Powerful PPMs

Yet again an energy-focused fund has defied what some placement agents have called the toughest private equity fundraising environment in history.

Goldman Sachs spin-out Energy Capital last month closed its second fund on $4.3 billion, exceeding its $3.5 billion target, and proving that LPs are indeed opening their wallets for strategies they deem lucrative. Its first fund raised $2.45 billion in 2007.

Energy Capital Partners II will invest primarily in North American infrastructure assets in the fossil fuel generation, renewable power generation, electric transmission and mid-stream gas sectors. It has already made a number of investments in each of those sectors – aside from renewable power generation – including an acquisition of three natural gas-fired power generating facilities in New England, purchased from the BG Group in March for $450 million.

Other investments include the purchase of a 100-mile gas gathering pipeline system under construction in the Barnett Shale region in Texas; an electric transmission line under development in Southern California; and an operating business that provides electrical infrastructure construction and maintenance services.