Renewables

On-market deal sourcing refers to the structured acquisition of wind, solar, and BESS assets that are actively offered in the market, from early-stage project development through shovel-ready projects to fully operational turnkey assets. CYCAP evaluates the full return/risk spectrum and applies strict acquisition criteria to ensure that only assets matching the respective investment strategy are acquired.

CYCAP maintains an active network covering all relevant sellers across European target markets, built over 25+ years and encompassing more than 100 completed transactions. This market access enables early identification of upcoming transactions and faster execution than competitors. For institutional investors, this translates into shorter time-to-market, a broader pipeline, and a comparatively lower risk of missing attractive assets.

On-market assets are typically already in their operational phase. This enables swift portfolio integration and immediately predictable cash flows. This is a key advantage for lower-risk Core strategies targeting a net IRR of 5–7% p.a., as pursued by CYCAP across its Core fund vehicles.

Off-market deal sourcing at CYCAP means unlocking value creation potential directly from its existing portfolio of 100+ renewable energy assets through repowering, hybridization, and extensions of existing assets. This approach eliminates competition for assets in the open market entirely.

By leveraging existing infrastructure such as grid connection points, cable routes, and established permitting relationships, CYCAP’s development risk is structurally lower than on greenfield projects. At the same time, savings in planning and construction costs and additional development margins enable more attractive return profiles than are typically achievable in the open market. The IRENA report “Renewable Power Generation Costs in 2023” (IRENA, September 2024) confirms that infrastructure reuse is among the most effective levers for reducing the levelized cost of electricity (LCOE).

Repowering refers to the process of replacing aging energy generation assets with modern, higher-performance technology at the same site. CYCAP deploys repowering as a targeted value creation instrument within its existing portfolio, generating significantly higher yields from established sites – without necessarily developing new land. The German Federal Ministry for Economic Affairs and Climate Action (BMWK) defines repowering as a central pillar of Germany’s energy transition.

Modern PV modules typically achieve efficiencies of over 20%, enabling significantly higher installed capacity on the same footprint. Freed-up space can be utilized for additional modules. According to the Fraunhofer ISE Photovoltaics Report (Fraunhofer ISE, October 2025), the efficiency of commercial silicon solar cells has nearly doubled over the past ten years. In CYCAP’s repowering projects, the power output of a PV park can typically be increased to more than three times its original level, while simultaneously reducing the levelized cost of electricity (LCOE) and retaining existing infrastructure.

Modern wind turbines with larger rotor diameters and greater hub heights harvest wind resources more efficiently at higher altitudes and generate reliable power even at lower wind speeds. According to the WindEurope Annual Report “Wind Energy in Europe 2023 – Statistics and the Outlook for 2024–2030” (WindEurope, February 2024), repowering triples the energy output of a wind farm on average while reducing the number of turbines by 25%. In CYCAP’s own repowering projects, energy production can be increased to more than four times the original level. For investors, this means: existing sites are transformed into high-value assets with more stable yields, lower maintenance requirements, and longer asset lifespans.

The 2023 EEG amendment and the “Easter Package” significantly streamlined permitting for repowering projects: PV ground-mounted installations can now be upgraded even when the existing modules are still operational, without forfeiting the feed-in tariff entitlement. For wind assets, permitting deadlines were extended and site relocations made easier. Germany’s statutory grid overbuild provision under Section 8a of the German Renewable Energy Sources Act (EEG 2023) allows multiple installations at a single grid connection point, which is a structural advantage CYCAP can directly leverage through its portfolio of 100+ grid connection points.

Hybridization refers to the combination of different generation technologies at an existing grid connection point – for example, adding solar PV to a wind farm, integrating a battery energy storage system (BESS) into an existing installation, or combining all three technologies. In its report “Renewable Power Generation Costs in 2024” (IRENA, July 2025), the International Renewable Energy Agency defines hybrid systems as combinations of solar PV or wind with battery storage – an approach that has become the standard in many markets, delivering more stable generation profiles, improved capacity factors, and enhanced grid reliability. CYCAP systematically applies hybridization across its existing portfolio to optimize the grid capacity of established sites.

