Breezy does it: A market-leading 7.5%, 3-year, peer-to-peer wind loan

Breezy does it:  A market-leading 7.5%, 3-year, peer-to-peer wind loan
  • 7.5% annual fixed interest rate if you invest in the first six weeks (7% after February 28)
  • 3-year term, minimum £50 investment
  • £2.5 million total raise, minimum £1.25 million
  • Asset-backed. Loan is secured against 10 revenue-generating wind turbines
  • Follows success of £1.25 million raise in August 2014

 

Trillion Fund, the UK’s biggest social crowdfunding platform, has launched a peer-to-peer loan that will reward investors in wind energy with a special rate of 7.5 per cent, if they invest before the end of February.

Lenders can pledge as little as £50 towards the installation of up to 10 new wind turbines across the country, giving people the chance to profit from their own energy sources and helping the UK to meet its clean energy goals. The 10 new turbines will generate enough electricity to power more than 500 average homes every year.

An investor lending £1,000 before February 28 would receive twice yearly interest payments of £37.50, totalling £75.00 a year and generating total interest of £225 after three years, with capital repaid at the end of the term.

The loan will be secured against a maximum of 10 operational wind turbines located across the UK that are owned by E5 Energy, a venture set up by Endurance Wind Power, a leading manufacturer of small and mid-size wind turbines.

The turbines are operated and maintained by Earthmill, one of the UK’s biggest installers. The turbines generate revenue from fixed Feed-in Tariffs and the sale of electricity to the National Grid.

Trillion Fund, which is authorised and regulated by the Financial Conduct Authority and specialises in raising money for environmental and social projects, will crowdfund a maximum loan of £2.5 million, with a minimum threshold of £1.25 million.

The raise is the second wind energy peer-to-peer loan from Trillion Fund. The platform successfully raised £1.25 million for E2 Energy, a joint venture between Endurance and Earthmill, in August 2014. The loan was oversubscribed and closed six weeks early, attracting more than 250 investors.

Julia Groves, chief executive of Trillion Fund, said: “The first offer in the Summer was hugely popular. People were attracted by the rate of return, but also the chance to invest in something real and beneficial to society. The opportunity to invest directly in renewable energy with as little as £50 is unique – most funds require a lot more as a minimum investment.”

“Cutting out middleman fees through the peer-to-peer model enables us to offer better rates to the borrowers as well as the lenders, so everyone gets a better deal. Because the loan is secured against existing assets, some of the risk of lending is removed. The loan funds newly-installed turbines, so it also helps the UK meet its clean energy targets by generating more wind power.”

Based on a survey of 80 of the E2Energy investors, 65 per cent stated their objective was: “Mostly financial but also social returns”, 18 per cent were “mostly social but also financial”, 15 per cent were: “Purely financial” and only 2 per cent were purely motivated by social benefits. Of those surveyed, 87 per cent said they would consider investing again, and there is already a waiting list from those who missed the last offer. Wind was the most popular technology choice for investment at 87 per cent, with solar coming in a close second at 85 per cent. The vast majority of lenders were crowdfunding for the first time (71 per cent) and unusually 30 per cent of the investors were female.

This second offer is the next step in Endurance’s ambitious community energy strategy being rolled out in 2015, which focuses on broader engagement through the expansion of stakeholders across the community and continuing to offer decent returns, but also has a clear goal of offering lower cost as well as lower carbon energy to UK consumers.

Brett Pingree, Vice President, Commercial, of Endurance Wind Power, said: “Our aim with the first raise was to open up access to renewable energy for everyday savers and investors, which we achieved. Now, we’re offering even more everyday investors the chance to support the UK’s clean energy supply which chimes with Endurance’s on-going community focus.”

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About Author

Trillion Fund

Trillion Fund is a crowdfunding platform authorised and regulated by the Financial Conduct Authority, listing peer-­to-­peer loans, community share raises, bonds and funds for environmental and social projects. Trillion Fund merged with Buzzbnk in June 2014 to create the UK’s biggest social crowdfunding platform with more than 5,000 active crowdfunders, which has successfully funded 120 projects. Trillion Fund was named Funder of the year by Community Energy England and E2Energy, its previous peer-to-peer loan, won “Best New Entrant” in Investment Week’s 2014 Sustainable Investment Awards.