Published on September 5th, 2012 | by Andrew1
UK Solar Pension Fund to Offer Healthy Returns, Free Solar for Social Housing
CleanTechnica’s been reporting on investors’ increasing comfort level and investments – both direct and indirect — in the still fast-growing solar, wind, and renewable energy sectors. Along those lines, UK-based BusinessGreen on Aug. 31 reported that London-based Goldfield Partners has launched what’s thought to be the UK’s first pension fund dedicated to financing the purchase, installation, and maintenance of residential solar power systems for social housing residents.
What stands to make Goldfield Partners’ proposed ₤50 million ($79 million) Solar Green Energy Fund unit trust appealing to investors are stable, inflation-adjusted returns as high as 8%. Returns are based on investors benefiting from the UK’s solar feed-in tariff (FiT), which UK retail investors haven’t been able to participate in directly up to this point in time.
What stands to make it very appealing for those living in government-supported housing is that the solar photovoltaic (PV) systems will be installed for free.
Bringing Solar Power to the Masses
Goldfield Partners is “very confident” it will meet the Solar Green Energy Fund’s initial ₤50 million subscription target by June 2013. The company already has contracts with residential solar PV systems installers in place for the entire amount.
“We hope to fund a lot more free solar… for people who may not have been able to afford the equipment in the first place,” Goldfield Partners’ chief executive David Gammond told BusinessGreen. “If we can raise the [£50m] we would definitely expect the fund would get bigger.”
Certainly, there are challenges and pitfalls peculiar and generic for any investor looking to put capital to work in the still up-and-coming renewable energy sectors, but doing so makes good business sense for institutional investors in several significant ways — not only in terms of long-term investment returns and performance, but in terms of social and environmental responsibility.
Moreover, the renewable energy sector, and investors, could benefit greatly if government representatives, regulators, and banking, finance and accounting industry associations tweaked tax and accounting rules and regulations to provide equal opportunity for solar, wind, and other renewable energy project developers to take advantage of a wider range of investment vehicles, such as master limited partnerships and accelerated depreciation schedules — advantages oil & gas companies and project developers have been taking advantage of for decades.
Underpinning and supporting all this is federal and state energy policy. The same is true for any government in any country looking to renewable energy as a socially and environmentally responsible engine for economic growth and development.
Goldfield Partners’ Gammond acknowledged that changes in the UK’s FiT would force Solar Green Energy Fund management to reassess the economics of its social housing solar power systems projects. “We’ve worked hard to get a good price for equipment and installation and with social housing there are economies of scale as you do the whole street at once,” he was quoted as saying. “But if the feed-in tariffs change dramatically, we would have to look again at the price of equipment.”
Here in the US, Pres. Obama and his administration have worked and fought hard and steadfastly to erect a mutually reinforcing and proactive framework for an energy policy that moves us more boldly towards a cleaner, more sustainable energy ecosystem and economy driven by new renewable energy systems and technology.
He’s been met with fierce, very well-funded opposition by those who would like to see federal energy policy remain in the hands of oil, gas, and nuclear industry interests. Those forces are only ramping up their spending and public relations campaigns. This November our votes will determine which road we head down. Get out, have your voice heard, and vote for candidates that envision a cleaner, healthier, and more sustainable economy and future for all.