This document provides an overview of a 20 or 25 year renewable energy investment opportunity involving established solar projects across the UK. The investment offers predictable annual returns of 7-9% paid quarterly through guaranteed payments from major energy suppliers. A total projected return of over 200% is estimated over the full investment period. Some risks associated with the investment relate to changes in tax treatment, natural disasters affecting output, and variability in returns depending on actual solar energy production.
5. Alternative Markets
INVESTMENT OVERVIEW
INVESTMENT OVERVIEW
20 OR 25 YEAR RENEWABLE ENERGY INVESTMENT
Solar projects are flourishing across the UK. Driven by Government backed Feed in Tariff
schemes, and the global drive for clean, renewable energy sources.
Alternative Markets offer established fully managed Solar Initiatives with predictable 7 - 9%* p.a
returns paid quarterly direct from a major UK energy supplier. Index linked for up to 25 years, a
projected total return of over 200%.
Alternative Markets offer a flexible way to make a large or small, low risk investment in
renewable energy, as a one-off product or as part of a balanced portfolio.
INVESTMENT HIGHLIGHTS
Original investment sum returned plus a potential 100% capital uplift.
20 or 25 year index linked investment, predictable 7 - 9%* p.a returns.
Guaranteed quarterly payments direct from Good Energy/ E.on.
Government backed guaranteed Feed in Tariff’s (FiT).
Invest with confidence - Clear, predictable schedule of returns.
Good Energy, the UK’s only 100% green energy supplier.
100% of Feed in Tariff income paid.
No restriction on investment size.
No physical installation required.
SIPP/SASS or cash investment.
All installations are UK based, insured and fully maintained for the 20/25 year term.
Ethical Investment – Diversify your portfolio with renewable energy.
2
6. CURRENT MARKET
EXPERIENCE WITHIN
THE UNITED KINGDOM
INDICATES THAT
ACTUAL SOLAR
PRODUCTION
GENERALLY EXCEEDS
SOFTWARE
PREDICTED OUTPUTS
BY AROUND 15%
7. Alternative Markets
INVESTMENT PORTFOLIO
TYPICAL INVESTMENT ILLUSTRATION
“Mr John. B” had paid into a private pension with a well known UK pension provider for
almost 20 years. Upon examination of his retirement fund he realised that things were not as
expected and his fund was losing value every year. John took some advice and opened a
SIPP (self invested personal pension) with significant tax advantages and took control of his
retirement planning.
Via his SIPP, John acquired a portfolio of producing solar leases. The transaction was quick
and simple and within weeks John’s SIPP received its first payment under the Government
backed Feed in Tariff.
Purchase cost of 4 systems £ 46,451
Locations – Kent, Devon, Northants and Hampshire
Projected gross Income over 25 years £116,867 (251.59%)
Projected net income over 25 years £70,416 (151.59%)
Alternative Markets Investment Illustration
System 124 System 172 System 231 System 247
LOCATION ESSEX DEVON NORTHANTS HAMPSHIRE
System Capacity 3.31 3.9 3.9 3.51
Annual predicted yield 1253 kw 1248 kw 1228 kw 1224 kw
FIT rate 16.8 16.8 16.8 16.8
Cost £10,643 £12,494 £12,287 £11,027
Projected Gross Earnings £26,777 £31,434 £30,913 £27,743
3
9. Alternative Markets
INVESTMENT PORTFOLIO
STRUCTURE OF INVESTMENT
The portfolio was created to provide a Income varies depending on the system
platform for a long term, reliable renewable output and the FiT rate in force at the time that
energy investment, available as an addition the system was installed.
to SIPP/SASS pension scheme or as a
standalone investment. Each solar installation varies in output,
dependent on a number of factors. Alternative
Each individual solar installation is installed Markets audits each system and use predictive
and fully operational, having passed software, which uses empiric meteorological
stringent due diligence and quality control data to accurately predict the annual output
before being added to the Alternative Markets for each installation. Each installation in the
portfolio. Already recorded on the OFGEM portfolio comes with an individual report and
central FiT register and contracted to one of a prediction of potential income.
