Image credit: Jonathan Riley / Unsplash
Rooftop solar, energy storage and other less-mainstream green energy technologies are among the targets of a new colossal renewable fund, the creation of the world’s largest asset manager.
BlackRock – a group claiming this year to hold nearly US$7 trillion in assets – said this week it has amassed over US$1 billion in its efforts to raise capital for its latest fund for global renewables, the third of a series it launched in 2011.
The first US$1 billion, collected from 35 American, European and Asian institutional investors, takes the Global Renewable Power III (GRP III) fund closer to its US$2.5 billion final target. The “record” raise was achieved within six months from GRP III’s launch in Q2 2019, BlackRock told PV Tech.
Contacted by this publication, a spokesperson provided a timetable for when GRP III should hit final close – around Q4 2020, they explained – and shared specifics on where and how the fund will invest as it seeks to grow a portfolio in global renewables.
According to the spokesperson, GRP III will focus on wind and solar plays in OECD markets, a group spanning Europe, the US, Turkey, Australia, Japan, Israel, Chile and others. In principle, the fund’s US$2.5 billion pot will be equally split between the US, Europe and the Asia-Pacific region.
Quizzed over the solar investment highlights of the new fund, the spokesperson added: “GRP III continues to evolve with the market, and we see increased opportunity in commercial & industrial (C&I) solar, alongside adjacent sectors such as energy storage.”
Global financiers set sights on batteries, grid investment
The addition of a third fund looks set to further grow the sizeable portfolio BlackRock has assembled in the renewable space. The firm claims to have invested in 250-plus wind and solar projects worldwide via the GRP platform, a fleet it says could cover the power needs of 19 million homes.
Over the past year, the trillions-worth giant has been active on the utility-scale front, with moves in the UK, Mexico and others. At the Large Scale Solar Europe summit in Lisbon in March, the firm appeared confident in the future success of subsidy-free solar across all European markets.
The past few months have seen BlackRock also target small-scale solar specialists in the US. The investor has come to control significant portfolios via the purchase of a stake in NYC-based CleanCapital in April and a separate holding in Distributed Solar Development in July.
BlackRock links its green energy ambitions to the “US$10 trillion opportunity” created by the global transition to PV and wind. Having noted the rising levels of renewables worldwide, the firm is also keen on the underinvested technologies – storage, distribution – needed to shore up power grids.
The asset management giant’s move towards underfunded, less-mature renewable segments mirrors comparable shifts by state-run financiers. The European Investment Bank and Australia’s CEFC have both signaled plans to start redeploying support onto storage batteries and grid stability.
The refocusing on storage funding coincides with progress with the economic viability of these systems. In early November, consultancy Lazard identified drops in levelised costs of storage (LCOS), particularly for lithium-ion batteries and solar-plus-storage hybrids.
Feb 03 - Feb 04, 2021
The business of solar is changing, as the industry scales up, technology, IT and new players to the market will add complexity. This sparks a host of opportunities such as co-location of solar and storage and the rise of unsubsidised solar projects as well as challenges which will question the very business model of European solar asset owners. Solar Finance & Investment Europe is the meeting place for institutional investors, sovereign wealth funds, solar, wind and storage funds and large energy buyers to do business.