Clean EnergyThe carbon investment market is rapidly evolving as the economy gradually integrates carbon emissions reductions as an asset class through the various emissions reductions policies and regulatory frameworks that have become established in the past 10 years. In addition, we have seen a rapid growth in investment opportunities in clean energy infrastructure (both in number and the scale of the projects involved), as the provision of energy in the UK and Europe converges to a framework of decarbonisation and sustainability. In this area, renewable energies are playing a key role in the UK, US, Japan and elsewhere in the world, and to a lesser extent nuclear energy projects, as they are encountering numerous regulatory hurdles in Europe and Japan. Renewable energy suppliers have gained considerable ground in the last few years in the UK, now providing a significant percentage of the overall requirements of electricity for the entire country. Several subsectors of this industry still retain investment momentum, in spite of uncertainty surrounding subsidies and energy prices. The growth in the sector is faster than expected in most Western countries, and the forecast for the provision of clean energy (including nuclear) anticipates there is still a lot of scope for further growth to achieve ambitious emissions targets, which we are still a long way from meeting. The investment in the sector is projected to grow by £80bn in the next 10 years in the UK alone. |
StrategyOur asset management and investment strategy is centred on the carbon and clean energy markets. We identify projects after meticulous research and work closely with project owners to maximise their potential growth over a sustained period of time. We are interested in projects that add value, create tangible benefits and long-term capital growth and returns as opposed to mere short-term benefits. At the same time, we evaluate our investments with strict ethical (including human and labour rights) and environmental criteria and for instance we rule out investment opportunities in China and certain emerging markets, as they fail to meet our investment criteria that we look into from a number of perspectives and with measurable and objective parameters. We must satisfy our criteria that each project is a sound proposition from both the ethical and environmental point of view (i.e. it is a clean energy project with tangible emissions reductions) that is in sync with our investment values as well a viable investment that will be of strong financial interest to our clients. We chose carefully to commit to long-term investments that can provide security and certainty for our clients. We like to identify suitably flexible opportunities where the right combination of clean energy and alternative investments will yield the most profitable long-term results. We proud that we have remained consistent to our criteria and investment values and performed remarkably well at the same time. |
The KN FundThis is a fund consisting of several investments in the nuclear sector, as part of an international consortium. Carbonica Capital has invested in infrastructure for the construction of nuclear reactors in the UK and Japan and is working with French companies to increase the scope of the investment. The fund has so far invested £435 million in three related projects. The management of the fund is underpinned by a combination of carbon assets, energy generation and an equity interest in the underlying infrastructure. The template of this model creates as suitable diversification of risk and a sound sustainable long-term performance. |
Green BondsCarbonica Capital is working with the World Bank and the EIB on a forestry-backed green bond issuance of £200 million, underwritten at investment grade credit rating, in order to finance a fund of renewable energy projects in Japan. We are also committed to our own corporate bond, which is designed to finance a basket of low-risk and diversified renewable energy projects in the UK and the EU. Our bonds are available to external investors (not just our own clients) directly from us or from authorised intermediaries. |
