The energy crisis has highlighted the need for energy security to protect consumers and businesses as the world shifts to more environmentally friendly sources of energy. It also highlights the need to redouble efforts to accelerate the transition away from fossil fuels.
Gresham House (GHE:810p), a fund manager specializing in renewable energy generation, solar, wind, battery storage farms, forestry, infrastructure funds and investment strategies. public and private equities, is ahead of the curve. Since I highlighted the potential of the group at the beginning of its journey in my Cheap Stock Portfolio 2016, the astute management team at Gresham House has created a business that has consistently delivered strong organic growth. In 2021, the group increased assets under management (AUM) by two-thirds to £6.5bn, supported by underlying growth of 50%.
Renewable energies have played an important role. For example, Gresham House now runs solar and wind projects which generate enough electricity to power 131,000 homes and manages 140,000 hectares of forest which capture the CO2 equivalent generated by 266,000 people in the UK. The group’s environmental, social and governance (ESG) credentials are one of the reasons investors support its funds, but ultimately the growth in assets under management is driven by its investment returns at the forefront of the market. Clever acquisitions also play their part.