Image:  Girl in a red dress running through a green field

Community ownership

 

One of the most effective ways we have found of involving communities with their local wind farm is to give people the opportunity to own a stake in it.

 

To enable this, an award winning scheme has been developed in collaboration with Energy4All, a not for profit organisation specialising in community ownership of renewable energy projects.

 

The first step is to set up a local co-operative for each wind farm once it's ready to be built. Once established individual investors are invited to purchase shares in this co-operative (priority being given to those living closest to the project) and the co-operative then uses this money in turn to buy a stake in the wind farm. The co-operative receives a return on this investment and in turn distributes this as share interest to its investors.

 

The main features of the scheme are as follows:

  • Co-operative may invest up to 4% of the project’s total capital costs (approximately £1m for a typical 25 MW project)
  • The minimum individual investment is £250, the maximum £20,000 (a legal constraint on co-operatives)
  • Financial returns typically forecast to average 10% per annum (linked to wind farm performance) but now guaranteed to be no less than 6.5%
  • Original investment returned at the end of project life (typically 20-25 years)
  • All decisions in the co-operative are taken on a one member one vote basis (regardless of shareholding)

 

As an example of community ownership working in practice, the co-operative for Ben Aketil (a 23 MW wind farm operated by our partners Falck Renewables on Skye) completed a successful share offer and started trading in January 2008.

  • Over £800,000 was raised from some 572 individual investors
  • The great majority of investors live locally to the project, over 50% on the island itself
  • Over 3% of the residents on Skye now own a stake in their local wind farm

Image:  Cover of community ownership share prospectus

 

 

Image:  Cover of community ownership share prospectus

 

 
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