April 2023 - DIF Capital Partners

DIF Capital Partners (“DIF”) is pleased to announce that it has signed an agreement to invest in Pinnacle Power Limited, a leading UK district heating platform, to accelerate its growth and fund the development and ownership of city-scale district heating networks across the UK. The transaction will see DIF owning a significant majority in the company, with the management team retaining a minority stake. This is following an agreement with Pinnacle Power’s previous shareholder, Pinnacle Group Limited. DIF’s investment will be executed through its DIF Infrastructure VII fund.

Pinnacle Power is a leading developer and turn-key contractor in the UK district heating market. Founded in 2012 and headquartered in London, the company has a successful track record, having delivered over 100 projects since its inception. Notably, it has developed and is the operator of the £87m Greenwich Peninsula network. With 87MW of heat capacity and servicing 15,700 residential units, this is one of the largest city scale networks in the country.

District heating networks are widely expected to play a crucial role in the UK’s journey to net zero. Today, heat-related activities are the biggest contributor to greenhouse gas emissions in the country, representing 37% of total emissions. District heating networks are a cost effective, low-carbon solution to traditional gas boilers in urban locations. As a result, the country’s district heating market is widely expected to undergo a sustained period of high growth, with substantial capital investment required to meet these net zero ambitions.

Gijs Voskuyl, Partner and Head of Infrastructure at DIF Capital Partners, said: “We share Pinnacle Power’s view that district heating networks will play a pivotal role in the energy transition story of the UK. We are impressed with what the Pinnacle Power management team has achieved to date and firmly believe in their ability to grow the business, backed by strong regulatory tailwinds. Pinnacle Power represents a compelling investment proposition for DIF, with an opportunity to invest in a build-to-core sustainable energy platform operating in a rapidly growing market.”

Commenting on the transaction, Toby Heysham, CEO of Pinnacle Power, said: “As recognised in the Government’s Energy Security Plan, heat networks will play a critical role in delivering affordable, low-carbon heating, and help hit the UK Government’s legally binding carbon targets. We are excited to be working with DIF to deploy the scale of investment this market needs. We know that the industry needs to deploy at least £60-80bn into low-carbon heat networks to unlock the vast amount of local, wasted heat and deliver that heat into homes and businesses. Many towns and cities have declared climate emergencies but very few have credible solutions to the ‘heat challenge’. This investment offers a clear pathway to achieving decarbonisation, through local investment in locally generated, low-carbon heat.”

Peregrine Lloyd, Group CEO of Pinnacle Group, said: “This agreement is the culmination of a ten-year journey since founding Pinnacle Power. I am incredibly proud of the work our management team has done to grow and nurture Pinnacle Power to see it become one of the country’s leading heat network platforms. The time is now right to hand over the reins to DIF, who will take Pinnacle Power to the next level and enable the scale of investment needed in the energy market. I look forward to following this exciting next phase in Pinnacle Power’s development.”

DIF was advised by AFRY, Deloitte, Evolution Infrastructure and Travers Smith. Pinnacle Power and Pinnacle Group were advised by Eversheds Sutherland and Opus Corporate Finance.

About DIF Capital Partners

DIF Capital Partners is an independent infrastructure fund manager, with more than EUR 15 billion of AUM. DIF was founded in 2005 and has built a leading position in managing mid-market investments, primarily in Europe, North America and Australia.

DIF follows two strategies: its traditional DIF funds invest in lower risk mid-sized infrastructure projects and companies in the energy transition (incl. renewables) and utilities sector, as well as PPPs and concessions. The firm’s CIF funds invest in small to mid-sized companies that will thrive in the new economy. These companies are typically active in the digital, energy transition and sustainable transportation sector.

With a team of over 210 professionals in 11 offices, DIF Capital Partners offers a unique market approach combining global presence with the benefits of strong local networks and investment capabilities. DIF is located in Amsterdam (Schiphol), Frankfurt, Helsinki, London, Luxembourg, Madrid, New York, Paris, Santiago, Sydney and Toronto.

For more information, please visit www.dif.eu

About Pinnacle Power

Pinnacle Power is a heat network provider in the UK. We provide, build, own and operate services for a large number of heat networks around the country. Pinnacle Power was started in 2012 by Pinnacle Group and management. Since then, it has grown to be one of the leading heat network providers in the country. Pinnacle Power is currently designing and building a number of schemes for local authorities across the UK as well as operating networks and running a heat utility. Pinnacle Power have offices in London, Carlisle, Sheffield and Copenhagen.

