Ecofin US Renewables Infrastructure Trust (RNEW) has announced that it is applying to the FCA to become a self-managed alternative investment fund, as it continues to implement its managed wind-down strategy. The move follows the decision by its current investment manager, Ecofin Advisors (EA), to serve notice on its management agreement in February 2025.
Subject to FCA approval, the company will assume full responsibility for the management of its assets for the remainder of the wind-down. EA has agreed to waive all management fees between now and the effective date of termination and will make a one-off payment of US$100,000 to the company upon early termination of its appointment.
To support the transition, the company has appointed Sustainability Partners Services to provide operational and asset management support. Nancy Johnson, who is currently VP of Finance and Asset Management at EA, will take on the role of CFO at Sustainability Partners and continue to oversee the portfolio. Johnson joined EA in 2022 from NextEra Energy and brings nearly 15 years of sector experience.
Under the terms of the agreement, Sustainability Partners will receive a one-time setup fee of US$50,000 and an ongoing annual fee equal to the lower of 1% of the company’s market cap or NAV, with a minimum of US$325,000. The agreement includes mutual indemnities, with the company’s capped at US$1 million and the manager’s at three months’ fees. It may be terminated on 12 months’ written notice.
The company confirmed that its current investment policy – to realise its assets in an orderly manner and return capital to shareholders – remains unchanged.
[QD comment MR: With its wind-down already in motion and the current manager having served notice on its management agreement, the move to self-management looks like a sensible and cost-conscious step for Ecofin US Renewables. Retaining an experienced individual such as Nancy Johnson should help the wind down run more smoothly particularly as she has experience with the portfolio. The appointment of Sustainability Partners on a capped and relatively modest fee basis also suggests that the board remains focused on preserving value for shareholders as assets are realised. While the trust’s future is now firmly centred on an orderly return of capital, these arrangements should help ensure that process is carried out efficiently.]
