EnviroInvest Investment Fund

The EnviroInvest Investment Fund is an unlisted wholesale Australian unit trust designed to capitalise on the global transition toward a low-carbon economy. The Fund implements a diversified strategy by investing in projects and companies dedicated to renewable energy generation, storage, and innovative technologies. The Fund will also have exposure to carbon abatement, carbon credits and other environmentally conscious assets.

By balancing its investments between utility-style assets all the way to high-growth opportunities, the Fund seeks to generate above-benchmark total returns while achieving a measurable environmental impact. Approximately half of the portfolio targets mature, income-producing facilities to support annual distributions, while the remainder focuses on development-stage projects and financial instruments like carbon credits and emission trading schemes. This diverse exposure across asset classes is achieved through the convenience of one single unit.

This open-ended vehicle provides sophisticated investors with diverse exposure to both debt and equity holdings across the decarbonisation spectrum. Managed with a rigorous evaluation process, the Fund remains adaptable to shifting regulatory landscapes and technological advancements within the Australian and international green finance markets.

EnviroInvest Investment Fund, is an unlisted and unregistered wholesale Australian unit trust which invests in projects or companies that:

• are creating solutions to help reduce carbon emissions.
• are creating emission free energy. 
• reduce carbon in the atmosphere through the development of their assets.

It may also have exposure to carbon credits, emissions trading schemes (ETS) or other nature based investments.

The Fund is an open-ended fund with no predetermined termination date. The Fund may, therefore, continue to make new investments and issue Units on an ongoing basis.

Investment Objective

To generate an above benchmark total return for investors by investing in projects and businesses seeking to profit from their leverage to the goal of carbon emissions reduction.

Investment Strategy

The asset allocation is detailed below. The aim of the investment strategy, implemented via the asset allocation, is:

1. To offer a diverse portfolio of environmentally conscious assets for investors to consider.
2. To provide the opportunity for investors to financially benefit from the ongoing transition.
3. To have some exposure to potentially high growth investments.
4. To achieve a measure of income through investments in assets that earn a fairly predictable return.
5. To achieve a measurable impact on the goal of carbon emissions reduction.

The Fund may invest directly or indirectly in listed or unlisted assets or projects that are engaged in:

• renewable energy generation
• energy storage
• transmission of renewable energy power
• carbon abatement projects
• developing innovative technology to reduce carbon emissions 
• green bonds
• financial assets based on carbon credits
• financial assets based on emission trading schemes
• financial assets based on nature-based credits
• other financial securities based on the above 

The Fund does not intend to take a controlling interest in companies or projects.

The focus of the Fund is to invest in projects or companies that: 

• are creating solutions to help reduce carbon emissions.
• are creating emission free energy. 
• reduce carbon in the atmosphere through carbon sinks, offsets or technology.

The Fund can also use derivatives and managed funds to gain exposure to carbon credits, emissions trading schemes (ETS) or other nature-based credits.

Some investments will be very early in their development cycle, whilst others will be mature, profit generating facilities. For those at the early stages, they often need to overcome obstacles including environmental approvals and resistance from communities. When looking at more innovative carbon reduction solutions, there is often a technology risk. Plenty of companies are working on technological solutions that offer great promise, but they are also unproven. 

There are also economic risks with some of the more innovative solutions. Whilst the technology may seem appealing, the cost of production may be excessive compared with other alternatives. Ultimately, technologies are far more likely to succeed if they are cost competitive without the need for long-term government support and not just relying on their green credentials. Further information on risks of investing in environmental assets is enclosed within the Information Memorandum.

Many of these investments will be in long duration projects. They will require a firm commitment of capital and there will be minimal opportunity to access liquidity until the projects have reached maturity.

The asset allocation is not fixed. It can vary within the ranges in the table below. This is to ensure that it can adjust to shifting risk factors as well as take advantage of opportunities as they arise. 

However, broad adherence to the asset allocation targets will maximise the opportunity to achieve the Fund’s objectives. 

Investments will occur at both the company and project levels and may include both equity and debt holdings. Each investment will involve in-depth evaluation including examining financial statements, management team, current and emerging technologies, competitive position, and growth prospects.

Regulatory factors including approvals, subsidies, guarantees etc are important factors, as too is the status of company and project financing.

Income vs growth

The intention is to achieve total return growth on your investment, with the income supporting the growth aspirations of the Fund. 

The Fund intends to pay an annual distribution if and when conditions and performance allow. This will primarily be supported by the income producing assets within the Fund, along with any capital gains that might be realised. To facilitate this, the portfolio will be diversified across mature operating assets that are profitable and pay a regular distribution, through to assets in the development phase and companies investing in new technologies.

Up to 10% of the total asset value of the Fund. This is for liquidity or to seize short term opportunities. It is not intended to be a leveraged fund.

Initial lock-up period of 12 months, there after Annual redemption requests (subject to certain restrictions). 90 days notice period. The redemption price will be determined based on the Net Asset Value of the relevant Class (adjusted for transactions costs) divided by the number of Units on issue.

Requests for redemption during the initial lock-up period or outside of the scheduled annual redemption period will incur an additional fee of 5% of the amount withdrawn and will remain subject to the Investment Managers’ sole discretion regarding whether the redemption is accepted and the timing of any payment.

EnviroInvest Pty Ltd ACN 685 107 957 (“EnviroInvest”) is an Authorised Representative of Daylight Financial Group Pty Ltd ACN 633 984 773 (“DFGPL”) which is the holder of an Australian Financial Services Licence (AFS Licence No. 521404).

Information in this commentary is current as at date prepared unless otherwise stated. However, please bear in mind that investments can go up or down in value, and that past performance is not a reliable indicator of future performance. 

This communication may contain general financial product advice. It has been prepared without taking into account your personal circumstances, and you should therefore consider its appropriateness in light of your objectives, financial circumstances and needs before acting on it.

If our advice relates to the acquisition or possible acquisition of a particular financial product, you should obtain a copy of and consider the Information Memorandum (IM) or Product Disclosure Statement (PDS) before making any decision.