Over two-thirds of UK pension schemes expect increase in renewable energy investments

Over two-thirds (68 per cent) of UK pension scheme investors expect allocations to renewable energy to increase over the next five years, while 10 per cent expect it to fall, according to research from Alpha Real Capital.

Furthermore, whilst 74 per cent of respondents already invest in the renewable energy sector, only 30 per cent would describe the sector as mature, with 52 per cent classifying it as developing, and almost a fifth (18 per cent) as at an early stage.

Considering this, solar and onshore wind are expected to remain the top two investment areas for the next five years.

When investing in UK renewables, the most important attribute identified by respondents was the ability to invest into strategic infrastructure.

This was followed by attractive risk adjusted returns, asset diversification, and the ability to deliver stable income returns.

Commenting on the findings, Alpha head of renewables, Will Morgan, stated: “Our research supports the view that professional pension fund investors see the UK renewables sector as offering attractive investment opportunities, and plan to increase their exposure here.

“We are seeing growing interest from a range of pension funds in our renewable energy investments.”

Alpha head of client solutions, Boris Mikhailov, added: "With more pension schemes looking to become carbon-neutral, investment in renewable energy infrastructure has significant ESG benefits and can help schemes on their journey to becoming carbon-neutral.

“Alpha's renewables investments currently offset over 75,000 tonnes of CO2 per annum."

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