Investing in Green Infrastructure Funds (ITs)

[BusyBumbleBee]

BBB, I've just been having a look at GSF, which I was attracted to because of its involvement with energy storage projects. However, according to HL the yield is (only) 3.00% and its already moved to a premium of 7.81%. (SP: 97.5/100p). So I don't feel particularly enthusiastic about buying it with the dividend yield as low as that. (Noted that you bought in at an earlier point at a discount and with a lower SP).

When they launched, RichFool, they announced a target dividend of 7 pence per share in the second and subsequent years. We are now in that second year and they have not changed that target. This from an RNS on 11th September

The Board of Directors (the "Board") of Gore Street Energy Storage Fund plc (ticker: GSF) has today declared an interim dividend of 2.0 pence per ordinary share for the period 1 April 2019 to 30 June 2019

The dividend will be paid on or around 18 October 2019 to shareholders on the register on 20 September 2019. The ex-dividend date will be 19 September 2019.

The Company is targeting an aggregate dividend of 7.0 pence per share for the period 1 April 2019 and 30 March 2020.

This also implies a quarterly dividend as this one was for a 3 month period and the yield is now 7% on the offer price.

I should point out that I am considering selling mine unless there is more good news from the Irish Government tie up or the National Grid comes on board.

[richfool]

BBB, I've just been having a look at GSF, which I was attracted to because of its involvement with energy storage projects. However, according to HL the yield is (only) 3.00% and its already moved to a premium of 7.81%. (SP: 97.5/100p). So I don't feel particularly enthusiastic about buying it with the dividend yield as low as that. (Noted that you bought in at an earlier point at a discount and with a lower SP).

When they launched, RichFool, they announced a target dividend of 7 pence per share in the second and subsequent years. We are now in that second year and they have not changed that target. This from an RNS on 11th September

The Board of Directors (the "Board") of Gore Street Energy Storage Fund plc (ticker: GSF) has today declared an interim dividend of 2.0 pence per ordinary share for the period 1 April 2019 to 30 June 2019

The dividend will be paid on or around 18 October 2019 to shareholders on the register on 20 September 2019. The ex-dividend date will be 19 September 2019.

The Company is targeting an aggregate dividend of 7.0 pence per share for the period 1 April 2019 and 30 March 2020.

This also implies a quarterly dividend as this one was for a 3 month period and the yield is now 7% on the offer price.

I should point out that I am considering selling mine unless there is more good news from the Irish Government tie up or the National Grid comes on board.

Thanks BBB and Jackdaww.

Dividend yield noted and understood. I will need to keep an eye on announcements.

[PrefInvestor]

Hi All, Personally I see GSF as a bit of a minnow of a Trust which didnt start well, failing to raise the desired amount at its IPO. If the Capacity Market takes off it could do well though. Personally I am steering clear for the moment.

Also after developments in the markets these last few days I have cancelled my subscription to the ORIT IPO as I see many other likely more profitable opportunities now for deploying the money.

ATB

Pref

[PrefInvestor]

Care to elaborate on the "developments in the markets these last few days"? Thanks.

Hi ReallyVeryFoolish, Well my comments weren't meant to imply any changes in the ORIT situation or any of the other renewable energy trusts. Simply that with this weeks developments in the markets if I now just stick the money in any of BP, RDSB or HSBA (or any combination thereof) I can get good capital appreciation prospects and close to a 7% yield. With that option available I dont feel the need to invest in ORIT. As I already hold BSIF, FSFL, JLEN, NESF and TRIG I'm not exactly short of renewables exposure already, but I wasnt averse to the prospect of picking up one close to NAV and hopefully seeing a premium similar to the others develop. But these market moves have opened other options which are more immediate as far as I am concerned.

ATB

Pref

[richfool]

Care to elaborate on the "developments in the markets these last few days"? Thanks.

Hi ReallyVeryFoolish, Well my comments weren't meant to imply any changes in the ORIT situation or any of the other renewable energy trusts. Simply that with this weeks developments in the markets if I now just stick the money in any of BP, RDSB or HSBA (or any combination thereof) I can get good capital appreciation prospects and close to a 7% yield. With that option available I dont feel the need to invest in ORIT. As I already hold BSIF, FSFL, JLEN, NESF and TRIG I'm not exactly short of renewables exposure already, but I wasnt averse to the prospect of picking up one close to NAV and hopefully seeing a premium similar to the others develop. But these market moves have opened other options which are more immediate as far as I am concerned.

