This report shows the need for transparent, data-driven credit risk assessment. Unlike public corporate bonds, much of the infrastructure debt universe remains unrated, privately negotiated, and opaque.

Private infrastructure debt has emerged as a distinct fixed income asset class, combining long-term stable cash flows with structural resilience to credit risk. Backed by essential assets in energy, transport, digital, and social infrastructure, it benefits from regulated or contracted revenues and inelastic demand—factors that reduce default risk and enhance recovery prospects. This makes it especially attractive to institutional investors seeking defensive stability and strategic diversification.

Empirical evidence highlights the strength of this profile. From 2019 to 2023, default probabilities across infrastructure debt remained consistently low, with average one-year PDs declining to around 1.3% by 2023, even through periods of macroeconomic stress such as COVID-19. Recovery rates held firm above 75%, underscoring the ability of infrastructure debt to preserve value in stressed environments. Younger firms show higher PDs (~1.8–2.1%), but risk steadily declines with maturity, falling to ~0.6% for the most seasoned entities. Sectoral dynamics further illustrate resilience and differentiation regulated utilities and social infrastructure exhibit very low risk, while renewables, data, and resource-linked sectors display greater sensitivity to market cycles and capital intensity.

At the same time, the market remains opaque, unrated, and illiquid, with secondary pricing scarce and credit ratings covering only a fraction of transactions. This lack of visibility makes it difficult for investors to evaluate relative value, monitor ongoing exposures, or integrate infrastructure debt confidently into diversified portfolios.

It is precisely here that infraMetrics® provides value. Drawing on a comprehensive dataset of infrastructure debt, infraMetrics® transforms raw financial and sector, and geographic data into standardized credit risk measures PD, LGD, and EL through a robust shadow credit risk assessment tool. This allows investors to quantify risk at both instrument and portfolio levels, analyse sectoral and regional dynamics, and monitor exposures with the same rigor as traditional fixed income.

In sum, private infrastructure debt delivers low default risk, strong recoveries, and long-dated, liability-matching returns. Powered by infraMetrics® data and modelling, investors gain a consistent, forward-looking view of the market, making the asset class both a defensive allocation and a strategic cornerstone for long-term portfolio resilience.