26 Jul Trish Nixon
Trish Nixon on ademocratizing clean energy investments.
In this monthly series, the team behind Genus Fossil Free speaks with Canadians at the heart of where finance meets climate action. Know someone we might want to speak with? Suggest them in the comments below or email email@example.com
Trish Nixon is democratizing clean energy investing for Canadians. As the Chief Impact Investing Officer at CoPower, Trish is also the first recipient of the Ewart Newton Award for Social Innovation. The award recognized her efforts in CoPower’s placement of $6 million in loans into clean energy projects, and in turn empowering individual investors to participate in these investments, for profit and planet. This was back in 2016.
CoPower issues green bonds backed by loans to clean energy projects. Their first release sold out in three weeks. Fast forward to 2017: Trish and her team have released another $20 million in green bonds now available to investors across Canada. Needless to say, things are moving fast.
We caught Trish for a few minutes out of her busy day to talk about her role in the climate action movement.
Trish Nixon, Chief Impact Investing Officer at CoPower, in real life.
Can you tell me more about CoPower, and why it’s exciting for you?
I’ve spent most of my career in impact investing. The biggest challenge I’ve found usually comes down to connecting two things already out there: profitable, market-driven solutions to social and environmental challenges, and investors that want both social and financial returns.
Impact investment opportunities rarely meet the needs of retail investors in terms of risk, return and impact. Even more importantly, these opportunities are almost never accessible to individual investors.
CoPower is a platform and model that overcomes the biggest challenge I’ve seen for my industry to date. That, to me, is truly exciting. We lower the barrier to entry so that everyday citizens can vote with their dollar, without compromising financial goals.
In my view, that’s how we’re going to build a system of capitalism that actually works for society.
The CoPower model is a three-step process: first, we finance distributed clean energy projects in Canada and the United States. That includes solar and geothermal energy. These projects are often seeking a lot less than the minimum amount that banks and mainstream institutions are willing to fund. That’s where we come.
Then, we package our loans into diversified financial products, like our five-year Green Bonds, which offer fixed five per cent annual interest rates. Finally, as an exempt market dealer, we can offer these products direct-to-consumer through our online platform, with no fees. You don’t have to be an accredited investor, and it doesn’t matter where you already bank or invest.
Basically, anyone with $5,000 to invest can start adding clean energy to their portfolio. It’s clear to me this is something that many, many people have been waiting for – and demand is only growing. That, to me, is truly exciting.
Who are CoPower’s main investors?
Our clients range from young professionals who are first-time investors, to seasoned investors with extensive private markets experience, to grandparents purchasing for their grandkids.
About 45 per cent of our investors are millennials (age 20-35), and 35 per cent are retirees, or those approaching retirement.
That’s an interesting breakdown. Why do you think that is?
Millennials tend to be socially conscious consumers, so it makes sense that social consciousness would extend to their investment portfolios, which often have a much greater carbon impact than lifestyle choices like travel, transportation and diet. For this demographic that is already thinking holistically about their impact on the world, sustainable investing is a no-brainer.
As for the strong showing among investors approaching retirement: we often hear concerns about the state of the planet that their children and grandchildren will inherit, so there are clear values-drivers at play. The fact that our product is uncorrelated to the broader public markets and offers a steady income stream also fits nicely with their financial goals.
How has CoPower overcome the barriers to creating demand for a new type of investing product?
Our value proposition is simple: grow and diversify your investment portfolio while helping build clean energy. Most people agree that’s a win-win scenario, but investing with CoPower also means doing a few things that might be new to you: first, considering the social and environmental impact of what you own as part of your investment criteria. Second, investing in a private placement, which is a new concept to many retail investors. And third, investing directly, through an online platform.
To address this, we focus on strategies that compel people to be proactive. That starts with our product. Our green bonds are backed by senior, secured loans to operating projects that generate steady revenues from either the sale of clean power or energy efficiency services. We pride ourselves on transparency, and make sure that investors can see exactly what projects their investments are supporting, how their returns are generated, and how much carbon they are offsetting. Most of our clients haven’t had access to opportunities like this, to their frustration, and are excited to participate.
Another thing that’s helped us gain investor confidence is working with credible organizations like RBC and Fondaction, who are shareholders in our management company, and Vancity Credit Union and the McConnell Foundation, two strategic lenders helping bring our green bonds to market.
The final challenge is awareness and education. We get out there as much as possible to talk to people about the impact (positive or negative) of their investment portfolios, and share real stories of how CoPower investors are helping fill the climate finance gap.
In your view, what’s next for impact investing?
The market has grown exponentially in the last few years, extending across asset classes. Foundations and high-net worth investors were the early drivers, but now large mainstream financial institutions, including Black Rock and Goldman Sachs, are taking notice and carving out impact investment strategies.
The growth has been largely driven by client demand, and will continue to accelerate as investors become more aware of both the impact of what they own, and the growing number of options available to them.
The fact that these options are increasingly available to everyday citizens is game-changing, and we’re proud to be a part of this next wave of social innovation in capital markets. We know that the easier and more profitable we can make it for everyone to invest in clean energy, the faster we can build our low carbon future.
What’s your climate superpower?
Empowering people to invest in clean energy solutions!
Where can people learn more about CoPower’s superpowers?
Visit copower.me to learn more about our products, sign up for our mailing list or register to invest. You can also check out our blog, which hosts several excellent investor profile’s demonstrating how individuals can be superheroes in their own right by changing the way that capital is allocated for the better.