The fund will invest in around seven unquoted British companies operating in areas such as renewable energy, waste-to-energy and recycling. These companies will be eligible for Enterprise Investment Scheme (EIS) tax benefits including 20 per cent EIS tax relief and capital gains tax exemption.
Foresight intends to raise further, larger funds in the future, which it may support by additional debt financing.
Bernard Fairman, founder and managing partner of Foresight, says that the environmental infrastructure sector addresses significant consumer demand both for services such as recycling and for renewable energy sources.
He adds: ‘The growth of renewable energy is likely to be further fuelled by security of supply issues, particularly concerns about the Middle East and Russia.’
The Sustainable UK Investment Fund has already made its first investment, in O-Gen UK, which generates electricity from waste wood. Foresight has committed £3 million to O-Gen as part of a funding round worth £10 million which will enable O-Gen to build its first plant in Stoke-on-Trent.