The Scottish solar farm owned by Empower Community Foundation. Image: Triodos Bank UK

Triodos Bank UK is launching a £4.7 million community renewable energy bond offer through its crowdfunding platform for Empower Community Foundation, which owns two solar farms.

The two 5MW solar farms owned by Empower Community Foundation are located near Salibsury in England and Arbroath in Scotland. Both were completed in 2016.

The two farms were originally brought into community ownership using bridging loans to fund the transaction, with the majority of this having been refinanced using a secured long-term loan from Triodos Bank UK.

The crowdfunding bond will repay the remainder of the loan and secure long-term funding for the remaining life of the solar farms.

The refinancing is to be at a lower cost than the existing short-term lending, Triodos said, with this to increase the amount of money available for community projects. Community payments are forecast to be around £1.3 million over the 16-year term of the bond.

There is a £50 minimum investment, with the bond eligible to be held in a Triodos Innovative Finance ISA. The bond pays 4.25% gross interest annually, with the interest rate to rise with inflation each year.

Alex Grayson, trustee of Empower Community Foundation, said: “Building resilience in local communities is what we are set up to do. We want communities to benefit from an acceleration of the transition to a decentralised energy economy.

“This bond will ensure that these two community solar projects have funding in place for their remaining life, meaning that each solar park will generate more income for the local community to meet local needs.”

In 2020, Triodos Bank UK launched an £850,000 renewable energy bond offer on its crowdfunding platform to finance the operational 5MW Ferry Farm solar site, which was brought into full community ownership the same year by Ferry Farm Community Benefit Society.

Meanwhile, last year Triodos Bank UK provided a loan to the UK’s largest community-owned solar farm, the 19.2MW Ray Valley Solar Park, helping it to be fully-financed.