--- title: "Schroders Greencoat, JERA Nex acquire 50% stake in two US solar parks; 395 MW portfolio powers more than 100,000 homes" sdDatePublished: "2026-09-04T06:08:00Z" source: "https://www.schroders.com/en-be/be/professional/insights/the-portfolio-case-for-energy-transition-infrastructure/" topics: - name: "energy industry" identifier: "medtop:20000261" - name: "renewable energy" identifier: "medtop:20000257" - name: "electricity" identifier: "medtop:20000260" - name: "infrastructure projects" identifier: "medtop:20001245" - name: "investments" identifier: "medtop:20000378" - name: "artificial intelligence" identifier: "medtop:20001298" locations: - "Manitoba" - "Louth" - "Louisiana" --- Schroders Greencoat, JERA Nex acquire 50% stake in two US solar parks; 395 MW portfolio powers more than 100,000 homes The portfolio case for energy transition infrastructure The portfolio case for energy transition infrastructure For wealth investors, energy transition infrastructure can offer distinct sources of risk and return that set it apart from traditional asset classes – and from broader infrastructure. Infrastructure investing has been through a significant change in backdrop. A decade of low interest rates and abundant liquidity helped push valuations higher across parts of the asset class, particularly around the market peak in 2021. Since then, higher rates have weighed on fundraising and deal activity and contributed to a broader repricing across all private markets, including infrastructure. At the same time, the investment case for energy transition infrastructure has evolved. Geopolitical tensions have made energy security a strategic priority, while electrification, digitalisation and the rise of artificial intelligence are driving structural growth in power demand. For investors, that makes it increasingly important to look beneath the broad infrastructure label and understand the different sources of risk and return within it. Energy transition infrastructure shares some characteristics with wider infrastructure, but its investment drivers can be markedly different, potentially bringing additional diversification and resilience to portfolios. What is driving the opportunity? The scale of investment required is a useful starting point. Global investment in the energy transition reached roughly €2 trillion in 2024. At that time it was estimated that around $28 trillion would be needed over the following three decades under existing government energy transition pathways. The investment required to achieve net zero was estimated at more than twice that sum (see chart below). Investment needed to finance the global energy transition Sources: BloombergNEF, Energy Transition Investment Trends 2025, and BloombergNEF, 2024. Decarbonisation is only part of the story. Energy security and affordability have become equally important policy priorities, reinforced by recent geopolitical events and energy-price shocks. Power demand is also growing. Electrification of transport, heating and heavy industry requires both capital investment to support the transition of these hard-to-abate sectors, but also investment into additional generation, storage and grid capacity. Artificial intelligence is adding another significant source of demand and point of stress for the grid. Policy support has become less consistent in some markets, notably the US. But the underlying economics remain powerful. Renewable energy is often among the lowest-cost forms of new power generation, can be relatively quick to bring online, and can help countries reduce their dependence on imported energy. Meanwhile, growing penetration of intermittent renewable energy introduces risks related to consistency and continuity of power that need to be managed – and expands the opportunities available to managers and investors that can navigate what is an increasingly complex area. As a result, the opportunity set has expanded well beyond wind and solar, although these remain central to both the delivery of the energy transition and the asset class’s investment case. Batteries, grids, heat networks and alternative fuels such as biomethane and green hydrogen are broadening the investible universe. Increasingly, energy transition infrastructure is not simply a bet on renewables, but an investment in the restructuring of how economies produce, distribute and consume energy. What makes energy transition infrastructure different? Asset class labels can obscure as much as they reveal. A wind farm, an office building and a private credit loan may all generate long-dated cashflows, but investors are being compensated for very different risks. Returns from energy transition assets can come from several sources: contracted and often inflation-linked revenues, positive exposure to power prices, improvements in operational performance, and the premium investors expect for holding illiquid assets. A fixed cost base that removes fossil fuels as an input, instead utilising free fuels like sunshine and wind, can provide an additional source of stability. These assets carry exposure to distinct risks including weather and resource availability, evolving technologies, and shifts in regulation and policy. Given the need for investment in these areas, there are corresponding risk premia that supports returns to ensure investors are compensated appropriately. Case study: US solar PV portfolio In August 2025, Schroders Greencoat acquired a 50% stake in a portfolio of two solar parks alongside JERA Nex, the global renewable energy developer. With combined capacity of 395MW, enough to power more than 100,000 US homes, the portfolio comprises two recently constructed assets in the MISO power market, one of the largest liquid power markets covering 15 US states and the Canadian province of Manitoba. One of the assets is a 300MW solar project in Louisiana, which was the largest solar park in the state at the time of the transaction. The investment provides access to high-quality renewable energy infrastructure, with a combination of predictable income and long-term growth potential through exposure to the structural growth of the US power market. Specifically, investment-grade power offtake contracts cover approximately three-quarters of the investment value, while power purchase agreements cover 100% of each project’s