Strong Nordic Interest in Energy Infrastructure Fund First Close

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Stockholm (NordSIP) – Foresight Group, an infrastructure and private equity investment manager, announced it secured total commitments to-date of €342 million for the Foresight Energy Infrastructure Partners (FEIP) fund, which targets European sustainable infrastructure projects.

Foresight offers Sustainability and ESG reporting services, which cover ongoing monitoring of metrics such as greenhouse gas reduction and greenhouse gas intensity of invested capital, renewable energy generation and diversion of waste from landfill, among others. The new fund’s investment strategy aims to achieve specific decarbonisation objectives in line with the Paris Climate Agreement. It aligns with the UN Sustainable Development Goals (“SDGs”), in particular concerning Affordable and Clean Energy (SDG 7), Industry, Innovation and Infrastructure (SDG 9) and Climate Action (SDG 13).

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“FEIP’s strategy has been designed specifically in the context of the evolving energy infrastructure sector, given the global transition to decentralised, digitised and decarbonised networks,” Dan Wells, Partner at Foresight, commented on the first closing. “While we are delighted with the commitments secured for the First Closing, the team’s focus is on the future and the rapid deployment of FEIP into a high-quality asset portfolio.”

Foresight expects the majority of investments will be made into greenfield projects where it can leverage its experience managing projects during construction to deliver a premium return to investors. The Fund will retain a proportional allocation for investment into operational projects to provide an element of cash yield.

“Building on our track record of sustainable investments made on behalf of institutional investors, FEIP’s strategy has been closely aligned to selected UN Sustainable Development Goals,” Richard Thompson, Partner at Foresight, added. “The portfolio will be structured with the objective of delivering an attractive risk-adjusted return to institutional investors, whilst providing a material and positive environmental and social impact.”

The Foresight team was advised by Stockholm-based Worthwhile Capital Partners, who acted as Placement Agent in the Nordic region. Institutional investors from across Europe made commitments to the Fund, with strong interest from the Nordics, including DNB Liv, Sweden’s PRI Pensionsgaranti, INGKA Group’s IMAS Foundation (IKEA) and several Swedish pension foundations acting through Stockholm-based advisor COIN.

“Foresight Energy Infrastructure Partners is quite different compared to the funds we have worked with earlier,” Christian Andersson, Founder and CEO of Worthwhile Capital Partners tells NordSIP, discussing this fundraising experience. “This fund strategy deploys thoughtful portfolio construction across all sectors necessary for the transition towards a new and clean energy system. This does not only mitigate single technology risk but also benefits from the negative correlation between several of the sectors. The fund, therefore, has great appeal to investors with limited internal resource and that need the long-term and stable cash-flow generation that a diversified new energy portfolio can produce over time.”

Image by Walter Perathoner from Pixabay

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In the current economic environment, even the strongest companies will face challenges from the impact of the COVID-19 pandemic. Perhaps now more than ever, understanding the factors that could have a material impact on a company’s sustainability will play a role in investment decision-making.

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