1. Community Share Offers
Ways Forward conference
17 January 2014
Jeremy Thorp
jeremy@sharenergy.coop
www.sharenergy.coop
2. Renewable energy co-ops, local ownership and
control
e.g.
• Leominster Community Solar, £150k shares,
93 members
• Neen Sollars Community Hydro, £150k in shares,
77 members
• Woolhope Woodheat, £320k in shares,
168 Members
• Many other examples
3. What are renewable energy co-ops for?
(different order of importance for different people)
• green electricity / carbon emissions?
• To put power generation in the hands of the
public?
• To generate income for another purpose
(community benefit or otherwise)?
• To create an ethical investment opportunity?
4. Features of renewable energy coops
Leominster Community Solar
• Structure of electricity market makes it
difficult for members to “trade”
• How to share profit?
• What is a “fair rate of interest” ?
5. Factors to consider
• How to factor in risk?
• The need to publish a target interest rate before
launch of share offer – difficult to adjust later
• How to engage with enthusiasts and pale
greens?
• target interest rate likely to be exceeded =
better returns. Is this OK?
6. More factors
• Different technologies regarded as different level of
risk
• If the community fund benefits a popular cause, it will
help to compensate for a low interest rate
• Tax relief – this can boost effective rates of return
• Not enough examples to establish what return is
just sufficient to raise the amount required –
too many variables
Notas do Editor
Sharenergy helps to set up co-ops as a way of raising capital to install renewable energy generation that is locally owned and controlled and where the benefit is kept in the local community.
To generate green electricity/energy and reduce carbon emissions?To put power generation in the hands of the public?To generate income for another purpose (community benefit or otherwise)?To create an ethical investment opportunity?
All renewable energy schemes have some risk, how do you factor this in?The co-op needs to publish a target interest rate before launch of share offer – difficult to adjust if you find the share offer is failing to reach your targetIf a scheme is small, you can probably find “enthusiasts” that will put in money whatever the return. For a big scheme, you will need to appeal to “pale greens” that will only invest if it is attractive enough. Is the co-op justified in trying to reach pale greens?conservatism in forecasting (small c) means that the target interest rate likely to be exceeded = better returns. Is this OK?
Different technologies regarded as different level of risk – PV seen as low risk, woodchip heating as high riskIf the community fund will benefit a popular cause, it will help to compensate for a low interest rateTax relief – this can boost effective rates of returnThere have not been enough examples to establish what return is just sufficient to raise the amount required – too many variables