In the second part of our look at the various options for financing your own project, we look at Private Equity Funding and Venture Capital.
Private Equity Finance
- Funding by an individual or group of individuals seeking a secure return on their investment
- Can provide 100% of project cost.
- Will probably require security from turbine owner in addition to charge on the turbine
- Normally lend over 5 year term at rates around 12%.
- May also require an equity share in the project in region of 20%.
- Can be a very speedy approval process if project seen as attractive to the Private Equity Funder.
- Can finance up to 100%
- Will be looking for a large equity share in the project(up to 60% depending on financial input of project owner and projected productivity of the project)
- Can retain involvement and ownership for 20 year life of the product
- No security needed from project owner as risk/security provided by their shareholding in the project
- Can suit those who cannot achieve funding from any other source
Finance however, does not come easy and the likelihood of borrowing 90% or 100% of the project’s cost and having full ownership is unrealistic. It is also essential that any issues such as turbine noise conditions, way-leaves or rights of way have been dealt with. Ideally, if you wish to source finance you should have a good planning permission, an independent site report (we can provide), a financial projection model, your own access and a viable grid offer.
If you are seeking finance, contact the GreenYard and see how you can advance your project and increase your farm income. The GreenYard also provides technical knowledge on turbine models and which turbine options are most suited for sites and for generating maximum returns.