Ares Secures $2.2 B for Climate Infrastructure Capital

Los Angeles-based private equity firm Ares Management Corp said on Thursday it has raised $2.2 billion to invest in infrastructure businesses operating in the renewable energy, energy efficiency, and energy storage sectors.

Ares said it raised $1.4 billion for its inaugural Ares Climate Infrastructure Partners Fund, and an additional $800 million in managed accounts that will be deployed alongside the fund.

The targeted investments will include renewable energy, resource and energy efficiency, energy storage and vehicle electrification, the firm said. Ares said about 50% of the new fund’s capital has already been invested via equity, preferred equity and structured debt in climate infrastructure projects mostly in North America and Europe.

“We appreciate the strong support and confidence from our global investor base as we continue to invest in climate infrastructure as a positive, proactive catalyst for the transition to a low carbon economy,” said Keith Derman, Partner and Co-Head of Ares Infrastructure and Power.

“This is an asset class that has demonstrated resiliency across market cycles and is benefitting from significant tailwinds. With our innovative approach to structuring transactions and benefits from the Ares platform, we believe we are a partner of choice in one of the largest and fastest growing opportunity sets in the infrastructure market.”

“Our climate infrastructure strategy is focused on directly originating essential clean energy investments that have a positive impact on our communities,” said Andrew Pike, Partner and Co-Head of Ares Infrastructure and Power. “We have developed differentiated ESG capabilities that we believe provide meaningful value-add across the investment lifecycle. We are proud that our strategy provides the opportunity to align our clients’ investment objectives with their sustainability goals.”

Ares said it has invested more than $9 billion in about 250 infrastructure and power assets in the climate infrastructure, natural gas generation, and energy transportation sectors. It sold the 302 megawatts Lincoln Land Wind project in Morgan County, Illinois to Danish power company Orsted A/S. Ares has about $282 billion of assets under management.