LGIM Real Assets, the real estate arm of insurer Legal & General, has provided £57.5 mln (€63 mln) of long-term debt financing to support two solar panel portfolios, which help power nearly 10,000 homes in the UK.
The borrower is Hermes Infrastructure, which is seeking to recapitalise the portfolios. The systems boast a capacity of around 34.52MWp – enough for more than 9,000 residential properties – and feed-in-tariffs which provide a high level of cash flow visibility until maturity in 2033 and 2036.
Welcoming the deal, Tom Sumpster, head of infrastructure finance at LGIM Real Assets, said: 'This is another great investment for us in the renewables sector. Renewable energy now accounts for a third of global power capacity, with wind and solar totalling 84% of new renewable generation capacity in 2018.
‘With the cost of power from wind and solar continuing to fall, consumer demand for clean power is increasing. Further investment in sustainable energy benefits society and provides secure investments to match our pension liabilities and payments.’
Over the past two years, LGIM has invested in three UK offshore wind farms; Walney, Hornsea and Dudgeon.
Explaining the company’s thinking, Nigel Wilson, CEO of Legal & General said: ‘Avoiding climate catastrophe is our greatest global priority. Across the Legal & General group, we have taken many actions in support of the environment by controlling what we do directly, investing in renewables and new science to support de-carbonisation, and by using our investment scale and strength to encourage others to follow suit.'