London-listed JLEN Environmental Assets Group Ltd has announced a placing intended to raise c.£60 million. They say it will allow the investment team to explore additional environmental infrastructure technologies, diversifying the fund further and supporting its ESG/sustainability KPIs whilst continuing to drive a strong, consistent return for investors.
With the AIC recently tipping environmental infrastructure as the expected asset class for 2022, JLEN is now looking beyond established green infrastructure technologies (such as wind and solar) to the latest generation of environmental solutions. This includes sectors such as controlled environment agriculture/aquaculture, as well as biogas in which JLEN has been establishing a presence.
The company is currently £109.8 million drawn on its revolving credit facility and the net proceeds of the Issue will be used to repay the Facility and fund a pipeline of environmental infrastructure opportunities.
The company’s investment strategy has delivered an annualized total shareholder return of 6.5% since launch and the Board and Investment Manager are excited by the breadth of opportunities within the wider Environmental Infrastructure sector with a pipeline of opportunities across anaerobic digestion, controlled environment, low carbon & energy efficiency and biomass.
The Board and the Investment Manager believe there is a potentially significant opportunity within the controlled environment agriculture (“CEAg”) and aquaculture (“CEAq”) sectors. "The growing global population will increase food demand and using the current agricultural practices is a challenge", they say.
"Controlled environment sectors provide a greater level of efficiency with CEAg using up to 95% less water per kilo of crop and onshore CEAq being able to recycle 99% of water. It also avoids erratic weather conditions, pollution, pests and use of antibiotics. The reduction in transportation distance decreases the loss of produce and carbon dioxide emissions, and increases the quality in transit."
"The operations of CEAg/CAEq facilities can be highly automated and benefit from the reducing cost of and/or co-location with renewable energy."
In that regard, one of the two near-term controlled environment opportunities is the construction of a 3-hectare glasshouse on land adjacent to the Codford AD plant held by JLEN. The Company is exploring the possibility of providing energy to the glasshouse, by diverting to the glasshouse electricity normally destined for direct export to the grid to be sold at a premium price. Waste heat from the existing CHP engines will be captured and delivered by pipe and a heat exchanger to the glasshouse. Wastage from the glasshouse produce may also be returned to the digester providing a truly circular ecosystem.
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JLEN environemental assets group