The UK government has announced a £40 million fund for green startups, designed to help “supercharge the development of next generation clean, low-carbon technologies.”
It has been established together with CCLA, one of the UK’s largest fund managers, to help provide investment to UK’s most promising early-stage “clean growth” companies. These will include those across power and energy, buildings, transport and waste.
In particular, the Department of Business, Energy and Industrial Strategy (BEIS) has highlighted energy storage and smart grid systems companies that can help to bolster resilience in the power system, renewable heating and ventilation technology companies across homes and commercial buildings, and biofuels and bioenergy system companies.
Business secretary Alok Sharma said that the need for “innovative and ambitious ideas” has never been higher.
“I am pleased that with the help of this fund, promising clean growth start-ups will be able to step up to accelerate the UK’s recovery, while supporting our path to Net Zero by 2050.
“This pioneering new fund will enable innovative low-carbon solutions to be scaled up at speed, helping to drive a green and resilient economic recovery.”
CCLA has matched the government’s investment, and BEIS added that through further private sector fundraising the fund could reach £100 million by Autumn 2021.
James Bevan, the CCLA’s chief investment officer added: “We decided it was time for CCLA to invest in the very best early stage technologies to support the UK Net Zero objective. In partnership with BEIS, we have developed a solution, the Clean Growth Fund.
“Through the Clean Growth Fund, we now look forward to working with other investors to support these exciting young UK companies aiming to reduce carbon emissions.”
BEIS and CCLA are looking for early stage, seed or Series A rounds start-ups, with a prototype product or service demonstrating a clear contribution to reducing greenhouse gases.
They are also looking for further investment partners, including pension funds, Limited Partner(LP) investors and family offices.
It will be managed by Clean Growth Investment Management LLP (CGIM), and aim to balance the start-ups portfolio across clean growth sectors.
Beverley Gower-Jones, managing partner of CGIM said: “The Clean Growth Fund is a significant boost to the country’s low carbon sector and is a clear signal from the UK Government that new and innovative technologies will be crucial to deliver Net Zero and the clean growth agenda. We want to hear from the very best clean technology businesses from across the UK.”
The Clean Growth Fund forms part of BEIS’s Energy Innovation Programme.