Triodos backs two UK solar farms with £17.9m

The fund’s investment in the 20MW capacity projects is its first since removing a targeted return from its ‘simplified’ investment objectives.

Two solar farms in the UK with a combined capacity of 20.1MW have secured £17.9 million ($23.6 million; €20.1 million) from clean energy financier Triodos.

The debt provided to the two projects owned by Spanish developer Gamma Solutions includes a £15.1 million project finance loan from Triodos Bank and a further £2.8 million mezzanine loan from Triodos Renewable Europe Fund, a vehicle managed by the bank’s investment management division.

The backed portfolio consists of the 15.1MW Stokes Marsh site and the 5MW Stoneshill project, which have been operational since March 2015 and March 2017, respectively.

The investment by the Triodos Renewable Europe Fund is the vehicle’s first since it announced a change to its investment objective in March, removing references to a targeted annual return. The semi-open-ended fund has eyed a 5 percent to 7 percent return since its launch in 2006, although it has only returned 2.7 percent to its institutional investors since its inception, as at the end of June this year.

“The overall objective of Triodos Renewables Europe Fund has not changed,” a spokesman for the fund told Infrastructure Investor. “References to the performance target objective were indeed removed. We consider it as more appropriate to include a broader financial objective, which also includes reference to the intended general environmental social impact of the sub-fund’s investments.”

In the first six months of 2017, the fund returned -2 percent following an adverse impact from lower electricity price forecasts, as well as lower-than-expected production in the Netherlands and Germany and the weaker British pound. The Stokes Marsh and Stoneshill sites backed by the fund are supported by UK Renewable Obligations Certificates and power purchase agreements.

As at the end of June, the fund had invested in 21 wind and solar projects across the Netherlands, Belgium, Spain, Germany, Italy, the UK and France. It has a portfolio value of €55.8 million.