Fund Profile


Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by Greencoat UK Wind. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Chunky dividend cover is the key to UKW’s resilient proposition…

Greencoat UK Wind (UKW) is the largest trust in the AIC Renewable Energy Infrastructure sector. UKW differs from its peers in a number of other ways. Firstly, its portfolio is largely exposed to unlevered windfarms only, giving it simplicity in what can be a hard-to-understand market. Secondly, its financial model is based on investing at high rates of return, which allows it to pay a well-covered dividend in most circumstances, and then use the surplus cashflows to grow the NAV on a real basis. Now that trusts across the peer group are trading at discounts to NAV, preventing equity fundraising, this feature arguably becomes an ever more important differentiator. UKW is also one of the rare trusts in the peer group that continues to link its dividend to UK RPI and grow its NAV on a real basis.

UKW’s simple model aims to provide attractive total returns over time, with a significant proportion of these returns coming in the form of a Dividend. The prospective dividend for 2024 yields 7.2% at the current share price. We believe investors should focus more on prospective total returns, which on a NAV basis stand at 10% per annum (on NAV) after fees if UKW’s long-term assumptions play out. As we discuss in the Discount section, if the shares re-rate from the current discount of 15%, and the portfolio performs as expected, then shareholders should achieve a higher share price total return.

During 2023 UKW generated c. 1.5% of UK electricity demand. In other words, this is a sizable trust that contributes meaningfully to the UK economy. For those investors who want their investments to earn a high investment return, as well as have a positive impact for society, then clearly UKW can claim to do both, as we discuss in the ESG section.

Kepler View

Having a “self-funding” model gives the board a range of options to optimise returns to shareholders. The increased dividend target of 10p for 2024, well above December 2024’s RPI increase, is reflective of the strong position UKW is in, but so too is the announced £100m buy-back facility, of which £75m remains.

Whilst UKW’s dividend yield of 7.4% is attractive relative to long-term bond yields, the real attraction to investors should be its double-digit prospective total returns, which are based on relatively conservative long-term expectations for energy prices and inflation. In our view, this is an attractive prospective return, and a significant margin over long-term gilt yields not to mention inflation-linked government bonds. The portfolio has so far proved robust in the face of downside power-price sensitivities, whilst offering upside to power prices, inflation, asset life extension, asset optimisation, new revenue streams, and at the current stage in the cycle, potentially to interest rates. However, there are risks, as there are with any investment proposition, and we discuss the potential headwinds to long-term returns in the Performance section.

Over the short term, as we illustrate in the Dividend section, dividend cover is robust even in very extreme scenarios for wholesale power prices. In the context of power price falls this year, this should reassure investors on both the ability of the trust to continue to increase its dividend by RPI, and that UKW will continue to have surplus cash to allocate in an accretive manner, providing good total NAV returns as well.


  • High dividend yield well covered by cash, and “self-funding”
  • Continued commitment to RPI-linked dividend growth, yet trading on a discount to NAV
  • Diversified portfolio of institutional scale assets, spread around the UK


  • Some fixed-rate gearing will need to be refinanced over the next few years, probably at higher interest rates
  • Gearing exacerbates underlying asset valuation movements
  • Valuations based on long-term assumptions which may (or may not) prove optimistic
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2024 Kepler Alternative Income Rated Fund

This trust has been awarded a rating by Kepler Trust Intelligence for alternative income... Find out more

