CapDyn’s clean energy fund closes $287m short of target

The asset manager’s fourth clean energy strategy vehicle originally targeted $750m, but closed on $462.5m.

Global asset manager Capital Dynamics (CapDyn) has closed its fourth clean energy fund, originally targeting $750 million, on $462.5 million.

In a late October interview with Infrastructure Investor sister publication Low Carbon Energy Investor, managing director John Breckenridge had said: “We are raising our fourth fund, targeting $750 million, and we have held multiple closes on it already. We are optimistic on where we are and we have invested a substantial part of it.”

The Clean Energy and Infrastructure Fund (CEI Fund) is CapDyn’s latest clean energy vehicle and takes the total amount the firm has raised for clean energy since 2010 to $1 billion. The fund attracted LPs from North America, Europe, Asia and the Middle East to invest in biomass, landfill gas, small hydro, solar, wind, gas-fired power and co-generation.

It has already made nine investments across the US and the UK, with six of those investments already operational. Breckenridge had previously said the fund had invested in “about 1.1 gigawatt (GW) of gas-fired plants, 500 megawatts (MW) of wind power in the US, and about 60MW of wind power in the UK”.

He was also bullish on the potential for further investments in the natural gas sector, saying: “There’s a great window of opportunity for very efficient natural gas power plants in North America, so we are very active in that space.”

Recently, CapDyn fully realised one of its clean energy strategies, the US Solar Energy Fund, by selling all its assets to TerraForm Power, a SunEdison Yieldco, for $250 million. The fund had a portfolio of 39 solar installations located across five states in the US, generating 75MW of power.

According to Breckenridge, “there was an opportunity in solar, but that opportunity has ended for private equity because the returns are so low. Right now, solar is more of a residential play or a play for utilities or others”.

CapDyn’s clean energy strategy started in 2010. It now manages over 1.3GW of clean energy in North America, Europe and Australia. The firm did not immediately return requests for comment.