
Nest, which manages £16bn of assets from the UK’s auto-enrolment scheme, has entered into the partnership with Octopus, as it seeks to deploy £1.4bn into European renewables by the end of the decade.
Peter Dias, investment director at Octopus Renewables, said: “The acquisition marks a significant step for our fund that has Nest as a cornerstone investor.
“The fund benefits from a healthy pipeline that will help target strong and stable returns. We see institutions and pension funds as playing a vital role in hastening the energy transition and helping to unleash pent up capital to fight climate change.”
Stephen O’Neill, the head of private markets at Nest, said: “We’re delighted to have our account with Octopus Renewables up and running, investing our members’ money into something that should provide steady returns for years to come.
“Biomass is an exciting technology and energy crops, such as miscanthus, could play a significant role in the UK hitting its carbon emission targets. We want to continue investing in the energy of the future and looking ahead for what opportunities will be presented in the drive to the low-carbon economy.”
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