Further Investment in Europe

7 February 2022

SDCL Energy Efficiency Income Trust plc
("SEEIT" or the "Company")

Further Investment in Europe

SEEIT, the first London Stock Exchange listed investment company of its kind to invest exclusively in the energy efficiency sector is pleased to provide an update on recent investment activity in Europe.

Investment in Operational Biomass Project in Portugal

SEEIT has agreed to acquire an 80% equity interest in a high-efficiency and operational biomass cogeneration plant, Sociedade de Iniciativa e Aproveitamentos Florestais - Energia, S.A. ("SIAF" or the "Project"), in Mangualde, Portugal from Capwatt S.A ("Capwatt"), for approximately €22 million.

SIAF generates heat and power from sustainably sourced biomass. It supplies critical onsite heat to an industrial facility manufacturing medium-density fibreboard ("MDF") owned by Sonae Arauco PT ("SAPT"). SAPT, a leading global producer of wood-based panels, is a joint venture between Celulosa Arauco y Constitucion S.A. ("Arauco") and Efanor Investimentos, SGPS, S.A. ("Efanor"), which are considered investment grade or equivalent counterparties. SAPT supplies contracted biomass feedstock to the Project, predominantly from waste wood from its own facility as well as sustainably sourced wood waste biomass.

In addition to supplying heat to SAPT on a take-or-pay basis, the Project generates electricity which benefits from the Portuguese Feed-in-Tariff to the grid. As a result, the Project is expected to benefit from at least a further 23 years of stable, inflation linked, contracted cashflows with no demand risk, providing good visibility of returns for SEEIT.

The Project contracts operation and maintenance activities to Capwatt, which will retain a 20% equity interest in the Project. Capwatt is a leading developer and operator of high-efficiency cogeneration and renewables plants in Portugal and Spain, with over 200 MW of assets under management. Capwatt is the wholly-owned energy business of Sonae Capital SGPS, S.A., a wholly-owned subsidiary of Efanor.

The investment is funded from the Company's existing cash resources. SIAF's existing project finance green bond facility, which is equivalent to approximately €41 million, remains in place. Completion of the acquisition is expected in the coming weeks after satisfactory conclusion of customary lender consents and completion documentation.

In addition to the acquisition of the Project, SEEIT and Capwatt have signed a Heads of Terms to focus on the joint development and acquisition of energy efficiency projects across Iberia.

Oliva Spanish Cogeneration

SEEIT has also acquired the interest of a minority shareholder of the Puente Genil projects ("Puente Genil") in Oliva Spanish Cogeneration for consideration of €12 million. Puente Genil comprises three of the nine projects in Oliva Spanish Cogeneration. SEEIT now has sole ownership of eight of the nine projects, with an offtaker retaining a minority interest in the other. The acquisition follows SEEIT's original investment in the 125 MW cogeneration portfolio in September 2019 and will enable it to support growth initiatives across these assets.

Commenting on the investment, Jonathan Maxwell, CEO of Sustainable Development Capital LLP, said: "SIAF is SEEIT's first investment in Portugal and demonstrates our commitment to growing our presence in Iberia and supporting our ambition for increasing geographic diversification.  Similar to our investment in Oliva Spanish Cogeneration, the SIAF investment provides critical onsite heat generated from waste sources. Both these investments are great examples of the circular economy at work, whilst contributing to meeting SEEIT's yield and returns targets."

For Further Information

About SEEIT

SDCL Energy Efficiency Income Trust plc is a constituent of the FTSE 250 index. It was the first UK listed company of its kind to invest exclusively in the energy efficiency sector. Its projects are primarily located in the UK, Europe and North America and include, inter alia, a portfolio of cogeneration assets in Spain, a portfolio of commercial and industrial solar and storage projects in the United States, a regulated gas distribution network in Sweden and a district energy system providing essential and efficient utility services on one of the largest business parks in the United States.

The Company aims to deliver shareholders value through its investment in a diversified portfolio of energy efficiency projects which are driven by the opportunity to deliver lower cost, cleaner and more reliable energy solutions to end users of energy.

The Company is targeting an attractive total return for shareholders of 7-8 per cent. per annum (net of fees and expenses and by reference to the initial issue price of £1.00 per Ordinary Share), with a stable dividend income, capital preservation and the opportunity for capital growth. The Company is targeting a dividend of 5.62p per share in respect of the financial year to 31 March 2022. SEEIT's last published NAV was 104.5p per share as at 30 September 2021.

Past performance cannot be relied on as a guide to future performance.

Further information can be found on the Company's website at www.seeitplc.com.

Investment Manager

SEEIT's investment manager is Sustainable Development Capital LLP ("SDCL"), an investment firm established in 2007, with a proven track record of investment in energy efficiency and decentralised generation projects in the UK, Continental Europe, North America and Asia.

SDCL is headquartered in London and also operates worldwide from offices in New York, Dublin, Madrid, Hong Kong and Singapore. SDCL is authorised and regulated in the UK by the Financial Conduct Authority.

Further information can be found on at www.sdclgroup.com.