Social and Sustainable Capital (SASC), a UK fund manager and social enterprise has invested £1.4 million in Resilient Energy Alvington Court Renewables (REACR), a Community Benefit Society (CBS) operating a 500kW wind turbine in the Forest of Dean.
SASC’s Community Investment Fund provided a term loan of £1 million and a bridge loan of £440,000 to REACR to fund the acquisition of Resilient Energy Great Dunkilns (REGD) and convert the organisation into a wholly owned subsidiary of the CBS.
REACR is set up to deliver community resilience through community-owned renewable energy that maximises local community social, environmental and economic benefits. The project aims to donate approximately £1 million to the community over 25 years: via a direct share of the society’s turnover providing grants for projects put forward by the community; and, from the society’s surplus (predicted from year 5/6 of turbine operation) which will support wider community initiatives, particularly those focused on tackling fuel poverty.
REACR is one of the projects founded and managed by The Resilience Centre (TRC), a social purpose business that is focused on building resilience in society in response to climate change and resource limits. TRC also manages Resilient Energy Mounteneys Renewables (REMR) – one of SASC’s existing investees.
REACR’s Alvington turbine is generating clean, green electricity to help meet local demand. A 4% share of turnover is directed to the Alvington Turbine Community Resilience Fund, which provides grants to help address current needs and future challenges in the community of Alvington, Aylburton and environs.
REGD developed a 500kW wind turbine near St Briavels, Forest of Dean, in late 2012. The project was the UK’s first crowd-funded wind turbine, which gave ordinary people the opportunity to invest in the project via debentures issued through the Abundance platform. In order to achieve this, however, the project was required to become a public limited company (plc); this resulted in additional administrative costs for the project.
The St Briavels turbine similarly benefits its host community via The St Briavels Turbine Community Resilience Fund. REGD was TRC’s first community renewable energy project and was the impetus for TRC’s replicable UK and European award winning ‘Resilient Energy’ community model.
The REGD shareholders realised that restructuring as a CBS would be more appropriate, and a combination with nearby society REACR would be the optimal way to achieve this.
Ben Rick, Managing Director of SASC said, “We’re delighted to invest in another community energy project that will benefit individuals and families in fuel poverty. Community energy projects are on the increase in the UK as communities look to provider greener energy solutions and surpluses for the benefit of their local area.
“Since legislation defining Community Benefit Societies changed in 2014, the way projects are funded has become more flexible and more community energy projects are being funded by social investment. We expect this will continue to grow as more community groups recognise that social investment can provide the much-needed finance to get them started.”
Sue Clarke, Director of REACR (and TRC), said, “It makes sense to bring REGD into an established community benefit society structure with similar aims and the REACR board were delighted to secure SASC support for the society to enable the acquisition.
“Combining the two projects, with the help of the SASC loan to buy back the debentures, results in a number of cost efficiencies and will generate a significant increase in the society’s surplus over the life of the two projects, increasing the community benefits achievable.
“The acquisition of REGD also provides a new opportunity for existing REACR members, previous REGD debenture holders and new community investors to actively participate in the combined project portfolio via a new REACR share offer,” adds Sue Clarke.
For more information on REACR visit www.resilientenergy.co.uk/REACR
For more information on TRC and its Resilient Energy community model, visit www.theresiliencecentre.co.uk
For more information on SASC visit www.socialandsustainable.com/.