Renewable energy: a profitable asset class for the future
Investors who take a long-term approach need to feel a trust in their assets that goes far into the future. Investment in renewable energies is based on a stable megatrend and offers above-average, long-term potential for returns. Its ecological added value means it also offers institutional investors an ESG-compatible capital investment that generally fits well with in-house activities in the environmental, social and governance sectors.
Fund solutions for professional investors
Whether insurance companies, pension funds, pension pools, churches or foundations, institutional investors value the greatest possible degree of predictability, together with a balanced ratio of risk to return. And so, many professional investors are taking a greater interest in solar and wind energy portfolios when it comes to strategic asset allocation.
That is because these investments offer:
- Specific security through investment in real assets
Investments go towards the construction and operation of renewable energy plants, and are therefore held in physical assets with tangible asset value.
- Risk-appropriate returns – protected against inflation
Target returns from renewable energies are significantly above the current low interest environment and are also risk-appropriately adjusted in the FR I Energy Investment offering. While financial assets, such as bonds, generally decrease in value in a high-inflation context, the real price of tangible assets generally stays stable or increases. Tangible asset investments therefore offer the opportunity to achieve yields exceeding the average interest level and inflation rate, and can therefore be protected against inflation-related decline in assets.
- Stable cash flow
Remuneration of power production ensures continual and predictable income, and forms the basis for ongoing disbursements.
- No correlation with share and bond markets
Tangible assets have their own value, meaning that their development is broadly independent of share, bond, real estate or commodities markets.
- Optimised risk/return profile due to portfolio diversification
In its funds, FR I Energy Investment GmbH follows the principle of spreading risk across a mix of different renewable energy technologies in various investment countries, at several sites.
- A sustainability concept (ESG): measurable environmental impact, ecological value
Renewable energies are the pillar of the energy transition, which is driven by political will. This is because the production of electricity at emissions-free power plants is 100% carbon-neutral. Renewable energies therefore make an effective contribution to climate protection, with measurable results. For example, a single 3 MW wind power plant reduces the burden on the environment by around 14,300 tonnes of CO2 per year, and has potential to meet the power needs of around 6,400 households, with 9 million kWh.