Triple Point Energy Efficiency Infrastructure (TEEC) has announced that its board has initiated a consultation process with a number of key shareholders regarding potential amendments to TEEC’s investment policy and, related to that, a change to the company’s name. Separately, the company has also announced its annual results for the year ended 31 March 2022 as well as the appointment of a new corporate broker.
Background to the proposed investment policy changes
TEEC’s board says that, since its IPO in October 2020, we have witnessed a rapid evolution in clean energy policy, the commitment to addressing the global climate emergency, concerns regarding energy security and the opportunities that exist for investments which both contribute to energy transition and can deliver returns to TEEC shareholders. “Energy transition” refers to the global drive to address the climate emergency through the transition of energy systems to lower or zero carbon which, itself, includes the move to greater energy efficiency, which has been TEEC’s focus to date. TEEC’s board and investment manager believe that the broader mandate that “energy transition” provides reflects better the nature of the current portfolio of investments and will offer a greater number of opportunities for investment without compromising TEEC’s fundamental purpose: to have a positive environmental impact, by investing in projects that support the transition to a low carbon economy and help the United Kingdom, in particular, achieve net zero.
Proposed amendments to the investment policy
The amendments to the investment policy are being proposed to reflect better the nature of TEEC’s existing portfolio and pipeline of investment opportunities. The key aspects of the proposed amendments include:
- broadening the scope of the investment mandate to reflect the wider energy transition sector;
- expanding TEEC’s geographical reach to enable it to make appropriate investments in Europe, albeit the United Kingdom will remain the core focus;
- clarifying the structures in which the company is able to invest into, including both debt and equity; and
- including a definition of “Adjusted Gross Asset Value” in place of “Gross Asset Value” for the purposes of applying the investment policy restrictions, from time to time (and the references amended, as necessary).
Proposed change of name
Assuming that the changes to the investment policy are approved, it is proposed that TEEC’s name will change to “Triple Point Energy Transition Plc” to reflect the revised mandate. The ticker will also change to “TENT” although the SEDOL and ISIN will remain the same.
Shareholder approval to be sought at the AGM in August 2022
TEEC’s board says that, subject to the outcome of the consultation and board decision, the proposals to amend the investment policy and the name of the company will be put to the vote of all shareholders at the Annual General Meeting to be held in August 2022. Full details of the proposals will be notified via a further announcement to the market and set out in the circular accompanying the notice of AGM to be sent to shareholders in due course.
Results for the year ended 31 March 2022
Separately to the proposed investment policy changes discussed above, TEEC has announced its annual results for the year ended 31 March 2022. During the period, TEEC provided dividend of 5.5p per share, while its NAV per shell fell marginally from 97.49p per share to 96.12p per share. TEEC’s chair says that there has been significant deployment and increasing diversification for the company over the last year. TEEC has now fully committed the proceeds from its IPO, as well as most of a new £40m revolving credit facility (RCF).
TEEC has provided the following key highlights from its results:
- Significant progress in the deployment of capital:
- Capital committed during the year ended 31 March 2022 amounted to £100.2m (2021: £21m)
- June 2021: £8.0m fixed rate debt investment in Spark Steam Limited, a company which owns and operates a combined heat and power asset
- November 2021: £26.6m acquisition of six operational, Feed in Tariff accredited, “run of the river” hydroelectric power projects in Scotland
- December 2021: £19.6m acquisition of a further three operational, Feed in Tariff accredited, “run of the river” hydroelectric power projects in Scotland
- March 2022: signed contracts to provide a £45.6m fixed rate debt facility to a subsidiary of Virmati Energy Ltd (trading as “Field”), for the purposes of building a 110MW portfolio of four geographically diverse Battery Energy Storage System (“BESS”) assets in the UK
- The portfolio valuation as at 31 March 2022 was £78.8m (2021: £28.8m)
- Adjusting for commitments, at the year ended 31 March 2022, the portfolio valuation would amount to £124m
- In March 2022, the company entered into a loan facility agreement for a £40 million RCF from TP Leasing Limited
- Dividends declared in respect of the year ended 31 March 2022 totalled 5.5p per share, in line with the target for the year
- Net Asset Value as at 31 March 2022 was £96.1m (2021: £97.5m), equal to a NAV per share of 96.12p (2021: 97.49p), largely reflecting the impact of uncovered dividends paid as a result of slower than expected deployment offsetting the uplift in valuation
- The group’s activities resulted in:
- Energy saved: 7,113 MWh
- CO2 avoided: 17,074 tonnes of CO2 avoided through lower emissions
- Renewable energy generated: 9,425 MWh
- Post period-end,in June 2022, the company committed £1m to a lighting solutions provider to fund the installation of efficient lighting and control at a leading logistics company
- Looking towards the future, today, the company also announced:
- J.P. Morgan Cazenove has been appointed as sole broker with immediate effect
- The investment manager will be consulting key shareholders regarding the proposed amendments to the investment policy
- Conditional on the amendment of the investment policy, a proposed change of name to “Triple Point Energy Transition plc”
- Both the proposed amended investment policy and the new name will be put to shareholders for approval at the Annual General Meeting due to take place in August 2022