THE Carbon Trust is to launch a listed venture-capital arm to invest in green technologies.

The government-funded organisation, which helps companies to assess and reduce their impact on the environment, is planning to raise £75 million from institutional investors to back the fund, which will be created from its own in-house investment unit and listed on the Alternative Investment Market.

The fund, the first of its kind, will invest in small and medium-sized companies operating in areas that will benefit from the increasing focus on reducing greenhouse gas emissions. Companies operating in the renewable energy, solar energy, fuel cells, biofuels and synthetic fuels industries are expected to be among potential investment targets.

Lord Turner of Ecchinswell, the former Director-General of the CBI, will lead the independent board that will oversee the fund.

The fund will act independently of the Carbon Trust but will continue to work with the body to exploit its knowledge and contacts in the relevant industries.

Tom Delay, chief executive of the Carbon Trust, said: “A core part of our role in accelerating the transition to a low- carbon economy has been demonstrating to the wider financial community that attractive returns can be made from clean technology investments. We aim to encourage wider institutional support for, and investment in, companies in the low-carbon sector.”

The trust has been investing in companies that reduce carbon emissions for four years, led by Peter Shortt, director of innovation and investment, who will join the new fund.

Lord Turner said: “The move to a low-carbon economy is creating many attractive investment opportunities which the performance, knowledge and expertise of the Carbon Trust investment team will help exploit.”

The focus for new investments will be primarily the UK, but the fund will be free to exploit opportunities overseas. It will be based in Jersey and regulated by Jersey’s financial regulators. Altium is acting as financial adviser.

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