TIDMTEEC

RNS Number : 6500A

Triple Point Energy Efficiency

03 June 2021

THIS ANNOUNCEMENT HAS BEEN DETERMINED TO CONTAIN INSIDE INFORMATION FOR THE PURPOSES OF THE UK VERSION OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014.

The financial information set out in these statements does not constitute the Company's statutory accounts for the year ended 31 March 2021, prepared in accordance with section 435 of the Companies Act 2006, but is derived from those accounts. Statutory accounts will be delivered to the Registrar of Companies in due course. The auditors have reported on these accounts and their report was unqualified and did not contain a statement under section 498(2) of the Companies Act 2006.

3 June 2021

Triple Point Energy Efficiency Infrastructure Company plc

("TEEC" or the "Company" or, together with its subsidiaries, the "Group")

RESULTS FOR THE PERIODED 31 MARCH 2021

The Board of Triple Point Energy Efficiency Infrastructure Company plc (ticker: TEEC) is pleased to announce the Company's audited results for the period ended 31 March 2021. This was the Company's inaugural financial year and a shortened period.

 
                                       31 March 2021 
------------------------------------  -------------- 
 
 Net Asset Value ("NAV")                   GBP97.49m 
 NAV per share                                97.49p 
 V alu e of the portfolio                  GBP20.88m 
 Ongoing charges ratio (annualised)            1.07% 
 Dividend declared per s hare                  2.00p 
 

H ighlights

-- The Company was admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange on 19 October 2020, having raised gross proceeds of GBP100 million (GBP98 million of net proceeds) at an issue price of 100 pence per share (" IPO ").

-- Net Asset Value as at 31 March 2021 was GBP97.49 million, equal to a NAV per share of 97.49 pence, reflecting costs incurred during the period as the Company continues to deploy its IPO proceeds.

-- The portfolio, held via the Company's subsidiary TEEC Holdings Limite d, consist ed of two debt investments in Harvest Generation Services Limited (" Harvest ") and Glasshouse Generation Limited (" Glasshouse ") valued at GBP20.88 million as at 31 March 2021. Harvest and Glasshouse hold operational, established energy centres located on the Isle of Wight, supplying heat, electricity and carbon dioxide to the UK's largest tomato grower, APS Salads (" APS "), pursuant to an Energy Services Agreement, with a remaining term of approximately 15 years.

   --          The Company hel d cash of GBP76.55 million as at 31 March 2021. 

-- Post period-end, on 28 May 2021, the Group completed a GBP8.032 million senior debt investment in an operational Combined Heat and Power (" CHP ") Energy Centre, Spark Steam Limited , which supplies heat, electricity and carbon dioxide to APS.

Dividend Declaration

-- The Company today declares a dividend of 2.0 pence per ordinary share in respect of the period from admission on 19 October 2020 to 31 March 2021, in line with the Company's target for the period, as set out at IPO. The Company is targe ting a dividend of 5.5 pence per Ordinary Share for the year ending 31 March 2022 (1) .

-- This dividend will be paid on 30 June 20 21 to shareholders on the register at 11 June 20 21 .

Notes:

(1) The dividend and return targets stated are Pound Sterling denominated returns targets only and not a profit forecast. There can be no assurance that these targets will be met, and they should not be taken as an indication of the Company's expected future results.

John Robert s, the Company's Chair, commented:

" We were delighted to welcome such a broad range of shareholders to the register on IPO. Since launch we have been busy implementing our strategy by identifying, investigating, and investing in Energy Efficiency Projects in the UK, and in doing so, contributing towards the transition to a low carbon economy and assisting in the acceleration of the UK achieving its net-zero targets.

The role of energy efficiency in helping to achieve the ambitious targets set by Government cannot be overstated and as we look forward to executing on our pipeline, growing the scale of the Company, and delivering returns to our shareholders ; we do so in the knowledge that as well as being profitable we will help meet decarbonisation goals and unlock wider environmental and social benefits . "

FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT:

 
 Triple Point Investment Management      (via FTI below) 
  LLP 
  (Investment Manager) 
 Jonathan Parr 
 Jonathan Hick 
 
 Akur Capital (Financial Adviser)        Tel: 020 7493 3631 
 Tom Frost 
 Anthony Richardson 
 Siobhan Sergeant 
 
 RBC Capital Markets (Joint Broker)      Tel: 020 7 653 4000 
 Matthew Coakes 
 Jill Li 
 Kathryn Deegan 
 
 Winterflood Securities (Joint Broker)   Tel: 020 3100 0000 
 Neil Langford 
 Hande Derinkok 
 
 FTI Consulting 
 Ed Berry                                Tel: 07703 330 199 
 Mitch Barltrop                          Tel: 07807 296 032 
 

The Company's LEI is 213800UDP142E67X9X28 .

   Further information on the Company can be found on its website at   www.tpenergyefficiency.com . 

NOTES:

The Company is a n investment trust which invests exclusively in a diversified portfolio of Energy Efficiency Projects in the UK, which have a positive environmental impact. The Company's investments will focus on the core sectors of: low carbon heat distribution; social housing retrofit and industrial energy efficiency; and distributed generation.

The Investment Manager is Triple Point Investment Management LLP ("Triple Point") which is authorised and regulated by the Financial Conduct Authority. Triple Point manages private, institutional and public capital, and has a proven track record of investment in Energy Efficiency and decentralised energy generation projects. In 2018, Triple Point was appointed as the Delivery Partner to BEIS, a department of the UK government, to deliver the GBP320 million Heat Networks Investment Project ("HNIP").

The Company was admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange on 19 October 2020 and was awarded the London Stock Exchange's Green Economy Mark.

CHAIRMAN'S STATEMENT

Dear shareholder,

On behalf of the Board, it is a pleasure to write to you in our maiden annual report. We were delighted to welcome such a broad range of shareholders to the register on IPO. Since launch we have been busy implementing our strategy by identifying, investigating, and investing in Energy Efficiency Projects in the UK, and in doing so, contributing towards the transition to a low carbon economy and assisting in the acceleration of the UK achieving its net-zero targets.

Investment Activity

In March 2021 we successfully completed our first investments into the target Combined Heat and Power assets identified at IPO. The transactions were structured differently from that indicated in the IPO prospectus, such that the Company, via its holding company TEEC Holdings, provided GBP21 million of senior debt finance to Harvest Generation Services Limited (" Harvest ") and Glasshouse Generation Limited (" Glasshouse "), rather than acquiring the associated equity interests. The Board considered this to be an attractive investment which not only generates a return within the target range but also provides a greater level of security.

Harvest and Glasshouse provided attractive first investments for us, being high quality assets, which are significantly more efficient than the engines they replaced. The new engines are almost 90% efficient (90% of the fuel energy is converted into electricity and hot water) and are less carbon intensive. The investments are a great example of the Company's focus on building a diversified portfolio of energy efficiency assets with a positive environmental impact.

We are pleased to report that since the period end, the Group completed a GBP8.032 m illion senior debt investment in an operational Combined Heat and Power (" CHP ") Energy Centre, Spark Steam Limited (" Spark Steam "). Spark Steam fully provides tomato grower APS Salads with its heat and electricity requirements, as well as supplying carbon dioxide produced by the CHP+ system to enhance crop yields. The transaction follows on from similar investments this year in Harvest and Glasshouse, also CHP businesses supplying heat and power to APS Salads and managed by P3P Partners, illustrating the Company's approach to building scalable partnerships with leading developers and offtakers.

Pipeline

We continue to be highly focused on reaching full deployment of IPO proceeds. O ur Investment Manager continues to selectively target those opportunities that will deliver the greatest value to shareholders. Many opportunities are off-market projects that are not part of a competitive process and consequently can take longer to execute and ensure that the necessary robust due diligence is carried out. While this, among other factors, has slowed down deployment, we have every confidence that the remaining funds will be deployed in the short term and look forward to updating the market on the next investments.

The Company has circa GBP300 million of pipeline opportunities, including approximately GBP100 million of more immediate pipeline opportunities that the Investment Manager is actively progressing, of which approximately GBP 26 million have signed heads of terms. The pipeline is spread across a diverse range of target sectors, including traditional power generation technologies such as hydroelectric power generation, combined heat and power, solar, onshore wind, anaerobic digestion and energy from waste. It also includes more emergent areas such as electric vehicle charging and fuel cells technologies.

We remain encouraged by the significant pipeline that the Company's investment strategy presents and look forward to our Investment Manager executing some exciting opportunities in the coming months.

For further details on the pipeline please see the Investment Manager's report.

Financial Results

This was the Company's inaugural financial year, and a shortened period. The NAV per share was 97.49 pence per share at 31 March 2021. The portfolio, consisting of two investments held via the Company's subsidiary TEEC Holdings, was valued at GBP20.88 million as at 31 March 2021 and the Company held cash of GBP76.55 million at the reporting date.

The Company made a loss before tax of GBP521k for the period, equal to 0.01 pence per share, resulting from costs incurred during the period and the first investments closing on 19 March 2021, with a minimal amount of income received.

The Company's annualised OCR was 1.07% As the Company enters a full financial year, we expect the OCR to increase proportionately in line with the operational costs of the Company. The Board will continue to monitor the OCR closely as we seek to grow the Company and deliver value to our shareholders.

Share Price and Distributions

Our share price has performed well and maintained a modest premium to NAV, reflective of our strong shareholder base since we launched as the first investment trust IPO post the Covid-19 hiatus in 2020. We continue to believe there is a significant market opportunity for energy efficiency investments and are confident that delivering on our outlined strategy will continue to support our share price performance. I am also pleased to announce, as indicated in the Prospectus, that the Company will pay its first interim dividend of 2.00 pence per share in respect of the period from IPO to 31 March 2021.

In future, the Board anticipates paying quarterly interim dividends, targeting total dividends of 5.50 pence per share (2) for the year ending March 2022 underpinned by robust long-term contractual payments that are expected to be availability, government subsidy or savings based. This dividend target is an increase on the 5 pence per share set out in the Prospectus. As we maintain our focus on deploying our remaining capital in the short term, we will be equally focused on our ambition to fully cover our dividend by cash earnings as soon as practicable.

Notes:

(2) The dividend and return targets stated are Pound Sterling denominated returns targets only and not a profit forecast. There can be no assurance that these targets will be met, and they should not be taken as an indication of the Company's expected future results.

Environmental, Social and Governance

The Investment Manager has long been an advocate of investing in sectors that have a positive social impact and has been aware of the value added by strong sustainability credentials and how they play a significant role in the long-term performance of investments. The Company is a direct product of this approach.

There is a global demand for sustainability, and it is at the heart of the Company's Investment Objectives, which also benefit from long-term contracted revenue from reliable counterparties. The Investment Manager continues to build and enhance our research and investment due diligence process to better assess the most material issues related to corporate sustainability each proposed investment may face. That work has informed our assessments and investment views and complements the broad framework for assessing ESG risks which the Investment Manager has developed. More information can be found in our sustainability report.

We are proud that, in October 2020, the Company was awarded the Green Economy Mark by the London Stock Exchange (" LSE "), which recognises listed companies and funds which derive 50% or more of their revenues from environmental solutions.

Outlook

Energy efficiency improvement opportunities are abundant and are often the cheapest and greenest energy resource that we have. Making our infrastructure more energy efficient and coming up with more efficient ways to structure and organise our society is perhaps the most important way we can reduce the UK's carbon dependency.

The role of energy efficiency in helping to achieve the ambitious targets set by Government cannot be overstated and as we look forward to executing on our pipeline, growing the scale of the Company, and delivering returns to our shareholders ; we do so in the knowledge that as well as being profitable we will help meet decarbonisation goals and unlock wider environmental and social benefits .

John Roberts

Chai r

2 June 2021

STRATEGY AND BUSINESS MODEL

The Board is responsible for the Company's Investment Objective and Investment Policy and has overall responsibility for ensuring the Company's activities are in line with such overall strategy. The Group's Investment Policy and Investment Objective are published below.

Investment Objective

The Company's Investment Objective is to generate a total return for investors comprising sustainable and growing income and capital growth.

Investment Policy

The Company intends to achieve its Investment Objective by investing in a diversified portfolio of energy efficiency investments in the United Kingdom. The term energy efficiency refers to assets or processes which reduce primary energy input for a given output, thereby reducing or eliminating energy waste. Energy efficiency is one of the cornerstones of the global drive to addressing the climate emergency. The cleanest or greenest energy is the energy that is never used - the projects and assets which deliver such savings are the focus of the Company.

The Group will invest in a range of assets which will contribute or are already contributing to energy efficiency in sub-sectors including electricity and heat generation, distribution and end user consumption, and which meet the following criteria:

-- contribute towards demonstrable energy (and financial) savings over a "business as usual" scenario;

   --      are established technologies (the Group will not invest in unproven technologies); 

-- provide long-term contracts based predominantly on availability, government subsidy or savings-based contracts with high quality industrial, governmental, and corporate counterparties, including counterparties which represent multiple end-users; and

-- entitle the Company to receive stable, predictable Pounds Sterling cash flows over the medium to long-term.

The Group's returns will typically take the form of contractual payments by counterparties in respect of equipment, usually installed at their premises (and which may provide index-linked, rental payments), as well as payments under off-take agreements in respect of energy generated and, where available, the Group will capitalise on government incentive programmes.

Contractual payments by counterparties are expected to be predominantly availability, government subsidy or savings-based. Availability payments will be receivable on the basis that the equipment is available and in suitable working order to deliver the applicable outputs; savings-based payments work by setting an agreed baseline for savings in KWhs up-front and are then ascribed a monetary value by applying the prevailing energy cost, with annual increases based on an agreed energy price index insulating the Company from any changes in the cost of energy.

The Group will invest predominantly in operational Energy Efficiency Projects. It will invest in either single assets or portfolios of multiple assets, via debt and/or equity structures. The Group may, under certain circumstances, invest in Energy Efficiency Projects that are in the development phase, the construction phase or the stabilisation phase, either directly or through funding of a third-party developer, where such investments will deliver an attractive risk adjusted return. In addition, the Group may invest in or acquire minority interests in companies with a strategy that aligns with the Company's overarching Investment Objective, such as developers, operators or managers of Energy Efficiency Projects, subject to the restrictions set out below.

In respect of each type of investment, the Group will seek to diversify its commercial exposure by contracting, where practicable, with a range of different equipment manufacturers, project developers and other service providers, as well as off-takers.

Investments may be acquired from a single or a range of vendors and the Group may also enter into joint venture arrangements alongside one or more co-investors, where the Group retains control or has strong minority protections.

Investment Restrictions

The Company will invest and manage its assets with the objective of spreading risk and, in doing so, will maintain the following investment restrictions:

-- no single Energy Efficiency Project investment by the Group will represent more than 20% of GAV;

-- the aggregate maximum exposure to any counterparty will not exceed 20% of GAV (and where an Energy Efficiency Project derives revenues from more than one source, the relevant counterparty exposure in each case shall be calculated by reference to the proportion of revenues derived from payments received from the counterparty, rather than any other source);

-- the aggregate maximum exposure to Energy Efficiency Projects in the development phase and the construction phase will not exceed, in aggregate, 25% of GAV, provided that, the aggregate maximum exposure to projects in the development phase will not exceed 5% of GAV, and the aggregate exposure to any one developer will not exceed 10% of GAV;

-- the Group will not invest more than 5% of GAV, in aggregate, in the acquisition of minority stakes in other related companies, and at all times such investments will only be made with appropriate minority protections in place;

-- neither the Company nor any of its subsidiaries will invest in any UK listed closed-ended investment companies; and

-- the Company will not conduct any trading activities which are significant in the context of the Group as a whole.

The investment restrictions set out above apply following full investment of the Net Proceeds and following the Group becoming substantially geared (meaning for this purpose borrowings by way of long-term structural debt of 20% of GAV being put in place).

Compliance with the above investment limits will be measured at the time of investment and non-compliance resulting from changes in the price or value of assets following investment will not be considered as a breach of the investment limits.

Gearing

The Directors intend to use gearing to enhance the potential for income returns and long-term capital growth, and to provide capital flexibility. However, the Company will always follow a prudent approach for the asset class with regards to gearing, and the Group will maintain a conservative level of aggregate borrowings.

Gearing will be employed at the level of the Company, at the level of any intermediate wholly owned subsidiary of the Company or at the level of the relevant Project SPV, and any limits set out in this document shall apply on a look-through basis. The Company's target medium term gearing for the Group will be up to 40% of GAV, calculated at the time of drawdown.

