QIC completes equity raise, refinancing for Pacific Energy Group

QIC has completed a $370 million equity raise and $1.6 billion debt refinancing for Pacific Energy Group (PEG) for a contracted capacity of 946 megawatts (MW) across 48 sites.

The equity commitments came from investors across Australia, Asia and North America, and takes the total amount of equity capital raised to $500 million in the past 18 months.

In addition to the investments, the new refinancing facility from a 15-bank group will provide PEG over $1 billion of financial capacity.

From that, PEG will continue to deliver on strong customer demand and pipelines of development projects, including several Power Purchase Agreements.

QIC head of global infrastructures Ross Israel said the fundraising momentum represent a "distinct opportunity" in Australia.

"Having invested in the energy transition thematic for over a decade, QIC has a deep understanding of the structural shifts reshaping Australia's energy value chain, and we continue to see compelling and differentiated opportunities to deploy capital at scale," Israel said.

"That conviction has once again been endorsed by new and existing capital partners supporting us to grow Pacific Energy.

"In doing so, they have recognised the tailwinds driving customer demand for the company's specialised and differentiated capabilities."

Israel noted that Australia remains "a safe harbour" for diversification amid global uncertainty.

"What this oversubscribed funding round shows is there is strong demand from investors globally to continue supporting the energy transition, a clear trust in Australia as an investment destination and in QIC as a manager in the region and this sector," he added.

Further, QIC senior principal, Pacific Energy asset manager and board member Matthew Zwi explained the platform has evolved significantly since QIC's acquisition in 2019.

"In that time, Pacific Energy has invested heavily in its capabilities through a series of value-chain acquisitions, creating a highly specialised, vertically integrated remote energy platform with full in-house capability to design, construct, commission and operate hybrid renewable power projects," Zwi said.

"The combination of these specialised capabilities and significant levels of prevailing demand for renewable and hybrid solutions in Australia's remote energy sector have driven material growth in Pacific Energy's portfolio."

Zwi believes it has also matured as an infrastructure investment.

"With this growth capital raise completed and the business competitively refinanced, Pacific Energy is well positioned to capitalise on customer demand and deliver its growth pipeline, which includes a range of renewable and hybrid projects in Western Australia as well as on the East Coast," Zwi continued.

PEG chief executive Jamie Cullen said the market has shown confidence in the platform, reflected by the improved pricing.

"The successful upsizing of Pacific Energy's debt facilities and equity raise mark a significant milestone in supporting our strategic growth ambitions, including our continuing east coast expansion," Cullen said.

"This boost to our growth capital puts us in a strong position to advance our robust pipeline of renewable energy projects and take full advantage of the increasing opportunities in Australia's transition to a low-carbon economy.

"We're in a leading position to deliver long-term value for our customers, and at the same time, move the dial in a meaningful way towards a more sustainable future."