Abundance Generation is offering a secured construction bond to bring about commercial scale electricity generation using the hot rocks beneath Cornwall.
- Crowdfunding renewable energy moves up a gear with new offer from United Downs Geothermal and Abundance.
- Since being launched on Saturday the bond has already raised over £1 million.
- Abundance has already raised c£8 million in last two months to support Tidal Energy (Atlantis Resources) and energy efficiency (Green Deal Financial Services) through debenture offers.
Abundance Investment Ltd, the UK’s leading ethical peer-to-peer finance platform, has just launched an opportunity to invest directly in the construction of the first commercial geothermal electricity power station in the UK. Since being launched on Saturday the bond has already raised over £1 million.
This follows its very successful offers to invest in Tidal Energy through Atlantis Resources, which attracted a record-breaking £1 million in its first 24 hours, and the relaunch of the Green Deal, and establishes Abundance firmly at the frontier of peer-to-peer renewable energy investment.
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Bruce Davis, co-founder and Managing Director, Abundance, said: “Our customers have demonstrated a strong appetite for investing in the next wave of renewable technologies which offer a win for the planet and a win for their financial aspirations too, so we are very pleased to offer this chance to help build the UK’s first geothermal power station in Cornwall. While onshore wind and solar will always be important as established renewable energy generators, the sector is moving beyond that now to the next generation of technologies like geothermal and tidal, with Abundance investors backing them through their ISAs.”
A 2012 study by Sinclair Knight Merz ‘Geothermal potential in Great Britain and Northern Ireland’ estimated that geothermal energy – which captures the heat held in rocks far beneath the earth’s surface – has the potential to meet up to 20% of UK electricity needs, with zero carbon emissions and providing a constant supply.
The United Downs Geothermal bond will pay 12% AER and has an 18-month term. Interest will be paid in full at the end of the term, and it is eligible to be held in an Abundance Innovative Finance ISA so returns are tax-free. It seeks to raise up to £5 million to assist with the construction of the UK’s first commercial geothermal plant near Redruth in Cornwall. The project has recently been awarded a £10.6 million grant from the European Regional Development Fund and £2.4 million of public funding from Cornwall County Council.
Bruce Davis added: “Geothermal technology is proven to work in Italy and Iceland but hasn’t so far been used in the UK to generate electricity. This is a ground breaking project, which is backed by EU grants and the Local Authority, and offers a chance for ordinary people to take a stake in something with the potential to deliver significant carbon reductions in the future.”
The first stage is drilling of a well down to 2.5 km followed by a second deeper well of 4.5 km to create a geothermal circuit to power the electricity generation plant built on the surface. The geothermal plant will have a target capacity of 3 MW of constant power, enough to supply 5,500 typical homes each year, from two deep wells with an average diameter of approximately 20 cm, and with a generation plant the size of an average house.
Ryan Law, Managing Director of Geothermal Engineering, said: “The geothermal resource beneath our feet is extensive, and, if properly managed, inexhaustible. The granite rocks of Cornwall have the highest heat flow in the UK and are the best place for the development of geothermal power. The United Downs project is at the cutting edge of geothermal technology and we want to give the local community the chance to be involved in this project. This is why we are launching an offer of debentures through Abundance to allow people to invest directly, from a minimum of just £5.”
Abundance is now in its fifth year of operation, and most of its previous peer-to-peer investments have focused on wind, solar and biomass. However it’s 2017 projects mark a gear change for the company; with successful investment offers for energy efficiency through the newly relaunched Green Deal, tidal power through listed-company Atlantis Resources, and this latest offer for geothermal through United Downs Geothermal.
Key Facts
- Capital and interest paid at maturity on 31 March 2019
- 18 month term length
- £3,800,000 minimum investment target
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As with any investment product there are risks. Part or all of your original invested capital may be at risk and any return on your investment depends on the success of the project invested in.
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