Foresight Group launches new renewable energy fund

Global infrastructure and private equity investment manager Foresight Group has launched a unique investment fund, Foresight Renewable Energy Income Fund (FREIF), to provide Australian wholesale investors access to Climate Bonds Initiative (CBI) certified green debt.

The Fund is designed to generate superior risk-adjusted returns by investing in secured Australia-based smaller scale renewable energy projects. Infrastructure debt offers diversification benefits through lower correlations with the broader equity, property, and bond markets. The Fund has the objective of providing investors with an attractive, reliable and predictable income and will target a yield margin of 4.0% to 4.5% over the RBA Cash Rate.

The Fund will also be the first to pool capital into a series of CBI-Certified loans and will give Australian wholesale investors unique access to an asset class that has typically been available exclusively to institutional investors.

The Fund will focus purely on lending to renewable energy generation and associated infrastructure projects. An indicative portfolio would save an estimated 5.7 million tonnes of CO2 emissions over the life of the underlying assets compared to the equivalent coal generation – this equates to a year’s worth of power for 1.6 million Australian homes.