Quercus officially launches new renewable energy infrastructure funds
Quercus announces the launch of the Quercus Italian PV fund and the Quercus Italian Wind funds that will complement the recently launched Quercus European Renewables fund to raise a combined EUR 500 million.
Quercus Assets Selection, which specializes in infrastructure investments with a focus on renewable energy, announces that it has officially launched two new renewable energy infrastructure funds, bringing the total number of funds in its portfolio to five.
The new funds will have a long-term investment horizon of a minimum of 10 years and a targeted Internal Rate of Return (IRR) per annum of 8-10%, rising to 9-11% in the case of Quercus Italian Wind fund.
Investment in renewable infrastructure provides stable, long-term returns with a low risk profile that generates sustainable and predictable cash flows de-correlated from the fluctuations of financial markets. The funds therefore represent an ideal investment for long-term institutional investors, whose investment style is characterized by risk aversion and the need for capital protection.
The three new Quercus funds facilitate participation in an attractive renewable energy marketplace that continues to offer significant investment opportunities. It is estimated that the proportion of global electricity generated from renewable sources will double in the next 25 years, reaching 46% of all electricity produced worldwide in 2040 compared to 23% today.
In this global scenario, the Italian market is particularly attractive, given its stable policy with regard to incentives and its focus on renewable sources which are given grid priority. The Italian market is the fourth largest in the world for installed PV capacity (18.3 GW) and 9th for wind power (8.7 GW). The high degree of asset fragmentation in this large market presents significant opportunities for consolidation for players capable of financing, sourcing and executing on such opportunities.
Diego Biasi, co-founder and CEO of Quercus commented: “We look forward to further building on our established track record through the launch of these two new funds. In addition to generating attractive returns that are unaffected by the fluctuations of financial markets, these projects provide capital protection as well as stable, long-term cash flows. “Quercus funds are therefore an ideal investment for pension funds, foundations, banks, and qualified investors. Our knowledge of the market and track record means that we can rapidly source and identify the best opportunities in order to optimize the asset allocation of the portfolio.”