The previous post on this website has prompted a number of calls from communities wanting to build their own renewable energy installation similar to Eden’s employee project. Alongside the not-for-profit electricity retailer Ebico, I am very interested in helping to get these projects completed. Together, we can provide help with the financial analysis of a proposal (is it viable? can it be financed?), writing of the business plan, approval of the investment document (alongside an FSA registered accountant) and assistance in marketing to investors. We have three key advantages.
- we know about the electricity market
- we understand renewable energy and its finances
- and we are strongly commercial, wanting to get as much generating capacity installed as quickly and as cheaply as possible.
It may be worth writing down our view of the best way of getting projects completed
- use an ordinary limited company. Cooperatives and other non-standard ventures work well but the cheapest and most effective structure will generally be a private limited company. They can be surprising flexible: for example, you can write the company documents in a way that will ensure that the shares stay in the hands of people within the community.
- if you want outside money, it is always much easier to find it if you offer a commercial rate of return. Some people will invest in a venture because they approve of its objectives. Most people are financially pressed and want to get the most for their money.
- go for simplicity at every opportunity. No complicated structures, avoid multiple objectives. A simple statement, such as ‘we want to build a wind turbine that provides enough power to meet the typical needs of our village and gives a good return to local investors’ is fine. Complex or contradictory objectives are always a problem, not least because they make investors scared. You can have strong social objectives but the business has to make reasonable money for its shareholders first.
- planning permission is not always the problem that it seems to be. Local authorities will usually (but not always) be intensely sympathetic to projects that have high levels of community support. It’s worth spending time getting that support as early as possible.
- all of us need to be paid for what we do, but costs can be held down at every turn. The financing of a community renewable energy installation needs to be done quickly, efficiently and using well-established routes.
If these views are similar to yours, and you want to build a wind turbine, a PV farm, an AD plant, a biomass heating system or a run-of-river hydro installation as part of a community, employee or other group, please do get in touch. We would love to help.