Electra spin-out launches environmental infra fund

London-based smaller companies investor Acuity looks to raise £100m for a vehicle predicated on local authorities having to meet government targets on organic waste recycling.

Acuity Capital Management, which spun out of private equity firm Electra Partners in 2008, is launching a fund to invest in environmental infrastructure projects focusing on organic waste recycling in the UK.

The Acuity Environmental Infrastructure Fund aims to raise an initial £100 million (€112 million; $167 million) of equity to invest in 8-12 sites, with each site backed by at least a 10-year contract with a local authority or a company establishing a fixed volume of waste at a set price, said the firm in a statement. 

Nick Ross, managing partner at Acuity who was previously at Electra Partners, said the fund represented a “new opportunity” for investors to benefit from the UK’s commitment to address the issues surrounding waste disposal and renewable energy generation. Ross co-founded Acuity with former Electra colleague Mark Speeks in 2008.

The launch comes amid demanding organic waste recycling targets set by the British government for local authorities. Acuity explained how the government has prioritised anaerobic digestion as a key technology to help meet targets. Anaerobic digestion is a biological process that happens naturally when bacteria breaks down organic matter, producing a digestate that can be used as a soil fertilizer and a biogas which can be burned to produce electricity. According to the firm, at least 450 organic waste recycling plants would need to build to service this demand. So far, only five have been built.