Green investment in its current form here in the UK seems to involve a lot of risk without the compensatory rewards. Lack of funding, and some woefully poor execution, has left the junior market littered with failures.
So much so that investors have become rather jaded and cynical about the sector. Going against type is Greencoat UK Wind, which is preparing to list next month.
Britain’s first ever green infrastructure fund, it has been set up as a yield play with the funding and development risk removed.
In that context, it is a unique vehicle rather than the latest iteration of unsatisfactory green investment attempts of the past.
Its IPO is expected to raise at least £205million, which will bankroll the acquisition of six established wind farms (five onshore, one offshore) from Scottish and Southern Energy and the German giant RWE.
The average price for the onshore assets is £1.8million per mega watt – the market rate for deals in this sector.