Singapore’s sovereign wealth fund GIC will commit US$240 million in equity to Iceland-based Arctic Green Energy to support the geothermal energy player’s expansion in Asia and Europe, and to drive uptake of zero-carbon district heating in those regions.
Geothermal energy is a renewable, economically competitive alternative to fossil fuels for heating and cooling, as it it doesn’t suffer from intermittency issues, GIC and Arctic Green said in a statement published to GIC’s website.
Haukur Hardarson, chairman and founder of Arctic Green Energy said, “The strategic alliance and funding from GIC will allow Arctic Green Energy to significantly increase its capability and momentum and launch multiple new projects. Taking down chimneys and transforming more cities into healthy living breathing cities is now a real prospect.”
Ang Eng Seng, GIC’s chief investment officer of infrastructure, added that the company was a world leader in geothermal district heating.
“As a long-term investor, we are confident it has the proprietary technology and experience to achieve significant scale across Europe. In addition, we believe the strong public demand to curb climate change will enable this technology to play a meaningful role in decarbonizing the heating sector,” Ang said in the statement.
In China, Sinopec Green Energy, which is jointly owned by Sinopec and Arctic Green, is the largest and fastest-growing geothermal company globally, the statement said. Arctic Green is also developing bankable renewable energy projects in Asia and Europe, including a recently announced district heating project in Europe.
Including this round, Arctic Green Energy has raised US$390 million, with other investors including China Development Bank, CITIC Capital Holdings and Everbright, according to Crunchbase data.