Ventus VCT to focus on wind power

15 November 2004

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Ventus VCT Plc, a new specialist VCT established to invest in companies that will develop, construct and operate small on-shore UK wind projects, has been launched recently with a Â£25m target. Investments will generally be in companies developing community projects, projects initiated by specialist small-scale developers, small industrial sites and small projects which are not of interest to large development companies and utilities. Brewin Dolphin Tax Solutions, part of Brewin Dolphin Securities, is marketing adviser in relation to the offering. Once Ventus is fully invested and its portfolio companies are operating at projected capacity, the company's objective, on the basis of the assumptions set forth in the prospectus, will be to pay an average annual tax-free dividend of 8p per ordinary share until at least 2016, although the directors anticipate that the level of tax-free dividends may fluctuate between 6p and 10p. The manager has developed a cost-effective financing package applicable to small wind projects which it believes will be attractive to communities and to developers of such projects. Companies in which Ventus invests will benefit from long-term power purchase agreements (PPAs) for the sale of electricity, at an agreed price, pursuant to an existing framework PPA facility backed by a major UK electricity supply company, thus mitigating the risk of changes in the future price of renewable energy.Assuming that the maximum amount of Â£25m is raised, Ventus should be able to invest in companies developing projects with a combined capacity of 70 to 80 megawatts of electricity generation. This amount of wind energy generation capacity will normally produce enough electricity to meet the annual needs of approximately 40,000 homes and will offset the annual release into the atmosphere of over 100,000 tonnes of carbon dioxide (the main greenhouse gas contributing to global warming and climate change).