The European Investment Bank (EIB) has announced plans to invest in Impax New Energy Investors III (NEF III), an EU renewable energy investment fund.

The renewable energy investment fund aims to invest mainly in the construction of on-shore wind, solar and hydro projects, primarily in selected European countries. The fund's target size is €500 million (US$558 million). The EIB is considering investing about €50 million (US$55.8 million).

The fund follows Impax New Energy Investors, a €125 million fund which reached final close in August 2006, and Impax New Energy Investors II (NEF II), which reached final close in August 2011 with €330 million of capital commitment. NEF II has a diversified investment portfolio across six European countries and successful exits achieved to date.

NEF III, as its predecessors, is expected to invests in projects and in growth companies owning multiple renewable energy projects across Europe. Impax investment targets include:

• renewable energy projects entering the construction phase, which can typically generate positive cash flows within twelve months from the investment and produce both a long-term, predictable yield as well as capital appreciation; and
• growth-oriented, independent power companies developing and operating projects.

Impax's investor base is comprised of leading institutional investors including pension funds, insurance companies and global investment managers. The firm is one of the longest established private equity fund managers in the renewable energy sector.