Blake Lapthorn welcomed Philip Wolfe, Director of Westmill Solar Co-operative and Nicola McConville, Partner, Blake Lapthorn to its Oxford Green Breakfast on 7 November 2012.

1. Westmill Solar Co‐operative
The triumphs,
trials and tribulations
of community energy
Philip Wolfe
philip@wolfeware.com

2. Topics
Community energy
UK policy
Westmill Solar – how we did it
Utility‐scale solar generation
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3. COMMUNITY ENERGY
UK picture
Other countries

4. Energy system
UK (and e.g. France)
▫ Initially centralised (CEGB, national gas grid)
▫ Then deregulated (but still feels like a monopoly)
Others (e.g. Germany, USA)
▫ Local and municipal utilities play significant role
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5. UK POLICY
Energy policy
Renewables policy
Feed‐in Tariffs

6. Why there is policy support for renewables
EU Renewables Directive requires UK to produce 15% of its energy from
renewables. It was about 3% in 2010!
Feed‐in Tariffs and Renewable Heat Incentive are projected to generate
8% of the UK’s energy from renewables in our properties by 2020.
The balance will come from the Renewables Obligation for utility scale
renewable electricity.
Power Offshore 15%
Stations Oil/ Gas Renewables
closing Running out Target in 2020
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7. How the Feed‐in Tariffs work
Renewable Electricity Electricity
Generation used Grid
landowners_banner.gif
Comes from renewable Drawn from
energy whenever the grid if
available more is needed
Import
Total Generation Export
Paid for the renewable energy you generate
Paid more for the renewable electricity you export
Save money from your current energy bills
More about the FITs regulations? Skip
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8. FITs eligibility
The FITs cover installations up to 5MW
The tariff level depends on:
▫ So‐called ‘Total Installed Capacity’
▫ The capacity is per ‘site’
▫ Additions based on cumulative capacity
Installations must be accredited
▫ Systems under 50kWe – MCS
▫ Systems over 50kW – ‘ROO‐FIT’
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9. The FITs Export Tariff
For every kWh exported to the grid
▫ The beneficiary gets the generation tariff
▫ Plus a premium for export, as follows
A fixed floor price is set in the regulations:
▫ Originally 3p/kWh
▫ Increased to 4.5p/kWh from this autumn
But you can opt out and negotiate
▫ a better price from an electricity supplier
▫ Opt‐out decisions can be made each year
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10. Duration of tariffs
Tariffs are fixed for 20‐25 years
▫ Except micro‐CHP for 10 years
▫ PV is 25 years all others are 20
Tariffs are index‐linked to the RPI
▫ Both generation and fixed export tariffs
▫ New rates will be announced annually
For new installations tariffs change:
▫ Subject to degression
▫ Maybe at reviews (5‐yearly from 2013)
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11. Tax treatment
Householders don’t pay Income Tax on
▫ The generation nor the export tariffs
▫ ... provided that it is for
“households who use renewable technology
to generate electricity mainly for their own use”
Business has no special tax exemption
▫ but can offset costs against profit as usual
▫ No Enhanced Capital Allowances for PV (yet)
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12. How the tariffs were set
FITs to achieve an “average 5‐8%” return
▫ Would equate to roughly 12‐year ‘payback’
We find that typical systems:
▫ Recover their costs ~ twice over the period
▫ That is equivalent to a 12‐year payback
We find that the best systems:
▫ Recover their costs 2½ to 3 times
▫ Equivalent to less than 10‐year payback
▫ Can achieve return rates over 10%
Index‐link & tax break improves all this
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13. Where the money comes from
The scheme is set in law, but
The government doesn’t pay for the FITs
▫ They come from a levy on electricity bills
▫ Collected and paid out by suppliers
o Who have a ‘levelisation’ system to share the costs fairly
between them
▫ Part of their licence conditions
o Only small suppliers can opt out
o Others are called ‘FITs licensees’
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14. Who the money goes to
The beneficiary is the system owner
For the FITs:
▫ He can specify a ‘nominated recipient’
o to whom is tariff payments can be made
▫ He nominates (and can change)
o which FITS licensee will pay over the tariff
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15. Scheme administration
Scheme is administered by Ofgem, who
▫ Maintain the register of installations
▫ Oversee the FITs levelisation process
▫ Accredit FITs systems over 50kW
▫ Have issued guidelines on how it works
For more details:
www.FITariffs.co.uk
▫ And on the Renewable Heat Incentive:
www.RHIncentive.co.uk
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16. Feed‐In Tariffs to date
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17. Feed‐In Tariffs to date
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18. Feed‐In Tariffs to date
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19. WESTMILL SOLAR PARK
History
The Co‐op’s transactions
Structure

