NextEnergy Solar Fund sees big opportunities ahead

Grier discusses the 30% discount to NAV of the NextEnergy Solar Fund share price and points out that the exposure is to a long-term investment spread across the sector that has a lot of potential to grow. NextEnergy invests in solar and also battery technology, both set to be crucially important to the race to Net Zero and climate targets.

There's been a significant milestone for the trust recently with project Camilla, a new storage facility in Fife, the first of a number around the country expected to harness the growing amount of incoming power generated from solar and wind. Camilla is the first asset to be delivered through the Company's £300 million Joint Venture Partnership programme with Eelpower Limited.

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NextEnergy Solar Fund's recent milestones

NextEnergy Solar Fund is an investment trust that specialises in solar infrastructure in the UK. They invest in solar projects and battery storage, both of which are essential for reducing emissions and meeting climate targets. Recently, the fund reached a significant milestone of one gigawatt of operating capacity and successfully activated their 50-megawatt Camilla battery storage.

Benefits and progress of solar

Solar energy has proven to be a reliable and predictable technology with decreasing costs, making it a great source of green energy. It is also a quick implementation process, taking only 18 to 24 months from concept to actual operation. In the UK, solar energy is economically viable and has consistently achieved its generation targets. Additionally, battery technology is continually improving, with costs going down and power density increasing. These batteries provide stability to the energy grid and can be used to buy and sell power at optimal times, ensuring a consistent energy supply.

Partnership with Yield Power Limited

The NextEnergy Solar Fund has a partnership with Yield Power Limited to convert battery storage assets into profits. Currently, the trust is trading below its net asset value (NAV) by approximately 30%. However, the fund has a strong underlying asset base that generates consistent cash flow. As a result, they offer a consistent dividend, giving investors a yield of 10% to 12%. While primarily a yield stock, there is also potential for growth.

The fund has a long-term growth strategy and a variety of exciting opportunities in the pipeline. They are in the process of refinancing their revolving credit facility and plan to reallocate capital into future growth. The NextEnergy Solar Fund is enthusiastic about the UK renewables market and believes that there will be plenty of opportunities for growth in the coming years.