Even as institutional investors’ appetite for the sector falters, fund manager HMC Capital (ASX: HMC) is pushing ahead with plans to raise a $2 billion clean energy transition fund.
HMC Capital founder and chief executive David Di Pilla has appointed former Labor prime minister Julia Gillard to chair its new Energy Transition Fund which plans to build up a 15-gigawatt portfolio of wind and solar energy generation, battery storage, biofuels production and emerging technologies.
Di Pilla, a former UBS investment banker, said: “There’s a lot of super funds that want to have an impact in this area. If we can create the vehicle that has the true energy impact that the system needs, we think that capital may coalesce around this kind of opportunity.”
Fundraising for the HMC Energy Transition Fund is to be launched in the new financial year.
The investment team will be led by Angela Karl who moved to HMC from QIC Global Infrastructure early this year. Karl was a founding director of Tilt Renewables, in which QIC’s Powering Australian Renewables Fund and AGL are the largest investors, and a director of many other alternative energy companies backed by QIC.
Gillard said the fund would be a “genuine driver” of the transition to zero net emissions by 2050 and she was confident it would generate competitive returns for investors.
“It is in our nation’s interests to better harness our abundant opportunities in solar, wind and other renewable sources of energy,” Gillard said. “In addition, our nation has made commitments to the world on combating climate change which we need to honour.
“To create a clean energy future, we must urgently unlock the full potential of private investment and business acumen. As prime minister I devoted a great deal of my, and my government’s, energy into fighting climate change and this new role is a continuation of that commitment.”
Di Pillar said the fund team would focus on building a portfolio of clean energy assets across wind, solar and energy storage which together would have capacity to provide energy at times when energy demand was greatest and when energy retailers paid the highest rates.
HMC first announced plans for its energy transition investment platform in February.
Image: The HMC fund plans to invest in combining wind and solar generation with battery storage to provide electricity at peak demand times.