Energy transition

Energy generation, storage and transportation

Changes in the energy market
Changes in the energy market

The European energy market is driven by strong fundamentals. These include but are not limited to the replacement of aging conventional production capacity, climate change related issues, concerns over the safety of nuclear generating plants, and the need to secure energy supply.

The increased share of renewable sources in the energy generation mix, and the separation of electricity production from electricity transmission (as per the Renewable Energy Directive), has set the energy sector into a transitional phase which is causing business models and value chains to reshape. In some geographies the utility sector presents new investment opportunities for investors with appropriate industrial skills, financial resources, and agility.

The increasing consumption of renewable energy has revealed a number of additional target markets that support the integration of renewable energy into grids, and that go beyond simply adding new generating capacity. Current power transmission and distribution networks continue to age, struggle to cope with the additional load, and are not designed to bear continuously increasing amounts of electricity produced from intermittent renewable energy sources.

Aquila Capital believes there are significant capital requirements for additional capacity in terms of energy generation, storage, transmission, distribution and efficiency within Europe. Some of these technologies, such as transmission and distribution, are mature, while others, such as energy storage, have experienced a major commercial breakthrough in recent years, making them more cost-competitive under the right  conditions.

Investment strategy
Investment strategy

The objective of an investment in this market is to provide its investors with attractive risk-adjusted returns through investments in energy infrastructure with geographic focus within the EU and the EFTA, with the possibility of investing in other OECD-Europe countries.

This will be achieved by building a diversified portfolio of investments predominantly in greenfield, but also brownfield, renewable energy infrastructure assets in selected geographies.

The investment stragegy will seek to acquire controlling stakes in 12 to 15 assets, although minority investments are not excluded over the investment period.

Aquila Capital will implement its tested value-creation solutions throughout its portfolio advisor services. Each step of the investment life-cycle will be driven by its specialised investment team that has deep industry expertise.

The value creation strategy of the portfolio is based on proactive sourcing of attractive opportunities in the greenfield mid-market sector, a stringent asset selection process, and active management of the assets.

The investment strategy is accompanied by Aquila Capital’s supporting departments: Structuring, Risk Management, Compliance, and Valuation.

Current investment opportunities

Aquila Capital Energy Transition Infrastructure Fund SCS*to fund portrait

* The official name of the fund is: Aquila Capital Infrastructure Fund SCS, SICAV RAIF

In addition to investment opportunities in fund structures we also desgin tailor-made investment solutions in the form of individual mandates or specific investment strategies and their implementation.

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