The Group may enter into borrowing facilities at a higher level of gearing at the intermediate subsidiary level or at the Project SPV level, provided that the aggregate borrowing of the Group shall not exceed a maximum of 45% of GAV, calculated at the time of drawdown.

Debt may be secured with or without a charge over some or all the Group's assets, depending on the optimal structure for the Group and having consideration to key metrics including lender diversity, cost of debt, debt type and maturity profiles. Intra-group debt between the Company and subsidiaries will not be included in the definition of borrowings for these purposes.

Use of Derivatives

The Group may use Derivatives for efficient portfolio management. The Group will only enter into hedging contracts (in particular, in respect of inflation, interest rates, power prices and commodity price hedging) and other derivative contracts when they are available in a timely manner and on acceptable terms. The Company reserves the right to terminate any hedging arrangement in its absolute discretion. Any such hedging transactions will not be undertaken for speculative purposes. The Company will not employ derivatives for investment purposes.

Cash Management

Whilst it is the intention of the Company to be fully or near fully invested in normal market conditions, the Company may hold cash on deposit and may invest in cash equivalent investments, which may include government issued treasury bills, money market collective investment schemes, other money market instruments and short-term investments in money market type funds ("Cash and Cash Equivalents").

There is no restriction on the amount of Cash and Cash Equivalents that the Company may hold and there may be times when it is appropriate for the Company to have a significant Cash and Cash Equivalent position instead of being fully or near fully invested.

Changes to and compliance with the Investment Policy

Any material changes to the Company's Investment Policy set out above will require the approval of shareholders by way of an ordinary resolution at a general meeting.

In the event of a breach of the investment guidelines and/or the investment restrictions set out above, the Investment Manager shall inform the Board as soon as practicable upon becoming aware of any breach. If the Board considers the breach to be material, notification will be made through an announcement via a Regulatory Information Service.

Business Model

The Company is a United Kingdom registered investment company and its Ordinary Shares trade on the Specialist Fund Segment of the Main Market of the London Stock Exchange. The Company's investments are held indirectly via its sole direct subsidiary and main investment vehicle, TEEC Holdings Limited (" TEEC Holdings "), a limited company incorporated in England and wholly owned by the Company, (the Company and TEEC Holdings, together, the " Group "). TEEC Holdings is, itself, an investment entity and is therefore measured at fair value. Triple Point Investment Management LLP (the " Investment Manager ", " AIFM " or " TPIM ") and Hanway Advisory Limited (' 'Hanway ") are third party service providers appointed by the Company via, respectively, an investment management agreement and an administration and company secretarial services agreement.

Payments to Investee Companies will typically take the form of contractual payments by counterparties in respect of equipment, usually installed at their premises (and which may provide index-linked, rental payments), as well as payments under off-take agreements in respect of energy generated and, where available, the Group will capitalise on government incentive programmes.

The Company has a 31 March financial year end, announces full year results in June and half year results in December.

The Company intends to pay dividends quarterly, targeting payments in June, September, December and March each year (3) .

Notes:

(3) Investors should note that references to "dividends" and "distributions" are intended to cover both dividend income and income which is designated as an interest distribution for UK tax purposes and therefore subject to the interest streaming regime applicable to investment trusts.

Investment Process

The Investment Manager has an extensive network of relationships which it leverages with the aim of delivering new potential investment opportunities.

The Investment Manager targets predominantly operational assets, either as single assets or portfolios of assets which, typically, have an existing operator in place. The Company has taken a conservative approach in applying the investment restriction limit on construction projects and, as such, whilst this limit does not become effective until such time as debt had been realised and IPO proceeds deployed, the Board has agreed the Company will apply an exposure limit on construction projects which assumes that debt has been put in place at 45% of GAV.

The Investment Manager considers Environmental, Social and Governance (" ESG ") factors when identifying investments. While considering the individual nature of a target asset, for example, the size and type of asset, region, operational environment and stage of project cycle, there are certain factors which the Investment Manager will also consider in order to understand the longevity of the value of an Energy Efficiency Project and its compatibility with the UK government's overall environmental targets moving to reduce greenhouse gas emissions to net zero by 2050.

Specifically, the Investment Manager will be mindful of the following factors, as appropriate:

Environmental : greenhouse gas emissions and air pollution, and their creation, management and monitoring during build and asset life including climate risk analysis. Use, generation and intensity of energy, and the nature of the energy (e.g., renewable) along with water use and its pollution. Levels of waste generated, avoided and disposed of, approach to raw material sourcing and supply chain sustainability. Build impacts on biodiversity and habitat, understanding management and protection measures.

Social : quality and fit of an asset with a more sustainable economy, including relevance/ appropriateness to the locality. Good customer and stakeholder relations, including management of land rights and accessibility and social inclusion of access to the asset. Strong management and reporting of health and safety (during and after build) as well as sound labour management including staff wellbeing, diversity and inclusion practices, appropriate training, and presence of fair pay, including reassurance of the absence of modern slavery.

Governance : promotion of a corporate governance structure that is accountable and responsive to stakeholders, considering board structure, remuneration policy, ownership and accounting practices. Business ethics with evidence of best practice in approaches to tax policy, management of bribery and corruption risk, conflicts of interest and appropriate senior level ownership of ESG issues.

The Group may also finance the development or construction of new Energy Efficiency Projects in circumstances where the Investment Manager has identified an attractive opportunity which meets the Company's Investment Objective and the criteria set out in the Investment Policy.

The Board have overall responsibility for the management of the Company and oversee compliance with the Company's Investment Objective and Investment Policy. When any potential investment is identified by the Investment Manager, an initial due diligence/analysis on the investment opportunity is undertaken to verify that it meets the Company's Investment Objective and Investment Policy and is commercially sound.

The Investment Manager will be responsible for further business due diligence, while the appropriate financial, environmental, social, governance, tax, legal, technical and other due diligence processes may be conducted by third party firms and/or advisers under the supervision of the Investment Manager.

If the outcome of the initial due diligence/analysis process is positive, the Investment Manager seeks to agree indicative terms for the investment opportunity and seeks to enter into a period of exclusivity.

When the Investment Manager expects that an investment opportunity is likely to complete, it delivers to the Board, as soon as reasonably practicable, a report on the investment opportunity. The Report includes a written confirmation from the Investment Manager that the investment opportunity falls within the scope of the Investment Objective, Investment Policy and the Board's risk appetite. Any decision to proceed with the investment opportunity is the sole responsibility of the Investment Manager but is only made having taken account of observations and comments from the Board.

Where the Investment Manager intends to acquire projects from any of its other clients, the Investment Manager approaches the Board at the earliest opportunity to discuss any additional diligence or additional comfort, such as independent valuation or audits required. The Investment Manager does not execute an acquisition of any project from one of its other clients without prior Board approval.

KEY PERFORMANCE INDICATORS

The Company sets out below its KPIs which it uses to track the performance of the Company over time against the objectives , as described in the Strategic Report.

The Board believes that the KPIs detailed below provide shareholders with sufficient information to assess how effectively the Company is meeting its objectives. The Board monitors these KPIs on an ongoing basis .

 
 KPI AND DEFINITION            RELEVANCE TO STRATEGY        PERFORMANCE                   EXPLANATION 
 
 Dividend s per share (pence) 
-------------------------------------------------------------------------------------------------------------------- 
 Dividends paid to             The dividend reflects the    The Company will pay a 2      The Company will pay a 
 shareholders and declared     Company's ability to         pence per share dividend in   dividend of 2 pence per 
 in relation to the period .   deliver a low risk but       respect of the period to 31   share in respect of the 
                               growing income stream        March 2021.                   period to 31 March 
                               from the portfolio.                                        2021 and is targeting a 
                                                                                          5.5 pence per share 
                                                                                          dividend in respect of its 
                                                                                          first full financial 
                                                                                          year to 31 March 2022 (4) 
                                                                                          . 
                              ---------------------------  ----------------------------  --------------------------- 
 
 Total NAV return (%) (5) 
---------------------------------------------------------  ----------------------------  --------------------------- 
 NAV growth and dividends      The total NAV return         (2.5% )                       The Company's NAV has 
 paid per share in the year.   measure highlights the                                     declined due to costs 
                               gross return to investors                                  incurred during the period 
                               including dividends                                        as the Company continues 
                               paid.                                                      to deploy its IPO proceeds 
                                                                                          . 
                              ---------------------------  ----------------------------  --------------------------- 
 
 NAV per share (pence) 
 NAV divided by number of      The NAV per share reflects   97.49 pence per share         GBP97.49 million/ 97.49 
 shares outstanding as at      our ability to grow the                                    pence per share as at 31 
 the period end.               portfolio and to add value                                 March 2021. 
                               to it throughout 
                               the life cycle of our 
                               assets. 
 
 Cash dividend cover (5) 
-------------------------------------------------------------------------------------------------------------------- 
 Operational cash flow         Reflects the Company's       The Company will monitor      The Company's first 
 divided by dividends paid     ability to cover its         dividend cover as the         dividend will be paid from 
 to shareholders during the    dividends from the income    Company continues to deploy   capital as it continues to 
 year.                         received from its            funds.                        deploy IPO proceeds 
                               portfolio.                                                 into Energy Efficiency 
                                                                                          Projects. 
                              ---------------------------  ----------------------------  --------------------------- 
 
 Weighted average project life (5) 
---------------------------------------------------------  ----------------------------  --------------------------- 
 Weighted average number of    The weighted average         10 years at 31 March 2021.    On 19 March 2021, the 
 years assumed to be           project life is a key                                      Company entered 10 year 
 remaining in project          measure of the quality of                                  secured loan agreements 
 contracts .                   our portfolio. Long lease                                  with Harvest and 
                               or loan terms help                                         Glasshouse. 
                               underpin the security of 
                               our income stream. 
                              ---------------------------  ----------------------------  --------------------------- 
 
 Ongoing Charges Ratio (5) 
---------------------------------------------------------  ----------------------------  --------------------------- 
 Annualised ongoing charges    Ongoing charges shows the    1.07% annualised              Company level budgets are 
 (i.e., excluding              drag on performance caused                                 approved annually by the 
 acquisition costs and other   by the operational                                         Board and actual spend is 
 non-recurring items)          expenses incurred                                          reviewed quarterly. 
 divided by the average        by the Company.                                            Transaction budgets are 
 published undiluted NAV in                                                               approved by the Board and 
 the period, calculated in                                                                potential abort exposure 
 accordance with                                                                          is carefully monitored. 
 Association of Investment 
 Companies guidelines. 
                              ---------------------------  ----------------------------  --------------------------- 
 
 Avoided emissions (5) 
---------------------------------------------------------  ----------------------------  --------------------------- 
 The carbon emissions          A measure of our success     0 tCO2e                       Although not possible over 
 mitigated by the Company's    in investing in projects                                   the shortened reporting 
 investments into Energy       that have a positive                                       period, the Company 
 Efficiency Projects.          environmental impact                                       intends to measure 
                               and reduce energy usage.                                   the energy efficiency of 
                                                                                          the projects in which it 
                                                                                          invests. 
                              ---------------------------  ----------------------------  --------------------------- 
 
 
 Exposure to development and construction phase assets (%) 
---------------------------------------------------------------------------------------------------------------------- 
 The aggregate exposure of the          Acquisitions may include a number     0%   At the period end, the Company had 
 portfolio that is in development or    of construction assets expected to         no exposure to any assets in the 
 construction phase of a                deliver growth as they                     development or construction 
 project as a percentage of GAV.        reach operations and are de-risked.        phase. 
                                       ------------------------------------  ---  ------------------------------------ 
 
 Gross loan to value ("LTV") (5) 
---------------------------------------------------------------------------------------------------------------------- 
 The proportion of our GAV that is      The LTV measures the prudence of      0%   The target LTV is 40% and will 
 funded by borrowings.                  our financing strategy, balancing          always be below the maximum of 45% 
                                        the potential amplification 
                                        of returns and portfolio 
                                        diversification that come with 
                                        using debt against the need to 
                                        manage 
                                        risk successfully. 
                                       ------------------------------------  ---  ------------------------------------ 
 
 

Notes:

(4) The target dividend is a target only and not a forecast. There can be no assurance that the target will be met and it should not be taken as an indication of the Company's expected or actual future results.

(5) KPI and Definition is an Alternative Performance Measure.

INVESTMENT MANAGER'S REPORT

Review of the Period

Since IPO in October 2020, the Group has begun implementing its strategy of investing in good quality Energy Efficiency Projects. As at the period end, we had deployed GBP21 million of the IPO proceeds and expect the remaining proceeds to be deployed well before the end of this calendar year.

We are pleased to report that since the period end, the Group completed a GBP8.032 m illion senior debt investment in an operational Combined Heat and Power (" CHP ") Energy Centre, Spark Steam Limited (" Spark Steam "). Spark Steam fully provides tomato grower APS Salads with its heat and electricity requirements, as well as supplying carbon dioxide produced by the CHP+ system to enhance crop yields. The transaction follows on from similar investments this year in Harvest and Glasshouse, also CHP businesses supplying heat and power to APS Salads and managed by P3P Partners, illustrating the Company's approach to building scalable partnerships with leading developers and offtakers.

Market Review

In November 2020, Prime Minister, Boris Johnson, announced the government's unambiguous 10-point plan for a green industrial revolution. Outlined in the plan is the government's vision to become a global leader in green technologies and details targets for different sectors including offshore wind, hydrogen, transport, carbon capture and buildings.

The plan also outlined ambitious funding plans, including GBP12 billion of Government investment to help create and support up to 250,000 green jobs. I t is vitally important that our recovery from the pandemic simultaneously grows the low carbon and climate resilient economy and t he announcement was a positive first step in that direction.

The month thereafter saw the publication of a body of mutually reinforcing policy announcements that would make clear the government's view on what is required to meet net zero:

The National Infrastructure Strategy (subtitled Faster, Greener, Fairer) signalled the creation of a new infrastructure bank to underpin the infrastructure revolution albeit with a clear mandate to crowd-in private capital.

That was followed by the Climate Change Committee's 6th Carbon Budget suggesting a "balanced net zero pathway" for a 78% reduction in carbon reductions from 1990 levels , by 2035, a recommendation that was subsequently enshrined in policy and rightly described as the "world's most ambitious climate change target". In their Carbon Budget, the Committee claimed that investment of up to GBP50bn per year would be required to afford the transition to net zero.

The long-awaited Energy White Paper - Powering our Net Zero Future was published in December.

The document builds on the Prime Minister's 10-point plan and the National Infrastructure Strategy to give 'further clarity on the Prime Minister's measures and puts in place a strategy for the wider energy system'.

Published just three days later, HM Treasury's Net Zero Interim Review considered "how the costs of achieving net zero emissions are distributed and the benefits returned... the fiscal impacts, risks of competitiveness effects and the impacts of decarbonisation across the whole economy" and "the full range of policy levers, including carbon pricing, taxes, financial incentives, public spending, regulation and information provision." The review concluded that much of the funding required could, and should, come from the private sector.

With the Heat and Buildings Strategy expected imminently, there is a unified and unifying policy tailwind being established after many years of comparative inaction with the UK demonstrating bona fide international leadership in a year that will draw to an end with its hosting of the 26th UN Climate Change Conference of the Parties (COP26).

Energy efficiency is now being recognised as a priority by governments and investors around the world.

The Company was deliberately conceived and developed against this backdrop. The Government's demonstrable support of the sector is both an endorsement of our strategy and an exciting catalyst of investable opportunities now and in the future.

Pipeline

Activity and competition around quality Energy Efficiency Projects remains strong, particularly as the wider sector is seen as a safe-haven in times of economic turmoil. We nevertheless have a good pipeline of opportunities, and have sufficient retained liquidity to take advantage of them.

The majority of that pipeline is comprised of projects seeking equity investments to afford the acquisition of operational or construction assets.

Users of energy, whether they be industrial, commercial or domestic, do not want or need electricity or fuel per se, they want or need the services that energy delivers. Shifting the focus onto the services required helps to reduce the total cost and total energy input to provide them, thereby reducing the absolute power input requirement from producers of energy.

We have also responded to a perceived gap in the market for flexible debt financing in some technology segments, for example where a developer wishes to retain an interest in an asset it has developed. The Company has circa GBP300 million of pipeline, including approximately GBP100 million of more immediate pipeline that the Investment Manager is actively progressing . The Company has GBP26 million of opportunities in heads of terms , including one large financing transaction which is in the final stages of due diligence.

