Mirova raises €857m in Eurofideme 4 funding round for renewables

• The investment manager is now Europe’s largest renewable energy fund. The €1.3 billion group already has a 1.8 GW generation portfolio.

French sustainable investment manager Mirova has become the largest renewables fund in Europe after its fourth funding round.

The Natixis Investment Managers subsidiary on Tuesday said it had closed a financing round worth €857 million for its Eurofideme 4 clean energy fund. The latest backing takes Mirova’s portfolio to €1.3 billion worth of unlisted renewable energy assets.

Regular backer the European Investment Bank was again involved, as part of the Investment Plan for Europe – the “Juncker Plan” – but Mirova said it had also attracted new investors.

Mirova opened its renewables funding pot to invest in France’s nascent wind market in 2002, raising an initial €46 million. A second funding round secured €94 million in 2009 and Eurofideme 3 generated €350 million in 2016. Thus far, Mirova has invested in 180 clean energy projects with a total generation capacity of 1.8 GW and the rising volume of contributions indicates increased confidence by institutional investors in renewables.

Rising confidence

“Institutional investors’ interest in Mirova Eurofideme 4 provides evidence of the relevance of renewable energy as an uncorrelated and efficient asset class in a context of low interest rates,” said Raphaël Lance, head of Mirova’s energy transition funds. “This also demonstrates the increasing need, regarding climate emergency, to target investment towards [being] in line with the [maximum] 1.5 degrees Celsius [global temperature rise] objective.”

The Mirova-Eurofideme 4 fund will invest in solar, onshore wind, hydropower, biomass and biogas projects with the possibility of venturing into e-mobility, hydrogen and battery storage.

Having been authorized to accept investors from France, Italy, Spain, Luxembourg, Slovenia, South Korea and the U.K., Mirova has already allocated €300 million of the €857 million raised for 600 MW of renewables generation capacity in France, Portugal, Norway and Spain.

European performance

The French fund is doing its bit to reverse a slight fall in European investment for renewables with Bloomberg New Energy Finance in July publishing figures which indicated finance was down 4% in the first six months of the year, compared to the same period of last year. Spain bucked the overall European trend, according to BNEF, with a 235% first-half increase to $3.7 billion (€3.36 billion), followed by Sweden, with a 212% jump to $2.5 billion. The U.K. also saw increased investment, up 35% to $2.5 billion and Ukraine performed well, with a 60% increase to $1.7 billion.

France saw first-half renewables investment fall 75% to $567 million according to July’s figures, and Germany lost 42% to $2.1 billion. The Netherlands’ performance mirrored Germany, with a 41% retreat to $2.2 billion.

BNEF reported global financing for utility scale renewables projects fell 24% to $85.6 billion, a development the consultant attributed mainly to falling levels of investment in China. By contrast, investment for small scale systems – those with less than 1 MW of generation capacity – rose 32% to $23.7 billion.