Private Markets

Capital at risk. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy.

Impax is one of the longest established private markets managers in the large and rapidly growing renewable energy sector. The firm manages three new energy funds that follow an industrially-focused value-add strategy, investing in renewable power generation and related assets.

History of the New Energy Strategy

The funds:

• Impax New Energy Investors (NEF I) is a €125 million fund which reached final close in August 2006. NEF I made onshore wind and PV solar investments across Europe and invested in its first construction projects in 2008.
• Impax New Energy Investors II (NEF II) built upon the activities of NEF I with a continued focus on European renewable energy investments. NEF II, which reached final close in August 2011 with €330 million of capital commitments, was deployed across a diversified investment portfolio spanning seven European countries. In 2011, NEF II made its first platform acquisition, acquiring development teams and pipelines in France and Germany. By 2016 the Fund had returned all of the capital back to investors and today the Fund is nearly fully exited, having realised multiple successful exits.
• Impax New Energy Investors III (NEF III) continues the successful strategy of NEF II, with an increased focus on development partnerships in key European countries. NEF III, which reached final close in May 2018 with €357 million of capital commitments, has currently made eight investments in five European countries, including a small-hydro platform in Norway.
• Our investor base is comprised of a geographically diverse mix of leading institutional investors including pension funds, insurance companies, asset managers, foundations and family offices.

The sectors:

• As a dedicated European renewable energy specialist, the funds invest across European countries and across commercially proven technologies (principally in onshore wind, solar PV and small-hydro). The team will selectively look at opportunities in related sectors such as renewables enabling infrastructure and demand-side opportunities.
• The funds invest into both single assets as well as development teams with pipelines of projects. We invest in projects and portfolios at various stages of development though we find the most value in entering during late-stage development and taking projects through construction, employing a buy-build-sell approach.
• Our team has deep sector experience stretching back to the 1980s and has successfully executed transactions across many European countries.

The strategy:

Impax takes a value-add approach to investing seeking to deliver superior risk-adjusted returns to investors. We focus on risk management and certain downside protections through careful deal structuring, contracting and operational management. We also seek to take advantage of what we see as an excellent market opportunity with our industrially-focused track record and expertise.

Market opportunity

• Attractive market created by ambitious EU renewable energy targets, a global consensus around the Paris Agreement, the widespread ageing and phasing out of existing power plants and nuclear and the increasing importance of lessening the reliance on energy imports.
• Strong regulatory support with feed-in tariff revenues in the long-term. This is complimented by the growing subsidy-free market as renewable energy technologies continue to decline in cost and improve in efficiency, enabling renewable energy projects to achieve grid parity across many European countries.
• A fragmented market which, we believe, is ready for consolidation as large financial investors and utility power generation companies look to buy scaled operational renewable energy portfolios.

Our industrial approach to adding value

• Over 15 years as a dedicated European renewable energy specialist with a proven track record in developing and constructing renewable energy assets.
• Experienced multilingual team with broad networks and access to strong proprietary deal flow.
• In-house specialists focused on technical management, commercial management and debt finance.
• A focus on risk management and certain downside protections through careful deal structuring, contracting and operational management.
• Returns driven by creation of intrinsic asset quality, not excessive financial leverage.