We are also exploring significant opportunities in private wire/PPA backed solar rooftop opportunities. We believe this market is underserved by existing funding providers, and offers attractive risk adjusted returns through long term, indexed linked cashflows, rather than exposing investors to the volatility experienced in recent wholesale power markets. We continue to seek to develop framework agreements with developers to provide a consistent flow of high-quality proprietary pipeline opportunities, working with trusted construction and maintenance partners to reduce cost and enhance returns.

The Company has a strong pipeline of assets across a range of sub-sectors within its investment mandate . In assessing our pipeline, we remain cognisant of our investment restriction limits to construction projects, this is something the Board has carefully considered and is discussed in further detail below .

Investment

During the period, the Company closed its first investments, using proceeds raised at IPO. The Group provided secured loans to two companies, Harvest and Glasshouse, which both own and operate combined heat and power ("CHP+") energy centres. Under the terms of the investments, the Group provided an aggregate GBP21 million of senior debt finance, secured against Harvest and Glasshouse, the underlying assets, equipment, and contracts. The interest rate is 7.75% per annum, each loan carries a term of 10 years, and each loan is amortising over 14 years, with the residual amount to be repaid at maturity. Approximately 25% of the refinanced debt was held by a Company advised by the Investment Manager and therefore the transaction underwent detailed conflict procedures and arrangements to ensure the transaction was on an arms' length basis and at fair market value, in addition to being subject to Board approval.

Harvest and Glasshouse each own and operate energy centres which supply power, heat and carbon dioxide to the UK's leading tomato grower. The two projects consist of energy centres at adjacent growing sites on the Isle of Wight. The energy centres each contain two 5.5 MW Rolls-Royce gas engines, together with two 8MWth backup gas boilers (for use when the CHPs are down for maintenance or are not being run to exploit any differences between the input fuel costs and the wholesale power prices).

The projects derive their primary revenues from 20-year energy services agreements, which commenced in April 2016 (when the energy centres were commissioned) and expire in April 2036.

Gearing

At the reporting date, the Company had not utilised any gearing. Although, in the interests of capital efficiency and to enhance income returns and long-term capital growth, the Company expects to utilise gearing in the medium term and has a maximum gearing level of 45%

Environmental, Social and Governance

In October 2020 we were delighted that the Company was awarded the Green Economy Mark by the London Stock Exchange ("LSE"). The award recognises listed companies and funds which derive 50% or more of their revenues from environmental solutions.

In conjunction with the Board's endorsement, the Investment Manager has been developing its ESG integration policy for the Company's investments. Within this policy, the Investment Manager has set out principles which it will seek to incorporate throughout its business. Further, incorporated within the ESG integration policy, the Investment Manager has become a signatory to the United Nations Principles for Responsible Investment, committing to the principles set out therein to show dedication to strengthening environmental, social and governance considerations into its business.

Further detail on the Company's ESG approach to due diligence and investments can be found in the sustainability report.

Personnel Changes

In January 2021, Charles Herriott left the Investment Manager on good terms and was replaced by senior investment professional and Investment Director, Jonathan Hick. Jonathan brings with him a strong background in leading the investment process from origination and execution through to asset management in the clean technology and renewable energy sector. We welcome Jonathan and look forward to his support as we move closer to deploying the Company's IPO proceeds into high-quality assets. We also look forward to welcoming a new Fund Finance Director in June 2021 and a further new Investment Director in September 2021. These new hires reflect our ambition to grow our capabilities as being at the forefront of energy efficiency investing.

Financial Review

The Company applies IFRS 10 and qualifies as an investment entity. IFRS 10 requires that investment entities measure investments, including subsidiaries that are themselves investment entities, at fair value except for subsidiaries that provide investment services which are required to be consolidated.

The Company's single, direct subsidiary, TEEC Holdings, is the ultimate holding company for all the Company's investments.

It is, itself, an investment entity and is therefore measured at fair value.

Ongoing Charges

Ongoing charges, in accordance with the Association of Investment Companies' ("AIC") guidance, are defined as annualised ongoing charges (i.e., excluding acquisition costs and other non-recurring items) divided by the average published undiluted net asset value in the year.

The Company's annualised OCR was 1.07% As the Company enters a full financial year, we expect the OCR to increase proportionately in line with the operational costs of the Company. The Board will continue to monitor the OCR closely as we seek to grow the Company and deliver value to our shareholders.

Valuation

The Investment Manager is responsible for carrying out the fair market valuation of the Group's investments, this is presented to the Board for their consideration and comment in advance of formal approval. The valuation of the portfolio is to be carried out on a six-monthly basis as at 31 March and 30 September each year.

At the period end, the Company has made two debt investments into Harvest and Glasshouse totalling GBP21 million.

Investments made by the Company through TEEC Holdings are expected to be predominantly non-market traded investments, such that these investments are valued using a discounted cash flow analysis of the forecast investment cash flows from each project.

When valuing equity investments, the key macro-economic and fiscal factors expected to affect the forecast of each portfolio company's cash flows are inflation rates, interest rates, power price assumptions, and corporation tax rates. The Investment Manager makes forecast assumptions for each of these external metrics, based on market data and relevant economic forecasts where available.

The Investment Manager exercises judgement in assessing the expected future cash flows from each investment, based on the detailed financial models produced for each portfolio company and adjusting where necessary to reflect the broader macro-economic and fiscal assumptions as well as any specific operating assumptions that may be relevant to the individual projects.

The fair value for each investment is then derived from the application of an appropriate market discount rate. Due to the Company investing solely in projects based in the United Kingdom, there are no foreign exchange assumptions required. The discount rate used considers risks associated with the financing of an investment such as investment risks (e.g., liquidity, inflation, interest rate risks, market appetite) and any risks to the investment's earnings (e.g., predictability of the revenues and factors affecting these), all of which may be differentiated by the phase of the investment's life (e.g., in development/construction or in the operational phase).

The Investment Manager uses its judgement in arriving at the appropriate discount rate. This is based on its knowledge of the market, considering insights gained from its investment activities, discussions with its financial advisers and publicly available information on relevant transactions.

Outlook

As highlighted above, Prime Minister Boris Johnson confirmed in April 2021 that based on the CCC's recommendations the target , of reducing emissions by 78% by 2035, would be introduced and is planned to be enshrined into law by the end of June 2021. It continues to build on the UK's commitment to net zero, which will see the nation reduce emissions by 68% by 2030, compared to 1990 levels.

While we view these targets as ambitious, we believe they are necessary and achievable, and they present the Company with a great opportunity to assist in filling the delivery gap. Meeting the Budget's requirements will require all new cars, vans and replacement boilers to be zero-carbon in operation by the early 2030s. UK electricity production must then reach Net Zero by 2035, in line with the National Grid ESO's vision, and the majority of existing UK homes will also need to be retrofitted in some way.

The Investment Manager hopes to utilise the skills and knowledge it has developed in this area, through the Heat Networks Investment Project to capitalise on the drive for energy efficient technologies.

Our current pipeline, which includes a wide range of low carbon and energy efficient technologies; including EV charging infrastructure, CHP, energy from waste, hydro, solar, waste heat recovery, heat networks and lighting has over GBP 300 million of prospective opportunities, which should comfortably enable us to deploy the balance of our IPO proceeds.

Jonathan Parr

Partner and Head of Energy

2 June 2021

SUSTAINABILITY REPORT

The Investment Manager's business mission is that through its people, and the partnerships it builds, it unlocks investment opportunities that have purpose, while generating profit for investors. The Company is a direct product of this way of thinking. There is a global demand for sustainability which includes the rapid transition to a lower carbon economy.

Sustainability and the Investment Manager

Investors choose funds managed by TPIM for the Investment Manager's ability to generate stable and consistent financial returns through a range of investment strategies. Inherent to the growth of its business has been a desire to develop investment products not only generating these strong returns, but which also serve a positive societal function.

Most relevant to the Company is TPIM's strategy of being a sustainable Investment Manager: Environmental, Social and Governance (ESG) are factored into each investment opportunity to support the Investment Objective of the Company.

The transition to Net Zero

Energy efficiency is critical to meeting the UK government's target of reducing greenhouse gas emissions to Net Zero by 2050. The Investment Manager and the Board believe that the investment case for energy efficiency is significant and can be deployed throughout business across the UK. Whilst the UK has made noticeable progress in the decarbonisation of electricity generation, we acknowledge the immense challenge of improving energy efficiency in order to achieve the Net Zero target by 2050. It was announced in April 2021 that the UK committed to deliver a 78% reduction in emissions by 2035 (as proposed by the CCC if it is to meet its long-term net-zero commitment).

In the UK, 54% of the energy used to provide electricity is wasted. This is primarily due to generation and transmission losses associated with the UK's centralised grid, with lost heat contributing significantly to the total losses. Substantial and continuing investment is needed to finance the transition to a low carbon economy in order to reduce these energy losses in generation, distribution, and consumption. Of the $120 trillion global investment the International Renewable Energy Agency (" IRENA ") believes is needed to meet the Paris climate accords, 44% is expected to come from energy efficiency.

The International Labour Organisation (" ILO "), the United Nations' agency for the world of work, estimates that action to meet the Paris goals may create 24 million jobs in clean energy generation, electric vehicles and energy efficiency and lead to job losses of just 6 million, a net gain of 18 million jobs. Energy efficiency solutions provide an important opportunity to significantly impact the transition to a low carbon economy and are at the core of the Company's mission .

ESG integration into the investment process

The Investment Manager with input from the Board integrates thorough and in depth ESG analysis into all potential investments. Potential investments are first assessed against broad thematic ESG criteria. If these criteria are not met, opportunities will not be pursued further. Throughout the due diligence process the analysis becomes specific, featuring quantitative savings compared to the counterfactual, and more detailed environmental, social and governance due diligence. Included in this analysis is an assessment of climate risk to ensure the physical implications of climate change and the transition effects of the move to a low carbon economy have been accounted for in the Investment Manager's assessment of a project.

The results of this due diligence and analysis process are shared with the Investment Manager's Investment Committee and the Board, before an investment is executed. This ensures that the Investment Manager's high standards of ESG and sustainability are used during the investment process for the Company.

Sustainable Development Goals

In 2015, the United Nations adopted the 2030 Agenda for Sustainable Development, in which 17 Global Sustainable Development Goals ("SDG's") were characterised, describing the areas and themes in which humanity needed to focus development to ensure prosperity of people and the planet now and for the future.

The Board, the Company and the Investment Manager are fully aware of the 17 SDGs and make investments promoting development across combinations of areas which are targeted by the SDGs, such as: Affordable Clean Energy (SDG 7); Decent work and economic growth (SDG 8), and Industry, Innovation, and Infrastructure (SDG 9).

Although the purpose of the Company is not specifically to align to these SDGs, the investments the Company makes will help address specific targets within each goal, such as:

-- 7.2 By 2030, increase substantially the share of renewable energy in the global energy mix;

   --       7.3 By 2030, double the rate of improvement in energy efficiency; 

-- 8.4 Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation, in accordance with the 10-year framework of programmes on sustainable consumption and production, with developed countries taking the lead;

-- 8.5 By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value;

-- 8.7 Take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers, and by 2025 end child labour in all its forms;

-- 8.8 Protect labour rights and promote safe and secure working environments for all workers, including migrant workers, in particular women migrants, and those in precarious employment;

-- 9.1 Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all; and

-- 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities.

Investment Targets

Increase energy efficiency

Energy efficiency is the cheapest, fastest to deploy and lowest risk energy solution. One of the Company's stated aims is to increase energy efficiency in existing assets, rather than develop brand new renewable infrastructure; this aids the transition over the medium-term towards the achievement of Net Zero by the UK.

The Company targets investments across multiple areas from reduction of transmission losses, energy used in transport to inefficient homes and factories, with a focus on bringing energy efficiency to energy intensive technologies and solutions.

Have a positive environmental impact

In line with the Company's Investment Policy the Investment Manager and the Board expect all investments to have a positive environmental impact that goes beyond energy and GHG emissions.

Greenhouse Gas ("GHG") emissions

Through the application of the Company's Investment Policy, and the fulfilment of the Company's Investment Objectives, the Company aims to reduce energy waste and thereby mitigate GHG emissions. It is a target criterion in every investment that the proposed project will reduce the GHG emissions compared to an appropriate counterfactual, across scope 1, 2 and 3 (where measurable) emissions.

Environment

Planet, biodiversity and climate change

The overarching objective of the Company's investment mandate is a focus on investments in increased energy efficiency technologies and hence a reduction in carbon emissions. The Board and the Investment Manager also realise that through the investment decisions made, the Company has the opportunity to enable further environmental benefits beyond that of energy and/or carbon efficiency improvements.

The Investment Manager, with the input of the Board, is working to develop asset specific management plans that will aim to ensure that our investee companies mitigate pollution to land, water and air as much as possible and at all times within the requirements of legislation set by the Environment Agency or other institutions. Infrastructure projects also create an opportunity to give benefits to local biodiversity through the introduction of insects and other species to closed off areas of unused land, allowing biodiversity to flourish.

Social

The Investment Manager and the Board remain cognisant of the fact that the Company's investments can be an opportunity to promote positive social outcomes to enable a just transition to a zero -carbon economy, as called for by the 2015 Paris Climate Agreement.

The Just Transition asks investors to recognise the social impact of the shift to zero carbon, through technological and business model change causing heavy numbers of anticipated job losses in the fossil fuel industry to the necessity to ensure that new jobs created are decent and contribute to resilient communities.

During ESG due diligence, the Investment Manager reviews all existing people related policies and will work with a counterparty to improve provisions or create new appropriate policies where they may be lacking. Such policies might include Health and Safety, Inclusion and Diversity, Equal Opportunities and Anti-Slavery and Human Trafficking to ensure workforces are being treated as fairly as possible.

Further social outcomes can be achieved by contracting, where possible, with local companies to facilitate local employment, thus maintaining a skilled local workforce that are not left behind by the energy transition. It's also about engaging with communities and stakeholders where the transition to net zero may ultimately lead to change in technologies and lead to job losses or changes in the local job market - we intent to help stakeholders to understand this. By doing this we expect to build goodwill and relationships with local communities which could be further expanded with donations towards local community groups or further investment into local communities.

Our first investment is in senior debt in Harvest and Glasshouse; those two companies employ 3 people between them, who live locally on the Isle of Wight and manage the day-to-day operations of site. Due to the low maintenance requirements of the assets, the Harvest and Glasshouse assets can be managed satisfactorily by these 3 employees. Most of the workforce on the site however, are employed by the grower. The Investment Manager will always perform due diligence on relevant counterparties.

Due to the nature of harvesting vegetables, many of the employees at the grower on the Isle of Wight are seasonal workers from Europe. Unfortunately, in the UK, European seasonal workers are often subject to a higher risk of modern slavery. It was important to the Board and the Investment Manager that these workers have appropriate working standards and so the Investment Manager conducted due diligence into employment practices, policies, and spoke with members of staff at the grower.

Governance

The Company aims to invest in well governed, fair and safe businesses, with low-risk supply chains and reliable stakeholders. Details of the Company's Anti-Bribery Policy can be found in the Corporate Governance Report .

The implementation of the Company's Investment Objectives, involve contracting with high-quality industrial, government and corporate counterparties. The Investment Manager works alongside over 75 Local Authorities and over 50% of its counterparties across the funds managed are in the public sector.

We will invest in sustainable businesses and focus on financially robust companies with a strong business model to weather economic downturns or recessions, that have several years of profitability and a successful track record of operations with an established management team.

We target established technologies backed by stable regulatory frameworks with predictable, long term cash flows underpinned by predominantly contracted revenues for financial sustainable investment. We work alongside investee companies to ensure they meet the Company's ESG objectives by seeking formal commitment from investee companies. This is done by incorporating ESG into deal documentation. For longer term concerns we will collaboratively work with the investee company to establish a roadmap for improvement over a three to five-year horizon with clear process benchmarks.

We are an externally managed business and do not have any employees or office space. As such the Group does not operate a diversity policy with regards to any administrative, management and supervisory functions. A description of the Board's policy on diversity can be found in the Corporate Governance Report .

Approach to reporting

The Board and the Investment Manager are committed to providing appropriate and transparent sustainability reporting. In addition to the Key Performance Indicators highlighted above , we will follow other industry best practice in our reporting, as follows:

Task Force on Climate-related Financial Disclosures ("TCFD")

Separately to the internal analysis and due -diligence that the Investment Manager conducts, both the Investment Manager and the Board support the recommendations of the TCFD. The TCFD is the most globally supported framework for climate related risk analysis and follows all existing best practice on climate emission calculations and reporting, including that of the Partnership for Carbon Accounting Financials (" PCAF ").

