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Schroders Capital has received regulatory approval from the Financial Conduct Authority (FCA) to launch the UK’s first long-term asset fund dedicated to renewables and the energy transition.
Long-term asset funds (LTAFs) are a new category of open-ended authorised fund created by the FCA to enable professional investors, in particular defined contribution pension schemes, to invest in long-term, illiquid assets such as venture capital, private equity and debt and infrastructure.
The new fund for investment in renewables and other infrastructure related to the energy transition is the third LTAF to receive regulatory approval from the FCA. The fund will be managed by Schroders Greencoat, which was named Greencoat Capital before Schroders Capital acquired a 75% stake in the company in 2021.
Schroders Capital’s Climate+ fund was the first LTAF to be approved by the FCA in March.
Richard Nourse, manager partner for Schroders Greencoat, said: “In March 2013, Schroders Greencoat pioneered the renewable energy infrastructure investment trust market with the launch of Greencoat UK Wind PLC, still the sector leader and now a £3.6 billion company on the edge of the FTSE 100.
“Today, with increased focus on the DC pension market, we are again pioneering innovative ways to make investment into renewable energy and other energy transition related infrastructure accessible to as wide a range of investors as possible.”
Duncan Hale from the private markets group at Schroders Greencoat, said: “For too long DC pension scheme members have had their noses pressed up against the glass, looking in at other types of investors enjoying the benefits that come from investing in illiquid assets.
“We are excited about the ability to offer access to renewable energy and energy transition related infrastructure assets to DC members widely, not only due to the attractive risk and return metrics they provide but also their ability to reflect members’ sustainability requirements.”
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