Abundance Generation, a democratic finance crowdfunding platform, has launched its first fixed return renewable energy project.
The project, SunShare Community Nottingham – is looking for investment of up to £896,000 from people with as little as £5 to invest. The project will involve refinancing the installation of already operational solar energy panels on 20 community buildings in Nottingham, each associated with children’s development, and will pay investors an effective rate of return of 6.5% over the 19-year life of the investment (or 6.65% including the ‘Pioneer Bonus’ being offered by Abundance in recognition of this being its first fixed return project).
Investors in the project will receive an equal portion of their original capital and a fixed return. For example if you invest £950, each year you can expect to receive £90.39 made up of £50 of capital, £38.50 of interest income and £1.43 of Pioneer Bonus.
This is the sixth project offered by Abundance since it launched just over a year ago, with the previous five raising £3 million from people investing as little as £5.
Sunshare Community Nottingham is part of a roll-out of new projects set to take place between now and the end of the year looking to raise an additional £7 million. The project is owned by EvoEnergy, a solar PV developer and installer based in Nottingham, and Stepnell, a 140 year old, family-owned main contractor with head offices in Rugby.
The solar PV systems, all installed in 2012 and January 2013provide energy for a variety of buildings associated with children’s development. The 20 buildings include nursery, primary and special needs schools, Sure Start centres, two leisure centres and a library.
Stepnell originally funded the installation of the solar panels themselves but are now looking to raise money through Abundance for this project so they can recycle their investment and put that money to work on new development projects.
The nurseries, schools and other buildings involved in this project have had nothing to pay to have the solar panels installed. As part of the project, they agree to buy the electricity generated at a price agreed with SunShare Community Nottingham that is less than their current electricity price. In this way the schools or building occupier will save money by cutting their electricity bills.
In addition, the price agreed with each building will increase in line with inflation each year, not actual electricity price rises. As electricity prices are expected to increase ahead of inflation for the foreseeable future (see DECC’s energy price projections), the amount the schools and other buildings are saving on their bills should increase each year.
Bruce Davis, cofounder and joint managing director of Abundance Generation said:
“It is very satisfying to keep up the flow of very attractive projects for the widest possible audience of investors across the UK. Our universal minimum investment of just £5 across all Abundance projects means we can help the most extensive cross-section of the population, and on a fully Financial Conduct Authority-regulated platform. We know from the rapid take up of the previous five projects that savers and investors are desperate for inflation beating returns and would much rather get them through investing in the real economy in assets that they can see, trust and believe in. We are proud to be leading the democratic finance revolution currently underway in the UK.”
Kevin Hard, CEO of EvoEnergy, said:
“We are excited and proud to be involved in the next stage of this project which started with the installation of the PV systems for the benefit of schools and other community buildings in Nottingham, and which now is delivering on EvoEnergy’s objectives to allow those that can’t own solar panels themselves to capitalise on the financial returns of solar energy.”
Investment in projects offered by Abundance is made through the purchase of Debentures in the project – official IOUs that guarantee the holders a share in the profits made by the project. Returns will be paid in twice yearly payments over the term of the project, although investors wishing to cash in early can sell their holdings on to others via the Abundance website. www.abundancegeneration.com.