Albion Ventures invests £1.4m in Northern Irish solar

The UK venture firm's backing of Erin Solar, its 11th renewable energy deal, comes shortly after it launched a power generation business this summer.

Albion Ventures, the UK venture capitalist, has invested £1.4 million (€1.7 million; $2.2 million) in Erin Solar.

The deal will help the company, a subsidiary of solar panel management business ISIS Renewables, develop solar photovoltaic (PV) projects in Northern Ireland. Albion aims to generate income from this investment over a 20 year-period, by selling electricity to the network grid and landlords at reduced prices.

The projects will benefit from Renewables Energy Certificates, the renewable energy subsidy provided by the Northern Irish government. These remain unaffected by recent regulatory changes regarding Venture Capital Trusts, the structure Albion uses to raise funds.

The transaction will provide fresh equity to ISIS, which was founded in 2010 as the first company to launch a nationwide solar PV offer in the UK. ISIS now manages around £40 million worth of solar assets for investors.

This investment marks Albion’s 11th in the renewable energy sector and third into solar. The firm, which was established in 2009 through the spin-out of Close Brothers’ former venture capital arm, increased its target allocation to renewables from 5 to 15 percent in September 2011, and has since followed on with investments in wind, hydro and solar.

The deal also follows the appointment of Volker Beckers as chairman at Albion Communiy Power (ACP), the power business it launched last June. ACP, which is currently on the road to raise £100 million, reached a first close on an undisclosed amount this summer.

Designed to offer investors relief from inheritance tax after two years, the company aims to develop enough power generation capacity to supply 35,000 UK homes.