Canadian pension giant CPP Investments has exited two German wind farms with a C$374 million (US$273 million) profit - but it remains committed to renewables as part of its strategy to achieve C$130 billion of transition and green assets by 2030.
CPP acquired a 49% stake in two German offshore wind projects, Hohe See and its extension Albatros, in 2018. They are located 100km from the North Sea coast and began operating in 2019 and 2020, respectively, producing 2.5 million MWh per annum of electricity.
The original acquisition was part of a C$2.25 billion investment in renewable assets owned by Enbridge, which also included North American onshore renewable power projects. The assets included 14 long-term fully contracted operating wind and solar assets in four Canadian markets and two operating assets in the US (one wind and one solar), with a combined installed capacity of approximately 1.3GW.
CPP and Enbridge also entered into a 50:50 joint venture agreement to pursue future European offshore wind projects.
The divestment does not represent a move away from renewables investment by the US$434 billion public pension fund. Bill Rogers, CPP’s Global Head of Sustainable Energies, said, “Since our initial investment in these assets in 2018, the European offshore wind market has continued to mature and we’ve realised solid returns during our ownership.
“The renewable energy sector, and offshore wind specifically, remains an important investment strategy for us, and we will continue to seek opportunities in the sector that best fit the scale and flexibility of our capital.”
In May 2020, CPP acquired a 49% stake in Éolien Maritime France SAS, Enbridge’s partnership with EDF Renewables, for EUR200 million including a commitment to ongoing investment. Last November, the platform brought into operation the 480MW Saint-Nazaire Offshore Wind Farm in France, providing the equivalent of 700,000 households’ electricity needs – similar to the offshore German wind projects. Other wind farms in the platform are located at Seine-Maritime (Fécamp) and Calvados (Courseulles-sur-Mer), with combined capacity of all three at almost 1.5GW, coming into operation in phases over 2022-24.
Enbridge is not CPP’s only partner in renewables. In 2022, the Canadian fund invested a total of EUR1.06 billion to help its European renewable energy platform Renewable Power Capital (RPC) fund a 528MW onshore wind project in Sweden. The four sites are expected to generate power for the grid in the fourth quarter of 2025. The investment lifted RPC’s onshore wind portfolio to 845MW, with locations also in Finland. It also has a 4GW solar PV pipeline in Spain. The UK-based platform was launched in December 2020.
In North America, CPP took control of US wind farms owner Pattern Energy Group in March 2020, taking it private at a total enterprise value of US$6.1 billion, including debt. Since take-over, Pattern Energy has increased its wind farm operating capacity from 4.4GW to more than 6GW with most of its portfolio in North America, plus some plants in Japan.
In CPP’s latest Sustainability Report, published last month, it announced that its sustainable portfolio had rise to C$79 billion, putting it on track to achieve at least C$130 billion in green and transition assets by 2030 – a target it is confident of meeting.