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Home / Business / Personal Finance

The Warehouse founder Sir Stephen Tindall on why he is investing in green businesses

Tamsyn Parker
By Tamsyn Parker
Business Editor·NZ Herald·
3 Nov, 2021 04:00 PM5 mins to read

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Sir Stephen Tindall talks to Chris Keall about his post-Warehouse career, which has seen the entrepreneur commit hundreds of millions to philanthropy and startups.

From solar panels on sheep farms to building hydrogen-fuelled chaser boats for the America's Cup, Sir Stephen Tindall's investment company is backing businesses he hopes will make a major impact on climate change.

The retail entrepreneur's K1W1 has about 200 investments in its portfolio, of which around 16 have a specific environmental impact focus, and he believes private finance is vital in the push for net zero carbon emissions.

"I think it is hugely important. I think it can play a very big part and I think it already is."

Tindall spoke to the Herald before a webinar being held on Thursday on the role of private finance as part of the United Nations Climate Change Conference, COP26, Finance Day.

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Organised by the Aotearoa New Zealand Investor Coalition for Net Zero and facilitated by the British High Commissioner Laura Clarke, the webinar will include presentations by Bridget Coates, chair of Toitū Tahua: Centre for Sustainable Finance, Reserve Bank Governor Adrian Orr, NZ Super Fund CEO Matt Whineray and Investor Group on Climate Change director Tom Arup.

Toitū Tahua chair Bridget Coates said New Zealand fund managers had hundreds of billions of dollars invested locally and globally.

"Redirecting this money from sunset industries and investing in sustainable solutions is an extremely powerful tool in our global efforts to reverse climate change."

Tindall, a backer of Toitū Tahua, said he had been investing in clean energy businesses for some time, investing in Solarcity about 20 years ago.

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It sells solar panels to homeowners but has recently won contracts for panels on industrial buildings and schools and when the schools are closed the extra power will feed back into the community.

K1W1 was also the first commercial investor in LanzaTech which was founded in 2005 and converts carbon monoxide off the smokestacks of steel mills and turns it into biofuel and now also had a big project converting wood waste into jet fuel.

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More recently it has invested in Lodestone Energy started this year by buying six farms which will operate as dual sheep and solar panel farms and generate enough energy to supply the whole of Hamilton.

Tindall's K1W1 has also invested alongside Japan's Mitsui in a hydrogen company called Hiringa which will operate wind turbines in Taranaki to make green ammonia which is converted to green urea for fertiliser.

"Almost all our fertiliser is imported and it is made from coal.

"Then we are rolling out next year four hydrogen filling stations and importing a bunch of hydrogen trucks."

Tindall said as the person in charge of sustainability for Team NZ they were in the process of building a hydrogen chase boat for America's Cup racing.

"As the holders of the Cup we will mandate that all teams have to have hydrogen chase boats rather than petrol ones and we will organise for the building of those."

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While some green investment opportunities have come knocking on his door others had to be hunted down. "There is a bit of both."

Tindall said it had taken the lead on investing in oat milk manufacturing business NZ Functional Foods, which was starting up an oat milk processing plant in Southland.

But in other cases it was investing alongside other like-minded investors.

"For example Lodestone, a number of us started talking about the need for more clean energy so we can retire Huntly - get rid of coal. Then we just passed the hat around ... It is going to be a $300 million project when it is finished."

"There are a number of like-minded people. We call it impact investing, some people will do it because it ticks both boxes, some people will do it for the environmental reason and others will do it for just the return."

Tindall said he was more focused on doing good than getting a return from the investments, but he knows they still have to stack up for other investors which K1W1 often invests alongside.

"I am trying to do it primarily to help with climate change. But I believe we have to prove to other investors that they are good investments as well."

Tindall said most of the investment were long term and wouldn't have big returns until the shares or companies were sold.

"You don't get hit the big return on these sort of companies through dividends ... most of them are long-haul R&D projects."

"The biggest thing for us is how much we can reduce the effects of climate change - so it is energy."

He said he was in the middle of a big project at the moment both through the Tindall Foundation and K1W1 on a solution for reducing methane using seaweed.

"We are looking for really big breakthrough technologies that will make a difference."

The average timeframe for the investments was around 10 to 15 years.

"Some things will make a very good return within 12 months, some two to three years but some of the other ones are slower burners. I think with most venture capital you are probably looking at 10 to 15 years before you get the sort of return you would like."

• Toitu Tahua The Centre for Sustainable Finance webinar is on Thursday November 4 from 3pm-4.30pm

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