Aquila Capital confirms EUR250m hydropower investment

Hydro power

Real asset specialist Aquila Capital has expanded its partnership with Dutch pension investor APG in European hydropower by EUR250 million to EUR550 million. With this new mandate, Aquila Capital’s assets under management increase to EUR10.75 billion.

The investment will facilitate the expansion of Norwegian-based Småkraft AS, the largest operator of small-scale hydropower plants in Europe. It currently has 110 operational plants, producing nearly 1.2 TWh of electricity annually. In late 2018, the company announced its plans to expand in order to produce 2 TWh annually through new run-of-river plants and the acquisition of existing plants. The investment will support Småkraft’s aim of building 10 new small hydropower plants each year.

Roman Rosslenbroich, Co-Founder and CEO of Aquila Capital, says: “We are delighted to expand our long-running and successful partnership with APG. As we increase the share of renewables in Europe, Norwegian hydropower will play a vital role.”

Tor Syverud, Head of Hydropower at Aquila Capital, says: “Our local management and on-site teams are specialized on developing hydro plants. The small hydropower sector is attractive to investors due to the long-term nature of the assets, the technological robustness and its sustainability credentials.”

Patrick Kanters, Managing Director Global Real Assets at APG, says: “As a pension investor, we are continuously looking for attractive infrastructure investments worldwide that help us realize long-term and responsible returns for ABP and other pension fund clients we work for.”

“Over the last years, we have made significant progress in realising our pension fund clients’ stated ambitions in the areas of sustainability and responsible investment. At the end of 2019, we had EUR5.8 billion invested in renewable energy. By increasing our commitment to Småkraft, we are enabling the European energy transition from fossil fuels and contribute to reducing carbon emissions, in line with the ambitions of our pension fund clients. Aquila Capital, with its on-the-ground knowledge and recognised track record on hydro, has proven to be a strong partner for APG.”

In a recent GRESB assessment of Aquila Capital’s assets, Småkraft was awarded the maximum five-star rating. It was ranked second out of 24 in an analysis of the Northern European renewable power maintenance and operation sector.