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Purpose Capital Consortium increases investment in Lodestone Energy to $17.4M

Wednesday 10 Apr 24 11:00am


Media release | In March 2024 Purpose Capital led a $7.4M syndicated follow-on investment into Lodestone Energy.

The Purpose Capital impact syndicate consisted of Purpose Capital Impact Fund, Tauhara North No2 Trust, Trust Horizon, as well as investors from the Purpose Capital Impact Fund.

 

The follow-on investment takes the Purpose Capital consortium total investment in Lodestone Energy to $17.4M.

 

This investment marks the completion of a successful Series C equity capital raise of $55 million for Lodestone Energy.

 

Investors in this round include Jarden Principal Investments who will be managing an investment from Fisher Funds, Purpose Capital Impact Syndicate, ACC, K1W1 and Pathfinder.

 

“We are delighted to confirm support of Lodestone Energy’s plans to meaningfully increase the amount of solar energy generation in New Zealand through our Series C investment.” says Purpose Capital’s Executive Director Bill Murphy.


Sheep graze under the solar panels at Lodestone Energy’s Solar Farm in Kaitaia.

 

When considering the initial investment back in 2021, Purpose Capital was conscious of considering where an investment in solar would have the greatest impact, and considered a dozen investment opportunities across residential, commercial and utility-scale solar.

 

“While we acknowledge distributed rooftop solar has its place, you get approximately twice the amount of electricity generation for the same capital cost from doing solar at scale and in an optimised way.” says Purpose Capital’s Investment Manager Nick Pacey.

 

“The impact implications of this are that much of the environmental and social benefits provided by solar photovoltaic systems can be achieved at half the cost via utility-scale when compared to residential-scale solar.”

 

A key factor in Purpose Capital’s investment decision was its assessment of the Lodestone management team, which involved evaluating their likelihood of success developing, building, and operating solar farms in New Zealand.

 

“Lodestone’s Kohirā solar farm in Kaitaia generating power a remarkable one year after construction commenced, strong progress on the other 4 Stage 1 Lodestone sites and securing multiple sites for Stage 2 gave us the confidence to participate strongly in this Series C capital raise” says Bill Murphy. 

 

At time of completion, Kohirā is New Zealand’s largest solar installation to date and was the first solar farm in New Zealand to bid into the electricity market, a crucial step forward in the future of energy generation.

 

The Kaitāia farm has more than 61,000 solar panels supported by more than 6500 piles across an expansive area spanning 64ha on an 80ha property. The site has an AC capacity of 23.7MW and is expected to produce about 56GWh annually, which is enough energy to power more than 7770 households. 7 hectares of Kohirā will be reforested with native trees.

 

The site’s official name, Kohirā, was gifted by Te Rarawa. Kohirā translates to suncatcher in te reo Māori and reflects how Lodestone harnesses the energy of the sun to generate electricity. This partnership with local iwi aligns with Lodestone’s commitment to work with tangata whenua to deliver solar projects that empower both the regions in which they operate, and the way Kiwis live.

 

The outcome Purpose Capital is aiming to achieve with this investment is increasing the amount of renewable energy generation, to mitigate climate change.

 

Lodestone’s Phase 1 and 2 combined, consisting of 12 solar farms, is estimated to represent about 2% of New Zealand's total electricity market.

 

One of Purpose Capital’s goals is to be a catalyst in the reallocation of capital from traditional investments to impact investments.

 

To date, Purpose Capital has attracted over $20M of co-investment into impact investments in New Zealand taking Purpose Capital’s total assets under management to $42M.

 

Purpose Capital continues to seek quality impact investment opportunities and co-investment partners wanting to invest for financial return and impact.

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