How to invest in tackling climate change

Guardian Money looks at where to put your cash if you plan to make an ethical investment
The Guardian, Saturday 5 September 2009
Isas and investment trusts
All the funds below tend to have minimum lump sum investments of around £1,000, but check with each provider for details.
Schroder's Global Climate Change fund (schroders.com) invests in companies involved in reducing carbon dependency or adapting to the impact of climate change. One of the first in this field, it's down around 10% since its launch in June 2007, but in the last six months it is up around 30%. Top investments include Honda (hybrid vehicles) and Gamesa (Spanish wind turbine makers).
Henderson Industries of the Future (henderson.com) promises to invest in "positive sustainability themes", with stocks such as Nalco (water treatment), Roper Industries (industrial controls to comply with regulatory standards), and Schneider Electric (energy efficiency). It has fallen by 11.5% over the past year, but is up 38% over the past five years.
BlackRock New Energy investment trust (blackrock.co.uk) has bounced around wildly. If you bought five years ago you'd have made 105%. But if you bought a year ago you're down 36.5%. Since March it is back up 30%. Major holdings include American Superconductor (smart grids), Archer Daniels Midland (ethanol, biodiesel), Vestas and Iberdrola (Spanish utility).
F&C Global Climate Opportunities (fandc.com) invests in companies at the heart of the climate change issue, including alternative energy, sustainable mobility, waste, advanced materials, forestry and agriculture, and water. Down 12.4% over one year, up around 25% in the past six months. Stocks include EAGA (UK insulation provider) and ITT Corporation (big in water management).
WHEB Sustainability (whebam.com), run by some of the UK's most experienced green/ethical fund managers. Focuses on climate change, water issues and demographics. Major holdings include EnerNOC (US energy efficiency) and Epure (Singapore/China water treatment).
Tiburon Green (tiburon.co.uk) launches next month. Focus will be on renewable energy in Asia. Starting portfolio will include China High Speed Transmission (wind equipment developer) and Silex Systems (Australian uranium enrichment and solar energy tech company).
Virgin Climate Change (Virginmoney.com/funds) invests in UK/European firms with a lighter carbon footprint. Down 28.2% over the past 12 months but up around 30% since March.
HSBC GIF Climate Change fund (assetmanagement.hsbc.com) hopes to capitalise on what it calls "one of the defining investment opportunities of the years ahead". Invests in 50-70 stocks from the HSBC Global Climate Change benchmark index. Down 23.6% over the past year but up 40% over the past six months.
Venture Capital Trusts and Enterprise Investment Schemes
Higher-risk funds with higher minimum investments, often putting your money into start-ups where some will succeed and make lots of money – and others will fail. They have a number of tax advantages for higher rate taxpayers.
Ventus (ventusvct.com) runs three VCTs which have invested £50m in wind farms such as Craig Wind Farm in Dumfriesshire and Fenpower in Cambridgeshire. Its first VCT, Ventus 1, is the fourth best-performing VCT of 111 this year, up 46%. None available for investment right now, but they are examining options for new share issues. The funds are managed by climatechangecapital.com.
Climate Exchange VCT invests in an emissions exchange operator, a role targeted by climate camp protestors this week as carbon gamblers. Shares in Climate Exchange plc are currently trading at half the levels of a year ago.
Oxford Capital (oxcp.com) is typical of many seedcorn-style business that match investors with high-tech projects, many in the sustainability field and some connected to the university. Its fifth Oxford Gateway EIS fund is open to investment – but the minimum is £25,000.