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New Energy Capital closes third fund on $325m

The fund is targeting senior and mezzanine debt investments in the North American clean energy sector.

New Hampshire-based New Energy Capital Partners has closed its third mid-market clean energy fund on $325 million.

The mid-market asset manager’s New Energy Capital Infrastructure Credit Fund exceeded its initial target of $250 million. The fund will focus on senior and mezzanine debt investments in the North American clean energy space, NEC chief executive Scott Brown told Infrastructure Investor.

“There has been a real gap in the capital market for small to mid-size projects, particularly for development stage debt,” Brown said. “We believe that the market is mispricing risk in this sector and that we can achieve outsized returns for our investors in that sector.”

The fund held a first close in February 2016 and has since deployed around a third of its capital. Brown said NEC will write cheques between $10 million and $50 million.

NEC attracted commitments from a range of institutional investors including insurance companies, college endowments, family offices, large foundations and public pensions, according to Brown.

Broadly focusing on the clean energy sector, Brown said solar, energy storage and efficiency technologies are areas of particular interest to NEC.

The firm began 13 years ago and has now closed three fundraises. Its inaugural fund raised $60 million in 2004, and its sophomore fund raised $100 million in 2010. Brown said NEC is also advising on a $140 million fund.