Copenhagen Infrastructure Partners (CIP), a fund manager within greenfield renewable energy investments and offshore wind, has launched Growth Markets Fund II. The fund has a target size of $3 billion and will focus on delivering renewable energy infrastructure projects reflecting over $10 billion of capital investment.
According to CIP, it will be the largest fund focused on greenfield renewable energy investments in high-growth, middle-income markets.
The fund will specifically focus on developing and building offshore and onshore wind, solar PV, energy storage, and Power-to-X projects in select markets in Asia, Latin America, and EMEA. CIP announced the new fund at the COP28, the 2023 United Nations Climate Change Conference, in Dubai. The fund is a successor fund to the Growth Markets Fund I launched in 2019.
“To reach net zero, we need to bring affordable, reliable, and clean energy to all parts of the world,” Christina Grumstrup Sørensen, senior partner and founder of CIP, said in a statement. “With a continuous increase in carbon emissions, successful deployment of large-scale renewable energy is particularly important in high-growth, middle-income countries. This fund will be deploying significant private capital and therefore ensure renewable projects in countries, where it will contribute to growth and job creation and deliver substantial impact in terms of reducing carbon emissions.”
The Fund’s Role in Expanding Renewable Energy
The renewable energy projects targeted in the fund will enable in more than 10 gigawatts of new renewable energy capacity.
CIP is also setting its sights on middle-income markets, which are expected to grow “dramatically” over the next several decades. The fund is specifically targeting 15 selected high-growth middle-income markets across Asia, Latin America, and EMEA, such as India, Vietnam, Philippines, Mexico, and South Africa. T
These markets are expected to account for 25% of global installed renewables capacity by 2050. Plus, the offshore wind markets in these areas are estimated to expand roughly 50 times from 2022 to 2035.
“This middle-income and emerging markets represent not only a mandatory task for the industry — and we believe that they are also very attractive markets for investors seeking exposure to some of the highest expected growth rates for renewables,” Niels Holst, partner at CIP and co-head of GMF, said in a statement. “They are estimated to account for 25% of global renewable energy capacity by 2050, as economic and demographic growth drives rapidly increasing electricity demand.”