10th Jul 2015 08:14
LONDON (Alliance News) - Next Energy Solar Fund Ltd Friday joined a long list of renewable energy firms to warn about the effects changes to the climate change levy made by the UK government on Wednesday will have on operations and financial results.
The solar-focused investment company said a preliminary investigation has suggested its net asset value will fall by around 2% from the 103.3 pence per share reported at the end of March. The company said it will release the full impact of the changes on its NAV at the end of July.
Next Energy Solar said its dividend policy remains unchanged and the payment of its second interim dividend of 2.652 pence per share will still be paid as planned at the end of July.
In the first Conservative-only budget since the break up of the coalition government, UK Chancellor George Osborne Wednesday said he will scrap the "out-dated" climate change levy exemption, which was introduced in 2001 with the aim of improving energy efficiency and increase demand for renewable energy.
Osborne said the main reasons for the change was to prevent energy generation abroad benefiting from UK taxpayers' money and to ensure low-carbon generation provides better value for money.
Numerous companies have released statements to clarify the effect of the climate change levy changes. The larger companies that will be hardest hit over the next few years will be Drax Group PLC and Infinis Energy PLC, which both warned earnings will be lower than expected over the next two years.
Numerous smaller companies also released statements including John Laing Environmental Asset Group PLC, Renewable Energy Generation Ltd, Renewable Infrastructure Group Ltd, Greencoat UK Wind PLC, Good Energy Group PLC, Bluefield Solar Income Fund Ltd and GCP Infrastructure Investments Ltd.
All the companies reported varying extents of how much the change to the levy will have on their financial results.
Next Energy Solar shares were up 0.7% to 105.72 pence per share on Friday morning, though it was quoted at 109.50p prior to Osborne's announcement.
By Joshua Warner; [email protected]; @JoshAlliance
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