Foresight Solar Fund, a new investment fund, has announced a £200 million share offering aimed at investing in large-scale solar schemes.

The fund will be listed on the main market of the London Stock Exchange, with shares priced at £1 each.

The finance group plans to invest the net proceeds of the IPO in solar farms across the UK. The nature of solar assets means that Foresight can provide shareholders with a “sustainable and increasing dividend with the potential for capital growth over the long term”.  

Commenting on the announcement, Jamie Richards, partner of Foresight Group, said: “Solar power has been the biggest source of new electricity generation for the past two years in Europe. This year the UK is seeing a significant increase in installed capacity of utility-scale solar PV power plants based on government support in the form of the Renewable Obligation Certificate (ROC) regime which provides a stable 20 year revenue stream that increases in line with RPI.

“The ROC regime combined with recent significant reductions in the cost of solar equipment provides a timely opportunity to launch this company coinciding with the new capacity coming on stream. Foresight Group has binding commitments for a portfolio of solar assets that the company can invest in from the outset, which will give investors access to the more predictable financial returns that UK solar offers over wind.”

The solar fund is a natural extension of the Foresight Group’s solar investment team that was formed in 2007 and launched a European equivalent of the fund in early 2008. Earlier this year, Foresight Group claims that its managed funds issued the largest UK solar index linked bond to date.

The £200 million solar fund is the latest in the line of solar-dedicated investment funds and hints that institutional investors are beginning to recognise the value of solar assets in the UK.