German investment company Climate Endowment Group has teamed up with eHydro500 to launch the Climate Endowment Hydropower Fund (CEHF), with the aim of creating a portfolio for institutional investment covering mid-sized hydroelectric power plants across Europe.
The German fund focuses on investments in European hydroelectric power plants, is expanding in Central Europe and is now one of the top 5 investors in the sector in Europe.
The Climate Endowment Group is a German climate-focused investment company employing a multi- class endowment approach. Pioneered by Yale and Harvard university endowments, which, for more than two decades, have been leaders in diversified multi-asset-class, this approach allows for attractive annual returns with moderate risk.
EHydro500 is an investment advisor specializing in hydropower. Its team consists of experienced hydropower specialists led by founder Dr. Gilbert Frizberg, who is the 4th generation of his family to be involved in a holding company that has been in existence since 119 years.
The fund focuses on investments in European hydroelectric power plants with an installed capacity of 10 to 50MW, diversified between the construction of new plants (greenfield) and the acquisition and modernization of existing plants (brownfield).
The fund aims to raise €500m to create, over several years, a portfolio based on an identified project pipeline that is suited for institutional investors. The fund will be made available to Swiss professional investors soon.
Hydropower is clean, stable, and proven renewable energy source that plays and will continue to play a major role in the transition from fossil fuel. However, almost 60% of Europe’s total installed hydropower capacity is more than 40 years old and urgently needs to adapt to changing grid and environmental regulations, in addition to new operational standards.
Investment is essential in order to modernize and refurbish existing hydropower plants to increase efficiency, safety and prolong their lifespan. The Climate Endowment Hydropower fund invests in brownfield plants as well as in new hydropower plants in Europe, even if the number of hydropower facilities in Europe is already high, with a total around 30,000 plants and counting.
Since 2018, renewable energy has produced more power than fossil fuels in Europe, and hydroelectric power is the largest provider of renewable energy in the continent, with hydropower plants set to remain a dominant renewable fuel provider in Europe for the foreseeable future.
In last half of 2019 and first of 2020, hydropower has ranked second (contributing 17.5%) behind nuclear plants, which generated 28.2% of all power. Gas and coal/lignite were third (17% and 14.7% respectively), followed by: wind (11.5%), solar (6.5%), then biomass, oil, waste and peat.
Most of the rivers in the south and central Germany are densely covered by hydropower plants. It is the number nine country in Europe for total installed capacity.
Edited by Ramata Diallo