Profit from your principles with green energy

August 25, 2012 by  
Filed under Green Energy News

By
Stephen Womack

15:42 EST, 25 August 2012


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15:42 EST, 25 August 2012

Opportunities are increasing to gain solid returns from renewable and clean energy through funds that target wind, solar and water power projects.

In the past few weeks new funds have been launched aiming to give a pension income from owning solar panels, and profits from wind energy investment.

The Government has set a target for 20 per cent of the UK’s energy to be produced from renewable sources by 2020, giving an extra push to the sector. Other nations are also keen to boost their green energy.

Philip Jones wants to help cut dependency on fossil fuels - and make money

Worthwhile: Philip Jones wants to help cut dependency on fossil fuels – and make money

‘People are motivated to invest in this sector both by profit and by their principles,’ says Mark Hoskin, a partner at independent financial adviser Holden Partners in Farringdon, central London, a specialist in environmental and ethical investments.

‘The long-term dynamics are that fossil fuel reserves are limited and energy prices are rising. Renewables have to be an important part of the energy mix in the years ahead.’

There are different ways to approach the sector. One option is to buy a fund that invests directly in the infrastructure of renewable energy such as wind turbines or solar panels.

Two years ago, Philip Jones, 69, bought into the Ventus venture capital trust, which invests in wind farms.

Then last year he invested in the Goldfield Solar enterprise investment scheme fund.

This buys the rights to a feed-in tariff income from solar panels fitted to homes. The occupier gets free electricity, while the investor banks the income.

Goldfield Partners has now launched the Solar Green Energy Fund. This is being structured as a pension investment, allowing those with self-invested personal pensions to draw a target annual income of between six and eight per cent.  The minimum investment is £10,000.

Philip, a retired union education officer from Morden, south-west London, says: ‘I prefer to make my money in ways that are worthwhile. These investments are my little contribution to reducing our dependency on fossil fuels.’

Five top-performing ethical funds for retail investors

Another fund in this sector is the £30 million Triodos Renewables, which is hoping to raise a further £8 million with a new share issue. A sister company to ethical bank Triodos, the fund has been running for 16 years and has 4,800 shareholders.

Mark Churchill, 36, of Bristol, a digital marketing manager with a stockbroker, bought shares last year and plans to top up his investment again.

The fund invests in British wind and hydro-electric energy projects. Its share price has risen by 50p to 190p since 2006 and it has paid 16p in dividends over the period, equivalent to a 6.8 per cent annual return.

Mark says: ‘Pound for pound I can get a far bigger reduction in carbon emissions through investing in the fund than by putting solar panels on my roof.’

Matthew Clayton, managing director of Triodos Renewables, says the company needs more capital to invest in projects. ‘We have a pipeline of investments already identified that we want to press ahead with,’ he says.

Go to triodosrenewables.co.uk or call 0845 4786359 for details.

Mark Churchill is a fan of Triodos Renewables

Ethical: Mark Churchill is a fan of Triodos Renewables

Investors willing to tie up their funds for 20 years can lock into returns of between six and 7.8 per cent a year through buying debentures from Padero South Downs. The investment will fund the installation of solar panels on homes in southern England, with the feed-in-tariff income going to the debenture holders.

A debenture is a long-term unsecured loan taken out by a company, which it agrees to repay at a specified date. The investment is being organised by Abundance Generation (abundancegeneration.com).

The debenture income paid every six months will depend on how much the sun shines and the rate of inflation for the life of the investment.

But be warned – those who invest directly in renewables through such funds may not always be able to sell their stake quickly. An exit can depend on there being a willing buyer.

An alternative approach is to invest through funds that buy shares in companies supplying and supporting the sector.

Sarasin New Power and Pictet Clean Energy, for example, both invest internationally.

They target firms producing equipment for solar and wind projects, the natural gas sector and companies in energy efficiency.

Profits have been hard to come by in recent months. Hoskin says: ‘Competition is fierce. Demand for solar panels and turbines is increasing, but so is supply, and it has been difficult for companies to make money.’

A lower-risk option is a broader environmental fund that can also invest in sectors such as water, waste management and agriculture. This allows the manager to hunt for returns in other areas if renewable energy company shares are under pressure.

General funds include Cheviot Climate Assets and Pictet Environmental Megatrend Selection.

Here’s what other readers have said. Why not add your thoughts,
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If the government went for Thorium Reactors which has 99% less waste, is not toxic, works at atmospheric pressure (so won’t explode as in Japan), plenty of cheep fuel about, cheeper to build and run (meaning lower fuel bills) and is being developed in China, the USA. This was also going to be our governments choice in the 40s until nuclear was used instead for weapons grade fuel. So why aren’t we using this now so we can be self reliant again for all our power?. Why, MONEY POWER for a few individuals thats why. They will let us go cold in winter so they can keep their thumbs on the power taps and charge ever increasing prices. If people only knew the truth, there would be a real revolution.

Unbelievable. A positive DM article mentioning wind farms

Profit from your Principals.
Boycott Debt.

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