Robert Owen nominated for Citi Micro-entrepreneurship Award.
Since 2013, the Community Development Finance Association – now known as Responsible Finance – has been partnering up with the Citi Foundation to deliver the Citi Microentrepreneurship Awards in the UK. The Citi Foundation is a charitable arm of the Citigroup global banking group, which seeks to promote economic progress and access to affordable financial around the world. The awards, which now take place in 30 countries worldwide, look to celebrate the innovative and valuable work of responsible finance providers in supporting financial inclusion and economic growth.
Robert Owen Community Banking is on the shortlist for the Responsible Finance Provider – Social and Community Impact award. The award ‘seeks to recognise the success of an outstanding responsible finance provider which has made a significant social or community impact’.
The element of our work that is being recognised is the Community Energy Fund, which we set up in conjunction with Community Energy Wales to cover an identified need for development finance for communities working on renewable energy schemes. The Fund, which opened in April 2014 and is capitalised by a Big Lottery – People and Places grant, uses an innovative mezzanine finance model to purchase consultancy work and fund the various permissions required by community energy groups to create viable projects. By charging a fee on each successful loan, we spread the risk across a pool of schemes, effectively absorbing the loss where a community proves unable to get their project off the ground.
To help access the risk on each loan, we have put together a panel of renewable energy experts from across Wales, who also offer technical advice and mentoring to the community groups we support.
Whilst the economic advantages of community owned renewable energy are well proven, there is a lack of confidence in communities about taking up loan finance. There is also insufficient understanding of the discipline that due diligence places upon community groups seeking to raise the large amounts of money required to install renewable energy projects, whether this be via loans or through community share offers. The Community Energy Fund has worked hard to help groups overcome these challenges, and Robert Owen is now also developing relationships with larger commercial lenders, to address the need for greater confidence in their dealings with the community energy sector.
The response to the Fund has been impressive, with 45 community groups having received advice, support or finance from us. Ten community groups currently have loans agreed totalling £500,000. Two hydro schemes have now been built, and two wind turbine schemes have equipment on order and construction finance secured. This represents a big step forward for community energy in Wales.
The socio-economic impact of these schemes will be significant. The large amount of income they will generate will be used to tackle local fuel poverty, increase energy efficiency and reduce carbon emissions. Some of the schemes we are working with are located in the most deprived areas of Wales, such as Treharris – a former coal mining town that now has its own clean hydro scheme!
The award ceremony takes place in Manchester on March the 8th, 2016. Fingers crossed. We will let you know the result.