In 1996 the insurer set up Allianz Capital Partners to act as its in-house alternative investment platform. Since it started investing Allianz policyholder's money in renewable energy in 2005 it claims to have become one of the largest financial investors in the sector in the world.
All of the company's 50 renewable energy projects to date are in Germany, Italy, France and, most recently, Sweden. It has spent more than EUR 1.7 billion on projects with a capacity of more than 1GW.
But a potential change in direction comes in the form of a possible move into offshore wind. The company has already come close to investing in several offshore projects, said head of renewable energies for Allianz Capital Partners David Jones.
"We've done a lot of preparation work in terms of calculating the risk capital charge. We have looked at a couple of projects seriously, but not concluded any deals yet," he said.
So far, the company has been unable to find any developments that offer return on investment relative to onshore wind. Jones added that there needs to be a premium to account for the higher risk and cost of operation. But Allianz continues to consider projects in the UK and Germany on their individual merits.
Currently, the insurer holds 100% stakes in all of the 43 onshore wind projects that it has bought so far. This would likely be different with offshore projects where the company would not be willing to shoulder all of the risk and would seek out a partner in the form of an "established player" in the field.
The company's most recent acquisition was the operational 24MW Cottbuser See wind farm in Brandenburg, Germany. Also last year the company strayed into new territory with the purchase of the 72MW Maevaara wind farm in Sweden, its first project outside the eurozone.
All of the projects in Allianz's portfolio are under 100MW, with the typical investment in the EUR 30 million to 100 million range.
The concentration of the majority of the company's projects in Germany, Italy and France and, most recently, Sweden has not come about by chance, with Allianz largely looking for projects in established markets within the euro zone. Jones explains this with reference to the risk that a fluctuation in exchange rates can represent.
"As a liability investor we are investing insurance policyholders money. This is largely in euros, and our policyholders expect euro denominated returns. Because we make long-term investments we could not neglect the effect of currency fluctuations," he said.
Allianz's nature as a long-term investor, interested in income rather than capital gain, means that when it buys into a project, it intends to ride it out for the 20- to 25-year life of the development. "Unlike most funds our long-term focus means that we have no need for an exit or capital gain," said Jones.
2013 saw the company invest solely in wind projects at the expense of solar, and Jones doesn't see this changing this year. The insurer has previously invested in solar, but said that the risk return profile for solar projects is not significant enough.
He explained: "The risks in solar are generally lower. There are no moving parts to go wrong and operational costs are generally lower. Output is also much more steady and predictable and the returns reflect this.
"This was fine when returns for renewables were higher generally, but since we've seen these fall, it just means that they are now too low and wind is more attractive."
In choosing new projects, Allianz looks for those that are well on the road to completion, with well-developed contracts, real estate sorted and consenting making progress. "We're very heavy on due diligence. If everything isn't in place we're unlikely to go for a project," said Jones.
However, the company also picks up already commissioned projects that are less polished. He said: "With older projects which have problems with the turbines or with legal issues, we are willing to invest if we can bring them up to a good quality."
When it comes to turbines, Jones said that his team only go for "the premier league" manufacturers. None of their projects feature turbines from smaller manufacturers. Allianz also have little interest in Chinese manufacturers looking to branch out into the European market.
But even with the most established of manufacturers, he adds that Allianz will always consult technical advisors and put together an assessment of all turbines before entering into a deal.
Whether or not Allianz does overcome the obstacles and branch out into new markets or out to sea remains to be seen. But the company does seem committed to long-term investment in renewable projects that meet its own, specific requirements.