A Short Guide to Renewable Investments

By November 25, 2019EIS Investments

Bure Valley Group is an investment brokerage business which links successful investors with exciting, innovative UK startups seeking funding. This content is for information purposes only and should not be taken as financial or investment advice.

2019 is an exciting time for renewable energy. Alternative power sources have become more viable and lower in cost due to improvements in supply chains, larger turbines and negative movements in the oil and gas markets. Global demand for renewables is on the rise as countries across the world experience the detrimental impacts of climate change, and strive to counteract them.

Domestically, there is also political pressure for increased investment into renewables, making it more attractive to investors. The National Climate Change Act (passed by the UK House of Commons in 2008) is still in effect, and binds successive British governments to reduce the country’s carbon footprint by 80% by 2050. “Green” policy commitments are also becoming a more central plank of different political parties’ manifestos, as British citizens increasingly demand that more should be done to reduce the UK’s emissions.

 

Reasons to Invest in Renewable Energy

Clearly there is much growth currently going on in the renewables sector, and this looks highly unlikely to change in the near future. However, there is a range of other compelling reasons for people to consider committing capital towards renewable energy investments, including:

  • Rise in employment numbers. A rise in investment and renewable companies (in terms of volume and scale) is likely to correspond with an increase in jobs within the sector – both domestically and overseas.
  • Technology growth. The speed of growth within the renewables sector is highly attributable to rapid advancements in technology. Indeed, hardly a month seems to go by without an exciting startup coming forward with a pioneering innovation which provides cleaner, more efficient energy for customers. Advancements such as these are only likely to continue and accelerate, especially since the UK government will face a huge challenge meeting its commitments under the National Climate Change Act without new technologies which make this more achievable.
  • Ethics and norms. There is little doubt that much of humanity has caused immense harm to the physical environment through human behaviour, buying habits and population growth. By investing in renewable energy, investors can make a positive contribution to our world by working with companies which mitigate and counteract this harm.
  • Trade and economic development. There is a strong case to argue that high levels of fuel imports can have a negative impact on a country’s trade balance. By becoming more reliant on green energy sources, however, this can help to reduce national debts and encourage growth in GDP and living standards. Trade is also boosted as demand within these countries accelerates for renewable energy services and technology. Overall, this means that renewable investors can help to lift countries out of poverty, reduce global inequality and boost the quality of life for people across the planet.

 

Ways to Invest in Renewable Energy

There is no single way to invest in renewables, but a range of available options depending on your unique financial goals and circumstances. It is a good idea to speak to an independent financial adviser prior to committing large sums of capital.

Here are just some of the main ways people can invest in renewables:

 

Exchange-Traded Funds (ETFs)

One way for investors to invest in multiple renewable energy companies is to work with a financial adviser to find one or more ETFs to commit capital to (e.g. the iShares Global Clean Energy ETF). These are usually passive investments which follow the index of a specific market or sector, with their value rising or falling in line with the index.

 

Direct Investment

Of course, if you have the inclination and the funds you can also choose to approach renewable energy companies directly and offer your investment. This can be a higher-risk option for investors, but it can also present opportunities for higher returns.

This is the approach we take to renewable investing here at Bure Valley Group. In particular, there are two important additional benefits for investors who choose to leverage our network of investment opportunities:

  • Vetting. In order to qualify for presentation to our exclusive network of investors, we need to be confident that their business model is viable and stands up to scrutiny. This means that our renewable energy investment opportunities have undergone rigorous “stress testing”, which lowers the risk for our investor network.
  • Tax efficiency. Here at Bure Valley Group we typically work with companies which not only offer an attractive return to investors, but also a strong tax incentive. In particular, many of our projects are seeking funding under the Enterprise Investment Scheme (EIS) or Seed Enterprise Investment Scheme (SEIS), which can enable investors to leverage significant tax benefits (e.g. off-setting the value of their investment against their income tax bill, or making capital gains which are exempt from tax). Please note that these benefits come with important conditions
  • Diversity. The renewables sector encompasses a wide range of exciting investment opportunities including solar, wind, hydro and more. It can be difficult to know where to find these different opportunities on your own, yet at Bure Valley Group we bring many of these different companies together for your consideration.

Invitation

If you are a successful investor and would like to know more about the exclusive renewable energy investment opportunities we offer here at Bure Valley Group, then we’d love to hear from you. Get in touch today to start a conversation with a member of our friendly team, and to discuss some of the great investment memorandums we have available:

+44 160 334 0827
[email protected]eygroup.com