A recent survey of UK pension funds and insurers managing over £350 billion in assets indicates a notable shift towards increasing investments in onshore wind over the next five years. The survey, commissioned by AlphaReal, a specialist manager of secure income real assets, highlights a clear preference among respondents for diversifying their portfolios across various renewable energy technologies.
According to the survey, 85% of respondents expressed a desire for exposure to multiple renewable energy technologies, with only 15% favoring investments in a single technology. Nearly 90% of those surveyed intend to boost investments in onshore wind, already the most popular renewable choice among UK institutional investors, with 67% currently holding allocations. Of these, 30% plan significant increases, while 57% anticipate slight increases.
Battery energy storage systems (BESS) also garnered significant interest, with 63% of respondents currently investing and 57% planning to increase allocations over the next five years. Ground-mount solar, invested in by 54% of respondents, will see substantial increases with 56% planning significant boosts and 15% aiming for slight increases.
Raza Ali, Investment Director of Renewable Infrastructure at AlphaReal, commented, “These findings support our approach of diversifying across renewable infrastructure technologies. There is a complementary energy generation profile between ground-mount solar and onshore wind, and adding BESS could provide further diversification and risk mitigation benefits while ensuring stable returns.”
Ed Palmer, Chief Executive and Head of Sustainability at AlphaReal, emphasized the strategic rationale behind diversification, stating, “Investors recognize the value of diversifying across different renewable energy technologies to capitalize on diverse opportunities.” AlphaReal, with a decade-long experience in managing renewable energy assets, has deployed over £1 billion into assets supporting the clean energy transition and aligning with ESG investment goals.