The TCFD framework recommends that organisations should seek to understand the impact of climate-related financial risks and opportunities and disclose the 'actual and potential impacts' of those risks and opportunities. Financial risks from climate change arise through two primary channels, or 'risk factors': physical and transitional.

The Investment Manager with input from the Board analyses climate related physical and transitional risks and opportunities when looking at potential future investments. The physical risks are based on physical changes which the UK is predicted to experience due to climate change as reported in the Climate Change Committee's 6th Carbon budget. The transitional risks are legislative changes that research shows are likely to occur and which we think would affect the investment. Where possible the Investment Manager looks to integrate these sensitivities into our financial models so that we can easily see the financial risks, or opportunities, that an investment may have due to the physical and transitional effects of climate change.

Given the Company's short financial period and the nature of the Company's initial investment portfolio at 31 March 2021, the Board believe that full disclosure against the requirements of TCFD reporting will not provide shareholders with useful information as to the Company's environmental impact. The Company intends to report against TCFD requirements for the full financial year ending 31 March 2022.

EU Taxonomy

The EU Taxonomy Regulation establishes an EU-wide classification system or "framework" intended to provide businesses and investors with a common language to identify to what degree economic activities can be considered environmentally sustainable. Broader disclosure obligations are laid out in the Regulation on Sustainability-Related Disclosures in the Financial Services Sector (" SFDR "). SFDR requirements include pre-contractual, website and periodic reporting obligations.

Under the current regulatory requirements, the Company is not required to disclose under SFDR, however we intend to make a disclosure in the coming months, which will be available on the Company's website and in subsequent interim and annual reports.

Although the UK is no longer subject to EU regulations, the UK is expected to mandate a similar Taxonomy Regulation aligned with scientific metrics in the EU taxonomy or with similar global standards. Once introduced, the Company will also disclose in line with these requirements.

Continued Commitment

Sustainability is intended to be at the heart of every investment made by the Company. Through the Investment Manager's and the Company's ESG approach to investments, and alignment with globally renowned frameworks, The Manager and the Company are at the start of a journey, in aiming to fulfil the objective of having a positive and sustainable impact on the United Kingdom.

SECTION 172(1) STATEMENT

The Board is committed to promoting the long-term success of the Company whilst conducting business in a fair, ethical, and transparent manner.

The Board makes every effort to understand the views of the Company's key stakeholders and to take into consideration these views as part of its decision making process.

As an investment company, the Company does not have any employees and conducts its core activities through third-party service providers. The Board seeks to ensure each service provider has an established track record and, through regulatory oversight is required to have in place suitable policies and procedures to ensure they maintain high standards of business conduct, treat shareholders fairly, and employ corporate governance best practice.

The following disclosure describes how the Directors have had regard to the matters set out in section 172(1) (a) to (f) when performing their duty under s172 and forms the Directors' statement required under section 414CZA of the Act.

Stakeholder Engagement

 
  Stakeholder       Why is it        How have the                            What were the                         What was the 
                    important         Investment                               key topics                            feedback 
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 Shareholders     Shareholders     The way in                                                                      Following 
                  and their        which we engage      *    Several investor meetings were held prior to IPO to   feedback 
                  continued        with our                  engage shareholders with the Company's strategy.      received at 
                  support are      shareholders                                                                    investor 
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                                                                                                                   per share. 
                 ---------------  ------------------  ----------------------------------------------------------  -------------- 
 Investment       The Investment   The Board           In addition                                                 The 
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                 ---------------  ------------------  ----------------------------------------------------------  -------------- 
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                 ---------------  ------------------  ----------------------------------------------------------  -------------- 
 Asset-level      Asset-level      The Group made      The key engagement                                          A thorough 
 counterparties   counterparties   its first            with asset-level                                           due diligence 
                  are an           investment           counterparties                                             process was 
                  essential        on 19 March          was during                                                 conducted 
                  stakeholder      2021. As a           the due diligence                                          with 
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                 ---------------  ------------------  ----------------------------------------------------------  -------------- 
 Investee         Investee         The Board and       The Investment                                              The 
  Companies       companies         Investment          Manager engaged                                            engagement 
  / Borrowers     are companies     Manager visited     with the boards                                            provided a 
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                 ---------------  ------------------  ----------------------------------------------------------  -------------- 
 

Principal Decisions

Principal decisions have been defined as those that have a material impact to the Group and its key stakeholders. In taking these decisions, the Directors considered their duties under section 172 of the Act.

Deployment of IPO proceeds

During the year, the Group invested, by way of secured debt into two companies who operate CHP engines. Following a recommendation from the Investment Manager, the Directors considered the investment in the context of the Company's Investment Policy, availability of financing and the potential returns to investors. They also considered the investment in the context of sustainability.

Dividends

Following the reporting date, the Board has approved the Company's first dividend to shareholders of 2 pence per share with respect to the period ending 31 March 2021. The Board is confident that, with the Company's pipeline and forecast cash flows, the Company can target a dividend of 5.5 pence per share for the financial year ending 31 March 2022, which the Board expects to contribute to the Company's target return to investors of an IRR of 7 % to 8 % , net of fees and expenses (6) .

Note:

(6) The target dividend is a target only and not a forecast. There can be no assurance that the target will be met and it should not be taken as an indication of the Company's expected or actual future results.

RISK MANAGEMENT

Risk is described as the potential for events to occur that may result in damage, liability or loss. Should these events occur, the Company may well be adversely impacted, potentially leading to the disruption of the Company's business model, as well as potential damage to the reputation or financial standing of the Company.

The benefit of a risk management framework is that it allows for potential risks to be identified in advance and may enable these risks to either be mitigated or possibly even converted into opportunities. The Prospectus (available on the Company website) detailed the potential risks that the Directors considered were material that could occur during the process of implementing the Company's Investment Policy. The Directors have identified below what they consider to be the current top risks to the Company and the mitigations in place.

As an externally managed Investment Company the Company delegates portfolio management and risk monitoring activities to the Investment Manager and Administrator, therefore the Company places reliance on the controls of service providers. In the normal course of business, each individual Energy Efficiency Project invested in will have developed a rigorous risk management framework including a comprehensive risk register that is reviewed and updated regularly and approved by the investee company board.

Risk appetite

The Board is responsible for setting the Company's risk appetite supplementing on the Investment Policy and investment restrictions. During the period, the Board focused on clarifying its views on technology risk. An initial articulation of broader risk appetite was then discussed and agreed at the Board meeting in May 2021. It sets the amount of risk the Company is willing to take, and the parameters which the Board determines that the Investment Manager must operate within.

Identification, assessment and management of risk are integral aspects of the Investment Manager's and the Administrator's work in both managing the existing portfolio on a day-to-day basis and pursuing new investment opportunities. The Board approved risk appetite, together with the Investment Policy and restrictions provides the framework for the Company and how the Investment Manager deploys the proceeds from the IPO in order to meet the Company's Investment Objectives. Adherence to the risk limits is reported regularly to the Board through the quarterly AIFM risk management report.

As a full scope UK AIFM, the Investment Manager has established a Risk and Valuation Committee that meets on a quarterly basis to discuss, amongst other matters, the risk framework of the Group and investee companies including processes for identifying, assessing and managing risks.

Principal Risks and Uncertainties

It is not possible to eliminate all risks that may be faced by the Company. The objective of the Company's risk management framework and policies adopted by the Company is to identify risks and enable the Board to respond to risks with mitigating actions to reduce the potential impacts should any of the risks materialise.

The Board regularly reviews the Company's risk register, with a focus on ensuring appropriate controls are in place to mitigate each risk. Taking considered risk is the essence of all business and investment activity. The Board is ultimately responsible for setting the risk appetite and for the oversight of the Company's system of internal control and for reviewing the effectiveness of the Company's system of internal control in the light of the risks identified.

Procedures to identify principal or emerging risks

In order for the Company to capture new and emerging risks and their potential implications the Administrator, Company Secretary and Investment Manager consider risk as a matter of good practice; and report these to the Board at the quarterly Board meetings. The AIFM has responsibility for identifying potential risks at an early stage, escalating risks or changes to risks and any other relevant considerations to the Board for recording in the Company's risk register. Where relevant the financial model will be stress tested against the likelihood of occurrence and graded suitably. The Board will regularly review the risk register to ensure grading and mitigations remain appropriate and it reflects all relevant risks.

The AIFM undertakes risk management functions for the Company as defined under the AIFM Directive, including but not limited to the provision of the following risk management services to the Company:

-- implementing adequate risk management systems to identify, measure, manage and monitor risks relevant to the Company's investment strategy and to which the Company may be exposed;

-- reviewing the performance of the portfolio management function and reporting to the Board of the Company in respect of the performance;

-- ensuring that the risks of each investment of the Company and its effect on the portfolio can be identified, measured, managed and monitored on an on-going basis, including the appropriate stress test modelling;

-- implementing an appropriate, documented and routinely updated due diligence policy and procedure which is followed by all relevant parties in the making of investment decisions relating to or on behalf of the Company according to the investment strategy, the objectives and risk profile of the Company;

-- regularly monitoring the compliance by the portfolio management function with the Investment Objective and limitations and restrictions and the Board approved risk appetite and reporting any instances of non-compliance promptly to the Board;

-- identifying and proposing qualitative risk limits for the Company appropriate for all relevant risks and subject to Board approval, establishing and implementing such limits; and

-- periodically reviewing the risk management systems described above to ensure that any modifications necessary are implemented.

The Board considers the following to be the principal risks faced by the Company along with the potential impact of these risks and the steps taken to mitigate them.

 
                                                                                             Post Mitigation 
  Risk Identified     Risk Description       Risk Impact           Mitigation            Impact          Likelihood 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 1. Exposure to       The Group makes     Changes in market    The majority of          Moderate             Low 
 power prices and     investments in      demand for           the Company's 
 risk to hedging      projects and        electricity,         portfolio of 
 power prices         concessions with    including changes    Energy Efficiency 
                      revenue exposure    in consumer demand   Projects should 
                      to power prices.    patterns could       benefit from 
                      The market price    have a material      fixed price 
                      of electricity is   adverse effect on    arrangements. 
                      volatile and is     the Company's 
                      affected by a       profitability, the   In addition, the 
                      variety of          Net Asset Value,     Group believe that 
                      factors,            the Company's        the transition to 
                      including market    earnings and         a low carbon 
                      demand for          returns to           economy increased 
                      electricity, the    shareholders.        usage 
                      generation mix of                        of smart grids and 
                      power plants,       To the extent that   residential 
                      government          the Group enters     participation in 
                      support             into contracts to    renewable energy 
                      for various forms   fix the price that   generation should 
                      of power            it receives on the   all positively 
                      generation, as      electricity          impact demand 
                      well as             generated or         levels and 
                      fluctuations in     enters into          patterns for 
                      the market prices   derivatives with a   electricity. 
                      of commodities      view to hedging 
                      and                 against 
                      foreign exchange.   fluctuations 
                                          in power prices, 
                                          the Group will be 
                                          exposed to risk 
                                          related to 
                                          delivering an 
                                          amount of 
                                          electricity 
                                          over a specific 
                                          period. If there 
                                          are periods of 
                                          non-production the 
                                          Group may need to 
                                          pay the 
                                          difference between 
                                          the price it has 
                                          sold the power at 
                                          and the market 
                                          price at that time 
                                          . 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 2. Expensive or      Expensive or lack   Without sufficient   When raising debt        Moderate             Low 
 lack of debt         of debt finance     debt funding at      finance the 
 finance              may limit our       sustainable rates,   Investment Manager 
                      ability to grow     we will be unable    will adopt a 
                      and achieve a       to pursue suitable   flexible approach 
                      fully covered       investments in       involving 
                      dividend.           line with our        speaking to 
                                          Investment Policy.   multiple funders 
                                          This would           offering various 
                                          significantly        rates, structures 
                                          impair our ability   and tenors. This 
                                          to pay dividends     will allow 
                                          to shareholders at   the Investment 
                                          the targeted rate.   Manager to 
                                                               maintain maximum 
                                                               competitive 
                                                               tension between 
                                                               funders. 
 
                                                               The Board also 
                                                               keeps liquidity 
                                                               under constant 
                                                               review to ensure 
                                                               that we have a 
                                                               level of 
                                                               protection 
                                                               in the event of 
                                                               adverse 
                                                               fund-raising 
                                                               conditions. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 3. Reliance on the   We rely on the      The performance of   Unless there is a          High            Moderate 
 Investment Manager   Investment          the Company          default, either 
                      Manager's           depends, in part,    party may 
                      services and its    on the ability of    terminate the 
                      reputation in the   the Investment       Investment 
                      energy and          Manager              Management 
                      infrastructure      to provide           Agreement 
                      market. As a        competent and        by giving not less 
                      result, our         efficient services   than 12 months' 
                      performance will,   to the Company.      written notice, 
                      to a large                               such notice not 
                      extent, depend on   The departure of     being served 
                      the Investment      any of the key       before the 
                      Manager's           personnel of the     fourth anniversary 
                      abilities in the    Investment Manager   of the date of 
                      energy efficiency   without adequate     Admission. 
                      market.             replacement 
                                          may also have a      The Board 
                                          material adverse     regularly reviews 
                                          effect on the        and monitors the 
                                          Company's            Investment 
                                          performance. In      Manager's 
                                          addition, if any     performance. In 
                                          such personnel       addition, 
                                          were to do           the Board meets 
                                          anything or were     regularly with the 
                                          alleged to have      Investment Manager 
                                          done something       to ensure that we 
                                          that may be the      maintain a 
                                          subject of public    positive 
                                          criticism or other   working 
                                          negative publicity   relationship. 
                                          or may lead 
                                          to investigation,    The key personnel 
                                          litigation or        of the Investment 
                                          sanction, this may   Manager are 
                                          have an adverse      subject to a t 
                                          impact on the        least a three 
                                          Company and          -month notice 
                                          its reputation by    period which sh 
                                          association.         ould provide 
                                                               sufficient time in 
                                          Termination of the   which to find a 
                                          Investment           suitable 
                                          Management           replacement with 
                                          Agreement would      relevant industry 
                                          severely affect      experience. 
                                          our ability to 
                                          effectively 
                                          manage our 
                                          operations and may 
                                          have a negative 
                                          impact on the 
                                          share price of the 
                                          Company . 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 4. Introduction      A technological     The future           As part of the       Moderate to High   Low to Moderate 
 of, or amendment     or regulatory       legislative          Group's 
 to laws,             change could        prohibition or tax   acquisition 
 regulations, or      occur which could   of particular        process, the 
 technology           have the effect     fuels (such as       Investment Manager 
 (especially in       of rendering        natural gas) or as   conducts a 
 relation             an Energy           a result of          thorough due 
 to climate change)   Efficiency          technological        diligence process 
                      Project in which    innovation or        on all projects 
                      the Group has       otherwise by         that takes account 
                      invested obsolete   changes to law and   of the technology, 
                      or materially       regulation that      regulatory 
                      change              renders              environment, 
                      the way in          an Energy            potential future 
                      which a service     Efficiency Project   regulatory changes 
                      or product is       obsolete could       , carbon pricing 
                      delivered or        threaten the         scenarios and the 
                      alter the return    profitability of     robustness of any 
                      profile of an       such an Energy       Government 
                      investment.         Efficiency           subsidy. 
                                          Project, in 
                      In addition,        particular due to    The Company's 
                      environmental       the financing        Investment 
                      regulators may      projections that     Strategy focuses 
                      seek to impose      are dependent on     on a diverse range 
                      injunctions or      an extended          of assets across 
                      other sanctions     project life. If     various energy 
                      on an Energy        such a change were   efficiency 
                      Efficiency          to occur, these      sub-sectors. Which 
                      Project's           assets would have    in turn reduces 
                      operation due to    very few             the impact on the 
                      changes in laws     alternative          Group's operations 
                      or regulations      uses should they     should 
                      that may have a     become obsolete.     the introduction 
                      material adverse                         of, or amendment 
                      effect on                                to laws, 
                      its financial                            regulations, or 
                      condition.                               technology impact 
                                                               any one sector. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 5. Counterparties'   The Group's         The failure by a     The Investment           Moderate             Low 
 ability to make      revenue derives     counterparty to      Manager will look 
 contractual          from the Energy     pay the              to build in 
 payments             Efficiency          contractual          suitable 
                      Projects in the     payments due, or     mechanisms to 
                      portfolio, the      the early            protect the 
                      Group               termination          Group's income 
                      will be exposed     of an Energy         stream from the 
                      to the financial    Efficiency Project   relevant Energy 
                      strength of the     due to insolvency,   Efficiency 
                      counterparties to   may materially       Project, which may 
                      such projects and   affect the value     include parent 
                      their               of the               guarantees and 
                      ability to meet     portfolio and        liquidated damages 
                      their contractual   could have a         payments on 
                      payment             material adverse     termination. 
                      obligations         effect on the 
                                          performance of the   The Group's 
                                          Company, the         exposure to 
                                          Net Asset Value,     defaults may be 
                                          the Company's        further mitigated 
                                          earnings and         by contracting 
                                          returns to           with 
                                          shareholders.        counterparties 
                                                               who are public 
                                                               sector or 
                                                               quasi-public 
                                                               sector bodies or 
                                                               who are able to 
                                                               draw upon 
                                                               government 
                                                               subsidies to 
                                                               partly fund 
                                                               contractual 
                                                               payments. 
 
