Clean energy investment firm Aligned Climate has found a sweet spot in distributed solar infrastructure like community solar and solar + storage projects for middle-market companies.
“The US needs new power generation to meet growing electricity demand, and solar energy is the cheapest, fastest and cleanest technology on the market,” said Aligned Climate’s Peter Davidson.
The New York-based fund manager, with $2 billion in assets under management, closed a $240 million fund, its sixth and largest solar infrastructure fund. Aligned Solar Partners fund will acquire ready-to-build solar projects from US development partners in underserved and rural markets and finance the buildouts with a mix of equity and construction debt capital.
Income producing
Aligned Climate plans to package the solar assets into large portfolios to be sold to institutional infrastructure investors. During its management, Aligned Climate will use tax credits to generate cash yield for investors. The future of some of those credits are up in the air as Republicans in Congress hash out a budget and tax bill.
Aligned’s sixth solar fund has already acquired over 25-megawatts of distributed solar and will make its first distributions to limited partners later this year. “We have been investors in this market for more than a decade and understand how solar can deliver consistent cash returns for our investors each year,” Davidson said.
Institutional impact
The fund raise, Aligned Climate’s second this year, drew institutional allocations from insurance companies, endowments, foundations and family offices in the US and internationally.
In March, Aligned Climate closed its second clean energy venture fund, backed with $85 million from the Rockefeller and Ford foundations and other institutional investors. The venture fund targets companies with proven solutions in electric mobility, green infrastructure, sustainable land use and renewable energy generation.