Hybridization creates synergies on multiple levels. Shared use of existing infrastructure – substations, access roads, grid connections – significantly lowers capital and operating costs compared to greenfield developments. Combining wind and solar results in a more uniform generation profile across the daily and annual cycle, materially improving cash flow stability for institutional investors. Battery storage additionally enables targeted monetization of generation peaks. According to the IRENA report “Renewable Power Generation Costs in 2024” (IRENA, July 2025), hybrid systems deliver more stable generation profiles, improved capacity factors, and enhanced grid reliability compared to single-technology projects. CYCAP leverages this approach as a structural return driver across its Core Plus and Value Add strategies.

Hybridized installations are grid-supportive: they generate more consistently, respond more flexibly to demand fluctuations, and thereby reduce costly grid congestion and curtailment. The more steadily a site feeds power into the grid, the less balancing energy grid operators need to procure at high cost. This pays off regulatorily: ENTSO-E established in its “Phase II Technical Report on Grid Forming Requirements” (ENTSO-E, November 2025) that new storage and renewable projects above 1 MW will be required to actively contribute to grid stability and are thereby structurally prioritized. Additionally, Section 11c of the German Energy Industry Act (EnWG) confirms that battery storage assets in Germany serve an overriding public interest and are granted priority in permitting procedures, which materially facilitates co-location projects at existing grid connection points. CYCAP’s hybridization projects in its existing portfolio benefit from a regulatory tailwind that single-technology projects do not.

CYCAP applies three complementary approaches to value creation within its existing portfolio – each clearly distinct from the others. Repowering replaces existing aging installations with more modern, higher-performance technology at the same site, delivering significantly higher yields with the same or fewer turbines. Hybridization adds a different technology at an existing grid connection point – for example, solar PV alongside wind, or a battery storage system alongside an existing installation. Extensions, by contrast, add capacity within the same technology – for example, installing additional wind turbines on adjacent land parcels. Because extensions build on existing infrastructure, pre-existing permits and surveys, and established permitting relationships, development risk and execution complexity are structurally lower than on greenfield projects.

CYCAP offers three strategies across the risk/return spectrum, all focused on renewable energy in Europe. The Core strategy (since 2007, 7 fund vehicles) targets operational onshore wind and solar assets with a target net IRR of 5–7% p.a., a target distribution yield of 4% p.a., and an SRI of 3–5. Core Plus (1 fund vehicle) extends the investment universe to include BESS and hybridization, with a target net IRR of 7–9% p.a., a target distribution yield of 5%+ p.a., and an SRI of 4–6. Value Add (1 fund vehicle, 1 in formation) additionally encompasses repowering, with a target net IRR of 10%+ p.a., a variable distribution yield, and an SRI of 5–7. Core and Core Plus are available as 20-year closed-end funds or evergreen structures; Value Add as a 10–12-year closed-end fund. SRI classifications are assigned in accordance with the EU PRIIPs Regulation (EU) No. 1286/2014 on a scale from 1 (relatively low risk) to 7 (relatively high risk).

All existing CYCAP fund vehicles are classified as SFDR Article 9 – the highest sustainability category under the EU Sustainable Finance Disclosure Regulation (SFDR, Regulation (EU) 2019/2088). ESG integration is a structural component of the investment process, not a downstream reporting exercise

CYCAP Capital Management GmbH, acting through its Luxembourg branch, is licensed as an Alternative Investment Fund Manager (AIFM) under the AIFM Directive (2011/61/EU). CYCAP manages fund structuring, administration, and lifecycle management entirely in-house, without reliance on third-party managers. This ensures governance continuity and operational control throughout the full investment period.

Since launching its first Core investment strategy in 2007, CYCAP has raised nine fund vehicles, three of which have been successfully exited. Assets under management stand at €2.7bn with 103 renewable energy assets in operation (as of December 31, 2025). 44% of investors are repeat investors – a direct measure of investor satisfaction and confidence in the platform. All funds are managed under the regulated CYCAP Investment Management GmbH, registered with BaFin, Germany’s Federal Financial Supervisory Authority.