New Pogbie wind farm focuses on alleviating local fuel poverty

The innovative deal structure for the new Pogbie wind farm brings together multiple stakeholders, including Mongoose Energy, the Renewable Energy Investment Fund (REIF) delivered by the Scottish Investment Bank, the investment arm of Scotland’s enterprise agencies, and Close Brothers Leasing. The focus and benefit of the project will be to support not-for-profit energy supplier, Our Power, in its fuel poverty alleviation aims. £13m of debt funding has been secured to allow the acquisition and development of the site.

Once finalised, Pogbie wind farm will contain 12 turbines with a total capacity of 9.6 megawatts. Nett surpluses from the project will go towards communities that are suffering fuel poverty via Our Power, and other local causes.

Pogbie wind farm, based in East Lothian, is a collaboration between Our Power and Mongoose Energy, a company which is majority-owned by community groups and was set up in 2014 to develop and manage community energy systems. The company will be responsible for building the turbines and associated infrastructure, with ownership transferring to a community benefit company, Our Community Energy, on completion in 2018.

Alister Steele, Chair of Our Power: “Our Power’s ambition includes securing a long-term supply of renewable energy. This innovative initiative will create the potential to not only secure local renewable energy in a cost effective way, which will help us deliver our social mission of tackling fuel poverty, but provides the potential for wider community investment in the assets. Directly linking renewable generation and not for profit ownership to addressing fuel poverty is a really exciting breakthrough.”

Mark Kenber, CEO, Mongoose Energy: “Mongoose Energy’s mission is to drive community ownership and control of renewable energy generation to create a fair and sustainable energy system. We are delighted to be developing Pogbie wind farm which will offer local stakeholders the opportunity to invest directly in the project, contribute to addressing fuel poverty and provide tangible benefits to the local community.”

Scotland’s Energy Minister Paul Wheelhouse said: “I am delighted that the Scottish Government has played an important part in making this pioneering project happen, by providing £3.5M of funding from our Renewable Energy Investment Fund towards the capital cost of the project. This project is pioneering in respect of being the first of its kind to be financed specifically to help not-for-profit energy supplier, Our Power, to tackle fuel poverty, but, in addition to doing so, Our Power has also committed to provide a community benefit package to the local community in East Lothian, in line with the Scottish Government’s Good Practice Principles. I congratulate Our Power, Mongoose Energy and Close Bothers Leasing for putting together such an exciting project and I wish the project team every success.”

Kerry Sharp, Director of the Scottish Investment Bank, said: “This innovative deal is a great example of how we can support initiatives that help deliver both commercial and societal benefits. Projects like Pogbie wind farm play an important part in helping grow Scotland’s renewable energy generation capability while addressing the issue of fuel poverty.”

Chris Rodgers, Head of Energy Finance, Close Brothers Leasing: “This is an exciting deal and one that we are very proud to be a part of. The significance of getting this deal agreed in a reduced subsidy environment should not be underestimated because it sends a strong message that these sorts of agreements are still possible, and – importantly - viable.”

Notes to Editors

Mongoose Energy

Mongoose Energy (www.mongoose.energy) works with community groups, project developers and investors to develop, finance and manage community-owned renewable energy installations. The organisation is majority-owned by the community energy groups it works with, and profits go back to the local communities that developments are located in.

Mongoose projects are funded through the crowdfunding platform Mongoose Crowd (www.mongoosecrowd.co.uk), where investors can see a range of investment opportunities for community-owned renewable energy developments across the UK.

Our Power

Our Power is a not-for-profit energy supplier, owned by social housing providers, community organisations and local authorities. Its aim is to make energy fairer for all members of society.

Our Power aims to reduce heat and fuel costs by passing benefits from the energy sector to our communities. It does this by not paying dividends to shareholders, by finding the most efficient ways to operate, by generating its own power and by reinvesting any profits to benefit customers and their communities.

Scottish Investment Bank

The Scottish Investment Bank (SIB) is the investment arm of Scotland’s main economic development agency, Scottish Enterprise, operating Scotland-wide in partnership with Highlands and Islands Enterprise. It manages a suite of co- investment funds including the Scottish Co-investment Fund and the Scottish Venture Fund, which are partly funded by the European Regional Development Fund (ERDF), and the Renewable Energy Investment Fund on behalf of the Scottish Government. SIB is also an investor in Epidarex Capital’s life sciences fund and is a participant in the Scottish European Growth Co-Investment Programme funded by the Scottish Growth Scheme alongside the European Investment Fund. SIB provides a team of Financial Readiness specialists to help companies prepare for new investment and access appropriate finance. SIB’s activities support Scotland’s SME funding market to ensure businesses with growth and export potential have adequate access to growth capital.

Renewable Energy Investment Fund

The Renewable Energy Investment Fund (REIF) was launched in October 2012 and is delivered by the Scottish Investment Bank, the investment arm of Scottish Enterprise – on behalf of the Scottish Government and its Enterprise Agencies.

Its aim is to promote the use of energy from specific renewable sources and drive further investment into key areas of Scotland’s renewables industry. With £103 million of funding available to provide commercially priced loans, equity investments and guarantees, REIF invests in projects that support the delivery of energy from a renewable source or represent an innovative renewable energy technology. Areas of anticipated demand for REIF include projects that will; accelerate the growth of the marine renewable energy sector in Scotland, increase community ownership of renewable energy projects in Scotland or support district heating networks that utilise renewable heat technologies. The underlying goal of REIF is to grow the renewables industry in Scotland and all projects will demonstrate potential economic benefits.

About Close Brothers Asset Finance and Leasing

Close Brothers Asset Finance and Leasing offers a range of flexible funding options, including hire purchase, leasing and refinancing and is a member of Close Brothers Group.

Close Brothers is a leading UK merchant banking group providing lending, deposit taking, wealth management services, and securities trading. We employ 2,900 people, principally in the UK. Close Brothers Group plc is listed on the London Stock Exchange and is a member of the FTSE 250.