The Irish fund plans to commit €1bn to climate-related projects, from energy storage to renewables, over the next five years.
The Ireland Strategic Investment Fund (ISIF), the Government’s sovereign investment vehicle, has published its report for the first half of 2021. It showed investment returns of 5.2pc, an increase of €450m in six months.
This brings the fund’s total returns since its inception in December 2014 to more than €2.2bn. Of this, €1.4bn came from investments in Ireland and €800m from those abroad.
Alongside the report, ISIF announced it is planning to target €1bn of investment in “climate action projects” over the next five years. Targets include energy efficiency projects, energy storage, renewable power sources and resource-saving measures.
‘Our planned investment programme reflects the urgency of the climate challenge and the significant opportunities that exist to back Irish businesses’
– NICK ASHMORE
The fund, which is managed by the State’s National Treasury Management Agency, made 10 new investments totalling more than €200m in the first half of this year.
This included €42m in fintech giant Stripe, €13m in Irish aircraft leasing company Genesis, €20m of debt capital to Kerry fintech Fexco and €3m to cybersecurity company Vectra. Recent investments brought its total commitments in Ireland to €5.2bn across 151 investments.
On top of its own investments, the fund said that it “acted as a catalyst” for €8.9bn of co-investment by third parties. As well as earning returns, the ISIF has a mandate to support economic activity and growth through use of its capital.
In terms of its climate-targeted commitments, ISIF said it will make both direct investments and put capital into managed funds, “partnering with major global investors where appropriate”. The fund also said it would make further announcements about this over the coming months.
Nick Ashmore, the fund’s director, commented: “Climate change is set to be the greatest challenge facing our society in our lifetimes and beyond. The urgency of the challenge is driving the far-reaching actions being taken by societies, governments, businesses, consumers and investors to create a more sustainable economy and way of living.
“Our planned investment programme reflects the urgency of the climate challenge and the significant opportunities that exist to back Irish businesses and projects that are developing new and more sustainable ways of doing things.”
The ISIF also noted its continuing participation in the national Pandemic Stabilisation Recovery Fund (PSRF), established last year to support Irish businesses impacted by the pandemic and to invest in their recoveries. The PSRF is managed by ISIF and has more than €2bn in capital.
Yesterday, Ireland’s DunPort Capital Management announced that ISIF had committed €95m to its latest SME-focused debt-lending fund.