The Greater Manchester Pension Fund (GMPF) and the London Pensions Fund Authority (LPFA) infrastructure partnership has made its first investment – £60m in British renewable energy.
The £500m partnership, Greater Manchester and London Infrastructure Limited (GLIL), said the investment would target five to 10 British renewable energy infrastructure projects using different counterparties to create a balanced and diversified portfolio.
Its first investment is a £9m commitment to Yorkshire-based anaerobic digestion plant, Leeming Biogas, through Iona Capital, an environmental infrastructure manager that will lead further investments for GLIL in other UK bioenergy infrastructure projects.
Leeming Biogas processes an average of 80,000 tonnes of local food waste each year and injects over 600m3 of biomethane gas per hour into the local gas grid.
GMPF assistant executive director Paddy Dowdall said: “Iona was an early mover into the biomass sector and has developed a strong track record. They were obvious partners and we are excited by the pipeline of potential investments. We have underwritten this investment with a double-digit return and an expectation of early cash flows – attractive characteristics for our portfolio.”
LPFA chief investment officer Chris Rule added: “Infrastructure investments provide an attractive opportunity to drive both capital appreciation and inflation-linked cash flows and are well suited to our long-term investment horizon. We are building a diversified portfolio of operational and greenfield assets and are delighted to make this first investment, which will provide equity capital for the development of essential new build energy infrastructure in the UK.”
GLIL said it was actively reviewing other UK infrastructure opportunities as it seeks to fully deploy the £500m over the next two years.
Comments