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Small Investors in the UK Can Invest in a Local Renewable Energy Project ‘from as little as £5’

Small investors get chance to invest in wind energy project ‘from as little as £5’

Green investment news – by Louise Bateman
28th March 2012

Small investors in the UK for the first time are being given the opportunity to back a local renewable energy project ‘from as little as £5’ thanks to a new financial service that aims to make green energy investment accessible to the masses.
Abundance Generation, which is backed by innovation body NESTA and authorised by the Financial Services Authority, has been set up to link up communities and individuals with renewable energy projects and make it possible for them to share in the benefits of green energy production directly. It has ambitious aims to ‘democratise’finance while growing the UK’s renewable energy market. Its first project is a community wind turbine in the Forest of Dean, which is looking to raise £1.3 million.

Open to all
The Resilient Energy Great Dunkilns wind turbine is open to anyone in the UK to invest in who has a bank account and is over 18 and has £5 or more to invest. As well as a regular cash return from the profits the turbine makes, investors also get their original investment paid back after 20 years – the lifetime of the project.

The wind turbine is being built by local couple Andrew and Sue Clarke, who have cashed in their pensions to invest in the project. They have teamed up with Great Dunkilns, a local organic farm, where the 500 kilowatt wind turbine will be sited. Between £15,000 to £20,000 of the profits generated from the wind turbine will go into a trust to benefit the local community.

The Abundance investment mechanism is an official IOU, called a debenture, usually used by large companies to borrow money. Abundance is the first financial service to be using a debenture to enable small investors to fund renewable energy projects in the UK.
Investors can expect an average return on their debenture of between seven and eight per cent over the lifetime of the investment, according to Abundance executive director Bruce Davis, who said the real attraction of this type of investment was that investors got to see “where their return is coming from”. 

Disruptive model
The Forest of Dean wind turbine is the first of a number of renewable energy projects Abundance is looking to fund in 2012. The start-up is looking to bring scale to the renewable energy sector, as well as shake-up the financial services sector, according to Davis.

“We are a building society for the 21st century. Building societies stepped in when banks wouldn’t fund houses and we are doing the same for renewables,” he said.

The investment prospectus for the Resilient Energy Great Dunkilns wind farm is set to go live on April 16. There will be bonus for early bird investors and the investment round is open for three months.

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