Canadian and Dutch pension funds are reportedly considering investing in an Indian renewable yieldco, according to a report by CleanTechnica. The yieldco, which is expected to be launched by Indian renewable energy company ReNew Power, will be the first of its kind in India and will focus on acquiring and operating renewable energy assets.
A yieldco is a publicly traded company that owns renewable energy assets such as wind farms and solar power plants. The company generates revenue by selling the electricity produced by these assets to utilities and other customers. Yieldcos typically pay out a portion of their earnings to investors in the form of dividends.
ReNew Power is one of India’s largest renewable energy companies, with a portfolio of over 4 GW of wind and solar power projects. The company is reportedly planning to launch its yieldco in the next few months, with an initial public offering (IPO) expected to raise around $600 million.
According to CleanTechnica, the Canadian Pension Plan Investment Board (CPPIB) and Dutch pension fund manager APG Asset Management are among the investors considering investing in the yieldco. Both CPPIB and APG have significant experience investing in renewable energy assets, with CPPIB having invested over $8 billion in the sector since 2016.
India has set a target of achieving 175 GW of renewable energy capacity by 2022, including 100 GW of solar power and 60 GW of wind power. The country has made significant progress towards this goal in recent years, with renewable energy capacity reaching 89 GW as of September 2020.
The launch of a renewable yieldco in India could help to accelerate the growth of the country’s renewable energy sector by providing a new source of capital for project development. Yieldcos have been successful in other countries such as the United States, where they have raised billions of dollars for renewable energy projects.
In addition to providing capital for project development, a yieldco could also help to attract more institutional investors to the Indian renewable energy sector. Institutional investors such as pension funds and insurance companies are increasingly interested in investing in renewable energy assets due to their stable returns and low risk profile.
Overall, the launch of a renewable yieldco in India could be a significant development for the country’s renewable energy sector. With the support of institutional investors such as CPPIB and APG, the yieldco could help to accelerate the growth of renewable energy capacity in India and contribute to the country’s transition to a low-carbon economy.
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- Source: https://zephyrnet.com/canadian-dutch-pension-funds-eye-stake-in-indian-renewable-yieldco-cleantechnica/