As one Yorkshire community prepares to ready itself for the onslaught of fracking after controversial plans were given the go-ahead this week, another, under an hour’s drive away in Linton, is launching a £2.5 million bond to fund the county’s largest hydro power plant.
In contrast to Third Energy’s fracking plans, this bond seems a win-win-win-win for society, the planet, the fish stocks in the river Ouse, the local Linton community, the energy sector AND its investors.
Such a wealth of benefits can hardly be said of the fracking plans down the road.
The bond, being offered by Linton Hydro in partnership with Triodos Bank, will pay investors 7.5 per cent gross interest for 10 years. The £2.5 million to be raised will be used to finance the build of a 280kW hydro power scheme at Linton Lock on the river Ouse adjacent to an existing 100 kW hydro plant.
The Linton Lock scheme should be completed and generating electricity by the first quarter of 2017, after which the combined two projects are forecast to generate a combined 1.87 GWh of electricity – enough to power 450 homes equivalent.
Local kayaker Sam Ellis, a supporter of the scheme, says: “Paddling is my life and this project could seriously improve the sport in the UK. In the past, I’ve been an objector to hydro schemes. But the Linton project will create green energy while improving local paddling and fish migration at the same time: it’s a triple-win. Linton Hydro reflects my values and is exactly the type of thing that I would want to invest in.”
Dave Mann, Director of Linton Hydro adds: “This project generates a positive impact on a number of levels. It allows us to harness the power of the river Ouse to produce a significant amount of clean renewable electricity as well as building new modern fish passes and a canoe pass at Linton Lock in partnership with Canoe England.”
Environmental benefits
The Linton Lock scheme will bring additional environmental benefits to the river Ouse through the installation of a series of modern fish passes alongside the new turbine. Currently migratory fish species struggle to progress upstream to their historic spawning grounds due to difficulty in passing the lock. An existing dilapidated fish pass at the lock will be refurbished and three new modern fish passes installed as part of the scheme which will significantly improve the migration of salmon, sea trout, brown trout, lamprey and eels in the river.
Local benefits
The Linton Lock scheme is pre-accredited for the Government’s Feed-in-Tariff scheme for renewable energy and will also sell electricity to a local free-range chicken farm at a mutually beneficial price with any surplus being sold to the national grid. The existing 100kW operational project already has a power purchase agreement in place with LoC02 Energy, an independent sustainable energy provider.
Dan Hird, head of Triodos Bank Corporate Finance, says: “The Linton Lock hydro power scheme is a great example of a renewable energy project which will benefit both local businesses and the environment to achieve sustainability. We are delighted to make this investment opportunity available to individual investors who want to combine a financial return with positive local and environmental impact.”
Repayments
Linton Hydro will repay investors’ capital in eight equal annual instalments from the third year, with the first instalment payable on 30 June 2019 and the final instalment payable on 30 June 2026. The bond will pay interest of 7.5% gross per year on the capital outstanding. Payment of interest and repayment of capital is dependent of the successful construction and operation of the new scheme and the continued successful operation of the existing scheme.
The Linton Hydro shareholders have already invested £494,000 of capital into the schemes and this will remain in the company as equity until the secured bonds are repaid in full.
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As with all such schemes, an investment in Linton Hydro Ltd bonds is not covered by the Financial Services Compensation Scheme. Linton Hydro Ltd’s ability to pay the interest and repay the bonds is not guaranteed and is dependent on the success of its business model, in particular the successful construction of the new hydro scheme at Linton Lock and the continued successful operation of the existing 100kW hydro scheme. Linton Hydro Ltd bonds are unquoted securities with fixed repayment dates and although the bonds are transferable, investors should be aware that they may not be able to access their capital during the life of the bond.
For a copy of the offer document, please call Huw Thomas on 0117 980 9593 or email investments@triodos.co.uk