                                                               As part of the 
                                                               Group's 
                                                               acquisition 
                                                               process, the 
                                                               Investment Manager 
                                                               conducts a 
                                                               thorough due 
                                                               diligence process 
                                                               on all projects 
                                                               that includes a 
                                                               credit check on 
                                                               counterparties. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 6. Portfolio of      Due diligence       The Group may        Prior to making an       Moderate             Low 
 new assets           undertaken by the   acquire Energy       investment, the 
 acquired which may   Investment          Efficiency           Investment Manager 
 include risks not    Manager may not     Projects with        will undertake 
 fully identified     uncover all of      unknown              commercial, 
 in due diligence     the material        liabilities and      financial, 
 process              risks               without any          technical and 
                      affecting such      recourse, or with    legal due 
                      project and/or      limited recourse,    diligence on the 
                      such risks may      with respect to      relevant Energy 
                      not be adequately   unknown              Efficiency 
                      protected against   liabilities. If an   Project. In 
                      in the              unknown liability    addition, 
                      acquisition         was later asserted   the Investment 
                      or investment       in respect of the    Manager undertakes 
                      documentation.      relevant Energy      scenario testing 
                                          Efficiency           as part of the 
                                          Project, the Group   investment 
                                          might by             appraisal to 
                                          required to pay      account for 
                                          substantial sums     unforeseen risks 
                                          to settle it or      to the extent 
                                          enter into           possible. 
                                          litigation 
                                          proceedings, which   The Investment 
                                          could adversely      Manager will also 
                                          affect cash flow     commission due 
                                          and the result of    diligence reports 
                                          its operations.      prepared by 
                                                               professional 
                                          Accordingly, in      advisers in 
                                          the event that       relation to an 
                                          material risks are   Energy Efficiency 
                                          not uncovered        Project. 
                                          and/or such risks 
                                          are not              Once the legal 
                                          adequately           documentation and 
                                          protected against,   confirmatory due 
                                          this may have a      diligence is 
                                          material adverse     completed, the 
                                          effect on the        Board will 
                                          Energy Efficiency    undertake 
                                          Project and          a final review of 
                                          consequently a       a transaction with 
                                          material adverse     the Investment 
                                          effect on the        Manager before the 
                                          performance of the   Investment 
                                          Company, the         Manager proceeds 
                                          Net Asset Value,     with completion of 
                                          the Company's        the transaction. 
                                          earnings and 
                                          returns to 
                                          Shareholders. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 7. Construction      Energy Efficiency   Should completion    The engineering,     Moderate to High         Low 
 risks for certain    Projects that are   of any project       procurement and 
 Energy Efficiency    in the              overrun (both in     construction 
 Projects             Construction        terms of time and    obligations 
                      Phase or the        budget), there is    relating to an 
                      Development Phase   a risk               Energy Efficiency 
                      may                 that payments may    Project in the 
                      be exposed to       be required to be    Construction Phase 
                      certain risks,      made to (or          or the Development 
                      such as cost        withheld by) a       Phase will be 
                      overruns,           counterparty in      undertaken by 
                      construction        relation to          third party 
                      delay and           the late             EPC Contractors 
                      construction        installation of      appointed by the 
                      defects             the relevant         Group, who will be 
                      that may be         assets and           outside the direct 
                      outside the         infrastructure. If   control of the 
                      Group's control.    the completion of    Group. 
                                          a project            The Group will 
                                          overruns, it would   seek to contract 
                                          also result in a     with EPC 
                                          delayed start of     Contractors of 
                                          contractual          good standing and 
                                          payments due to      with a strong 
                                          the Group,           track 
                                          which could affect   record, and will 
                                          the Company's        seek to ensure 
                                          ability to achieve   that any contract 
                                          its target           with the EPC 
                                          returns, depending   Contractor, and 
                                          on the nature        the other 
                                          and scale of such    contracts 
                                          delay.               relating to the 
                                                               relevant project, 
                                          In addition, any     will contain 
                                          error or deviation   sufficient 
                                          from project         protections to 
                                          specifications       ensure that the 
                                          during the           Group 
                                          Construction Phase   will be adequately 
                                          may lead to          compensated should 
                                          additional costs     it suffer any 
                                          or expenses being    losses due to any 
                                          incurred by the      delays or defects 
                                          Group and could      in 
                                          thus result          the completion of 
                                          in a lower profit    the Energy 
                                          for the Group.       Efficiency 
                                                               Project, or if 
                                                               commissioning of 
                                                               the Energy 
                                                               Efficiency 
                                                               Project is never 
                                                               completed. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 8. Risks relating    Machinery or        If the machinery     The Investment             High         Low to Moderate 
 to installing,       equipment may       and equipment        Manager will 
 operating, and       not be properly     installed as part    procure that the 
 decommissioning      and adequately      of an Energy         Group uses proven 
 energy efficiency    installed,          Efficiency Project   technologies, 
 equipment            maintained or       fails, this          typically backed 
                      otherwise           could give rise to   by manufacturer 
                      underperform.       remediation rights   warranties, when 
                                          for the              installing 
                                          counterparty, the    machinery and 
                                          withholding of       equipment as part 
                                          part or all          of an Energy 
                                          of the contractual   Efficiency 
                                          payment payable to   Project. 
                                          the Group, 
                                          termination of the   The Group will 
                                          relevant contract    also implement a 
                                          for                  maintenance 
                                          the default of the   programme for each 
                                          Group and/or         Energy Efficiency 
                                          additional           Project and 
                                          maintenance          will typically 
                                          expenditure. This    appoint O&M 
                                          could have a         Contractors with a 
                                          material             strong track 
                                          adverse effect on    record to carry 
                                          the performance of   out such 
                                          the Company, the     maintenance 
                                          Net Asset Value,     pursuant to an O&M 
                                          the Company's        Contract. 
                                          earnings 
                                          and returns to       Typically, the O&M 
                                          shareholders.        Contract will 
                                                               contain 
                                          Additional costs     back-to-back KPIs 
                                          and expenses,        against the same 
                                          carrying out         performance 
                                          repairs, lack of     criteria 
                                          warranty cover       contained in the 
                                          and/or operational   correlating Energy 
                                          failures or          Efficiency 
                                          malfunction of an    Project, to enable 
                                          Energy Efficiency    the Group to 
                                          Project and delays   pursue the 
                                          in the production    O&M Contractor, 
                                          or supply            often on a 
                                          of energy may have   liquidated damages 
                                          a material adverse   basis, for any 
                                          effect on the        loss of revenue 
                                          performance of the   caused by a 
                                          Company, the Net     failure 
                                          Asset                to meet all KPIs. 
                                          Value, the 
                                          Company's earnings 
                                          and returns to 
                                          shareholders. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 9. Lack of           Competition for     If the Investment    The Investment             High            Moderate 
 availability of      Energy Efficiency   Manager is not       Manager has a 
 suitable energy      Project in the      able to source a     strong track 
 efficiency           primary             sufficient number    record and 
 projects             investment or       of suitable          experience in 
                      secondary           investments          asset and project 
                      investment          within a             finance, 
                      markets, may        reasonable           portfolio 
                      result in the       timeframe whether    management and 
                      Company being       by reason of lack    structured 
                      unable to make      of demand,           investments, with 
                      investments or      competition or       Energy and 
                      investments on      otherwise,           Infrastructure 
                      terms               a greater            being a principal 
                      that enable the     proportion of the    area of focus. 
                      target returns to   Company's assets     Through extensive 
                      be delivered.       will be held in      industry 
                                          cash for longer      relationships the 
                                          than anticipated     Investment Manager 
                                          and the Company's    provides access 
                                          ability to achieve   to a significant 
                                          its Investment       pipeline of 
                                          Objective will be    investment 
                                          adversely            opportunities. 
                                          affected. 
                                                               Furthermore, the 
                                                               Company will use 
                                                               of leverage to 
                                                               increase the 
                                                               return profile of 
                                                               Energy Efficiency 
                                                               Projects. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 10. Cyber and        Attempts may be     Increased            Cyber security       Low to Moderate    Low to Moderate 
 other security       made to access      regulation, laws,    policies and 
 risks                the IT systems      rules and            procedures 
                      and data used by    standards related    implemented by key 
                      the Investment      to cyber security,   service providers 
                      Manager,            could impact the     are reported to 
                      Administrator       Company's            the Board 
                      and other service   reputation or        regularly to 
                      providers through   result in            ensure conformity. 
                      a cyber attack or   financial loss       Thorough 
                      malicious           through the          third-party due 
                      breaches of         imposition of        diligence is 
                      confidentiality.    fines. Suffering     carried out on all 
                                          a cyber breach       suppliers engaged 
                                          will also            to service the 
                                          generally incur      Company. All 
                                          costs associated     providers have 
                                          with repairing       processes in place 
                                          affected systems,    to identify cyber 
                                          networks and         security risks 
                                          devices. The         and apply and 
                                          effect of a Cyber    monitor 
                                          Security breach      appropriate risk 
                                          may result in        plans. 
                                          reputational 
                                          damage 
                                          which may affect 
                                          relationships the 
                                          Company has with 
                                          partners, 
                                          investors and 
                                          other third 
                                          parties. 
                                          Cyber security 
                                          policies and 
                                          procedures 
                                          implemented by key 
                                          service providers 
                                          are reported to 
                                          the Board 
                                          regularly to 
                                          ensure conformity. 
                                          Thorough 
                                          third-party due 
                                          diligence is 
                                          carried out 
                                          on all suppliers 
                                          engaged to service 
                                          the Company. All 
                                          providers have 
                                          processes in place 
                                          to 
                                          identify cyber 
                                          security risks and 
                                          apply, and monitor 
                                          appropriate risk 
                                          plans. 
                     ------------------  -------------------  -------------------  -----------------  ---------------- 
 

Emerging Risks

Emerging risks are characterised by a degree of uncertainty and the Investment Manager and the Board consider new and emerging risks every six months, the risk register is then updated to include these considerations.

The United Kingdom's withdrawal from the European Union

The Board has continued to monitor the potential risks associated with Brexit. Despite the trade deal reached on 24 December 2020 between the UK and EU, it still remains unclear as to the extent or precise nature of the impact of Brexit on the UK economy or the Company. Nevertheless, Energy Efficiency Projects, being UK based, the Group remains relatively insulated from the impact of Brexit.

The Board will continue to monitor the ongoing developments between the UK and the EU and the wider potential impact of Brexit on the Group and its stakeholder base.

Covid-19 and global pandemic risk

The outbreak of Covid-19 in early 2020 has negatively impacted economic conditions globally and is having an adverse and disruptive effect on the UK economy (triggering a technical recession after the second quarter of 2020). The Board has considered the potential significant and wide-ranging adverse effect on the Group, including the operating issues arising directly from the pandemic (including health and safety related impacts) and the longer-term impacts in relation to portfolio investments, from the economic consequences of the global pandemic. The Directors have performed an assessment of the ability of the Company to continue as a going concern, which includes the impact of Covid-19 further details of which can be found in Note 2 .

The Board will continue to monitor economic conditions and implement appropriate controls and processes in order to mitigate the potential impact of the pandemic on the Group.

Physical effects of climate change

While efforts to mitigate climate change continue to progress, the physical impacts are already emerging in the form of changing weather patterns. Extreme weather events can result in flooding, drought, fires and storm damage, which may potentially impair the operations of borrowers and future portfolio companies at a certain location or impacting locations of companies within their supply chain.

GOING CONCERN AND VIABILITY STATEMENT

Going Concern

The Strategic Report and financial statements have set out the current financial position of the Company. The Board regularly reviews the position of the Company and its ability to continue as a going concern in Board meetings throughout the year. The Company is targeting investments in Energy Efficiency Projects that aim to meet its target return expectations and will continue to analyse investment opportunities to ensure that they are the right fit for the Company.

The Directors, in their consideration of going concern, have reviewed comprehensive cash flow models for the Company and its intermediate holding company prepared by the Company's Investment Manager, which are based on market data and the Managers assessment of the current pipeline of opportunities, based on these forecasts and the assessment of the principal risks described in this report, that it is appropriate to prepare the financial statements of the Company on the going concern basis. At the reporting date the Company had GBP76.55 million in cash and cash equivalents.

The Directors confirm they have carried out a robust assessment of the emerging and principal risks facing the Company, including those that would threaten its business model, future performance, solvency, liquidity and dividend cover for a five-year period. The Directors' assessment has been made with reference to the principal risks and uncertainties and emerging risks summarised above and how they could impact the prospects of the Company.

The Board believes that there are currently no material uncertainties in relation to the Company's ability to continue for a period of at least 12 months from the date of the approval of the financial statements and, therefore, has adopted the going concern basis in the preparation of the financial statements.

Viability Statement

In accordance with Principle 21 of the AIC Code, the Board has assessed the prospects of the Company over a period longer than 12 months required by the relevant "Going Concern" provisions. The Board has considered the nature of the Company's assets and liabilities, and associated cash flows, and has determined that five years, up to 31 March 2026, is the maximum timescale over which the performance of the Company can be forecast with a material degree of accuracy and therefore is the appropriate period over which to consider the viability.

When making the loan investment into Harvest and Glasshouse, through the Company's main subsidiary TEEC Holdings, the business model of the borrower was subject to a number of key assumptions underlying the forecasts of the borrowers. The sensitivities performed were designed to provide the Directors with an understanding of the borrower's ability to service the debt in the event of a severe but plausible downturn scenario.

Downside sensitivities have been carried out based on a 10% adverse movement in electricity and gas prices. In this adverse scenario, the companies would be able to continue servicing their loans. In a downturn scenario, mitigating actions to reduce variable costs could be actioned to enable the Group to continue to meet its future liabilities. Harvest and Glasshouse have considerable cash balances and their revenues are approximately 49% exposed to power price volatility, with the balance being a fixed PPA with the offtaker.

Based on the results of the analysis, the Directors have a reasonable expectation that the Group and Company will be able to continue in operation and meet its liabilities as they fall due for the next five years.

In considering the prospects of the Company, the Directors looked at the key risks facing both the Company and the portfolio as detailed above , focusing on the likelihood and impact of each risk as well as any key contracts, future events or timescales that may be assigned to each key risk.

As an Investment Company , part of the Company's objective is to produce stable dividends while preserving the capital value of its investment portfolio on a real basis to deliver a total NAV return of 7-8% per annum. Following regular pipeline updates from the Investment Manager, the Directors believe that the Company is well placed to manage its business risks successfully over both the short and long term, the Board has a reasonable expectation that the Company will be able to continue in operation and to meet its liabilities as they fall due for a period of at least 5 years. While the Directors have no reason to believe that the Company will not be viable over a longer period, they are of the opinion that it would be difficult to foresee the economic viability of any company with any degree of certainty for a period of time greater than five years.

Board Approval of the Strategic Report

The Strategic Report has been approved by the Board of Directors and signed on its behalf by the Chair.

John Roberts

Chair

2 June 2021

FINANCIAL STATEMENTS

INCOME STATEMENT

For the period ended 31 March 2021

 
                                      Note   Revenue   Capital     Total 
                                             GBP'000   GBP'000   GBP'000 
-----------------------------------  -----  --------  --------  -------- 
 
 Investment income                     5          57         -        57 
 Loss arising on the revaluation 
  of investments at the period end     12          -     (113)     (113) 
                                            --------  --------  -------- 
 Investment return                                57     (113)      (56) 
 
 Investment management fees            4           5         1         6 
 Other expenses                        6         388        71       459 
                                                      --------  -------- 
                                                 393        72       465 
 
 Loss before taxation                          (336)     (185)     (521) 
                                                      --------  -------- 
 
 Taxation                              8           -         -         - 
 
 Loss before taxation                          (336)     (185)     (521) 
                                            --------  --------  -------- 
 
 Other comprehensive income                        -         -         - 
 
 T otal comprehensive loss                     (336)     (185)     (521) 
                                            ========  ========  ======== 
 
 Basic & diluted e arnings per 
  share (pence)                        9     (0.01)p   (0.00)p   (0.01)p 
 

The total column of this statement is the Income Statement of the Company prepared in accordance with IAS in conformity with the requirements of the Act and in accordance with IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the EU. The supplementary revenue return and capital columns have been prepared in accordance with the Association of Investment Companies Statement of Recommended Practice (AIC SORP).

