Infrastructure Equity Funds- An overview

Whenever we refer to the term “infrastructure”, roads, railway systems, cables, wires and pipelines tend to come to mind – not energy efficiency. However, energy efficiency does have the characteristics of other traditionally recognized infrastructure. It is long-lasting capital stock requiring significant upfront investment mainly in the form of equity.

Energy efficiency has been referred to as one that extends energy supplies, increases energy security, lowers carbon emissions and generally supports sustainable economic growth. Energy efficiency is also considered a way of managing and restraining the growth in energy consumption.

Like any other financial product, energy efficient financing options have different structures, terms, and conditions and can be both secured and unsecured loan.

Many institutions and banks offer energy efficiency financing.

  1. Energy efficiency companies may offer loans, often through their contractor networks.
  2. Credit unions all over the country are developing energy efficiency loan products for homeowners, and often offer lower-cost energy efficiency loans.
  3. National lending institutions offer specialty loan products tailored to energy efficient buildings.
  4. Public-private partnerships can offer energy efficiency loan programs. Government agencies partner with private financiers to offer energy efficiency with lower interest rates and no fees.
  5. Utilities offer on-bill financing programs that allow homeowners to finance energy efficiency improvements and repay the borrowed amount through electric bills.

Oil and gas are another key area in the infrastructure sector which has seen strategic mergers and acquisitions in recent years. A turbulence in the oil and gas sector, and with squeezing margins, more and more oil and gas companies are moving towards mergers and acquisitions with private equity fund be the major buyers.

As prices remain low and demand moving east, companies are moving towards strategic acquisitions and strengthen their portfolios. Many buyers need acquisitions to replenish reserves that gets dwindled due to challenging environment. As such Infrastructure fundraising in the form of private equity for aiding such mergers and acquisitions is crucial.

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