To mark this year’s Community Energy Fortnight (23rd June – 8th July) Social and Sustainable Capital (SASC) is highlighting its recent investment in Gawcott Fields Community Solar Project CIC in Buckinghamshire, which has helped to finance a solar farm, that will generate energy from local renewable sources and provide financial surplus to help the local community in fuel poverty.
Using social investment to bridge the finance gap for community energy projects has proven to be an invaluable option since the government removed tax incentivesii for local energy projects in 2015.
Buckingham and the surrounding areas spend almost £20m each year on energy, almost all of which leaves the local economy.
The Gawcott Fields Community Solar Project CIC is set to change this. It owns a 4.17MW solar array, which is expected to generate over 4 million kWH of renewable energy each year and generate surplus income to benefit the community.
To help fund the construction costs of the Gawcott Solar farm, SASC created an innovative blended funding package. SASC provided £575,000 of junior debt alongside a £3m commercial loan from Santander, which was the first time Santander has invested in a community owned energy project. SASC also helped the charity obtain grants from its partner, Power to Change, which will be used to support and supplement the community benefit of the project and has funded a portion of a £400,000 community bond raise.
Tom Cosgrove, Director at Gawcott Fields Community Solar Project said,
“Social investment offered us a way to fund the solar farm, which will be a tremendous asset to the local community. Raising millions of pounds to fund commercial scale energy projects can appear a daunting task for local communities who often don’t have a lot of experience in the sector. Having innovative, easy to work with funders like SASC, offering products that are tailored to suit each project and achieve the maximum social impact is crucial in realising local energy success stories like Gawcott Fields.
“SASC was instrumental in our obtaining the grant from Power to Change. The grant has enabled us to start funding our community benefit and fuel poverty programmes straight away, achieving a good outcome for the community from day one. We encourage other communities committed to generating their own energy to consider social investment as a way of making it happen.”
The solar farm will power over 1,000 homes a year with green energy and will reduce CO2 emissions by 50,000 tonnes over the life of the project.
Over its thirty-year life, the project is expected to generate around £2m of surplus income for the community. For the first three years, half the surplus will be used to fund a program in the local area that helps people who are struggling with their energy bills.
For example, this winter Gawcott funded a local energy and fuel poverty service managed by The National Energy Foundation and Citizens Advice Aylesbury Vale. The other half will go to a fund that provides grants to local community organisations. One example is a sports fund to which Gawcott donated £10,000 and has achieved match funding of £5,000 from a local benefactor, for which local enterprises can apply to fund sports related projects. The sports fund is currently open for applications on the Heart of Bucks website.
Ben Rick, Co-Founder and Managing Director of SASC said, “Community energy continues to be an area where we see growing demand for social investment. Organisations often can’t access all the funding they need from mainstream investors and social investment provides a way for them to progress their projects and achieve their mission.
“Each project we invest in has developed its own way of supporting and engaging its local community, and the future impact on the environment and disadvantaged people in the local area will be significant.”
As part of the Community Energy Fortnightiii (organised by the Community Energy Coalition (CEC)) SASC will be speaking at the Community Energy Conference at Manchester University on 23rd June, with a session, ‘Everything you wanted to know about finance but were afraid to ask’ in partnership with Ethex and Thrive Renewables. Register to attend here.