Environment, Feb. 7: Generation IM discloses stake in smart grid firm

RI’s regular review of environmental investing news

Generation Investment Management, the sustainable funds boutique founded by former US Vice President Al Gore and ex-Goldman Sachs Asset Management head David Blood, has disclosed a 5.6% stake in Digi International Inc., according to a filing at the Securities and Exchange Commission. Minnesota-based and Nasdaq-listed Digi is a wireless networking technology firm.

Bank of England Governor Sir Mervyn King has replied to a letter from investors and campaigners calling for an assessment of whether the UK’s exposure to high carbon investments presents a “systemic risk”. King admits that “there is clearly scope for further evaluation of these issues”, according to a report in the Financial Times. Signatories to the letter to King last month included Aviva Investors, Climate Change Capital, the Carbon Disclosure Project, leading academics, UKSIF and Fair Pensions.

Former Australian Federal Opposition leader John Hewson and International Trades Union Congresss (ITUC) General Secretary Sharan Burrow have joined the board of the Asset Owners Disclosure Project (AODP), which ranks funds based on their shareholdings’ carbon impact. The AODP will also launch a new ratings system later this year with the aim of rating over $60trn. Further board appointments are expected. Hewson said: “Stakeholders of all types need to see which asset owners are leading and by how much and who the laggards are so we can create pressure to drive change.”

California-based solar power outfit SolarCity is expected to file its initial public offering (IPO) plans with the Securities and Exchange Commission shortly, according to a Reuters report. The start-up firm – chaired by PayPal and Tesla Motors’ founder Elon Musk – has hired Goldman Sachs to underwrite the IPO, expected to value the company at around $1.5bn.

DONG Energy, the Danish energy group, successfully issued a £750m (€898.8m), 20-year sterling-denominated bond last month. Dong said the financing “goes hand in hand with our increased presence in the UK where we are building offshore wind farms and developing our gas and oil discoveries West of Shetland”. DONG has also signed up to the Extractive Industries Transparency Initiative. Link*Capital Group’s Capital Research* and Management Company subsidiary has trimmed its stake in Danish wind turbine firm Vestas Wind Systems to 10.14m shares (4.98%), from 10.66m (5.23%), according to a filing.

Ludgate Environmental Fund Ltd., the closed-end cleantech investment company where Flintshire County Council has a 10.29% stake, has written down its £1.3m investment in the solar energy developer Lumicity to £702,500. It blamed the “unexpected severity and early timing” of the cut in UK subsidies. Link to interim report

Capital Dynamics AG, the Swiss-based asset management firm, has invested in a 5.7MW solar energy project in Massachusetts that is expected to be one of the largest solar energy projects in New England. The project will sell power to three investment-grade rated municipal entities under 20-year agreements, the firm said.

Research from Ernst & Young has found that US venture capital investment in renewable power and energy-efficiency technology declined to $4.9bn in 2011 – down 4.5% from the year before. The report was based on Dow Jones VentureSource data. Link

Canada: the federal and provincial governments are to set up a new environmental monitoring system for the northern Alberta oil sands. A three-year program will study the effects on water sources such as the Athabasca River. Environmental researchers at the Pembina Institute welcomed the move but said “monitoring is only one piece of the puzzle”.

The World Bank has said its initiatives on carbon finance will probably be needed for at least five more years, according to a Reuters report. It was quoting Joelle Chassard, manager of the bank’s carbon finance unit. She also told the news agency that the bank was unlikely to launch any new carbon finance initiatives in the near term.

RenewableUK, the trade body, has announced that the country’s wind sector has reached 6GW of installed capacity – enough to supply electricity to 3.3m homes. The landmark was reached by the Ormonde offshore wind farm, off the coast of Cumbria in northern England.