The Greater Manchester Pension Fund has pledged £10m to invest in UK community-scale renewable energy projects through Albion Community Power plc.
GMPF joins the UK Green Investment Bank plc (GIB) and Strathclyde Pension Fund (SPF) as investors.
Albion Community Power (ACP) builds, controls and operates community-scale renewable projects across the UK. It is one of the largest single sources of equity funding available for projects in the sector.
GIB and SPF committed £50m and £10m respectively to ACP earlier this year. GMPF’s investment amounts to a quarter of the further capital ACP aims to raise from additional co-investors as it builds a £100m pot of funding for small-scale projects.
GMPF chair and councillor Kieran Quinn said they look forward to supporting the continued expansion of community-scale renewable energy schemes across the UK.
“ACP will play a key role in this regard as the pressure to diversify beyond carbon-based energy sources becomes even greater,” he added.
The news comes as ACP announced a 499 kW hydropower scheme located on the River Arkaig in Lochaber in the Scottish Highlands.
The £3.3m scheme, located on the Achnacarry estate, will generate approximately 2.3 GWh of renewable electricity per year. This is equivalent to the electricity consumption of around 550 homes. It will be constructed in conjunction with Green Highland Renewables and completion is expected in February 2016.
Water will be diverted from the river down a six metre drop using a weir. This will turn two 250 kW Archimedes’ screws to generate power, before returning to the river downstream.
ACP chair Volker Beckers said GMPF’S investment is a “clear reflection” of the growing institutional demand for access to high-quality community-scale renewable energy projects, as they have a “proven track record of generating strong and stable returns for investors”.