output for the first 15 to 20 years. The assets’ expected operating lives of up to 40 years create the potential to benefit from future re-contracting opportunities. The sector itself is also far from homogeneous. A mature wind farm with long-term contracted revenues has a very different risk profile from a battery storage facility exposed to market electricity prices. Battery owners, for example, can combine fixed-price contracts with market exposure depending on the level of risk they are willing to take. This complexity makes specialist expertise particularly important. Experienced managers can bring technical knowledge, execution capabilities and industry relationships, as well as access to opportunities that may not be widely marketed to diversified managers. Of the approximately £13 billion invested by Schroders Greencoat, for example, around 30% has been sourced bilaterally rather than through a broad auction process. Case study: Green digital infrastructure platform In March 2026, Schroders Greencoat announced its first investment into green digital infrastructure with the acquisition of a brownfield industrial site in Ireland, with planning consent for an initial 36MW data centre. Focused on the development of green energy data centres and Energy Parks, initially in Ireland, the platform will focus on opportunities where grid access, land and renewable energy infrastructure can be combined to serve the fast-growing and energy-intensive requirements of hyperscalers driven by AI. The first project in Drogheda, County Louth, is a brownfield industrial site located adjacent to Drogheda Port, with access to existing infrastructure. This investment seeks to provide investors with access to a high growth opportunity, supporting Ireland's next phase of digital infrastructure investment through a green energy solution, supported by innovative new government policy. What can it bring to a portfolio? The distinct return drivers of energy transition infrastructure create the potential for meaningful portfolio diversification. Our previous analysis highlights low year-on-year return correlations with other asset classes, including diversified infrastructure, and negative correlations with some more economically cyclical equity and fixed-income assets (see chart below). Energy transition infrastructure diversification potential Simulated performance is no guarantee of future returns. Source: Schroders Capital, 2026. For illustrative purposes only. There can be no assurance that any objective or intended outcome will be achieved. No strategy can guarantee future results. The views shared are those of Schroders Capital and may not be verified. Based on simulated performance. Returns are based off quarterly prices, covering the period from 31 March 2016 – 31 March 2026. Simulated energy transition returns are constructed using a combined Net Asset Value (including dividend) performance of Schroders Greencoat listed vehicles. All other private asset classes are sourced from pitchbook benchmarks for private assets. Public assets are sourced from Refinitiv, March 2026. Global equities returns is calculated from MSCI World Gross USD prices. Source: Refinitiv, March 2026, Fixed income returns are calculated from Bloomberg Global Aggregate Credit Total Return Index. There is also considerable variety in the risk-return opportunities across the asset class, reflecting the diversity in underlying assets and exposures outlined above. For example, operational renewable assets can provide long-duration cashflows, particularly where revenues are supported by subsidies, power purchase agreements or other contracts. Further along the risk spectrum, newer technologies and growing infrastructure platforms in need of capital to fund additional development and expansion can offer greater potential for capital appreciation. For wealth investors, investment structures are increasingly able to combine these characteristics. Semi-liquid evergreen strategies, for example, may blend a foundation of Core and Core+ assets designed to provide stable income with selected Value Add investments seeking higher returns. Our analysis has shown that including private infrastructure into a traditional listed equities and bonds portfolio can produce higher returns with reduced volatility – and that allocating to energy transition infrastructure in place of diversified infrastructure produces similar returns while further reducing risk (see chart below). Why add energy transition to a portfolio? How might it behave when market conditions change? Resilience does not mean immunity from market falls. But energy transition infrastructure's different economic exposures can affect how it behaves when conditions become more challenging for traditional portfolios. Our simulated analysis of the ten worst quarters for global equities between March 2014 and March 2024 illustrates this point. Global equities returned an average of -7.66% in those quarters, and fixed income -2.93%. Diversified infrastructure returned 1.43% - and energy transition infrastructure returned 3.48%. Inflation provides another example. During periods when UK inflation was above its historical average, the same simulated analysis found that energy transition infrastructure returned an average 3.07% per quarter, compared with 2.64% for diversified infrastructure, 2.57% for equities and -0.75% for fixed income. For wealth investors, this is ultimately why looking beneath the infrastructure label matters. Energy transition infrastructure is neither simply a defensive alternative to equities nor a greener version of traditional infrastructure. Its potential portfolio role comes from a distinct combination of contractual cashflows, real assets, power-market exposure and long-term structural growth. The question, then, is not simply how much infrastructure to own. It is part of the broader question of how to build a diversified portfolio capable of producing resilient returns – and how to construct that through complementary allocations. In our view, a dedicated allocation to energy transition infrastructure can be a valuable part of the mix. Visit our preference center, where you can choose which Schroders Insights you would like to receive. Weekly US Bond Market Update: Warsh’s hawkish reset as the Fed prioritizes inflation Schroder