Small investors in the UK will soon have the opportunity to back a renewable energy project for ‘as little as £5’, as a new service aiming to make green energy investment more accessible to the masses rolls out this week.
Authorised by the Financial Services Authority and backed by NESTA, Abundance Generation has been set up to provide a link between individuals working on renewable energy projects and the communities they serve. It is an ambitious project aiming to grow the UK’s renewable energy sector through a variety of activities; the first is a community wind turbine in the forest of dean, which is seeking to raise £1.3 million from investors.
The 500kw wind turbine is being built by Andrew and Sue Clarke, a local couple who have invested their pensions in the project. The project is open to investment from anyone over 18 who has a UK bank account with at least £5 to invest. The project will last for 20 years, investors will receive a regular cash return for their investment and receive their original stake back once the time runs out.
Abundance Generation’s investment method is known as a debenture. These are more often used by large companies looking to borrow money. Abundance is the first financial service to use a debenture to create an opportunity for small investors to fund energy projects.
Investors should receive an average return of 7-8 per cent over the lifetime of their investment, according to the project’s executive director Bruce Davis, who says: “the real attraction of this type of investment is that investors get to see exactly where their return is coming from.”
As well as the Forest of Dean wind turbine, Abundance is looking to fund a wide range of renewable energy projects in 2012, ultimately looking to upscale the renewable energy sector and ‘shake up’ the financial services industry.
“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.” Said Davis..