ATB

Pref

Totally understood thanks. I have been buying into RDSB on the way down. Recently LGEN has really surprised me after I luckily bought in bang on the bottom price too. But I have nothing in renewables so I am looking forward to owning a small slice of ORIT.

That's just given me a thought. Whilst not exactly green energy, your comments about RDSB made me think of BERI (Blackrock Energy & Resources Income trust - formerly BRCI), which gives exposure to Oilies such as Shell, BP, Chevron and Exxon, along with miners and gold, and currently yielding 6% and trading at a discount of -10%.

https://www.hl.co.uk/shares/shares-sear ... rd-gbp0.01

[PrefInvestor]

That's just given me a thought. Whilst not exactly green energy, your comments about RDSB made me think of BERI (Blackrock Energy & Resources Income trust - formerly BRCI), which gives exposure to Oilies such as Shell, BP, Chevron and Exxon, along with miners and gold, and currently yielding 6% and trading at a discount of -10%.

Hi richfool, Well FYI I just sold BERI and CYN the other day having held them for just over a year. BERI was down close to 10% in Total Return terms, CYN was flat. Figured I could do better elsewhere. Personally I think BRWM would be good if you could buy it in the 330s, but it hasnt got that low yet.

ATB

Pref

[richreduk]

<SNIP>

I am hoping that the IPO will be fully subscribed, as to my knowledge pretty well all new share issues on the part of renewable energy trusts in the last year have been. I am not expecting any scaling back as they have said that they are happy to go up to 750M if demand permits. Thereafter I hope that the trust quickly develops the significant premium that all if the other trusts operating in this space seem to have accumulated.

But all that is just my hopes for the investment. As to what actually transpires we will just have to wait and see....

ATB

Pref

My Bolding for emphasis

Just had my order for ORIT confirmed by AJ Bell - I only applied for £1000 and have received £747 worth of shares, so either they didn't go up to the full 750M or there was significantly extra demand. Either scenario should help add to the premium.

[PrefInvestor]

Hi richfool, There is an RNS which explains how things went, go onto the LSE web site and search for OCTOPUS. I looked earlier this morning.

ATB

Pref

[midgesgalore]

...
Just had my order for ORIT confirmed by AJ Bell - I only applied for £1000 and have received £747 worth of shares, so either they didn't go up to the full 750M or there was significantly extra demand. Either scenario should help add to the premium.

I got 74.7% of my order too but also approximately 0.5% extra free from HL

midgesgalore

[UncleEbenezer]

Looks like a linear scaleback. I too got 75.09% of my application (being 74.72% + my bonus from H-L).

So it would appear to have been moderately oversubscribed. Which (at a wild guess) probably comes as no great surprise to the market, and won't precipitate any great inflows or outflows of money from the sector on Monday.

[PrefInvestor]

Hi All, Article from Citywire on ORIT IPO

https://citywire.co.uk/investment-trust ... ider+Daily

ATB

Pref

[richfool]

Does this mean that wind is gaining the upper hand (over solar) in terms of UK renewable energy, and thus should I be increasing my exposure to wind (funds) in preference to solar?

This weekend’s windy weather set a new renewable power record – and saw some households paid to charge their electric cars to help balance the grid.

Wind farms generated more than 16 gigawatts of power – five times the output expected from the new Hinkley Point C nuclear power plant – in Britain for the first time on Sunday evening, figures from National Grid revealed.

Over the day as a whole, wind supplied 43.7% of British electricity as Storm Atiyah blew in with strong gusts, while nuclear generated 20.5%, gas supplied 12.8% and biomass 7.9%.

The British grid also got 7.4% of its power from imports, 3.1% from coal and smaller amounts from hydro, solar, storage and other sources.
“On a dark cold Sunday when we need it most, wind was providing more than 40% of our power, far more than any other source of electricity.

The previous wind energy record of 15.32 gigawatts was set on February 8 this year.

https://uk.finance.yahoo.com/news/windy ... 29225.html

P.S. Octopus get a mention.

