The government announced this Wednesday (25 April) that it has directly invested £80 million into the waste and recycling sector. The funds – which were committed by a ‘specialist team’ working within the Department for Business, Innovation and Skills (BIS) – have been dedicated to two ‘specialist fund managers’ who will administer investments in the small-scale waste infrastructure sector.
What’s more, all BIS investments made by the fund managers will be match-funded, which means that a further £80 million will eventually support the sector.
As opposed to waiting for state aid approval for the UK Green Investment Bank, the government has invested directly on ‘fully commercial terms’ by assigning fund managers Foresight Group (an independent alternative asset manager) and Greensphere Capital (a specialist investment firm focused on sustainable energy and infrastructure) to manage the £80 million of investment.
The fund managers will be responsible for generating and managing investments in small-scale areas such as waste recycling and reprocessing facilities, pre-treatment projects and energy-from-waste projects.
“These first investments are a landmark moment”, said Business Secretary Vince Cable in a statement. “They represent a great opportunity to unlock substantial commercial investment in green technologies and infrastructure. The government has committed to setting the UK firmly on course towards a green and growing economy and today is another important step in that direction.
“Investing directly now shows that we are not just sitting on our hands while we wait for the UK Green Investment Bank to receive state aid approval.”
According to BIS, Foresight Group will manage £50 million of the investment and Greensphere Capital will manage the remaining £30 million. The government pointed out that the maximum amount of individual investments is unlikely to exceed £15 million.
The government will also make a further £100 million available for investment in the non-domestic energy efficiency sector. A competition was launched last month for fund managers interested in working with BIS on the upcoming investment. The outcome of the competition will be announced in the summer.
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