Quercus launches Italian wind fund

Renewable energy fund manager Quercus Assets Selection is targeting a minimum of €150m to build a 300MW portfolio of wind farms.

Luxembourg-registered fund manager Quercus Assets Selection (Quercus) has launched an investment fund focused on Italian wind farms.

The fund will aim to invest at least €150 million over the next two years in building a portfolio that will generate 300 megawatts (MW).

The fund requires a minimum investment of €10 million and will target institutional investors in Italy and internationally. It will back wind farms that have been operational for between two and five years and which each generate between 20 to 25MW of electricity.

Initially focusing on existing plants in Central and Southern Italy, the fund will have an investment horizon of 15 years and a target internal rate of return (IRR) of between 9 and 11 percent over the lifetime of the plants.

In a statement, Quercus co-founder Diego Biasi said the Italian market is “about to enter a phase of consolidation which presents some very interesting opportunities for Quercus”.

He pointed out that Italy has the world’s seventh-largest wind energy sector but that it is highly fragmented. The largest competitor has a market share of just 13 percent, while 50 percent of installed wind power is held by small operators.

Quercus, which is advised by London-based Quercus Investment Partners, has two existing funds. The Quercus Renewable Energy Fund was launched in 2010 and owns a portfolio of 11 Italian solar photovoltaic plants generating almost 80MW.

Quercus Renewable Energy II was launched in 2011 and invests in “multi-technology” plants across Europe. It has a portfolio of 13 plants diversified by technology and geography which generate more than 120MW.