Warrington leads £60m solar energy investment
0Warrington Borough Council is leading a group of four councils in a £60m bond investment in Swindon Solar Park, one of the UK’s largest solar farms.
The council has structured the deal and is joined by Newham and Thurrock councils. A fourth local authority is anticipated to invest later in the year.
Returns on the bonds are expected to be 6% per annum over a five-year period. The councils have invested approximately equal sums.
Danny Mather, corporate finance manager at Warrington, said: “We have worked together with Newham and Thurrock Councils to develop a transparent investment process and one that captures the joint pooling of local government investment funds while keeping structuring and administrative costs to a minimum.”
The deal has been clinched with the aid of Rockfire Capital as investment advisers to the councils.
Mather added the investment in renewable solar energy provided an opportunity to diversify investments.
“With bail in regulations, quantitive easing, a fall in the base rate all reducing the number of counterparties available to local authorities, together with falls in returns, this alternative secured asset class provides an investment diversification together with good returns that can be invested in front line services.”
Warrington is in the process of structuring further investment products to be offered to local authorities in the future.
The Swindon solar farm is built on a former RAF facility owned by the Science Museum Group. The site covers 172 acres and has the capacity to generate 60.9 MW, enough energy each year to supply 15,400 homes and save 35 tonnes of carbon dioxide.
HSBC in the UK will take energy from site at a fixed price as part of a 15-year corporate power purchase agreement.
Photo (cropped): David Goehring, Flickr.
