Bluefield Solar Income Fund is a rather different beast. Founded in 2013, Bluefield was the first solar-focused fund to list on the London Stock Exchange.
From the start, founder James Armstrong had two objectives – to invest exclusively in UK solar plants and to deliver generous returns.
The strategy has worked well. The shares have risen from £1 at launch to £1.29 today and the group has delivered annual dividends of 7p or more since 2014.
Bluefield was the first solar-focused fund to list on the London Stock Exchange
A total payment of 7.68p is expected for the year to June 2019, putting the stock on a yield of more than 6 per cent, and dividends are paid quarterly, providing investors with income every three months.
Much like the US, the UK solar market has changed considerably in recent years. Prices have tumbled and solar energy is now commercially viable, so much so that new plants are no longer eligible for Government support.
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Plants built before 2017 are subsidised however and Bluefield’s portfolio is entirely comprised of such assets, providing inflation-linked subsidies for 20 years or more.
Most of the group’s plants were built between 2013 and 2016, when subsidies were relatively generous and Armstrong could source attractively-priced sites. Since then, Bluefield has bought very little because sites became increasingly expensive and Armstrong did not want to overpay.
Today, the portfolio has 46 large solar plants and 41 smaller assets, mostly in the south of the country and generating some 450 megawatts of electricity, enough for around 140,000 homes.
Looking ahead, Armstrong and his team are minded to return to the market. The cost of new plants has come down and Armstrong believes he can find sites that will generate a decent income for shareholders, even without Government subsidies.
Midas verdict: The UK is nowhere near as sunny as America but days in summer are long and the British solar market is the seventh largest in the world, ahead of much brighter countries such as France, Spain and Australia. Bluefield is at the forefront of the market, the stock has been a strong performer since the start and should carry on in that vein. At £1.29, the shares are a buy, particularly for the income-focused investor.