According to statements made by both firms, the large Canadian pension fund Ontario Teachers’ Pension Plan has agreed to invest up to one billion dollars in a new offshore wind company that was formed by Australia’s Macquarie Group Ltd. The purpose of the company is to construct renewable energy projects all over the globe.
OTP is one of Canada’s largest pension plans, with $185 billion in total assets. Due to the high level of interest in offshore wind projects, some transactions involving the purchase of these projects have seen significant premiums, such as Equinor’s sale to BP in 2020 of a 50% investment in two U.S. wind farms, which brought the Norwegian business a $1 billion profit. Long-term investors like pension and infrastructure funds are drawn to renewable energy projects because of the steady income they can expect from them. However, they are less likely to invest in projects that have not yet been built or that have not yet secured agreements with consumers to purchase their power.
What’s next: Macquarie and Ontario Teachers’ have signed a contract to invest up to $1 billion in the building of 14 fixed-bottom and floating wind farms in South Korea; Taiwan; Japan; Ireland; the United Kingdom; and the Republic of Ireland.
