How to invest in clean energy
PUBLISHED: 11:30 02 November 2018 | UPDATED: 11:33 02 November 2018
Many years ago, I was a first year student at Bristol University, living in Badock Hall, a modern hall of residence in a cluster of four small accommodation complexes situated on the edge of the beautiful Durdham Downs, around 30 minutes' walk from the main university precinct and the magnificent Wills Building.
Leafy and quiet, the setting was idyllic, though this benefit was offset by the need for students to vacate their rooms during the Christmas and Easter holidays because the university rented them out, primarily to companies hosting conferences at the halls who also had a need to accommodate their staff and delegates.
Just before the Easter vacation, a clutch of delegates appeared within Badock’s hilly environs and began preparing for a forthcoming conference. In one meeting room, a handful of people worked diligently, building and painting a scale model of the nearby river Severn.
Elsewhere, others unloaded equipment from the back of trucks, together with what appeared to be half a dozen very large oil drums, each cut into cross-sections to best show their inner workings to delegates scheduled to attend the conference, the subject of which was how to harness the Severn’s power with a tidal barrage.
I recall speaking at length with a member of this advance team engaged in conference preparations, an enthusiastic man in his 40s, a vintage I probably considered ancient.
He insisted that as the river Severn registered the world’s second-highest difference, in metres, between low and high tide (it still does), constructing a tidal barrage a little upstream from the original Severn Bridge made enormous commercial sense. It would, he said, eventually produce enough electricity to power the city of Bristol and most of Gloucestershire.
To a fresh-faced economics student, the chap presented what looked like a cut-and-dried case. Granted, there was a significant up-front investment to make, but payback would be achieved within 15-20 years, after which electricity produced by the barrage would effectively be generated free of charge. I was fascinated by the project and couldn’t understand why anyone in their right mind would oppose it.
That was almost forty years ago and, of course, the Severn barrage has still not been built. I cannot recall how much it was scheduled to cost (it was a very long time ago), but inaction then and since has cost the nation billions of pounds.
A lost opportunity? Well, the Severn’s ample tide still ebbs and flows with the same frequency as it did all those years ago, so it could be argued that the opportunity still exists. A windfarm has been constructed in nearby Avonmouth and several others built elsewhere along the Severn coast, on the English and Welsh sides, perhaps blunting the case for a tidal barrage, although it could be argued that their appearance does the exact opposite. If an unpredictable supply of wind can be harnessed to produce power, a guaranteed flow of billions of gallons of water (twice a day) could surely do the same?
I mention this episode not to expose any green credentials I may have, but after the people behind Moneymapp.com advised earlier this week that a summary of the various ‘ethical’ portfolios, suitable for ISAs, general investment accounts and pensions, was now available for savers and investors to see on their website. You can see the summary here: https://www.moneymapp.com/invest-now
Within the ‘Ethical Growth’ portfolio is the Pictet Global Environmental Opportunities Fund, which seemed apposite considering the opportunity described above. The fund invests in technologies and resources relating to environmental sustainability. Forty years following my initial interest in such matters, it warranted further investigation.
Established in 2005 and now worth £3.8 billion, the fund invests in companies that contribute to the reduction of carbon emissions by encouraging the production and use of clean energy. It also has stakes in firms involved in developing cleaner resources and infrastructures; the generation and distribution of cleaner energy, as well as cleaner and more energy-efficient transportation and fuels.
There’s no doubt that most of us are more ‘environmentally aware’ than we were four decades ago, which perhaps explains why this fund has proved so popular. Its growth suggests that opportunities on a scale with the mothballed Severn barrage still exist – a godsend for people looking to invest in such areas via their ISA. For further details, visit: https://www.moneymapp.com/isa .