UK EV charging fund reaches first close

The UK government has marked the official launch of the Charging Infrastructure Investment Fund (CIIF) after it reached a first close at £70 million (€78m US$86m).

The £400 million (€447m US$494m) fund is aiming to catalyse private sector investment into electric vehicle charging stations and spur the installation of charging infrastructure across the UK.

The launch of the CIIF was presented by HM Treasury as part of a “£500 million new investment in green technologies” and an example of the government stepping up its green policy push, despite the fact that work on the CIIF has been ongoing since the start of the year and contains a sizable chunk of private money.

Half the £400 million will be provided to CIIF by the government, while the rest is being raised by fund manager Zouk Capital, which has been appointed to manage fundraising from the private sector as well as future investments.

The first £70 million was raised from UAE renewables sovereign wealth fund Abu Dhabi Future Energy Company (Masdar) and will be used to install over 3000 charge points, more than doubling the number of UK public chargers to 5000.

Masdar was the initial LP that Zouk brought into the fund in order to reach a first close and the fund manager is planning to follow this up with a least one and possibly two more closings before the end of the next quarter, which will take the fund up to the full £400 million.

Future investors

Zouk is currently in the process of talking to several potential future investors and the interest that the fund manager has received from LPs has been very diverse.

“We’ve had interest from sovereign wealth funds, UK pension funds, as well as strategics such as those that have more of a corporate venture capital arm and are interested in the mobility space more broadly,” George Ridd, partner in the infrastructure team at Zouk tells inspiratia.

“We have also had interest from funds with big pools of capital looking to deploy funds into interesting areas. The fundraising has not been pigeon-holed, there is a very broad spectrum of interested parties.”

The fund has a hard-cap of £500 million, but there is scope to carry on fundraising after this target has been reached, however the government has stated that its contribution will stop at £200 million.

Routes to market

Zouk Capital was selected by the government to manage the CIIF fund back in February and announced that it would be running a “dual-track” approach to the deployment of the funds. The CIIF is able to invest in both charging station operators at a corporate level, while also partnering with developers on individual projects.

“We are looking at various routes to market including the more infrastructure traditional SPVs or we can look to set up joint ventures with partners who have a strategic interest,” says Ridd.

The use of SPVs, potentially involving project finance is a route that has not been used in the EV charging space to date.

Join us at EVS Whistler in November to find out more about the forces behind recent moves in the electric vehicle charging sector, among many other topics. Register here.