Asa Gibson for EnvironentalFinance.com:
Some 12 months ago, Allianz Capital Partners (ACP) reached a milestone when it closed its first renewable energy allocation outside Europe with a tax equity investment in a US wind farm. Since then, the in-house alternative asset manager of German insurance group Allianz has quadrupled its exposure to US wind using the country’s Production Tax Credit (PTC) system.
The most recent was announced last week as a joint investment with Japanese financial conglomerate Mitsubishi UFJ in the Great Western wind farm in Oklahoma, taking ACP’s global renewable energy portfolio up to about €3.7 billion ($3.96 billion) – with roughly €3.5 billion invested in 74 wind farms in the US and Europe.
ACP invests only on behalf of the Allianz insurance group, as opposed to Allianz Global Investors, which takes on mandates across a broader range of asset classes from other institutional and retail investors. ACP manages about €17.8 billion of Allianz’s capital spread across three asset classes: private equity (€9.5 billion), infrastructure (€4.6 billion) and renewables (€3.7 billion).
The firm’s chief executive Juergen Gerke told Reuters in April 2016 that the company intends to double its exposure to renewable energy assets during the next two or three years, and the size of projects to the west of the Atlantic Ocean is proving a major draw.
“One of the appealing things about the US is the project sizes are larger,” says ACP’s head of renewables David Jones.
ACP’s US wind farm portfolio comprises five individual farms with a combined energy output of about 909MW. The company’s total wind portfolio has a capacity of about 2000MW, says Jones.
“Even when one is only investing tax equity or a share of the tax equity with other partners – which is often how these things are structured – the actual ticket size that we typically put into a US project is significantly larger than a European project, which is helping move the needle on our project aspirations,” Jones adds.