Schroders Greencoat yesterday (18 January) launched its new Schroders Capital Semi-Liquid Energy Transition Fund to support renewable technologies such as solar, wind, hydrogen and battery storage.
Greencoat, which is the renewable and energy transition infrastructure manager of UK-headquartered asset management giant Schroders, has assets under management (AUM) worth $1.4 billion (£1.1 billion) across a number of geographies including the UK, Europe and the US.
A semi-liquid structure allows funds the chance to invest in long-term illiquid infrastructure projects. Semi-liquid funds invest in private equity, with investors committing their capital at the time of subscription. In doing so, this offers “greater flexibility and operational simplicity to investors,” Schroders said.
The firm stated that the Article 9 Fund will make investments into what it calls the “backbone of the energy transition” and includes large-scale wind farms and solar parks. Alongside this, it will also target other infrastructure contributing to the energy transition such as clean hydrogen, battery storage, district heating, charging infrastructure, power grids and carbon capture technology.
All of these areas are set to benefit from this additional private investment. Power grids, for example, have been the subject of increasing calls from industry to bolster their capacity to ensure grids are able to cope with the growing scale of renewable energy set to be transmitted across them.
For the UK, National Grid ESO has previously said that developing a grid sufficient for net zero by 2030 could be a £54 billion undertaking.
Duncan Hale, portfolio manager at Schroders Greencoat, commented: “The energy transition represents one of the largest and most relevant investment themes impacting clients’ portfolios and, as a result, it’s an exciting and attractive time to be accessing these types of investments.
“This fund highlights our commitment to expanding access to private assets and generating positive returns for our clients through directly allocating to energy transition infrastructure.
Schroders’ renewable ventures
Schroders has been investing heavily into the UK’s energy transition, supporting up-and-coming technologies find their feet across the nation, one of which is green hydrogen.
As previously reported by Current± in May 2023, energy infrastructure development company Carlton Power and Schroders Greencoat agreed on a partnership to build a 500MW portfolio of UK green hydrogen projects by 2030.
To achieve this target, the two firms formed a new joint venture (JV) dubbed Green Hydrogen Energy Company (GHECO) to bolster the UK green hydrogen sector.
A number of projects have also been selected to be included as the first wave of GHECO projects. These include a number being developed by Carlton Power, such as Trafford in Greater Manchester, Barrow-in-Furness in Cumbria and Langage, near Plymouth in Devon.
Schroders has also been involved in EV charging infrastructure and in October 2022, invested €75 million (£65 million) into European-based Fastned. The fast-charging firm stated at the time that it would utilise the capital to expand its EV network that spans across the EU and UK. This would provide a basis to scale EV adoption by providing additional areas to charge.