Impact looks to launch second Australian solar investment fund
Australia's Impact Investment Group (IIG) said it plans to create a second solar investment fund after debuting an 11 MW solar farm developed with proceeds from its first fund, launched last year. The company said the second pool would open next year with the aim of raising between AUD100m ($78m) and AUD200m. Its first asset will probably be the 15 MW Swan Hill solar farm in the southern state of Victoria, according to Lane Crockett, IIG’s head of renewable energy infrastructure.

Australia’s Impact Investment Group is planning to launch a second solar investment fund, following the runaway success of its first solar fund last year.

On Thursday, Impact celebrated the formal opening of the 11MW Williamsdale solar farm in the ACT, one of three solar farms contracted by the ACT government at the start of its goal to source the equivalent of 100 per cent of its electricity from renewable energy by 2020.

Williamsdale, which actually came on line earlier this year, was the first asset in the original solar fund, which attracted $100 million in less than two days from high net worth individuals, self-managed super funds and one institution, Future Super.

That fund aimed to deliver a return to investestors of 10 per cent per annum, and such was its success that Impact is now looking at a second fund, with the first asset likely to be the 15MW Swan Hill solar farm in Victoria, that is building on a “merchant basis”. A pipeline of other assets is also being put together.

“The smartest investors and developers in the country aren’t trying to eke another few years out of old unreliable, polluting coal-fired infrastructure,” said Lane Crockett, IIG’s head of renewable energy infrastructure.

“They are building the clean generators that will deliver reliable electricity, crucial environmental benefits, health benefits and attractive financial returns. Meanwhile, our investors have confidence knowing that the ACT government has committed to buying the farm’s electricity for 20 years.”

Crockett told RenewEconomy that the second fund would likely be launched next year, aiming for between $100 million and $200 million, once the pipeline of proposed solar projects in Victoria, Queensland and NSW is in place.

He said that there are two sweet spots in the Australia large scale solar market right now – one between 10MW and 30MW in size, and the bigger installations of 100MW plus.

“The benefit of the smaller solar farms is their speed to market …. and the ability to locate them in places where you can’t put bigger ones,” Crockett said.

“Solar costs have come down significantly over the last 3-4 years, it’s advantaged by its time of day generation portfolio, and its speed to market. It’s predictable, reliable technology, and it is well received by communities in regional areas.”

ACT climate and energy minister Shane Rattenbury said Williamsdale is the fourth large-scale solar farm built in the ACT. It joins the Royalla Solar Farm, Mt Majura Solar Farm and Mugga Lane Solar Park in completing the “solar highway”.

“The future is here, and it is clean, green and renewable. The clean power generated by Williamsdale Solar Farm takes us another significant step towards achieving our target of 100% renewable electricity by 2020 in the ACT,” he said in a statement.

“The ACT is establishing itself as a world leader when it comes to investment in renewable energy and action on climate change. Already, renewable energy has driven around $500 million of investment into the local economy.”

“By 2020, the ACT will produce 100% of our electricity from renewable sources like wind and solar and, by 2050 at the latest, our city will produce zero net greenhouse gas emissions.”