The UK government has awarded £100m (€125.9m) of initial funding to two specialist fund managers to promote investments in energy efficiency projects.
The government’s UK Green Investments arm has awarded the contracts to Equitix and Sustainable Development Capital LLP (SDCL) and follows a tender issued in March this year.
Equitix is a UN Principles for Responsible Investment (PRI) signatory whose Equitix Fund II closed at £333m in May with backing from 14 UK corporate and local authority pension funds.
The London-based firm considers environmental, social and governance (ESG) factors at each stage of its investment process and is a member of the UK Sustainable Investment and Finance Association (UKSIF).
SDCL was founded in 2007 and is an investment bank and advisor focusing on resource efficiency and sustainable development.
The pair will be “actively encouraging” foreign anddomestic investment in small-scale non-domestic energy efficiency projects, alongside UK government funds.
The government will co-invest on an equal footing, and on market terms, with private investors on each deal.
Ministers said the move paves the way for the UK Green Investment Bank, which is expected to open later this year following state aid approval.
Energy and Climate Change Secretary Edward Davey said the government was taking the necessary steps to develop a “secure, clean energy mix” which was opening up “massive, long-term investment opportunities”.
In separate news, Triodos Renewables Plc has announced a new public share issue. Priced at £1.90 a share with a £570 minimum investment, proceeds will be invested into building new onshore wind power assets. The renewable power company managed by sustainable banking group Triodos has returned 8.5% over the past year and 6.8% over six years.