Ingenious Investments, part of UK-based investment and advisory group Ingenious, has launched the African Solar Fund, a social impact investment fund which aims to transform the energy supply for some of the most economically deprived households in Africa.
Social impact investment is a rapidly developing asset class that enables investors to make investments that generate financial returns while simultaneously having positive social, and often environmental, benefits.
The fund will invest in one or more companies which distribute innovative “off-grid” solar technology, such as solar panels which power LED lamps and mobile phone charging cables, to households in rural African communities. These solar units enable people to benefit from cleaner, safer, renewable energy and simultaneously reduce energy spend by up to 50 per cent when compared to kerosene, the widely used alternative.
Many people in Africa have to make long journeys to buy kerosene for light and to charge their mobile phones, both of which are essential for education, trade and communication. There are also significant health and safety risks involved with using kerosene, the indirect effects of which are reportedly responsible for as many as two million deaths each year.
The fund is targeting an investment period of between four and five years; on exit, any returns in excess of an annualised eight per cent will be redeployed into more projects developing sustainable resources in Africa.
Some or all of the fund’s investments may qualify for relief under the Enterprise Investment Scheme (EIS), giving UK taxpayers additional tax advantages. The minimum individual investment is GBP5,000 and the closing date for investment is 2 April 2013.
James Axtell, investment director at Ingenious Investments, says: “At Ingenious, we are committed to offering our clients a broad range of investment opportunities. The African Solar Fund offers investors a very real opportunity to make a difference and help transform the lives and livelihoods of tens of thousands of people in rural Africa, as well as providing the prospect of achieving an attractive financial return.”
