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Citywire: The 2021 Trust Recovery Stories I’m Betting On

Posted on: January 8th, 2021 by Dusted Design

Last year will not be looked back on fondly by most people, but for many investors it ended up being a bumper 12 months. After the rebound from the pandemic, where are the remaining investment trust opportunities?

Last year will not be looked back on fondly by most people, but for many investors it ended up being a bumper 12 months. Those of us who had exposure to technology, biotech, gold, and Asia – China, Japan and Korea, in particular – will be patting ourselves on the back. By contrast, value investments struggled in 2020, even after November’s bounce, and many sectors were hit hard by lockdown restrictions. The first question for 2021, is: how quickly will Covid-hit businesses bounce back once vaccination programmes allow the resumption of ‘normal’ economic activity?

The Democrat win is also a shot in the arm for the renewable energy sector in the US. That is potentially good news for US Solar, SDCL Energy Efficiency Income  and newcomer Ecofin US Renewables Infrastructure (RNEW). I wouldn’t be surprised if each of these managed to raise more money this year.  In the UK too, the government’s pledge to build back greener may help UK-focused renewable funds and GCP Infrastructure which has a sizeable exposure to the renewables sector.

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The Association of Investment Companies (AIC) Compass: SEEIT and Efficient Income

Posted on: January 8th, 2021 by Dusted Design

How SDCL Energy Efficiency Income is benefitting from reducing energy wastage

‘2020 saw a fundamental shift in the prioritisation of green policy and the clean energy transition. Key policy initiatives and the commitment of vast sums of capital from leading government bodies around the world will aid the financial recovery and are critical steps forward in tackling climate change. These climate goals cannot be achieved through supply side measures alone. Reducing the size of cake has become key.

Forty percent of the world’s energy is used in buildings, but more than half of that energy can be lost or wasted in poor generation, transmission, and distribution systems. Those losses account for about a third of global greenhouse gas emissions and, as a result, the International Energy Agency says that energy efficiency measures can make up forty percent of the required energy reduction to limit global warming to 1.5° centigrade. This is the sector in which SDCL Energy Efficiency Income Trust Plc (SEEIT), the first UK-listed investment trust to invest exclusively in energy efficiency, specialises.

Forty percent of the world’s energy is used in buildings, but more than half of that energy can be lost or wasted in poor generation, transmission, and distribution systems. Those losses account for about a third of global greenhouse gas emissions and, as a result, the International Energy Agency says that energy efficiency measures can make up forty percent of the required energy reduction to limit global warming to 1.5° centigrade. This is the sector in which SDCL Energy Efficiency Income Trust Plc (SEEIT), the first UK-listed investment trust to invest exclusively in energy efficiency, specialises.

SEEIT floated on the London Stock Exchange in December 2018, introducing the opportunity to invest in energy efficiency projects to the public and raising £100m. There has been growing appetite from investors for our offering. Since our IPO, we have raised an additional £441m in subsequent fundraisings from a broad range of investors keen to invest in a strategy that delivers an attractive income stream by providing businesses with sustainable energy solutions, while reducing their costs in the process.

SEEIT has acquired and manages a portfolio of assets across the UK, Europe, and North America that delivers a diverse range of energy efficient solutions directly to end-users in return for long-term contracted income. Some projects provide cleaner, cheaper and more reliable energy directly to the point of use through onsite energy generation, e.g. through solar panels or combined heat and power plants – thereby avoiding losses in transmission and distribution from the grid. Others reduce energy waste on the demand side, for example retrofitting a building with more efficient LED lighting, air conditioning, insulation or building controls.

For example, our onsite generation system in St Bartholomew’s Hospital in London provides heat and power at an efficiency level of over 80%, whereas if the energy were drawn from the grid, its energy would have an efficiency level of below 40%. We have also installed rooftop solar power panels across Tesco’s estate, again bypassing the grid and providing more efficient energy directly to the point of use. Recently, we have also invested in the roll-out of an electric vehicle charging network, acquired a biogas

For example, our onsite generation system in St Bartholomew’s Hospital in London provides heat and power at an efficiency level of over 80%, whereas if the energy were drawn from the grid, its energy would have an efficiency level of below 40%. We have also installed rooftop solar power panels across Tesco’s estate, again bypassing the grid and providing more efficient energy directly to the point of use. Recently, we have also invested in the roll-out of an electric vehicle charging network, acquired a biogas distribution network in Stockholm and invested in one of the largest commercial and industrial solar portfolios of its kind in the United States.

In addition, we have a portfolio of industrial cogeneration projects in the United States, where waste flue gases and heat from steel production, that would otherwise be polluting the atmosphere, are recycled into turbines, producing power for the steel mills and the surrounding site. The portfolio generates around 298MW of energy but earns renewable energy certificates equivalent to 536MW of solar power production, due to its waste reduction.

SEEIT’s portfolio has continued to perform robustly throughout the hugely challenging Covid crisis, reflecting the nature of the essential service our projects provide to clients.

With the prospect of a renewed commitment to environmental policy in the United States from the incoming Biden administration, as well as recent commitments by the UK government and the EU, we expect 2021 will see even greater momentum for greening the economy. We have an exciting pipeline of opportunities for SEEIT to invest in and we will look to continue to expand and diversify the portfolio. These projects will help us achieve our shared net-zero goals while delivering long-term, reliable income to our shareholders.

With the prospect of a renewed commitment to environmental policy in the United States from the incoming Biden administration, as well as recent commitments by the UK government and the EU, we expect 2021 will see even greater momentum for greening the economy. We have an exciting pipeline of opportunities for SEEIT to invest in and we will look to continue to expand and diversify the portfolio. These projects will help us achieve our shared net-zero goals while delivering long-term, reliable income to our shareholders.

