Type Crowd funding Headquarters UK | Founded 2009 Abundance NRG Ltd Products Financial Services | |
Key people Karl Harder (Director)
Louise Wilson (Director)
Bruce Davis (Director) | ||
Abundance Investment (formerly Abundance Generation) is a regulated online platform that lets people lend money to projects providing a social and/or environmental good from as little as £5 per person. To date investments have gone to renewable energy projects in the UK and investors from across Europe receive a share in the returns from generating low-carbon electricity. When investors buy a Debenture through Abundance, they are lending money to a project and in return they have the right to a percentage of the revenue or profit generated, mostly from the sale of the electricity produced by the project. Abundance Investment is open to all UK residents over 18, residents from the European Economic Area (EEA), Switzerland and not US citizens and is authorised and regulated by the Financial Conduct Authority. Currently, Abundance focuses on a range of renewable energy projects but is looking to offer other ethical and social beneficial investments in the future that contribute to a green economy.
Contents
Risks of investing in renewable energy
All investment carries risk, and Abundance, as a regulated crowdfunding platform, is required to clearly set out these risks for all potential investors. For renewable energy projects, something could go wrong and an investor may not get back all or any of their original investment. Abundance Debentures are usually long-term investments which investors should expect to hold for the full 20 years. Although Abundance facilitates a process for Debentures to be bought and sold before the end of their life, there is no guarantee that this can be done, or what the value will be. 2015 saw Abundance raise over £2m for its first short-term (one year) Debenture supporting the construction of a wind turbine, which it expects to re-finance with a long-term Debenture. Finally, rates of return are estimated and not guaranteed. Offer Documents set out risks related to specific projects and should be read thoroughly before an investment is made.
History and aims
Abundance is based in London, UK and launched to the public in April 2012. The company was set up in 2009 and went through a two year process to become the first community finance platform / crowdfunding platform to be authorised and regulated by the Financial Services Authority (now the Financial Conduct Authority).
Abundance aims to support projects that deliver benefits for society and the environment, including renewable energy, which give "people control over where their money is invested and how it generates a return. Renewable energy is the starting point, but we believe that democratic finance could be a more sustainable source of finance for other forms of public infrastructure investment such as schools, hospitals and social impact initiatives" (Karl Harder, Abundance Director). Allowing the local community to invest in projects can leverage greater support for the project and provide an opportunity to allow the community to have joint-ownership.
As of Januar 2016, Abundance has raised over £14 million from the public for 16 projects, including a 500 kW turbine in Gloucestershire, a residential solar project in the South Downs, biomass boilers on the Welsh border and free solar power for various schools across the UK.
Returns
Abundance is like a building society for low carbon technology, offering a lower-risk crowd funding opportunity. Investors put money towards specific renewable energy projects and receive a return based on the green electricity generated.
Abundance projects make use of different types of Debentures, some are fixed return and some are variable return Debentures for example. One of these, a 500 kW community wind turbine in South Gloucestershire, offered an estimated return across the 19 year life of the project of 8.0 - 9.1%. Another consists of up to 749 solar PV systems set up across Berwickshire, with a maximum capacity of 2,595 kW. This project offered estimated returns of 7.5% across the 20 year life of the project.
The website
Abundance operates through its online platform, with individuals able to deposit money online and then invest in specific projects according to their preferences.
For renewable energy projects the Abundance website lets investors view how much electricity their projects are generating, depending on how windy or sunny it is. Abundance Investment has recently launched the ability to hold Abundance Debentures in a Self-invested personal pension (SIPP), and Debentures can be held in an Innovative Finance ISA (IF ISA).