Fund History

10 Jun 2024 Investing in renewable infrastructure with UKW manager, Stephen Lilley – Podcast: Trust Issues #32
We discuss opportunities for investors in the renewable energy infrastructure sector with Greencoat UK Wind manager Stephen Lilley...
22 May 2024 Keep It Slightly-unconventional, Stupid
We argue a position in bonds should be diversified with alternatives…
01 May 2024 Flash Update: Greencoat UK Wind
UKW’s first quarter update shows the trust is well-placed for continued growth…
20 Mar 2024 How to grow old gracefully (and preferably rich)...
Ahead of the final week of our event, focused on retirement planning, we consider some of the complexities of portfolio construction…
20 Mar 2024 Fund Analysis
Chunky dividend cover is the key to UKW’s resilient proposition…
04 Mar 2024 Greencoat UK Wind: Discounting too much
Wholesale electricity prices are falling, but UKW’s dividend and buyback look secure…
27 Mar 2024 Greencoat UK Wind
Stephen Lilley
Rewatch this webinar as part of our month-long online series 'Themes for your ISA in 2024' hosted by the team at Kepler Trust Intelligence throughout March...
Watch Recording
09 Feb 2024 Flash update: Greencoat UK Wind
UKW’s total return strategy continued to bear fruit in 2023…
17 Jan 2024 Top of the Pops
We reveal the winners of our investment trust ratings for 2024…
10 Jan 2024 Definitely maybe
Fund flows and discounts may shed some light on a once-in-a-generation opportunity…
29 Nov 2023 We need to talk about discounts
Discounts are the problem and the solution…
21 Nov 2023 Winds of destiny
Newsflow in the wind sector does nothing to derail the long term attractions of the renewable energy infrastructure sector…
31 Oct 2023 Flash update: Greencoat UK Wind
UKW’s board appears bullish, with an inflation beating dividend and £100m buyback announced…
04 Oct 2023 Get real
The prospect of attractive real returns seems to be ignored by the market…
14 Aug 2023 Fund Analysis
Increased clarity on underlying assumptions highlights UKW’s resilient proposition…
09 Aug 2023 Should I stay, or should I go?
Re-appraising the invitation to the bond party…
27 Jul 2023 Results analysis: Greencoat UK Wind
UKW’s resilient NAV and increased discount rate suggest strong prospective returns…
26 Apr 2023 Hope springs eternal
Far-fetched as it might seem, we imagine some scenarios where a UK government might actually do something useful – and the investment trusts that could benefit…
22 Mar 2023 Good vibrations
We identify some sectors with structural discounts we think could close over time…
30 Mar 2023 Greencoat UK Wind - A unique, sustainable route to income
Stephen Lilley
Rewatch this webinar from our month-long online series 'A feast of ideas for your ISA' hosted by the team at Kepler Trust Intelligence throughout March...
Watch Recording
09 Feb 2023 Here comes the sun
Our analysis suggests renewable energy should be at the core of a well balanced portfolio...
07 Feb 2023 Fund Analysis
UKW’s strong performance isn’t necessarily reflected in the share price…
11 Jan 2023 Solving the Rubik’s Cube
We reveal the winners of our investment trust ratings for 2023…
21 Dec 2022 Reasons to be cheerful
We find reasons to be cheery this Christmas in the long-term trends which are going to transform society and generate returns…
21 Sep 2022 Jolly green giant
There could be a solution to economic troubles on the horizon, and one where the UK is a world leader...
11 May 2022 Catch a tiger by the tail
As inflation bites harder than it has for decades, we consider the best ways for investors to hang on to their capital...
29 Apr 2022 Flash update: Greencoat UK Wind
Reporting performance for the first quarter of 2022, UKW has announced a NAV which represents a 13.2% total return for the 3 months to 31/03/2022...
22 Mar 2022 Fund Analysis
UKW is in a strong position to capture the benefit of current high energy prices…
09 Mar 2022 Private markets: A closer look at infrastructure and renewables
We examine the £27bn listed Infrastructure and Renewable Energy Infrastructure sectors…
01 Dec 2021 How to protect your portfolio from inflation
We highlight trusts which could appeal in an environment where 'transient' inflation is here to stay...
03 Nov 2021 Don't fear the reaper
With market direction hard to call, we consider the case for taking a long-term view in the investment trust sector…
10 Jun 2021 Green is good!
2021 will see billions dedicated to sustainable initiatives, which brings with it a host of possible investment opportunities...
02 Jun 2021 Fund Analysis
UKW’s size and robust model means we think it deserves to trade at a premium to peers…