For more information, please visit www.pinnaclepower.co.uk

About Pinnacle Group

Pinnacle Group is a community-facing, people-first business that delivers, manages, and maintains communities and places where people live, work, learn and play including a portfolio of 75,000+ mixed tenure homes and, 200+ schools as well as open spaces, public and private buildings, retail, distribution centres and manufacturing.

Formed in 1994, Pinnacle is a trusted service provider to both public and private sectors; employing 3,700+ people and operates across the UK from over 200 delivery locations.

For more information, please visit www.pinnaclegroup.co.uk

Contacts:

DIF Capital Partners:

Diederik Heinink, d.heinink@dif.eu

Pinnacle Power:

enquires@pinnaclepower.co.uk

Pinnacle Group:

Aisling Jamieson-Ewers, +44 (0)75 5281 0514 / Mia Dexter, M: +44 (0)73 1137 0065

PinnaclePress@headlandconsultancy.com

DIF Capital Partners is pleased to announce that it has agreed to acquire a majority equity interest in US-based Green Street Power Partners (“Green Street”), a leading developer, financier, owner, and operator of distributed generation solar projects for various private and public clients across the US. DIF’s investment will be executed through its DIF Infrastructure VII fund.

Since its inception in 2014, Green Street has experienced rapid year-over-year growth driven by its experienced executive management team and extensive network of industry relationships. Headquartered in Stamford, Connecticut, Green Street has developed a 300+ MW portfolio of operational and under-construction projects throughout the country.

Green Street has over 2 GW of solar projects in its pipeline in both existing and new markets, which it will look to execute over the near-to medium-term. Green Street is well positioned to accomplish its development goals, utilizing its vertically integrated capabilities across development, legal, project financing, engineering, and project and asset management functions.

In addition to existing and upcoming renewable energy goals, execution of the growing development pipeline is further supported by the recently passed Inflation Reduction Act, providing a long-term runway of supportive renewable energy legislation long awaited by developers, sponsors, and market participants alike.

In 2023, Green Street’s projects nationwide will produce over 275 million kWh of energy, displacing over 200 thousand tons of CO2.

The transaction is subject to customary conditions and approvals and is expected to close in early Q2 2023.

“Green Street is very excited to be partnering with DIF. As a leader in distributed generation in the US, the partnership will enable Green Street to continue its growth efforts and execute on its 2 gigawatts and growing of pipeline,” said Jason Kuflik, President of Green Street. “We are excited about what we will be able to accomplish together. As a leading global infrastructure fund, we could not have picked a better partner.”

Green Street was advised by Scotiabank and its legal counsel Orrick, Herrington & Sutcliffe LLP in connection with this transaction.

“The partnership with Green Street will further grow DIF’s North American renewable portfolio and marks our first distributed solar generation platform in the North American market”, said Gijs Voskuyl, Partner and Head of Infrastructure at DIF Capital Partners . “DIF is excited to work with the Green Street team to continue developing and operating distributed solar projects across the US to further advance the global clean energy transition, one of DIF’s responsibilities as a leading infrastructure investor. Supported by strong thematic tailwinds in the US, we see this as an excellent opportunity to support a strong team in their goals to become a leading distributed generation developer and asset owner.”

DIF was advised by Macquarie Capital and its legal counsel Stoel Rives LLP in connection with this transaction.

About DIF Capital Partners

For more information, please visit www.dif.eu.

About Green Street Power Partners

Founded in 2014, Green Street is a national developer, financier, owner, and operator of solar energy systems benefiting businesses and communities across the country. Green Street specializes in structured finance for solar assets, securing sponsor and tax equity alongside project-level debt financing to realize the highest value for its clients.

Green Street’s proven dependability, experience within the industry, and established portfolio of 300+ MW of operational and under-construction projects, underpin its success as one of the leading solar developers and owners in the country.

Green Street strives to continue this growth while staying committed to corporate social and environmental responsibility, as we sustain our environment for future generations through solar power. We view this responsibility as a fundamental part of our business, and we consistently work to inspire these values in our employees, partners, and customers. Green Street currently has 58 employees and is headquartered in Stamford, CT with a legal office in Tallahassee, FL.

For more information, please visit www.gspp.com.

DIF Capital Partners invests in leading UK district heating company Pinnacle Power

DIF Capital Partners agrees to acquire majority interest in US-based solar platform Green Street Power Partners