Co-CEO interview with Institutional Money
In a wide-ranging conversation with the trade publication’s editor in chief, Marius Dorfmeister and Marco van Daele spoke about the company’s plans for the future and highlighted the need for increased investment in clean energy infrastructure to achieve global climate goals. The interview coincided with the third closing of the SUSI Energy Efficiency Fund II.
“Investments in energy efficiency are among the most important instruments in the fight against climate change because of the multitude of applications and high investment efficiency,” said Marco van Daele, Co-CEO and Chief Investment Officer of SUSI Partners. “We launched the first fund of this kind as early as 2014. It was fully invested by the end of 2018 with a total of 35 projects and had investor commitments of EUR 200 million. The fact that the successor fund already has commitments of EUR 275 million makes our energy efficiency platform an increasingly important pillar for our company.”
He also elaborated on SUSI Partners’ unique solution for financing energy efficiency measures: “Although the technology is available, private and public infrastructure owners and operators often lack the financial resources to implement energy efficiency measures. Our solution – off-balance-sheet contracting – solves this problem. It means the fund takes the necessary investments onto its own balance sheet and in return receives a portion of the energy savings.”
SUSI Partners’ approach to investing in clean energy infrastructure is based on three pillars: decarbonising energy production, increasing energy efficiency and enabling the utilisation of clean energy. “As these areas become more and more interrelated, we take a holistic and comprehensive view of the energy transition. Our new strategies also reflect this,” said Marius Dorfmeister, Co-CEO and Global Head of Clients.
He also highlighted the firm’s competitive advantage in its segments: “We have gained experience over many years. SUSI Partners has been in the market for renewable energies, energy efficiency and energy storage for quite a long time. This means that we have created key relationships, even exclusive ones for certain strategies.”
Building on this experience, SUSI Partners is moving away from a strongly product-driven strategy to a platform approach, as van Daele explained: “After ten years and more than 100 transactions completed in around 20 countries, we have a certain track record, which allows us to rethink our business to the extent that we operate less in a purely product-oriented environment. Instead, we pursue an investment strategy that is more strongly guided by opportunities and that supports the energy transition overall.”
On the company’s growth plans, Dorfmeister said: “We now have total assets under management of EUR 1.2 billion. And when we took over as Co-CEOs, which was only a few months ago, we set ourselves the goal of moving towards EUR 2 billion in terms of our asset base over the next year and a half.” He added that “we still face a special challenge: the current regulatory framework. We are operating in the area of illiquid assets. This means that we are still a niche market in terms of the legal requirements for pension funds or insurance companies. In my opinion, legislation should follow suit at some point in order to give investors more flexibility and enable them to actually invest in the risk-return profiles that are best for them.”
As investment sourcing and due diligence are time- and labour-intensive to ensure opportunities provide the right risk-return profile, the Co-CEOs emphasised that fundraising and investment pace have to be closely aligned to fulfil clients’ expectations and enable sustainable growth for the business. Providing a positive outlook, van Daele concluded: “We have plenty of room to grow. Because the good thing is: Not only are the markets and networks continuing to grow, the frequency of deals is also increasing. So, there is plenty of work for us to do.”
The interview was published in German in the 1/2020 edition of the magazine.