Global investment manager BlackRock’s arm, BlackRock Real Assets, has hit the final close of its latest global renewable power fund at $4.8 billion, making it the largest independent climate infrastructure fund globally.
Global Renewable Power Fund (GRP) III, which invests in renewable power generation across Americas, Europe, and Asia, attracted commitments from over 100 institutional investors from over 18 countries, the firm said.
The fund is the third vintage of BlackRock’s global renewable power fund series. It seeks to invest across the spectrum of climate infrastructure assets, with a focus on renewable power generation, and energy storage and distribution.
Launched in 2019, the fund has actively begun investing capital and to date has already completed three investments in Europe, Asia, and North America. These investments include onshore wind in Europe, solar in Asia, and distributed solar generation in the US.
Since 2011, BlackRock’s Global Renewable Power platform has invested in at least 250 wind and solar projects globally on behalf of 150 investors. GRP II, a 2016 vintage, and GRP I, a 2012 vintage, are fully invested.
“By sourcing, building, and optimising assets throughout their lifecycle, we believe that renewable power has the potential to generate attractive risk-adjusted returns and stable cash yields for investors with low correlation to the economic cycle,” said BlackRock Renewable Power global head David Giordano.
BlackRock’s foray into the global renewables market comes as the firm believes there will be a shift in global power generation from two-thirds fossil fuels to two-thirds renewables over the next three decades.
The green energy transition is set to continue, with wind and solar power generation alone requiring a $10 trillion investment globally according to Bloomberg New Energy Finance in 2020.
In April 2020, BlackRock raised $5.1 billion for Global Energy & Power Infrastructure Fund III, exceeding the original fund target of $3.5 billion and the original hard cap of $4.5 billion.
“With increasing renewables penetration on power grids globally, substantial investment is required across other parts of the climate infrastructure value chain, including energy storage, energy distribution, and electrified transport,” BlackRock said on its website.