[PrefInvestor]

Does this mean that wind is gaining the upper hand (over solar) in terms of UK renewable energy, and thus should I be increasing my exposure to wind (funds) in preference to solar?

Hi richfool, Well IMHO I don’t think so, the electrical power generation of each type renewable energy (wind, solar, AD, hydro etc.) tends to vary according to what’s happening in the environment over the relevant period. Sometimes the sun shines more often than at other times or the wind blows harder and longer than at others etc. I think that those trusts which hold all or most of the different types of asset are in a slightly better position than those with only one asset type as typically the different types won’t all be at their lows at the same time and so can generate more electricity and so make more money. Trusts with battery assets are also to be favoured I think as they can store their electricity for release when needed.

Just my personal opinion though.......

ATB

Pref

[richfool]

Thanks PrefInvestor. Just thinking out loud really.

I hold JLEN and TRIG as both hold solar and wind and JLEN also has some anaerobic digestion, so I feel I have covered most bases there.

I did in fact add NESF (solar) last month to increase my exposure to the sector, and as you may be aware from the thread above, flirted with GSF because of its focus on energy storage, but which I decided to leave the latter alone. (Plus I bought some BERI).

[torata]

Does this mean that wind is gaining the upper hand (over solar) in terms of UK renewable energy, and thus should I be increasing my exposure to wind (funds) in preference to solar?

Apologies in advance for the vagueness of this comment.

I remember seeing a map that was linked to from an online article, outlining the potential wind energy that could be harnessed.

I can't find the article or map now, but there's something similar here: https://globalwindatlas.info/

The point being made in the article was that in terms of potential wind energy that can be relatively easily and cost-effectively harnessed with current technology, then Scotland has potential to produce something like 20-30% of world's wind energy.

torata

[everhopeful]

ORIT trading at 1.04 on HL.

[sunnyjoe]

https://www.etfexpress.com/2019/12/11/2 ... niteshares

Renewable energy has become the top investment sector for UK investors with almost a third (30 per cent) regarding it as the sector they would actively put their money into for long term gain, according to a survey by ETF provider GraniteShares...

[richfool]

https://www.etfexpress.com/2019/12/11/281277/green-agenda-becomes-top-investor-priority-2020-says-graniteshares

Renewable energy has become the top investment sector for UK investors with almost a third (30 per cent) regarding it as the sector they would actively put their money into for long term gain, according to a survey by ETF provider GraniteShares...

I'm getting a bit worried that renewable energy might be becoming a bit too much in vogue (flavour of the period) and might just boil over. I note also the high premiums the funds are trading at. My exposure to the sector currently is c 7%.

[sunnyjoe]

https://www.moneyobserver.com/news/top- ... funds-2019

In a list of the most-bought ethical fund options for 2019, based on customer data from investment platform interactive investor, investment trusts claim the three top spots and take up six places in total in the top 10 table.

Interest in ESG (environment, social and governance) investing has spiked amid greater public concern over climate change, with activists such as Swedish teenager Greta Thunberg helping to keep the “E” in ESG centre stage.

The popularity of investment trusts in the top 10 list from interactive investor, the parent company of Money Observer, could be partly owing to some strategies being very sector specific. For example, The Renewables Infrastructure Group, which tops the table, and Greencoat UK Wind, in second place, both concentrate on renewable energy, while Syncona, with its focus on life sciences, takes the third slot. Greencoat manages a portfolio of onshore and offshore UK wind farms, while the Renewables Group offers exposure to wind and solar energy, as well as battery storage...

[Walkeia]

I'm getting a bit worried that renewable energy might be becoming a bit too much in vogue (flavour of the period) and might just boil over. I note also the high premiums the funds are trading at. My exposure to the sector currently is c 7%.

Seconded, I don't see a reverse to the investment theme but high premiums should result in on-going share offerings as managers grow AUM. As a consequence in October I reduced my TRIG and GRP and went into GCP infrastructure which is more debt heavy (albeit 60% is against renewable projects). I stick with JLEN as I appreciate the diversity across the power generation classes.

On the plus side - if been in vogue brings down funding rates for these projects so we can de-carbonise quicker so much the better. I'm eagerly awaiting electric cars becoming common so London's air quality improves.