ALBION Community Power has raised £10 million from Greater Manchester Pension Fund (GMPF) to drive its development of community renewable projects across the UK.
GMPF has joined Strathclyde Pension Fund and the Edinburgh-headquartered UK Green Investment Bank in backing Albion, which has now raised £70m of a targeted £100m to finance its plans.
The GIB and SPF committed £50m and £10m respectively to Albion, which builds, controls and operates community-scale renewable projects, earlier this year.
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Albion announced the latest funding tranche as it unveiled details of its second hydro-electric scheme in the Scottish Highlands.
The £3.3m project, based on the River Arkaig in Lochaber, will generate 2.3 gigawatt hours (GWh) of renewable electricity per year – equal to the electricity consumption of 550 homes.
It will see water diverted from the river down a six-metre drop using a weir, which will turn two 250 kilowatt (kW) Archimedes’ screws to generate power before returning to the river downstream.
The scheme, which will be constructed with Green Highland Renewables, is expected to be completed in February.
Its development is consistent with Albion’s aim to create a portfolio of small, decentralised renewable generation projects closer to sources of demand. The River Arkaig project will connect directly to distribution networks and, Albion said, contribute to a reduction in transmission and distribution losses because of its local nature. It will also cut greenhouse gas emissions.
Councillor Paul Rooney, chair of SPF, said: “Our first priority is always to ensure our members’ financial futures are secure; but to do that while supporting infrastructure, jobs and innovation in the communities where we live and work is something Strathclyde is proud to be at the forefront of in the UK.
“There is clearly a strong and growing appetite among forward-thinking pension funds to diversify their portfolios into this exciting sector.
“Manchester is one of those funds, so it is no surprise to be working with them and the Green Investment Bank to provide funding for innovative, community-focused infrastructure.”
Councillor Kieran Quinn, chair of Greater Manchester Pension Fund, said: “We are excited to be joining GIB and Strathclyde Pension Fund as investors in ACP and we look forward to supporting the continued expansion of community-scale renewable energy schemes across the UK.
“ACP will play a key role in this regard as the pressure to diversify beyond carbon-based energy sources becomes even greater.”
Volker Beckers, chair of Albion Community Power, said: “We are delighted to welcome the Greater Manchester Pension Fund as a new investor in ACP. It is a clear reflection of the growing institutional demand for access to high-quality community-scale renewable energy projects as they have a proven track record of generating strong and stable returns for investors.”