British pension funds invest in renewables projects

Greater Manchester Pension Fund (GMPF) and the London Pensions Fund Authority (LPFA) yesterday announced they have jointly committed £60 million towards funding the construction and operation of British renewable energy assets.

The investment, which is the first made by the two funds’ £500 million infrastructure investment joint venture, will immediately fund £9 million towards Leeming Biogas, with several more projects soon to be confirmed.

Speaking about the investment, Tameside Council Leader and Chair of the Greater Manchester Pension Fund, Councillor Kieran Quinn, said:

“I’m delighted that our collaboration with the LPFA has made its first investment. The capital we have allocated will allow both Funds to increase investment in UK infrastructure while at the same time delivering the societal benefit of developing renewable energy projects across the country, including the North West.”

Chairman of LPFA, Sir Merrick Cockell, said:

“The steps we have taken with Greater Manchester Pension Fund over the past year are a prime example of how LGPS Funds can collaborate to make investments for the benefit of UK infrastructure and in order to meet their own long-term investment goals. It’s our desire that others will see this success and look to see how they too can be a part of it.”

The remaining allocated capital will be used to target a balanced and diversified portfolio of five to ten UK bioenergy infrastructure projects, financing projects from planning consent through construction, with the intent of holding the operational plants through their economic life.

The GMPF and LPFA joint-venture is actively reviewing several other UK infrastructure opportunities with further investments anticipated in the coming weeks as it seek to fully deploy the initial £500m commitment over the next two years.

On 5 November  2014, Iona Capital announced that Iona Environmental Infrastructure LP (IEILP) had completed the transaction in which it invested in Leeming Biogas Limited, a joint venture company with developer JFS & Associates Limited.

This facility is Iona's twelfth Anaerobic Digestion (AD) plant and will be one of the largest gas-to-grid AD plants in the UK

The plant will process up to 80,000 tonnes per year of commercial food waste produced by local businesses and generate approximately 6,000,000 m3 of biomethane per annum in Yorkshire. The upgraded biomethane will be injected directly into the local medium pressure gas grid where it will be used by households in the area. The plant at Leeming will recycle food waste to provide renewable energy and a bio-fertilizer by-product that will be distributed on local farm land to improve crop production. 

The project has been developed in partnership with JFS & Associates and UTS Biogas, who are the biogas and biomethane upgrade technology provider. CNG Services are providing the gas network entry equipment and Surgo Construction will act as the EPC Contractor for the delivery of the plant. The day to day management of the plant will be provided by Veolia Environmental Services under a long term O&M contract.