Bristol Energy Co-operative is attempting to raise an ambitious £2.8 million to develop three separate community solar projects in the city ahead of government cuts to tax relief.
The co-op is looking to develop two separate ground-mount projects – a 4.2MW solar farm near Avonmouth and a 4.6MW project near Puriton in Somerset – as well as a 500kW portfolio of rooftop installations throughout the city.
Potential investors can submit between £50 and £100,000 for a share of the projects and the programme is offering investors projected returns of 5% on their investment.
But the share offer comes amidst uncertainty for community energy projects and their eligibility to receive tax relief through EIS, SEIS and SITR mechanisms, which are to be cut at the end of this month under amendments made to the government’s new finance bill controversially added between its second and third readings.
The co-up has received assurances from HMRC that the offer is eligible for EIS tax relief, meaning that UK income tax payers entering the scheme will receive 30% tax relief on their investment, effectively boosting returns to as much as 7.1%.
In its share offer document Peter Thompson, chairman at Bristol Energy Cooperative, said it was “imperative” that potential investors take advantage of such offers before the 30 November deadline, after which tax relief will be lost.
Jan-Willem Bode, managing director at Mongoose Energy, which is providing support for Bristol Co-op's projects, said that people would have to be “quick off the mark” to make the most of EIS tax relief on offer but offered reassurance over the projects' eligiblity for subsidy support.
“They won’t be impacted by the recent government proposals to reduce the feed-in tariff support scheme for renewables. This is because the projects have already been pre-accredited by Ofgem and their Feed-in Tariff rates are now locked in. Investing in these projects not only provides a good financial return but also leads to real community benefits,” Bode added.