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Foresight launches first fund of Climate Bonds Initiative certified loans

  • 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 JonesHead 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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