- Foresight Renewable Energy Income Fund comprises loans to small-scale Australian renewable energy infrastructure projects that are certified by Climate Bonds Initiative.
- Rare avenue for wholesale investors seeking direct exposure to green energy opportunities.
- Further evidence of Foresight’s commitment to investing for a smarter future.
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London, 13 September 2019: Foresight Group LLP (“Foresight”), the global infrastructure and private equity investment manager, has developed a Sustainability Framework that has been Certified by Climate Bonds Initiative (“CBI”) and Verified by the Carbon Trust for the launch of Foresight Renewable Energy Income Fund (“FREIF” or “Fund”).
The Fund will provide private debt to small-scale renewable energy infrastructure projects located in Australia. The Fund is the first to pool capital into a series of CBI certified loans and gives Australian wholesale investors unique access to an asset class that has typically been available exclusively to institutional investors.
FREIF will be focused purely on lending to renewable energy generation and associated infrastructure projects. An indicative portfolio of seven assets would save an estimated 5.7 million tonnes of CO2 emissions over the life of the underlying assets compared to the equivalent coal generation.
The Sustainability Framework for the Fund developed by Foresight includes a proprietary sustainability evaluation methodology which is used to assess projects under CBI’s Programmatic Certification process. The Framework has been verified by Carbon Trust to ensure it complies with the Climate Bonds Standard and is available on the Fund’s website.
Foresight intends to report annually on the environmental impact of the loans and their contribution to the United Nations Sustainable Development Goals. Foresight is aligned with leading climate change bodies, having been a signatory of the United Nations Principles for Responsible Investment (“UNPRI”) for more than five years, and a member of the Responsible Investment Association Australasia and the UN Global Compact.
Climate Bonds Initiative administers an international standards and certification scheme for green and sustainable debt instruments. The Climate Bonds Standard is a science-based process designed to guide investors towards projects that contribute to addressing climate change.
Since 2017, Foresight has established itself as one of the largest solar investors in Australia; managing A$400 million portfolio including four solar farms in Queensland and the 110MW Bannerton project in Victoria, a 192 hectare solar farm that provides clean energy to the Melbourne Tram network and can generate enough clean electricity to power the equivalent of 30,000 homes.
Nigel Aitchison, Head of Infrastructure at Foresight, commented:
“At Foresight we believe everything we do should build towards a smarter future. All investments that pass through our Investment Committee are governed by our propriety set of principles for Sustainable Investing and it is an extremely positive development to receive certification from a leading industry body such as CBI. This Fund will set the bar for investing into renewables in Australia, encouraging providers to be held accountable to committing funds to truly sustainable projects.”
Sean Kidney, CEO of Climate Bonds Initiative, commented:
“Australian investors – whether they are retail, wholesale or institutional – are becoming more climate-aware and increasingly seeking domestic green infrastructure opportunities, that have an ongoing and verifiable environmental impact. This latest offering from Foresight to wholesale investors reflects that growing demand. It’s another innovative step in the development of the Australian market.”
Morgan Jones, Head of Assurance at the Carbon Trust, added:
“We are delighted to have worked on the Foresight Renewable Energy Income Fund. The transition to a low carbon sustainable economy will require significant access to new and green finance, so it is particularly exciting to see an innovation in the market that allows wholesale individual investors to participate in the financing of renewable energy and related green infrastructure.”
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About Foresight Group LLP
Foresight is a leading infrastructure and private equity investment manager which has been investing on behalf of institutions and private investors for over 35 years.
Foresight has over $5.6 billion of renewable energy infrastructure assets under management.
Foresight currently manages more than 190 renewable generation assets globally, with a total generating capacity of 1.9GW. In Solar, Foresight has invested in over 100 solar plants and has more than 1.3GW of solar generation assets under management around the world. In Wind, Foresight manages 330MW of wind generation assets across the UK, France and Germany. In Bioenergy, Foresight manages 35 waste projects with 55MW baseload generating capacity, processing over 1.8 million tonnes of waste per annum, having mobilised over A$1.3bn of capital investment. The projects when fully operational will divert some 1 million tonnes of waste from landfill every year, saving more than c.200,000 tonnes of CO2 emission every year.
In addition, Foresight manages 170MW of Reserve Power assets and two utility scale Battery Storage projects in the UK, providing 45MW of Enhanced Frequency Response (“EFR”) services to National Grid. Foresight is headquartered in London with regional offices in Manchester, Nottingham, Milton Keynes, Leicester and Guernsey and international offices in Sydney, Rome, Madrid and Seoul.
FREIF launched at the end of August. It offers Australian wholesale investors an attractive risk-adjusted return through the appealing characteristics of the infrastructure debt asset class. Volatility and downward pressure in the Australian equities and property market is generating increased appetite for diversified investment strategies, with investors increasingly turning to renewables and infrastructure for an attractive and reliable alternative source of investment income.
About Climate Bonds Initiative (“CBI”)
CBI administers an international standards and certification scheme for green and sustainable debt instruments. The Climate Bonds Standard is a science-based process designed to guide investors towards projects that contribute to addressing climate change.
About Carbon Trust
Established in 2001, the Carbon Trust is an independent organization working with businesses, governments and institutions around the world, helping them contribute to, and benefit from, a more sustainable future through carbon reduction, resource efficiency strategies, and commercialising low carbon businesses, systems and technologies.
Combining a deep understanding of low carbon technologies, markets and environmental impacts, with experience in both investment and finance, the Carbon Trust’s work ensures that green finance delivers genuinely green outcomes.