All revenue and capital items in the above statement derive from continuing operations.

This Income Statement includes all recognised gains and losses.

The accompanying Notes are an integral part of this statement.

BALANCE SHEET

At 31 March 2021

Company Number: 12693305

 
                                             31 March 
                                                 2021 
                                      Note    GBP'000 
-----------------------------------  -----  --------- 
 
 Non-current assets 
 Investments at fair value through 
  profit or loss                       12      20,883 
                                            --------- 
 
 Current assets 
 Trade and other receivables           13         201 
 Cash and cash equivalents                     76,553 
                                            --------- 
                                               76,754 
 Total assets                                  97,637 
                                            ========= 
 
 Current liabilities 
 Trade and other payables              14       (149) 
                                                (149) 
 N et assets                                   97,488 
                                            ========= 
 
 Equity attributable to equity 
  holders 
 Share capital                         15       1,000 
 Share premium                                      - 
 Special distributable reserve                 97,009 
 Capital reserve                                (185) 
 Revenue reserve                                (336) 
                                            --------- 
 Total Equity                                  97,488 
                                            ========= 
 
 Shareholders' funds 
 
 Net asset value per Ordinary 
  S hare                               11     97.49 p 
 

The s tatements were approved by the Directors and authorised for issue on 2 June 202 1 and are signed on behalf of the Board by:

Dr John Roberts

Chair

2 June 202 1

   The accompanying N otes are an integral part of this   s tatement. 

S TATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

For the period ended 31 March 2021

 
 
                                                               Special 
                                    Issued      Share    distributable    Capital    Revenue      Tota 
                                   capital    premium          reserve    reserve    reserve         l 
 
                           Note    GBP'000    GBP'000          GBP'000    GBP'000    GBP'000   GBP'000 
------------------------  -----  ---------  ---------  ---------------  ---------  ---------  -------- 
 
 Opening b alance                        -          -                -          -          -         - 
                                 ---------  ---------  ---------------  ---------  ---------  -------- 
 
 Issue of share capital     15       1,000     99,000                -          -          -   100,000 
 Cost of issue of 
  shares                                 -    (1,991)                -          -          -   (1,991) 
 Transfer to special 
  distributable reserve     17           -   (97,009)           97,009          -          -         - 
 Total comprehensive 
  income/(loss) for 
  the period                             -          -                -      (185)      (336)     (521) 
                                 ---------  ---------  ---------------  ---------  ---------  -------- 
 Balance at 31 March 
  2021                               1,000          -           97,009      (185)      (336)    97,488 
                                 =========  =========  ===============  =========  =========  ======== 
 
 

The capital reserve represents the proportion of Investment Management fees and other expenses, where applicable, charged against capital and realised/unrealised gains or losses on the disposal/revaluation of investments. The unrealised element of the capital reserve is not distributable. The special distributable reserve was created on court cancellation of the share premium account. The revenue, special distributable and realised capital reserves are distributable by way of dividend.

   The accompanying N otes are an integral part of th is   s tatement. 

STATEMENT OF CASH FLOWS

For the period ended 31 March 2021

 
                                                        Period ended 
                                                       31 March 2021 
                                               Note          GBP'000 
--------------------------------------------  -----  --------------- 
 
 Cash flows from operating activities 
 
 Loss before taxation                                          (521) 
 Loss arising on the revaluation 
  of investments at the period end              12               113 
                                                     --------------- 
 Cash flow (used in) operations                                (408) 
 (Increase) in receivables                      13             (201) 
 Increase in payables                           14               149 
 Net cash flow generated from operating 
  activities                                                   (460) 
                                                     --------------- 
 
 Cash flows from investing activities 
 Purchase of financial assets at 
  fair value through profit or loss                         (20,996) 
 Net cash flow used in investing 
  activities                                                (20,996) 
                                                     --------------- 
 
 Cash flows from financing activities 
 I ssue of s hares                              15           100,000 
 C osts of share issue                                       (1,991) 
 Net cash flow generated from financing 
  activities                                                  98,009 
                                                     --------------- 
 Net increase in c ash and cash 
  equivalents                                                 76,553 
                                                     =============== 
 
 Reconciliation of net cash flow 
  to movements in cash and cash equivalents 
 Cash and cash equivalents at 23 
  June 2020                                                        - 
 Net increase in cash and cash equivalents                    76,553 
                                                     --------------- 
 Cash and cash equivalents at 31 
  March 2021                                                  76,553 
                                                     =============== 
 
   The accompanying N otes are an integral part of th is   s tatement. 

NOTES TO THE F INANCIAL STATEMENTS

   1.    CORPORATE INFORMATION 

The Financial Statements of the Company for the period ended 31 March 2021 were authorised for issue in accordance with a resolution of the Directors on 2 June 2021.

The Company is incorporated and domiciled in the United Kingdom and registered in England and Wales under number 12693305 pursuant to the Act. The address of its registered office, which is also its principal place of business, is 1 King William Street, London EC4N 7AF.

The Company was incorporated on 23 June 2020 and is a Public Company and the ultimate controlling party of the Group. The Company's Ordinary Shares were admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange under the ticker TEEC on 19 October 2020, following its IPO which raised gross proceeds of GBP100 million.

The financial statements comprise only the results of the Company, as its investment in TEEC Holdings Limited (" TEEC Holdings ") is included at fair value through profit or loss as detailed in the key accounting policies below.

The Company has appointed Triple Point Investment Management LLP as its Investment Manager (the " Investment Manager ") pursuant to the Investment Management Agreement dated 25 August 2020. The Investment Manager is registered in England and Wales under number OC321250 pursuant to the Act. The Investment Manager is regulated by the FCA, number 456597.

The Company intends to achieve its Investment Objective by investing in a diversified portfolio of energy efficiency investments in the United Kingdom. The Company, through TEEC Holdings, will invest in a range of energy efficiency assets which will contribute, or are already contributing, to energy efficiency in sub-sectors including electricity and heat generation, distribution, and end user consumption.

The current year financial information is from the period of incorporation on 23 June 2020 to 31 March 2021; there is no comparative information for this period. The Company is required to nominate a functional currency, being the currency in which the Company predominantly operates. The functional and reporting currency is pounds sterling, reflecting the primary economic environment in which the Company operates.

   2.    SIGNIFICANT ACCOUNTING POLICIES 

Basis of Preparation

2.

The financial information contained in this announcement has been prepared on the basis of the accounting policies set out in the statutory accounts for the period ended 31 March 2021 . Whilst the financial information included in this announcement has been computed in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union, this announcement does not itself contain sufficient information to comply with IFRS. The financial information does not constitute the Company's statutory accounts for the period ended 31 March 2021 , but is derived from those accounts. Those accounts give a true and fair view of the assets, liabilities, financial position and profit and loss of the Company. Statutory accounts for the period ended 31 March 2021 will be delivered to the Registrar of Companies following approval by the Directors . The auditor's report on 20 21 accounts was unqualified; did not draw attention to any matters by way of emphasis; and did not contain statements under s498(2) or (3) of the Companies Act 2006.

After making the necessary enquiries, the Directors confirm that they are satisfied that the Company has adequate resources to continue to meet its day-to-day commitments for at least 12 months from the date of approval of the financial statements.

The financial statements, which aim to give a true and fair view, have been prepared in accordance with IAS in conformity with the requirements of the Act and in accordance with IFRS adopted pursuant to Regulation (EC) No 1606/2002, as it applies in the EU, using the historical cost basis, except for financial instruments and any subsidiaries classified at fair value through profit or loss, which are included at fair value through the Income Statement.

The principal accounting policies to be adopted are set out below and will be consistently applied, subject to changes in accordance with any amendments in IFRS.

IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). When measuring fair value, the Company takes into consideration the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date, including assumptions about risk.

The Company accounts for its investment in its wholly owned direct subsidiary TEEC Holdings at fair value. The investment in TEEC Holdings which will principally comprise working capital balances and investments in Energy Efficiency Projects, are required to be included at fair value in the carrying value of investments. Consequently, the Company does not consolidate its subsidiary, which is itself an investment entity or apply IFRS 3 Business Combinations when it obtains control of another entity as it is considered to be an investment entity under IFRS. Instead, the Company includes its investment in its subsidiary at fair value through profit or loss.

The financial statements incorporate the financial statements of the Company only, the financial statements are presented in pounds sterling, which is the Company's functional currency and are rounded to the nearest thousand, unless otherwise stated.

TEEC Holdings is itself an investment entity. Consequently, the Company need not have an exit strategy for its investment in TEEC Holdings.

Each investment indirectly held has a finite life. For the Energy Efficiency Projects in which the Group holds debt investments, the debt is expected to mature towards the end of the concession, and at the end of the concession it is expected that the investment will be fully repaid. In the case of Energy Efficiency Projects in which the Group holds equity, the life of the project is based on the expected useful asset life alongside the land lease term. After expiry, it is anticipated the investment may be dissolved. The Board and the Investment Manager will monitor the market and where possible look to maximise value for shareholders.

The exit strategy is that investments will normally be held to the end of the concession unless the Company sees an opportunity in the market to dispose of investments. The Company's Investment Manager, and the Company's Board will regularly review the market and consider whether any disposals should be made.

Based on analysis and advice from the Administrator, the Directors will consider on an ongoing basis whether the Company demonstrates the characteristics and meets the requirements to be considered an investment entity.

IFRS 10, Investment Entities

The sole objective of the Company and through its subsidiary TEEC Holdings is to enter Energy Efficiency Projects, via individual corporate entities. TEEC Holdings typically will issue equity and loans to finance its investments in the Energy Efficiency Projects.

The Directors have concluded that in accordance with IFRS 10, the Company meets the definition of an investment entity having evaluated the criteria that needs to be met (see below). Under IFRS 10, investment entities are required to hold subsidiaries at fair value through the Income Statement rather than consolidate them on a line-by-line basis. There are three key conditions to be met by the Company for it to meet the definition of an investment entity.

For each reporting period, the Directors will continue to assess whether the Company continues to meet these conditions:

1. It obtains funds from one or more investors for the purpose of providing these investors with professional investment management services;

2. It commits to its investors that its business purpose is to invest its funds solely for returns (including having an exit strategy for investments) from capital appreciation, investment income or both; and

3. It measures and evaluates the performance of substantially all its investments on a fair value basis.

In satisfying the second criteria, the notion of an investment time frame is critical. An investment entity should not hold its investments indefinitely but should have an exit strategy for their realisation. Although the Company through TEEC Holdings has currently made two debt investments, it is the intention to seek equity interests in Energy Efficiency Projects that have an indefinite life; the underlying assets that it invests in have an expected life of between 10-30 years. The Company intends to hold these for the remainder of their useful life to preserve the capital value of the portfolio. However, as the energy efficiency assets are expected to have no residual value after their life, the Directors consider that this demonstrates a clear exit strategy from these investments.

Subsidiaries are therefore measured at fair value through profit or loss, in accordance with IFRS 13 "Fair Value Measurement", IFRS 10 "Consolidated Financial Statements" and IFRS 9 "Financial Instruments".

Going Concern

The Company's business activities, together with the factors likely to affect its future development, performance and position, are set out in the Investment Manager's Review.

The Company faces a number of risks and uncertainties, as set out in the Strategic Report. The financial risk management objectives and policies of the Company, including exposure to price risk, interest rate risk, credit risk and liquidity risk are discussed in Note 18 to the financial statements.

Following the successful IPO of the Company on 19 October 2020, The Company continues to meet day-to-day liquidity needs through its cash resources. As at 31 March 2021, the Company had net current assets of GBP76.8 million (which reflected a high level of cash within the Company, whilst the Investment Manager pursues suitable investment opportunities) and had cash balances of GBP76.6 million.

The major cash outflows of the Company are the payment of dividends, fees and costs relating to the acquisition of new assets, both of which are discretionary.

In the period since early 2020 and up to the date of this report, the outbreak of Covid-19 has had a negative impact on the global economy. The Directors and Investment Manager continue to actively monitor the situation and its potential effect on the Company and its investments if applicable.

The Company was admitted to trading on the Specialist Fund Segment of the Main market of the London Stock Exchange on 19 October 2020, which was after the UK had been in its first lockdown in response to the Covid-19 pandemic. As a result, the Investment Manager and Administrator had already successfully implemented business continuity plans to ensure business disruption was minimised and had been operating effectively whilst working remotely. All staff were able to continue to assume their day-to-day responsibilities.

Based on the assessment outlined above, including the various risk mitigation measures in place, the Directors do not consider that the effects of Covid-19 have created a material uncertainty over the assessment of the Company as a going concern. The Directors have reviewed Company forecasts and pipeline projections which cover a period of at least 12 months from the date of approval of this report, considering foreseeable changes in investment and the wider pipeline, which show that the Company has sufficient financial resources to continue in operation for at least the next 12 months from the date of approval of this report.

On the basis of this review, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for at least 12 months from the date of approval of this report. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Financial Instruments

Financial assets and financial liabilities are recognised on the Company's statement of financial position when the Company becomes a party to the contractual provisions of the instrument. Financial assets are to be de-recognised when the contractual rights to the cash flows from the instrument expire or the asset is transferred, and the transfer qualifies for de-recognition in accordance with IFRS 9 Financial Instruments and IFRS 13 Fair Value Measurement.

Derivative financial instruments

The Company may use derivative financial instruments to hedge risks associated with interest rate fluctuations. The Company will not hold any derivative financial instruments for trading or speculative purposes. Specifically, the Company may utilise interest rate swaps to help manage its interest rate risk.

All derivatives are initially recognised at fair value at the date that the derivative is entered into and are subsequently re-measured to their fair value at each balance sheet date. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument. Since future derivatives held by the Company may not qualify for hedge accounting, gains or losses are to be recognised in profit or loss in the Income Statement.

Fair values of derivative financial instruments will be based on valuation statements provided by third party expert advisers.

The level in the fair value hierarchy into which these interest rate swaps are categorised is Level 2, being inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

The Company did not use any derivative financial instruments during the period.

Financial assets

The Company classifies its financial assets as either investments at fair value through profit or loss or financial assets at amortised cost. The classification depends on the purpose for which the financial assets are acquired. Management determines the classification of its financial assets at initial recognition.

Investments at fair value through profit or loss

At initial recognition, the Company measures investments in Energy Efficiency Projects, through its investment in TEEC Holdings, at fair value through profit or loss and any transaction costs are expensed to profit or loss. The Company will subsequently continue to measure all investments at fair value and any changes in the fair value are to be recognised as gains or losses on investments at fair value through profit or loss within investment income.

Investments at fair value through profit or loss are recognised upon initial recognition as financial assets at fair value through profit or loss in accordance with IFRS 10. Investments held at fair value through profit or loss consist of the Company's subsidiary, TEEC Holdings.

The Company's investment in TEEC Holdings comprises both equity and loan notes. The Company measures its investment as a single class of financial asset at fair value in accordance with IFRS 13 Fair Value Measurement.

Through TEEC Holdings, the Company has made secured loan investments to two companies which own and operate CHP energy centres. Both elements are exposed to the same primary risk, being performance risk. This risk is to be taken into consideration when determining the discount rate applied to the forecast cash flows, alongside the decision to set the interest rates on any loan investments.

In determining the fair value, the Board will consider any observable market transactions and will measure fair value using assumptions that market participants would use when pricing the asset, including any assumptions regarding risk surrounding the transaction.

Financial assets at amortised cost

Trade receivables, loans and other receivables that are non-derivative financial assets and that have fixed or determinable payments that are not quoted in an active market are classified as "financial assets at amortised cost". Trade receivables, loans and other receivables are measured at amortised cost using the effective interest method, less any impairment. They are included in current assets, except where maturities are greater than 12 months after the reporting date, in which case they are to be classified as non-current assets. The Company's financial assets held at amortised cost comprise "trade and other receivables" and "cash and cash equivalents" in the statement of financial position.

Financial liabilities and equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.