20. Westmill Solar Park history – Phase I
Feb 06 Westmill wind farm co‐operative launched
Mar 11 Planning consent for solar park
May 11 Lease & option agreement with developer
Jul 11 Solar Park commissioned
Aug 11 FITs tariffs slashed
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21. Westmill solar and wind farm
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22. Westmill Solar Park history – Phase 2
23 Jun 12 Co‐op public share offer launched to raise £4m
31 Jul 12 Public offer closes with £6m
10 Aug 12 Private placing launched
28 Aug 12 Private placing closes with £1.8m
31 Oct 12 Solar Park SPV acquired
31 Oct 12 Option ends
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23. ‘The deal’
Low Carbon Public offer
Group A‐shareholders
Private placing
Blue Energy Westmill Solar
B‐shareholders
Co‐operative
SPV
CC Pension Fund
Santander
BEWF Ltd Investec Bank
Lease PPA O&M DNO
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24. Our management plan
Public offer
A‐shareholders
Westmill Solar Private placing
Co‐operative B‐shareholders
Administration CC Pension Fund
Asset Manager
provider Investec Bank
Lease DNO O&M PPA
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25. UTILITY‐SCALE SOLAR POWER
The book
History
Current status

26. Shameless plug – my book
Solar photovoltaic projects
in the mainstream power market
Published 26th October 2012
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27. History of utility‐scale PV
1982 First MW station
1984 5MW plant
20 years nothing
2004 4MW community‐owned solar park at Hemau
2005 First plants under revised German FITs
2007 First plants in Spain. Global capacity > 100MW
2009 Global capacity > 1GW
2010 UK FITs introduced
2011 Global > 4.5GW more than offshore wind
Today Global capacity > 7GW
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28. Large‐scale solar power stations worldwide
Westmill Solar Co‐operative at Blake Lapthorn

29. Global solar plants 10MW+
Built Built Developing
Rank Country Schemes
Qty MW MW
1 Germany FITs 73 2,262 11
2 United States Obligations, Tax 46 1,045 14,724
3 Spain FITs 62 1,042 0
4 Italy FITs 14 434 14
5 China National 16 400 408
6 France FITs 9 353 82
7 Canada FITs 12 337 450
8 India National 14 301 573
9 Ukraine FITs 5 284 0
10 Czech Republic FITs 9 188 0
11 Bulgaria FITs 4 155 66
12 Thailand CDM 2 83 100
13 Republic of Korea National 4 73 0
14 Portugal FITs 2 57 0
15 Mexico National 1 38 75
16 Puerto Rico National 1 24 95
17 Peru Obligations (RA) 1 22 0
18 Belgium FITs 1 13 0
19 Japan National, FITs 1 13 134
20 Reunion International 1 11 0
21 Australia National 1 10 483
22 United Arab Emirates National 1 10 300
23 Greece FITs, international 1 10 250
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30. Large‐scale solar power stations UK

31. Westcott Solar Park
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32. Any questions?
Contacts:
About Westmill Solar:
www.westmillsolar.coop
About the Feed‐In Tariffs:
www.fitariffs.co.uk
About utility‐scale solar power:
www.wiki‐solar.org
@wikisolar
About the Renewable Heat Incentive:
www.rhincentive.co.uk
To contact me:
philip@wolfeware.com
@philip_wolfe
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