London-based Quercus Investment Partners Ltd. has launched its Middle East office in Dubai as investment in renewables gathers momentum across the GCC. Quercus is positioned to become one of the largest European investors in renewable energy within the next five years. The firm now operates from offices in London, Milan and Dubai, with an international senior management team.
The International Energy Agency has said that the world’s capacity to generate electricity from renewable sources has now overtaken coal, which indicates a clear market shift in favour of renewables. European governments are planning to power 20% of production from renewables by 2020, while Dubai’s DEWA has made a solid investment in solar power with its Mohammed Bin Rashid Al Maktoum Solar Park development, the largest single-site solar project in the world.
Commenting on opportunities for GCC investors, Diego Biasi, Co-Founder and CEO of Quercus said:
“In the last couple of years we have seen a lot of interest in renewable energy from GCC investors. This is an ideal moment for us to establish a permanent presence in the region, as GCC member states have announced plans to invest up to $100 billion in renewable projects during the next two decades. Investment in renewables is no longer just a subject of debate among the investment community, and there are plenty of questions around which funds to choose. The UAE has a clear vision for a sustainable future beyond the hydrocarbon era, so it is an ideal market for us to present opportunities for pursuing competitive returns in the sector.“
The global installed capacity for renewables is set to increase by 69% over the next 15 years. Renewable energy sources show resilience against market conditions, and in particular the recently volatile price of oil.
Quercus has built a successful track record over 6 years, and only last week announced the €150 million first close of an innovative set of 3 funds which are targeting €500 million, an annual dividend yield of 6%, distributed semi-annually and an IRR above 11%. The firm has already completed fundraising for two funds that have invested approximately €200 million globally, generating an annual dividend yield of 5% and 6% and an IRR of 9-10%. As Middle East investors eye opportunities to diversify their portfolios, renewables are an increasingly attractive option.
“We launched our latest funds as part of a unique project to combine three separate renewable energy funds to provide investors with choice and flexibility. The €150 million Italian Wind fund will invest in Italian wind projects, the €150 million Italian Solar fund will invest in photovoltaic plants, while the €200 million European MultiTech fund will invest in solar, wind, hydroelectric and biomass projects, preferably in Scandinavia, the United Kingdom and Italy. The funds will capitalise on opportunities presented by fragmentation in the broader European renewable market. The close of these funds will place Quercus among the top 3 renewable infrastructure funds in Europe. We aim to bring funds like these to the UAE, demonstrating our commitment to providing fresh alternatives for local investors and supporting the country‘s ambition to become a major player in the renewables sector,“ Biasi added.