Equity instruments

The Company's Ordinary Shares are classified as equity and are not redeemable. Costs associated or directly attributable to the issue of new equity shares are recognised as a deduction in equity and are charged from the share premium account.

Financial liabilities

Financial liabilities are classified as other financial liabilities, comprising:

-- loans and borrowings which are recognised initially at the fair value of the consideration received, less transaction costs. Subsequent to initial recognition, loans and borrowings are to be stated at amortised cost, with any difference between cost and redemption value being recognised in the income statement over the period of the borrowings on an effective interest basis; and

-- other non-derivative financial instruments, including trade and other payables, which are to be measured at amortised cost using the effective interest method.

Finance expenses

Borrowing costs are recognised in the Income Statement in the period to which they relate on an accruals basis.

Effective interest method

The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to the relevant asset's carrying amount.

Fair value estimation for investments at fair value

The Company's investments at fair value are not typically traded in active markets. Fair value is calculated by discounting at an appropriate discount rate future cash flows expected to be received from the Company's intermediate holding in TEEC Holdings, from which the underlying cash flows are from investments in both equity (dividends and equity redemptions), shareholder and inter-company loans (interest and repayments) in Energy Efficiency P rojects.

The discount rates used in the valuation exercise will represent the Investment Manager's and the Board's best assessment of the rate of return in the market for assets with similar characteristics and risk profile. The discount rates are to be reviewed on a regular basis and updated, where appropriate, to reflect changes in the market and in the project risk characteristics.

Revenue Recognition

Gains and losses on fair value of investments in the income statement will represent gains or losses that arise from the movement in the fair value of the Company's investment in TEEC Holdings.

Dividends from TEEC Holdings are recognised when the Company's right to receive payment has been established.

Investment income comprises interest income and dividend income received from the Company's subsidiary. Interest income is recognised in the Income Statement using the effective interest method.

Share capital and share premium

The Company's Ordinary Shares are classified as equity and are not redeemable. Costs associated or directly attributable to the issue of new equity shares are recognised as a deduction in equity and are charged from the share premium account.

The costs incurred in relation to the Company's IPO were charged to the share premium account.

Segmental Reporting

The Chief Operating Decision Maker (the "CODM") being the Board of Directors, is of the opinion that the Company is engaged in a single segment of business, being investment in Energy Efficiency Projects.

The Company has no single major customer. The internal financial information to be used by the CODM on a quarterly basis to allocate resources, assess performance and manage the Company will present the business as a single segment comprising the portfolio of investments in energy efficiency assets.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances, deposits held on call with banks and other short-term highly liquid deposits with original maturities of three months or less. Bank overdrafts that are repayable on demand are included as a component of cash and cash equivalents for the purpose of the cash flow statements.

Deposits to be held with original maturities of greater than three months are included in other financial assets.

There are no expected credit losses as the bank institutions will have high credit ratings assigned by international credit rating agencies.

Foreign currencies

Items included in the financial statements are presented in Pounds Sterling because that is the currency of the primary economic environment in which the Company operates and is the Company's functional currency.

Transactions and balances

Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the Income Statement.

Dividends

Dividends to the Company's shareholders are recognised when they become legally payable. In the case of interim dividends, this is when they are paid. In the case of final dividends, this is when they are approved by the shareholders at the Annual General Meeting.

Fund Expenses

Expenses are accounted for on an accruals basis. Share issue expenses of the Company directly attributable to the issue and listing of shares are charged to the share premium account. The Company's investment management fee, administration fees and all other expenses are charged through the Income Statement.

Investment Management Fees

As per the Company's Investment Objective, it is expected that income returns will make up the majority of the Company's long-term return. Therefore, based on the estimated split of future returns (which cannot be guaranteed), 25% of the investment management fee is charged as a capital item within the Income Statement.

Taxation

Under the current system of taxation in the UK, the Company is liable to taxation on its operations in the UK. Current tax is the expected tax payable on the taxable income for the period, using tax rates that have been enacted or substantively enacted at the date of the Statement of Financial Position.

Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Deferred tax assets and liabilities are not recognised if the temporary differences arise from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit or the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments, except where the Company is able to control the timing of the reversal of the difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled, or the asset is realised. Deferred tax is charged or credited to the Income Statement except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off tax assets against tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.

Deferred tax assets and liabilities are not discounted.

Acquisition Costs

In line with IFRS 9, acquisition costs are expensed to the Income Statement as they are incurred for investments which are held at fair value through profit or loss.

New and revised standards applied

There were no new standards or interpretations effective for the first time for periods beginning on or after 23 June 2020 that had a significant effect on the Group's or Company's financial statements. Furthermore, none of the amendments to standards that are effective from that date had a significant effect on the financial statements.

New and revised standards not applied

"Interest Rate Benchmark Reform - Phase 2" was issued and will become effective for accounting periods beginning on or after 1 January 2021. The amendments require additional disclosures that address issues that might affect financial reporting after the reform of an interest rate benchmark, including its replacement with alternative benchmark rates. They also provide relief to the Group in respect of certain loans whose contractual terms are affected by interest benchmark reform.

Other accounting standards and interpretations have been published and will be mandatory for the Company's accounting periods beginning on or after 1 January 2021 or later periods. The impact of these standards is not expected to be material to the reported results and financial position of the Company.

   3.    CRITICAL ACCOUNTING ESTIMATES, JUDGEMENTS AND ASSUMPTIONS 

In the application of the Company's accounting policies, which are described in Note 2, the Directors are required to make judgements, estimates and assumptions about the fair value of assets and liabilities that affect reported amounts. It is possible, that actual results may differ from these estimates.

Key sources of estimation uncertainty

The estimates and underlying assumptions underpinning our investments are reviewed on an ongoing basis by both the Board and the Investment Manager. Revisions to any accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Investments at fair value through profit or loss

The fair value of investments in Energy Efficiency Projects is calculated by discounting at an appropriate discount rate future cash flows expected to be received by the Company's Subsidiary, TEEC Holdings, from investments in both equity (dividends and equity redemptions), shareholder and inter-company loans (interest and repayments).

Estimates such as the cash flows are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about the fair value of assets not readily available from other sources. Discount rates used in the valuation represent the Investment Manager's and the Board's assessment of the rate of return in the market for assets with similar characteristics and risk profile. The discount rate is deemed to be one of the most significant unobservable inputs and any change could have a material impact on the fair value of investments.

Critical accounting judgements

Equity and debt investment in TEEC Holdings

In applying their judgement, the Directors have satisfied themselves that the equity and debt investments in TEEC Holdings share the same investment characteristics and, as such, constitute a single asset class for IFRS 7 disclosure purposes.

Please refer to the accounting policies in Note 2 for further detail.

Investment Entity

As discussed above in Note 2, the Directors have concluded that the company continues to meet the definition of an investment entity as defined in IFRS 10.

This assessment involves an element of judgement as to whether the Company continues to meet the criteria outlined in the accounting standards.

   4.    INVESTMENT MANAGEMENT FEES 

The Company and the Investment Manager entered into an Investment Management Agreement on 25 August 2020.

Following the IPO of the Company, no Annual Management Fee has been accrued or shall accrue or be charged on the undeployed cash funds arising from the IPO until such time as 75% or more of the net proceeds have been deployed.

Under the terms of the agreement, the Investment Manager must use 20% of the management fee received to acquire shares in the Company. On a semi-annual basis, following the announcement of the Net Asset Value for the semi-annual periods ending 31 March and 30 September in each year, the Investment Manager shall procure that the Wider Triple Point Group shall apply an amount, in aggregate, equal to 20% of the Annual Management Fee for the relevant six-month period as follows:

(a) where the Ordinary Shares are trading at, or at a premium to, the latest published Net Asset Value per Ordinary Share; the Investment Manager shall procure that the Wider Triple Point Group shall use the relevant amount to subscribe for new Ordinary Shares issued at the latest published Net Asset Value per Ordinary Share applicable at the date of issuance; or

(b) where the Ordinary Shares are trading at a discount to the latest published Net Asset Value per Ordinary Share; the Investment Manager shall procure that the Wider Triple Point Group shall, as soon as reasonably practicable use the relevant amount to make market purchases of Ordinary Shares within four months of the relevant Net Asset Value publication date;

Even though the Annual Management Fee is payable on a monthly basis, Ordinary Shares will only be acquired by the Wider Triple Point Group on a half-yearly basis. In addition, any such Ordinary Shares acquired by the Wider Triple Point Group are subject to a minimum lock-in period of 12 months.

Investment management fees paid or accrued during the year were as follows:

 
                    For the period ended 
                        31 March 2021 
                 ------------------------- 
                 Revenue  Capital    Total 
                 GBP'000  GBP'000  GBP'000 
 
Cash element           5        1        6 
Equity element         -        -        - 
 
                       5        1        6 
                 -------  -------  ------- 
 
   5.         INVESTMENT INCOME 
 
                                      For the period ended 
                                          31 March 2021 
                                   ------------------------- 
                                   Revenue  Capital    Total 
                                   GBP'000  GBP'000  GBP'000 
 
Interest on cash deposits                4        -        4 
Interest income from investments        53        -       53 
 
                                        57        -       57 
                                   -------  -------  ------- 
 
   6.    OPERATING EXPENSES 
 
                                          For the period ended 
                                              31 March 2021 
                                       ------------------------- 
                                       Revenue  Capital    Total 
                                       GBP'000  GBP'000  GBP'000 
 
Investment Management fees                   5        1        6 
 
Directors' fees                             91        -       91 
Company's audit fees: 
 
   *    In respect of audit services        60        -       60 
Other operating expenses                   225       71      296 
Irrecoverable VAT on Administration 
 & Management fees                          12        -       12 
 
                                           393       72      465 
                                       -------  -------  ------- 
 

In addition to the fees disclosed above, GBP 12.5 k is payable to the Company's auditors in respect of audit services provided to unconsolidated subsidiaries and therefore is not included within the Company's expenses above.

The Company has no employees. Full detail on Directors' fees is provided in the Directors' Remuneration Report. The Directors' fees exclude employer's national insurance contribution which is included as appropriate in other operating expenses. There were no other emoluments.

   7.    EMPLOYEES 

The Company had no employees during the period.

Full detail on Directors' fees is provided in Note 17. The Directors' fees exclude employer's national insurance contribution which is included as appropriate in other operating expenses. There were no other emoluments during the period .

   8.    TAXATION 

Analysis of charge in the period.

 
                    For the period ended 
                        31 March 2021 
                 ------------------------- 
                 Revenue  Capital    Total 
                 GBP'000  GBP'000  GBP'000 
 
Corporation tax        -        -        - 
                 -------  -------  ------- 
 

The effective UK corporation tax rate applicable to the Company for the period is 19% . The tax charge differs from the charge resulting from applying the standard rate of UK corporation tax for an investment trust company. The differences are explained below:

 
                                       For the period ended 
                                           31 March 2021 
                                    ------------------------- 
                                    Revenue  Capital    Total 
                                    GBP'000  GBP'000  GBP'000 
 
Loss before taxation                  (336)    (185)    (521) 
                                    -------  -------  ------- 
Corporation tax at 19%                 (64)     (35)     (99) 
Effect of: 
Utilisation of tax losses 
 brought forward                          -        -        - 
Capital losses not deductible             -       22       22 
Dividends received not deductible         -        -        - 
Disallowed expenditure                    -       12       12 
Surrendering of Tax losses 
 to unconsolidated subsidiaries          64        1       65 
 
 Tax charge/(credit) for the 
  period                                  -        -        - 
                                    -------  -------  ------- 
 

The Directors are of the opinion that the Company has complied with the requirements for maintaining investment trust status for the purposes of section 1158 of the Corporation Tax Act 2010. This allows certain capital profits of the Company to be exempt from UK tax.

Additionally, the Company may utilise the interest streaming election which allows the Company to designate dividends wholly or partly as interest distributions for UK tax purposes. Interest distributions are treated as tax deductions against taxable income of the Company so that investors do not suffer double taxation on their returns.

The financial statements do not directly include the tax charges for the Company's intermediate holding company, as TEEC Holdings is held at fair value. TEEC Holdings is subject to taxation in the United Kingdom.

   9.    EARNINGS PER SHARE 
 
                                       For the period ended 
                                           31 March 2021 
                                    ------------------------- 
                                    Revenue  Capital    Total 
                                    GBP'000  GBP'000  GBP'000 
 
Loss attributable to the equity 
 holders of the Company (GBP'000)     (336)    (185)    (521) 
Weighted average number of 
 Ordinary Shares in issue ('000)     58,156   58,156   58,156 
 
 Loss per Ordinary Share (pence) 
  - basic and diluted               (0.01)p  (0.00)p  (0.01)p 
                                    -------  -------  ------- 
 

Dilution of the earnings per share as a result of the equity element of the investment management fee as disclosed in Note 4, is not expected to have a material impact on the basic earnings per share.

There is no difference between the weighted average Ordinary or diluted number of Shares.

10. DIVIDS

On 3 June 2021 , the Company announced an interim dividend of 2.00 pence per share with respect to the period ending 31 March 2021 to be paid on 30 June 2021 to shareholders on the register on 11 June 2021 . This is the Company's first distribution and is in line with the expectation set out during the Company's IPO process.

This dividend will result in a payment to shareholders of GBP2 million. Going forward, the Board anticipates paying quarterly interim dividends, targeting total dividends of 5.50 pence per share for the year ending March 2022.

 
                                            Dividend 
                                           per share  Total dividend 
                                               pence         GBP'000 
Interim dividends declared after 31 
 March 2021 and not accrued in the year         2.00           2,000 
 

11. NET ASSETS PER ORDINARY SHARE

 
                                       31 March 2021 
                                       ------------- 
                                             GBP'000 
 
Total shareholders' equity (GBP'000)          97,488 
Number of Ordinary Shares in issue 
 ('000)                                      100,000 
 
 Net asset value per Ordinary Share 
  (pence)                                     97.49p 
                                       ------------- 
 

12. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

As set out in Note 2, the Company designates its interest in its wholly owned direct subsidiary as an investment at fair value through profit or loss.

Summary of the Company's valuation is below:

 
                                        For the period ended 
                                               31 March 2021 
                                        -------------------- 
                                                     GBP'000 
 
Opening Balance on Incorporation                           - 
Investments made                                      20,998 
Movement in fair value of investments                  (113) 
 
Total investments as at 31 March 2021                 20,883 
                                        -------------------- 
 

Reconciliation of movement in fair value

 
                                                   Period ended 
                                                  31 March 2021 
                                                 -------------- 
                                                        GBP'000 
 
Opening Balance on Incorporation                              - 
Investments made                                         20,998 
                                                 -------------- 
Fair value of portfolio as at 31 March 
 2021                                                    20,996 
Cash held in intermediate holding company                    80 
Fair value of other net assets in intermediate 
 holding companies                                        (193) 
 
Fair Value of Company's investments 
 as at 31 March 2021                                     20,883 
                                                 -------------- 
 

Valuation methodology

The Directors have satisfied themselves as to the methodology used and the discount rates and key assumptions applied in producing the valuations. All investments are at fair value through profit or loss.

For non-market traded investments (being all the investments made during the period), the valuation is based on a discounted cash flow methodology and adjusted in accordance with the IPEV (International Private Equity and Venture Capital) valuation guidelines where appropriate to comply with IFRS 13 and IFRS 9, given the special nature of energy efficiency investments. Where an investment is traded in an open market, a market quote is used.

The Investment Manager exercises its judgment in assessing the expected future cash flows from each investment based on the project's expected life and the financial models produced for each project company and adjusts the cash flows where necessary to consider key external macro-economic assumptions and specific operating assumptions.

The fair value for each investment is then derived from the application of an appropriate market discount rate to reflect the perceived risk to the investment's future cash flows to give the present value of those cash flows. The discount rate considers risks associated with the financing of an investment such as investment risks (e.g. liquidity, interest rate risks, market appetite), and any risks to the investment's earnings (e.g. predictability and covenant of the income) and a thorough assessment of counterparty credit risk, all of which may be differentiated by the phase of the investment.

The Company records the fair value of TEEC Holdings by calculating and aggregating the fair value of each of the individual investments in which the Company holds an indirect investment. The total change in the value of the investment in TEEC Holdings is recorded through profit and loss in the Income Statement.

