Alpha sees strong AUM growth in renewables business

Alpha Real Capital's (Alpha) specialist renewables team has closed 15 transactions, deploying GBP160 million of equity over the last 12 months.

In total, Alpha’s renewables business, which invests in the majority of UK renewable energy infrastructure types including wind, solar, hydro and other low carbon energy resources, has completed over 50 transactions and invested more than GBP550 million in a portfolio of over 225MW and more than 100 sites, providing predictable, long term cash flows to investors.

Five of Alpha’s acquisitions this year – with a combined investment of GBP57.2 million – were for its Wind Renewables Income Fund (WRIF).  The fund invests predominately in sub 5MW onshore wind assets in the UK, providing investors with secure inflation-linked income of more than 80 per cent and with a duration in excess of 20 years. Its fleet of 41 turbines generates over 50GWh of clean energy a year, enough to power over 16,000 homes, and in the 12 months to June 2020, it achieved above budget generation by 3 per cent and above budget EBITDA by over 5 per cent.

Alpha’s renewables portfolio now generates over 340 GWh of wind, solar and hydropower - enough clean power for over 110,000 homes. The portfolio, which has a weighted average remaining economic life of more than 20 years, generates an annual turnover of more than £50 million. Alpha estimates the annual CO2 offset is equivalent to planting almost 50 million trees.

A notable recent acquisition completed by Alpha’s renewables team was the purchase of Bryn Blaen wind farm in Q1 2020, adding a further 14.1 MW of operational wind capacity to its portfolio. The transaction was acquired on a debt-free basis following repayment of the developer-arranged construction finance. The wind farm, which is located in Wales, will be the highest yielding renewable energy asset in Alpha’s portfolio, adding another six Enercon turbines to Alpha’s assets under management, taking the total number of wind turbines to 99. The project includes an annual community benefit fund of GBP70,000 that will contribute directly to local initiatives.

Will Morgan, Head of Renewables at Alpha Real Capital, says: “As a specialist real asset investment manager we choose UK renewables as an asset class because of its ability to provide investors with long term, secure income from an established and well diversified asset base that delivers predictable performance as well as a positive environmental impact.”