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Government low carbon plans a ‘defining moment’ for green investment
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The Government's Low Carbon Transition Plan, which was launched today, will have a material impact on green investment over the long term, according to Emma Howard Boyd, Jupiter Asset Management's Head of Socially Responsible Investment.
Jupiter is one of the UK's most highly-regarded green investors. The Company launched the Jupiter Ecology Fund over 21 years ago in 1988 and since then, the Fund has produced a return of 320% *.
The government's plan is designed to help the UK meet EU targets to cut carbon emission by 34% from 1990's level and boost renewable energy use to 15% of all energy by 2020. It includes up to £120m in assistance to develop the offshore wind industry, fuel-efficient vehicles and other forms of low-carbon manufacturing. Job creation is also a goal of the plan with some 400,000 green jobs expected to be created by 2015.
Commenting on the government's plans, Emma Howard Boyd said: "The plan highlights that carbon reductions must be a central consideration in every element of the way we live and work and in particular for those sectors responsible for the most emissions: power, transport, homes, workplaces and agriculture.
"Ed Miliband, the energy and climate change secretary, has described the transition to a low-carbon economy as a 'defining issue' for the 21st century and arguably this plan will become a defining moment in the green investment thesis. We would expect it to have a material impact on most of our six green investment themes**, albeit over the longer term. However, we also believe it has the potential to have an impact beyond what are traditionally regarded as green companies. As a result a transition to a low carbon economy is likely to gain greater importance for all investors over time.
"In addition to this plan, the government has provided greater clarity on how the legally binding carbon budgets announced in April will work, with each government department allocated a separate budget. Going forward major policy decisions will need to take place within the constraints of these budgets.
"The Low Carbon Transition Plan was published alongside three other papers: the Low Carbon Industrial Strategy, focussing on 'green growth' in industry and business; a Renewable Energy Strategy detailing how the UK will meet its 15% target; Low Carbon Transport: a Greener Future, outlining the transport sector's contribution to greenhouse gas reductions.
"Amid the most severe economic downturn in decades, it has been encouraging to see that initiatives to tackle climate change and decarbonise our economies have become part of the solution to global economic troubles. The transition to a low carbon economy is not something to be delayed because of the global recession - instead it has become the driver of recovery."
"Overall, we believe the government has taken a welcome step ahead of UN climate change discussions in Copenhagen in five months' time."
- ENDS -
NOTE* Source: Financial Express. Bid to bid, net income reinvested to 30.6.09.
| Bid-Bid custom table from UK IMA UT and OEICs universe. Rebased in Pounds Sterling |
| GBPSector\Discrete Years |
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Discrete |
Discrete |
Discrete |
Discrete |
Discrete |
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Annual |
Annual |
Annual |
Annual |
Annual |
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Performance |
Performance |
Performance |
Performance |
Performance |
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30/06/2004 |
30/06/2005 |
30/06/2006 |
30/06/2007 |
30/06/2008 |
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to |
to |
to |
to |
to |
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30/06/2005 |
30/06/2006 |
30/06/2007 |
30/06/2008 |
30/06/2009 |
| Jupiter Ecology TR |
20.95 |
27.02 |
28.62 |
-8.89 |
-18.68 |
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| Source: Financial Express 2009, Bid-Bid, Basic Rate Tax, Net Income Reinvested.
Past performance should not be seen as a guide to future performance. The value of an investment can go down as well as up and may be affected by exchange rate variations. |
** Jupiter's six green investment themes are: clean energy, environmental services, green transport, sustainable living, waste management and water management
Jupiter Unit Trust Managers Limited (JUTM) and Jupiter Asset Management Limited (JAM) are both authorised and regulated by the Financial Services Authority and their registered address is 1 Grosvenor Place London SW1X 7JJ. They are both subsidiaries of Jupiter Investment Management Group Limited and the group is collectively known as "Jupiter". The above commentary represents the views of the Emma Howard Boyd, Jupiter Asset Management's Head of Socially Responsible Investment, at the time of preparation and may be subject to change and this is particularly likely during periods of rapidly changing market circumstances. Their views are not necessarily those of Jupiter and should not be interpreted as investment advice. Every effort is made to ensure the accuracy of any information provided but no assurances or warranties are given.
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