VCs launch renewables, clean-tech group
London, 26 February: The British Private Equity and Venture Capital Association (BVCA) has set up an energy, environment and technology group to help promote the role of private equity (PE) and venture capital (VC) in renewable energy and clean technology.

The group held its first meeting last week and, according to its chairman Tom Murley of HG Capital, it has three objectives.

“The first is to educate investors and government of the need for climate change investments, and for the type of regulatory frameworks needed to encourage that investment,” he told Environmental Finance.

Given that the group includes investors with interests ranging from early-stage VC to infrastructure build-out, it will avoid specific policy recommendations, but will try to ensure that “the proper foundations are laid … to benefit the entire sector".

The second area of focus will be on establishing standards for reporting and transparency, and communicating returns from the sector. “The BVCA is a leader in setting high standards – how we should operate, how we should report – and we will look at how standards should be applied to this emerging area.”

He added investors also want to know what returns they can expect from clean-tech VC and PE investing – given that funds are unlisted, and typically hold investments for several years, return information is often hard to come by in the early years of an investment class.

The third objective will be to engage with management teams and communicate the benefits that VC and PE investors can bring. He said that the sector has benefitted from “easy capital” in recent years – particularly from listings on London’s Alternative Investment Market – but that has come without the discipline often brought by VC investors.

“We can bring in experience from other areas and expertise in management – it’s more than just money we offer,” he said.

The group members are: Amadeus Capital Partners, Blackstone Cleantech Venture Partners, CT Investment Partners, ePlanet Ventures, ETF, Good Energies, HgCapital, Impax Group, Riverstone Holdings, SEP, Virgin Green Fund and Wheb Ventures.

Simon Walker, chief executive of the BVCA, said: “Investment in renewable energy and clean technologies is a necessity now, not a luxury for healthier economic times … Innovation-intensive businesses will also be central to our efforts in charting a path out of recession. Private equity and venture capital can help forge a new clean energy economy and assist economic recovery by providing the capital and expertise which will allow this nascent industry to flourish.”