12 May 2021 Riders on the storm
We look at the yields in the alternatives space and how they have been affected by the pandemic…
09 Mar 2021 Fund Analysis
2020 has proved UKW’s resilience, which continues to target an inflation linked dividend…
24 Feb 2021 Dire Straits or Money for Nothing?
With the sector having seen discounts narrow like never before – our analysts debate whether a premium is a price worth paying…
17 Feb 2021 Jungle Fever
Soaring interest in ESG has exciting implications, but risks pushing some stocks to distinctly unsustainable valuations...
20 Jan 2021 Kepler's top-rated investment trusts for 2021
We update our annual quantitative ratings for investment trusts…
26 Nov 2020 Fund Analysis
2020 has proved UKW’s resilience, but is now better value in terms of premium...
15 Oct 2020 Nice guys finish first
ESG has moved from hippy pipe-dream to corporate mainstream, but what is it really and where do we see opportunities?
09 Sep 2020 Time to switch horses?
We look at what returns are likely from equity markets in the coming decade and identify which alternatives could offer similar or greater returns for lower levels of risk…
09 Jul 2020 The next big thing: two mega-trends that everyone should own
Tech has beaten almost everything hands down – but nothing lasts forever. Where else should investors be looking for secular growth themes?
23 Apr 2020 Sucker punch
Two of our analysts debate the merits of equity income and alternative income trusts at this point in time...
12 Mar 2020 The importance of buying earners*
Our analysis shows that the impact of dividend contributions on long term returns is anything but trivial...
04 Mar 2020 Fund Analysis
Recent de-rating, but prospects appear undimmed…
16 Oct 2019 Life on Mars: could inflation take us back to the '70s?
We discuss two potential catalysts for inflation - and the assets that could offer a hedge against it...
09 Oct 2019 Bond proxy?
As a replacement or complement for longer duration bonds, listed alternative income funds look an interesting, well… alternative..
19 Sep 2019 Rebels no more...
Climate change and sustainability is now mainstream - we launch ESG analysis into all of our fund research…
19 Sep 2019 Fund Analysis
UKW invests in operating wind farms, aiming to provide an RPI-linked dividend and preserve the real value of the NAV…
06 Mar 2019 Stairway to heaven
Our research shows that reinvesting the income generated by alternative assets could add a significant boost to long-term portfolio performance…
28 Feb 2019 Fund Analysis
Greencoat UK Wind invests in operating wind farms, aiming to provide an RPI-linked dividend and preserve the real value of the NAV...
30 Jan 2019 The Annuity Portfolio
We reveal our investment trust picks for a high income ...
24 Dec 2018 Why did the chicken cross the road?
Because he was so bored of reading newspapers devoted entirely to Brexit he was hoping he’d be hit by a truck.
25 Jul 2018 The Evergreen Annuity Portfolio
Our Evergreen Annuity Portfolio was set up to provide a high income, rising at least in line with inflation...
19 Jul 2018 A new dawn
As the sun sets on fossil fuels, we examine the opportunities for investors in the burgeoning listed renewable infrastructure sector...
26 Mar 2018 Electric dreams
The global shift toward electrification could spark many opportunities…
21 Mar 2018 Fund Analysis
Aims to provide investors with an annual dividend that increases in line with RPI inflation while preserving the real value of the NAV
24 Jan 2018 Seeing the wood for the trees...
Our model portfolio designed as an annuity alternative is struggling to keep pace with inflation, we review the latest from the constituents…
20 Nov 2017 Under pressure
Our model portfolio designed as an annuity alternative is coping so far, but may struggle to keep pace with inflation at this rate…
20 Nov 2017 Fund Analysis
A differentiated trust generating both income and capital growth from operating UK wind farms
25 Jan 2017 Should I stay or should I go?
That's exactly the question we are asking ourselves as the story at BlackRock Income Strategies unfolds...
16 Nov 2016 Weathering well
The Evergreen Annuity Portfolio enters its second year with a solid performance from most of its constituents...
16 Nov 2016 Fund Analysis
An update of the Greencoat UK Wind investment trust including share price performance, discount, dividend, premium, asset allocation and gearing analysis...
13 Oct 2015 The Evergreen Annuity Portfolio
Five 'all season' investments which will produce a sustained high income without eating into capital...
13 Oct 2015 Fund Analysis
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