VH Global Sustainable Energy Opportunities PLC (LSE:GSEO) reported a 7.6% total return for the past calendar year as it highlighted the “quiet revolution” in renewable energy around the world.
The investment trust, which owns a diversified portfolio ranging from the darker green solar photovoltaic, hydro power and battery energy storage to what might be called 'cleaner hydrocarbons', with oil storage terminals in Mexico and a UK project that aims to capture carbon from a natural gas power plant, recorded a net asset value per share of 108.2p as at 31 December 2022, up from 104p over 12 months.
It paid a total of 5.13p of dividends per share, exceeding its 5p target, and for the current year its target dividend is 5.52p per share, a 7.6% increase.
Fund manager Victory Hill noted that it had benefited from significant inflation protection as 90% of the trust's revenue is inflation-linked with no caps.
A third funding round, of £122mln, was completed in July, and by the end of the period it had deployed or committed 93% of its total funds.
Looking forward, the manager expressed most enthusiasm about “the proliferation of smaller-scale distributed sustainable energy projects directly contracted with end users on a global scale... We call this trend the quiet revolution, as it does not grab the same headlines as the large multi-billion dollar projects being announced in the energy space day to day. The quiet revolution will continue to gather pace and new opportunities in different markets will emerge.”
In Brazil, it has an existing commitment of £14mln to construct remote distributed solar generation projects, and another £17mln in Australia to acquire a portfolio of distributed solar generation assets and build battery storage capacity.
It noted that current costs for solar panels meant building small-scale solar PV plants at end-user premises “has become viable, even when considering energy sales contracts that represent discounts in the energy bills of these end users”.
With the current volatility in energy prices, the managers expect demand for viable “behind the meter” solutions to continue to increase.