With the prospect of a renewed commitment to environmental policy in the United States from the incoming Biden administration, as well as recent commitments by the UK government and the EU, we expect 2021 will see even greater momentum for greening the economy. We have an exciting pipeline of opportunities for SEEIT to invest in and we will look to continue to expand and diversify the portfolio. These projects will help us achieve our shared net-zero goals while delivering long-term, reliable income to our shareholders.’

The Compass January 2021 (Page 4)

Citywire: Acquisition Spree Keeps Green Energy Funds Busy Over Xmas

Posted on: January 4th, 2021 by Dusted Design

On Christmas Eve, SDCL Energy Efficiency Income (SEIT), a £560m investment trust, agreed to acquire $150m of US solar and energy storage projects as well as a 50% stake in their developer, Onyx Renewable Partners, managed by private equity firm Blackstone. The London-listed energy efficiency fund today announced it had spent $36m acquiring a further interest in Indiana-based assets.

The closed-end fund has grown quickly since raising £100m to launch in December 2018, most recently raising £105m in October. Shareholder total returns, including dividends, were 4% last year, with the shares sinking slightly from August highs. Stockbroker Numis Securities called the latest transaction ‘significant’ and said the 5.8% premium to net asset value (NAV) at which the shares ended 2020 reflected the ‘in-vogue’ nature of energy efficiency and storage.

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PV-Tech: SDCL Acquires US$150M of Solar-Plus-Storage Projects in US

Posted on: January 4th, 2021 by Dusted Design

UK-based investor SDCL’s Energy Efficiency Income Trust (SEEIT) is to acquire hundreds of solar PV and solar-plus storage projects in the US from developer Onyx Renewable Partners and set up a joint venture in a deal worth US$150 million. SEEIT will acquire four portfolios totalling 175MW of capacity in 18 US states from Oxyx and investor Blackstone, and will set up a joint venture with the developer, taking a 50% interest in its project pipeline, which is expected to surpass 500MW by 2025.

The projects comprise more than 200 on-site solar-plus storage projects including rooftop installations, carport and private wire ground-mounted solar PV projects, with individual capacity ranging from 5MW to more than 15MW. Just over a quarter (27%) of the installed capacity is either operational or near-operational, with all projects expected to come online in the next 18 months. Projects that are already online are contracted under Power Purchase Agreements (PPAs) with municipalities, universities, schools, hospitals, military housing providers, utilities and corporates. The acquisition is set to complete over the next few weeks, according to a statement from SDCL.

Jonathan Maxwell, chief executive of SDCL, said the deal will diversity the UK-based group’s portfolio and create a “meaningful impact to reduce the carbon footprint of commercial and industrial clients across the US”.

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Citywire: FTSE Soars 3.1% on First Trading Day of 2021

Posted on: January 4th, 2021 by Dusted Design

SDCL Energy Efficiency Income (SEEIT) traded up 0.7%, or 0.8p, at 107p after buying an additional 15% stake in Primary Energy, a portfolio of recycled energy projects in the US.

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Clean Energy Pipeline: SEEIT Bolsters Investment in Primary Energy

Posted on: January 4th, 2021 by Dusted Design

SDCL Energy Efficiency Income Trust plc (SEEIT), managed Sustainable Development Capital LLP, has acquired an extra 15% stake in Primary Energy, which owns a portfolio of recycled energy and cogeneration projects located in Indiana, USA.

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Jefferies: First View: Primary Energy Follow-on

Posted on: January 4th, 2021 by Dusted Design

Detail: SEIT has acquired an additional 15% interest in Primary Energy, a 298MW portfolio of recycled energy and cogeneration projects at steel mills located in Indiana, for a cash consideration of $36m. This takes SEIT’s total interest in the portfolio to 65% and under the agreed terms it could be further increased.

Conclusions: The follow-on implies a valuation of $240m for the portfolio, against $220m at the time of the original acquisition in February last year. However, a 10-year extension of the offtake agreement at the Ironside plant has been agreed in the interim. On the financing side, the acquisition has been funded from October’s placing proceeds, noting that the $150m Onyx solar and storage project acquisition (announced on 24/12/20) has yet to complete.

N+1 Singer: SDCL Energy Efficiency Income Trust (SEIT) – Further Investment in Primary Energy

Posted on: January 4th, 2021 by Dusted Design

Investment: “Acquisition of an additional 15% interest in Primary Energy, a portfolio of recycled energy and cogeneration projects located in Indiana, USA for an equity cash consideration of approximately $36 million. SEEIT acquired an initial 50% interest in Primary Energy in February 2020. Following this acquisition, SEEIT’s interest in Primary Energy is now 65%. “

Primary Energy: “The 298MW [Primary Energy] portfolio consists of five operating projects which generate low-cost, efficient energy with substantial environmental benefits via three recycled energy projects, one natural gas combined heat and power project and a 50% interest in an industrial process efficiency project.”

QuotedData: QuotedData’s Morning Briefing 4 January 2021

Posted on: January 4th, 2021 by Dusted Design

SDCL Energy Efficiency Income (SEIT) announced the acquisition of an additional 15% interest in Primary Energy, a portfolio of recycled energy and cogeneration projects located in Indiana, USA, from a consortium led by Fortistar LLC for a cash consideration of approximately $36m. SEIT acquired an initial 50% interest in Primary Energy in February 2020. Following this acquisition, SEIT’s interest in Primary Energy is now 65%. SEIT has also agreed terms under which it could increase its stake and further enhance returns for shareholders. The 298MW portfolio consists of five operating projects which generate low-cost, efficient energy with substantial environmental benefits via three recycled energy projects, one natural gas combined heat and power project and a 50% interest in an industrial process efficiency project.

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