New Earth Solutions (NES), the British waste treatment and resource recovery company, and Isle of Man-based investment fund provider The Premier Group, have launched the New Earth Solutions Recycling Facilities Investment Sub-Fund, which provides direct exposure to waste recycling and treatment facilities.

The fund aims to provide experienced investors with the opportunity to obtain long-term capital growth by investing in proven, effective and efficient waste management technologies.

NES believes that the fund will help accelerate the development of sustainable waste management practices in the UK and enable the roll-out of its advanced waste treatment facilities, assisting the UK in meeting statutory recycling and landfill diversion targets.

Minimum investment: £10,000
Initial charge: None (An early redemption charge of up to eight per cent)
Annual management fee: 1.5 per cent
Contact: www.newearthrecyclingfund.com

James Davies says:
Under the EU landfill directive local authorities are obliged to find alternatives
to depositing waste into landfills. At present the UK is the second-worst offender in Europe when it comes to landfills, with over 75 per cent of all ‘black bag’ waste ending up in landfills. Now local authorities face restrictions, and even fines, if they
don’t meet targets to reduce the amount they send to landfill.

Key to the investment proposition for the New Earth Solutions Fund is something called the Advanced Bio Stabilisation System. This is a high temperature composting process that uses air-handling equipment to prevent odour, emissions or aerosols (usually associated with waste treatment processes). The facilities are also able to process waste which is not biodegradable.

The facilities are designed to have a low impact on the existing environment
and have the potential to provide surplus power to the national grid when mature (i.e. after three to four years).  Currently the fund has one facility up and running at Canford Park in Dorset, another under construction in Kent and further facilities at the planning stage.

This is a specialist investment and only suitable for an experienced investor. Those interested should speak to a financial adviser before deciding whether to make an investment into this fund.

Whereas I normally give a fairly low score to the more specialist investments, this is a fund that I genuinely like and believe that investors who are looking for something a little bit different, and lowly correlated to other asset types, should certainly consider. With so many traditional investments having performed badly over the recent months, this fund offers something with decidedly different performance characteristics and a relatively low initial investment amount for a direct investment.

From an investment perspective, the rationale stacks up in my opinion, as
the requirement for councils to find an alternative to landfills is pressing and financially damaging if they don’t. The technology argument is not only fascinating, but also can be shown to work, while the environmental case is extremely compelling.  

Unfortunately, much of the detail is too complex to do justice to in this short review, but I would not hesitate to suggest that interested parties investigate further by visiting www.newearthsolutions.co.uk or speaking to a financial adviser.

4 Stars