The UK Infrastructure Bank has today announced it will be the cornerstone investor into a new fund to provide scale-up capital for the next generation of infrastructure projects across the UK.
The Bank has worked with Octopus Investments to create the fund, which will support new infrastructure projects vital to helping the UK meet its net-zero targets. The Octopus Sustainable Infrastructure Fund, ‘OSIF,’ will provide growth capital to companies looking to roll out and support sustainable infrastructure projects within the Bank’s mandated priority sectors.
The Bank will invest up to £100m on a match-funding basis, unlocking between £100m to £300m of private capital. The fund will invest in the companies developing and rolling out sustainable infrastructure projects in emerging sectors for whom mainstream debt financing is not yet available. Projects could, for example include battery storage and electric vehicle charging.
CEO of the UK Infrastructure Bank, John Flint said:
“The UK Infrastructure Bank was set up to solve the most important problems we face today, in partnership. This investment, which is fully aligned with our mandate, could unlock over £100m of private funding into new green industries and help people across the UK to benefit from innovation in their local area. We are happy to work alongside Octopus Investments to help innovative green projects access the finance they need.
“This is the sixth deal for the Bank as we approach the end of our first year, and we are developing our approach to how we can best complement the market. We’re just getting started, and I look forward to seeing the impact of this fund, and our other investments as we grow.”
Robert Skinner, Head of Alternative Investments, Octopus Investments said:
“The scale of the UK’s net zero ambitions will require billions of pounds of investment. Some of that money needs to be channelled towards scaling up the emerging infrastructure technologies, companies and assets across critical sectors, such as digital infrastructure like small cells and green data centres, battery storage, electric vehicle charging and waste management. These are the sectors will form the foundations of our sustainable economy and energy system in the years to come.
“We are incredibly fortunate to have the support of the UK Infrastructure Bank in seeking to unlock this much-needed funding. Its commitment is an important starting gun. There is now a tremendous opportunity for institutional investors to align their capital with the UK’s net zero goals, supporting job creation, powering economic growth, and bringing the next generation of infrastructure to every corner of the country, while generating the necessary financial returns.”
The UK Infrastructure Bank opened for business in June 2021 to tackle climate change and boost growth across the United Kingdom. The Bank has now announced six deals with a range of investments in line with its mandate, strategic objectives, and investment principles, which can be found on the UK Infrastructure Bank website.
These include digital infrastructure in Northern Ireland through Fibrus, and England through Gigaclear, as well as supporting subsidy-free solar power production in England and Wales through its deal with NextEnergy. It has also supported the UK wind sector, through a loan to Tees Valley Combined Authority via its lending function and financed green bus routes with the West Midlands Combined Authority.
Octopus is an investment manager which specialises in sustainable investments with over £12.5bn of funds under management. It was founded in 2000 and as a certified B Corporation it operates at the highest standard of social and environmental performance, accountability and transparency.
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