13. TRADE AND OTHER RECEIVABLES

 
                    For the period ended 
                           31 March 2021 
                    -------------------- 
                                 GBP'000 
 
Prepayments                          148 
Other receivables                     53 
 
                                     201 
                    -------------------- 
 

14. TRADE AND OTHER PAY ABLES

 
                   For the period ended 
                          31 March 2021 
                   -------------------- 
                                GBP'000 
 
Accrued expenses                     72 
Other payables                       77 
 
                                    149 
                   -------------------- 
 

15. SHARE CAPITAL AND RESERVES

 
                                                     Nominal value 
                                          Number of      of shares 
Allotted, issued and fully paid:             shares          (GBP) 
--------------------------------------  -----------  ------------- 
 
Opening balance as at 23 June 2020                -              - 
 
Allotted upon incorporation 
 
Ordinary Shares of 1p each                        1           0.01 
Management shares                            50,000      50,000.00 
 
Allotted/redeemed following admission 
 to LSE 
 
Ordinary Shares of 1p each               99,999,999     999,999.99 
Management shares                          (50,000)    (50,000.00) 
 
Closing balance of Ordinary Shares 
 at 31 March 2021                       100,000,000   1,000,000.00 
--------------------------------------  -----------  ------------- 
 

Shareholders are entitled to all dividends paid by the Company and, on a winding up, provided the Company has satisfied all its liabilities, the shareholders are entitled to all of the residual assets of the Company.

16. FINANCIAL INSTRUMENTS

The table below sets out the classifications of the carrying amounts of the Company's financial assets and financial liabilities into categories of financial instruments.

 
                                                                                Financial 
                                                                                   Assets 
                                                                  Financial            at 
                                                   Financial    Liabilities    fair value 
                                                      Assets        held at       through 
                                    Cash and    at amortised      amortised        profit    Tota l 
                               bank balances            cost           cost       or loss     value 
                                     GBP'000         GBP'000        GBP'000       GBP'000   GBP'000 
---------------------------  ---------------  --------------  -------------  ------------  -------- 
 Period ended 31 
  March 2021 
 Non-current Assets: 
 Financial assets 
  at fair value through 
  profit or loss                           -               -              -        20,883    20,883 
 Current Assets: 
 Receivables                               -             201              -             -       201 
 Cash and cash equivalents            76,553               -              -             -    76,553 
                             ---------------  --------------  -------------  ------------  -------- 
 Total Assets                         76,553             201              -        20,883    97,637 
                             ---------------  --------------  -------------  ------------  -------- 
 Current Liabilities 
 Taxation payable                          -               -              -             -         - 
 Trade and other 
  payables                                 -               -            149             -       149 
                             ---------------  --------------  -------------  ------------  -------- 
 Total Liabilities                         -               -            149             -       149 
                             ---------------  --------------  -------------  ------------  -------- 
 Net Assets                           76,553             201          (149)        20,883    97,488 
                             ===============  ==============  =============  ============  ======== 
 
 

Fair Value measurements

As set out in Note 2, the Company accounts for its interest in its wholly owned direct subsidiary as an investment at fair value through profit or loss.

IFRS 13 requires disclosure of fair value measurement by level. The level of fair value hierarchy within the financial assets or financial liabilities is determined on the basis of the lowest level input that is significant to the fair value measurement. Financial assets and financial liabilities are classified in their entirety into only one of the following 3 levels:

   --     Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities; 

-- Level 2 - inputs other than quoted prices included within Level 1 that are observable for the assets or liabilities, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

-- Level 3 - inputs for assets or liabilities that are not based on observable market data (unobservable inputs).

The determination of what constitutes 'observable' requires significant judgement by the Company. The Company considers observable data to be market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

There were no Level 1 or Level 2 assets or liabilities during the period. There were no transfers between Level 1 and 2, Level 1 and 3 or Level 2 and 3 during the period.

Reconciliation of Level 3 fair value measurement of financial assets and liabilities

An analysis of the movement between opening to closing balances of the investments at fair value through profit or loss (all classified as Level 3) is given in Note 12.

The fair value of the investments at fair value through profit or loss includes the use of Level 3 inputs. Refer to Note 12 for details on the valuation methodology.

Given the proximity of the transactions in which the investments were made to the period end date, and the fact that the discount rate at which the investments are being valued is the discount intrinsic in the transactions, we do not consider there to be reasonable alternative discount rate inputs that would materially impact the valuation of investments.

17. SPECIAL DISTRIBUTABLE RESERVE

As indicated in the Company's prospectus dated 25 August 2020, following admission of the Company's Ordinary Shares to trading on the London Stock Exchange, the Directors applied to the Court and obtained a judgement on 12 January 2021 to cancel the amount standing to the credit of the share premium account of the Company.

As stated by the Institute of Chartered Accountants in England and Wales (" ICAEW ") and the Institute of Chartered Accountants in Scotland (" ICAS ") in the technical release TECH 02/17BL, The Companies (Reduction of Share Capital) Order 2008 SI 2008/1915 ("the Order ") specifies the cases in which a reserve arising from a reduction in a company's capital (i.e., share capital, share premium account, capital redemption reserve or redenomination reserve) is to be treated as a realised profit as a matter of law.

The Order also disapplies the general prohibition in section 654 on the distribution of a reserve arising from a reduction of capital. The Order provides that if a limited company having a share capital reduces its capital and the reduction is confirmed by order of court, the reserve arising from the reduction is treated as a realised profit unless the court orders otherwise.

The amount of the share premium account cancelled and credited to the Company's Special reserve is GBP97.0 million which can be utilised to fund distributions by way of dividends to the Company's shareholders.

18. FINANCIAL RISK MANAGEMENT

The Company's investment activities expose it to a variety of financial risks; including, interest rate risk, power price risk, credit risk and liquidity risk. The Board of Directors has overall responsibility for overseeing the management of financial risks, however the review and management of financial risks are delegated to the AIFM. Each risk and its management are summarised below.

Interest rate risk

The Company's interest rate risk on interest bearing financial assets is limited to interest earned on cash and loan investments into project companies, which yield interest at a fixed rate. At the period end, the Company had secured loan investments into two CHP companies. The CHP companies cash flows are continually monitored and reforecast, both over the near future and the long term, to analyse the cash flow returns from investments. The interest rate applicable to the Company's loan to TEEC Holdings, reflects the rate attached to the project company loans.

The Company may use borrowings to finance the acquisition of investments. At the period end, there was no borrowing in place. Looking ahead the Company's policy is to ensure that interest rates are sufficiently hedged to protect net interest margins from significant fluctuations when entering into material medium/ long term borrowings. This may include engaging in interest rate swaps or other interest rate derivative contracts.

 
                                Interest  Non-interest 
                                 bearing       bearing  Total value 
                                --------  ------------  ----------- 
                                 GBP'000       GBP'000      GBP'000 
For the period ended 31 March 
 2021 
Assets: 
Investments at fair value 
 through profit or loss           20,883             -       20,883 
Receivables                            -           201          201 
Cash and cash equivalents         76,553             -       76,553 
                                --------  ------------  ----------- 
Total Assets                      97,436           201       97,637 
                                --------  ------------  ----------- 
 
Liabilities: 
 Trade and other payables              -           149          149 
Total Liabilities                      -           149          149 
                                --------  ------------  ----------- 
 

Power Price risk

The wholesale market price of electricity and gas is volatile and is affected by a variety of factors, including market demand for electricity and gas, the generation mix of power plants, government support for various forms of power generation, as well as fluctuations in the market prices of commodities and foreign exchange. At the period end the Company was not directly exposed to power price risk, as the investments made by TEEC Holdings during the period were fixed rate secured loans. The investee companies, Harvest and Glasshouse are exposed to power price risk. A significant fall in power prices may result in Harvest and Glasshouse being unable to service the debt provided by the Group and as a result could affect the fair value of the Company's investments. As the Company deploys further funds, the Investment Manager intends to continually monitor energy price forecasts and aims to put in place mitigating strategies, such as hedging arrangements or fixed PPA contracts to reduce the exposure of the Company to this risk.

Credit Risk

Credit risk is the risk that a counterparty of the Company will be unable or unwilling to meet a commitment that it has entered into with the Company. It is a key part of the pre-investment due diligence. The credit standing of the companies which we intend to lend or invest is reviewed, and the risk of default estimated for each significant counterparty position. Monitoring is on-going, and period end positions are reported to the Board on a quarterly basis.

Credit risk also arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial institutions. The Company and its subsidiaries may mitigate their risk on cash investments and derivative transactions by only transacting with major international financial institutions with high credit ratings assigned by international credit rating agencies.

The Company had no derivatives during the period.

The carrying value of the investments, trade and other receivables and cash represent the Company's maximum exposure to credit risk.

Liquidity risk

Liquidity risk is the risk that the Company may not be able to meet its financial obligations as they fall due. The AIFM and the Board continuously monitor forecast and actual cash flows from operating, financing, and investing activities to consider payment of dividends, repayment of trade and other payables or funding further investing activities. The Company ensures it maintains adequate reserves and will put in place banking facilities and it will continuously monitor forecast and actual cash flows to seek to match the maturity profiles of financial assets and liabilities.

At the period end, the Company's investments were in secured loan investments to private companies, in which there is no listed market and therefore such investments would take time to realise, and there is no assurance that the valuations placed on the investments would be achieved from any such sale process. The Company's direct subsidiary TEEC Holdings, is the entity through which the Company holds its investments, the liquidity of TEEC Holdings is reflective of the investments in which it holds.

Financial assets and liabilities by maturity at the period end are shown below:

 
                            Less than             More than 
                               1 year  1-5 years    5 years    Total 
                            ---------  ---------  ---------  ------- 
                              GBP'000    GBP'000    GBP'000  GBP'000 
 
Assets: 
Investments at fair value 
 through profit or loss             -          -     20,883   20,883 
Receivables                       201          -          -      201 
Cash and cash equivalents      76,553          -          -   76,553 
                            ---------  ---------  ---------  ------- 
 
Liabilities: 
 Trade and other payables       (149)          -          -    (149) 
                               76,605          -     20,883   97,488 
                            ---------  ---------  ---------  ------- 
 

19. SUBSIDIARIES

At the reporting date, the Company had one subsidiary, being its 100% investment in TEEC Holdings, the Company's intermediate holding company.

The following table shows subsidiaries of the Company. As the Company is regarded as an Investment Entity as referred to in Note 2, this subsidiary has not been consolidated in the preparation of the financial statements.

 
                                     Ownership interest 
                                         as at 31 March 
 Investment      Place of Business                 2021 
---------------  ------------------  ------------------ 
 
 TEEC Holdings   United Kingdom                    100% 
 

20. RELATED PARTY TRANSACTIONS

During the period interest totalling GBP53,497 was earned on the Company's long-term interest-bearing loan between the Company and its subsidiary. At the period end, GBP53,497 was outstanding.

The loan to TEEC Holdings Limited is unsecured; the underlying loan from TEEC Holding Limited to Harvest and Glasshouse is secured against the assets of the companies by a fixed and floating charge.

The AIFM and Investment Manager

The Company and Triple Point Investment Management LLP have entered into the Investment Management Agreement pursuant to which the Investment Manager has been given responsibility, subject to the overall supervision of the Board, for active discretionary investment management of the Company's Portfolio in accordance with the Company's Investment Objective and Policy.

As the entity appointed to be responsible for risk management and portfolio management, the Investment Manager is the Company's AIFM. The Investment Manager has full discretion under the Investment Management Agreement to make investments in accordance with the Company's Investment Policy from time to time.

This discretion is, however, subject to: (i) the Board's ability to give instructions to the Investment Manager from time to time; and (ii) the requirement of the Board to approve certain investments where the Investment Manager has a conflict of interest in accordance with the terms of the Investment Management Agreement.

Under the terms of the Investment Management Agreement, the Investment Manager will be entitled to a fee calculated at the rate of:

-- 0.9 % , per annum of the adjusted NAV in respect of the Net Asset Value of up to, and including, GBP650 million; and

-- 0.8 % , per annum of the adjusted NAV in respect of the Net Asset Value in excess of GBP650 million.

The management fee is calculated and accrues monthly and is invoiced monthly in arrears. During the period ended 31 March 2021, management fees of GBP6,213 was incurred of which GBP6,213 was payable at the period end.

No annual management fee shall accrue or be charged on any undeployed cash funds until such time as 75% or more of the IPO proceeds have been deployed. For these purposes, "Deployed" shall mean invested in the acquisition or development of Energy Efficiency Projects.

21. EVENTS AFTER THE REPORTING PERIOD

On 28 May 2021, the Company completed a GBP8.032m senior debt investment in an operational Combined Heat and Power (" CHP ") Energy Centre, Spark Steam Limited (" Spark Steam "). This investment was made via the Company's subsidiary TEEC Holdings Ltd.

Dividend

The Company will pay an interim dividend in respect of the period from 23 June 2020 to 31 March 2021 of 2.00 pence per Ordinary Share, payable on 30 June 2021 to holders of Ordinary Shares on the register on 11 June 2021. The ex-dividend date will be 10 June 2021.

22. ULTIMATE CONTROLLING PARTY

In the opinion of the Board, on the basis of the shareholdings advised to them, the Company has no ultimate controlling party.

GLOSSARY AND DEFINITIONS

 
  The Act                   Companies Act 2006 
  AIC Code                  The AIC Code of Corporate Governance produced 
                             by the Association of Investment Companies. 
                          -------------------------------------------------------- 
  AIFM                      The alternative investment fund manager of the 
                             Company, Triple Point Investment Management 
                             LLP. 
                          -------------------------------------------------------- 
  AIFMD                     The EU Alternative Investment Fund Managers 
                             Directive 2011/61/EU. 
                          -------------------------------------------------------- 
  CCC                       Climate Change Committee 
                          -------------------------------------------------------- 
  CHP                       Combined heat and power 
                          -------------------------------------------------------- 
  The Company               Triple Point Energy Efficiency Infrastructure 
                             Company plc (company number 12693305). 
                          -------------------------------------------------------- 
  DCF                       Discounted Cash Flow 
                          -------------------------------------------------------- 
  Energy Efficiency         A project which falls within the parameters 
   Project                   of the Company's investment policy 
                          -------------------------------------------------------- 
  ESG                       Environmental, Social and Governance 
                          -------------------------------------------------------- 
  EU                        European Union 
                          -------------------------------------------------------- 
  FCA                       Financial Conduct Authority 
                          -------------------------------------------------------- 
  FRC                       Financial Reporting Council 
                          -------------------------------------------------------- 
  GAV                       Gross Asset Value 
                          -------------------------------------------------------- 
  GHG                       Green House Gas 
                          -------------------------------------------------------- 
  Group                     The Company and any subsidiary undertakings 
                             from time to time 
                          -------------------------------------------------------- 
  Harvest and Glasshouse    Harvest Generation Services Limited (company 
                             number 09353790) and Glasshouse Generation Limited 
                             (company number 09352996) 
                          -------------------------------------------------------- 
  ITC                       Investment Trust Company 
                          -------------------------------------------------------- 
  IPO                       The admission by the Company of 100 million 
                             Ordinary Shares to trading on the Specialist 
                             Fund Segment of the Main Market, which were 
                             the subject of the Company's initial public 
                             offering on 19 October 2020. 
                          -------------------------------------------------------- 
  kWh                       Kilowatt-hour 
                          -------------------------------------------------------- 
  LED                       Light-emitting Diode 
                          -------------------------------------------------------- 
  NAV                       The net asset value, as at any date, of the 
                             assets of the Company after deduction of all 
                             liabilities determined in accordance with the 
                             accounting policies adopted by the Company from 
                             time-to-time. 
                          -------------------------------------------------------- 
  Net Zero                  A target of completely negating the amount of 
                             greenhouse gases produced by human activity, 
                             to be achieved by reducing emissions and implementing 
                             methods of absorbing carbon dioxide from the 
                             atmosphere 
                          -------------------------------------------------------- 
  OCR                       Ongoing charges ratio. 
                          -------------------------------------------------------- 
  PPA                       Power Purchase Agreement. 
                          -------------------------------------------------------- 
  Project SPV               Special Purpose Vehicle in which energy efficiency 
                             assets are held. 
                          -------------------------------------------------------- 
  SDG                       Sustainable Development Goals. 
                          -------------------------------------------------------- 
  SORP                      Statement of Recommended Practice. 
                          -------------------------------------------------------- 
  TCFD                      Task Force on Climate-related Financial Disclosures. 
                          -------------------------------------------------------- 
  TEEC Holdings             The wholly owned subsidiary of the Company: 
                             TEEC Holdings Limited (company number 12695849). 
                          -------------------------------------------------------- 
  Wider Triple Point        Triple Point LLP (company number OC310549) and 
   Group                     any subsidiary undertakings from time to time. 
                          -------------------------------------------------------- 
 

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