Swindon launches first-ever 'council solar bond' with investment platform

Swindon Borough Council has linked up with peer-to-peer investment platform Abundance to launch what is claimed to be the first ‘council solar bond’ in the UK.

Under the scheme, the local authority and the public will invest £4.8m to fund the building of the 5MW Swindon community solar farm.

The council will be the sole shareholder in the Swindon Common Farm Solar Community Interest Company. It will plough in £3m, while outside investors will provide the remaining £1.8m.

The minimum stake is £5 and investors will be paid a 6% return. A further 0.5% will be paid for the first five years to those investing within six weeks of the launch.

The initiative is part of Swindon’s plans to build sufficient renewable energy capacity (200MW) by 2020 to generate enough electricity to meet the needs of all homes in its area. A total of 140MW is already in construction on in planning, the council said.

Cllr Dale Heenan, Swindon’s Cabinet Member for Transport and Sustainability, said: "For years, companies have been trying to find ways to make investing more accessible and understandable. Swindon's Solar Bonds provide an opportunity for people invest as little as £5 or more than £5,000, and enjoy better returns than their bank provides as they invest for their children’s future, their own retirement or just a rainy day.

“Our approach is democratic finance in action, and the combination of personal benefit, environment issues and community involvement provides a topical way to catch imaginations, and help improve personal finance skills in a simple, easily understood way."

Abundance Investment has raised £15m for 16 different renewable energy projects in the past three years.

Bruce Davis, Managing Director of Abundance, said: “This first ever Council Solar Bond is exciting and important as it is further proof that ‘win win investment’ is not only possible, but can play a crucial role in providing the public with a better return, while creating innovative new ways for local community infrastructure to be improved without increasing costs to the taxpayer.

“This is great news for people struggling to live off their savings or wanting to invest for their future without stock market risks, and to councils across the UK trying to maintain and improve local services.”