The Edinburgh-based UK Green Investment Bank has announced first close on commitments of £463m on its planned £1bn fund to invest in operating offshore wind farms in the UK.

The UK Government-backed bank said first close marks the completion of the first stage of fundraising and is triggered by the commitment of an initial group of investors which comprise UK-based pension funds and a major sovereign wealth fund.

The GIB said it is also investing £200m in the fund as fundraising continues to reach the £1bn target.

In addition to the £463m of fund commitments raised, an additional significant amount of investor capital is available to co-invest into projects alongside the fund.

The fund is an innovative, first-of-a-kind transaction and is the world’s first fund dedicated to investments in offshore wind power generation and, once fully subscribed, will be the largest renewables fund in the UK.

The fund has an expected life of 25 years, which the GIB said will allow a new class of long-term investor to enter the sector.

This is the first fund raised by the GIB group and its first step into asset management. It is also the first private capital to be managed by the GIB group. It will be managed by a new FCA-regulated and authorised subsidiary called UK Green Investment Bank Financial Services Limited which is staffed by a dedicated team.

GIB has now transferred its investments in two operating assets into the fund, which will produce immediate cash yield for investors.

Evercore Private Funds Group is acting as advisor and exclusive global placement agent for the fundraise and King & Wood Mallesons is acting as legal counsel to the fund.

Shaun Kingsbury, chief executive of the UK Green Investment Bank said: Offshore wind is playing an important role in the UK’s energy infrastructure. By 2020 we expect it to be providing enough clean, green energy to power the electricity needs of 8.2m homes across the UK. A sector this size needs a broad range of long-term investors and those investors need products they can confidently, and commercially, invest in – like this fund.

The fund will create significant benefits for the UK by mobilising capital into the UK offshore wind sector from new, long-term investors seeking good, risk adjusted returns. Attracting additional capital and creating a liquid market for operating assets is an important step in reducing the cost of offshore wind and supporting the continued growth of the sector. New investors will allow the original developers to sell down their stakes and use the proceeds to finance new renewable energy projects.