Impact project/investment of the year - infrastructure: Zouk Capital's Charging Infrastructure Investment Fund
The £420 million ($585 million) Charging Infrastructure Investment Fund (CIIF) is tackling the largest source of greenhouse gas emissions in the UK, according to fund manager Zouk Capital.
Backed by a cornerstone investment from the UK government, Zouk launched the fund in September 2019. It is dedicated to facilitating the country’s transition to electric vehicles, away from polluting internal combustion engine vehicles and improving air quality across the country.
Zouk said it is also committed to procuring 100% renewable energy tariffs for its electric vehicle chargers, "meaning that the vehicles charging on our networks are truly green vehicles".
The fund grew beyond its original £400 million target, and attracted investment from the Middle East, UK, US, Australia, and Germany, including from Masdar, The Church Commissioners for England, Willis Towers Watson's clients and investment funds, and Morgan Stanley Investment Management.
Zouk estimates that, over the life of the fund, the CIIF will, via its investments and transport miles supported by EV charging, enable hundreds of millions of litres of petrol/diesel to be replaced, and hundreds of millions of kilogrammes of GHG emissions to be avoided.
To meet its net zero by 2050 target, the UK Government has committed that 100% of the UK vehicle fleet will be electric by 2050, with no sales of new petrol or diesel vehicles from 2030.
During 2020, the market for electric vehicles grew by 175,000 units, a figure which represents 141% year-on-year growth. The UK's entire stock of electric vehicles grew by 60% in 12 months.
A further 200,000 to 250,000 new electric vehicles were expected to hit the road in 2021 and 2022, respectively.
Estimates vary, but it is thought between 25-40% of the UK’s cars do not have off-street parking and therefore are reliant on public EV charging networks to make the transition..
The CIIF has so far invested in three companies:
- Charging stations operator InstaVolt, the UK's largest owner and operator of charging stations, with plans to grow to 5,000 'rapid charge' points;
- Liberty Charge – a joint venture between Liberty Global, the owner of telecoms company Virgin Media, and Zouk Capital. The company uses Virgin Media's infrastructure deployment capabilities to lay the under-the-pavement infrastructure for on-street residential charging; and
- char.gy, which provides on-street electric vehicle charging via lampposts, and the software to run them.
Zouk said that, in 2020, its investments had the following environmental impact:
- GHG emissions avoided: 219,267kg
- Energy provided to drivers of electric vehicles: 2 GWh
- Litres of petrol/diesel displaced: 841,526 ltrs
George Ridd, partner at Zouk Capital told Environmental Finance: "The strategy which Zouk proposed to HM Treasury during the selection process was a capital gain i.e. earlier stage investing into innovative but well-structured companies with strong management teams looking to build companies and charging networks rather than buying assets that others have already built.
"Fundamentally, the UK car and van market which stands at nearly 40 million cars and vans presents a huge addressable market for the charging networks which we are building."