six national energy suppliers under the
Government Feed in Tariff (FiT) scheme. Systems are highly efficient and have
guaranteed performance over a 20 or 25
Alternative Markets and their operating partners year lifespan. Insured and with full
have long experience in the development of maintenance included, systems are
high quality solar installations. Alternative monitored and optimised for peak
Markets is a growing portfolio of selected performance.
prime SPVs (Special Purpose Vehicles)
consisting of over 2000 domestic and Each installation is fitted with a generation
commercial solar PV installations. meter, which is enabled, using GPRS
You may lease one or more complete solar technology to transmit data to a central
pv installations from the Alternative Markets collection point. This data indicates how
portfolio. The term of each lease runs much electricity each system generates per
concurrent with the Feed in Tariff contract, day. These figures are compared with
generally 20 or 25 years. You receive 100% regional generation meters to ensure
of the income earned during this period. expected performance and to flag up any
service issues.
ROCs (Renewable Obligation certificates)
and FiTs (Feed-in Tariffs) generate quarterly The UK Feed-in Tariff scheme directs that
payments made directly from national payment is made by national energy
energy companies, in proportion to the suppliers for each kilowatt hour (kWh)
amount of electricity generated by each generated by renewable energy. Payments
individual solar installation. are index linked and made quarterly for the
term of the investment/ lease.
4
10. THE 2008 ENERGY ACT
PAVED THE WAY FOR A
BOOM IN GREEN
INVESTMENTS
11. Alternative Markets
MARKET TREND FOR SOLAR
MARKET TREND
Feed-In Tariffs were first introduced in Although the UK government initially
Germany in the 1990s. They proved very resisted the introduction of feed in tariffs,
successful and have made Germany a the creation of the new Department of
global leader in renewable energy Energy and Climate Change (DECC) in
production. Tariffs are now widely used 2008 and the changes to UK law in the
across Europe and since 2010 in the UK. 2008 Energy Act paved the way for a boom
in domestic renewable energy production.
OFGEM FEED IN TARIFF TABLE
UK progress against 2009 EU Renewable Energy Directive
4.0%
3.5%
3.0%
P erc entage
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
2004 2005 2006 2007 2008 2009 2010 2011
5
12. IN 2011, GERMANY,
THE UNITED STATES,
ITALY AND THE U.K.
ALL INSTALLED A
RECORD NUMBER OF
SOLAR PANELS IN
THEIR RESPECTIVE
COUNTRIES
13. Alternative Markets
MARKET TREND
Renewable energy is energy that comes The sun is largest energy source on the planet,
from natural resources including solar, wind, and it is green and free. Solar is renewable
geothermal heat and biofuels. In 2009 the energy that does not pollute the air and water
EU Renewable Energy Directive was or add toxic wastes to the environment. Solar
agreed, setting a target of 20% of all EU reduces our dependence upon other sources of
energy to come from renewable sources. energy that pollute the environment and consume
Under this directive the UK must produce vast quantities of diminishing resources.
15% of its total energy consumption from
renewable sources by 2020. Solar power has proven to be a reliable,
predictable source of energy and income.
This Directive and an increasing global China is poised to double its solar capacity
focus on the reduction of carbon emissions for the second year in a row and solar is
has succeeded in motivating governments also quickly becoming a viable solution for
across the world, to introduce incentives to .
the 1.3 billion people around the world with
help promote the increase in the adoption of no access to grid energy.
renewable energy.
Even though government subsidies are set
Carbon is released when coal is burned to to wind down over the next few years in
generate electricity. These carbon Europe and the United States for solar, big
emissions harm the environment producing investors are already picking up the slack.
greenhouse gases and air pollution. Solar Berkshire Hathaway owned MidAmerican
provides a sustainable means of generating Energy Holdings announced in December it
electricity, reducing your carbon footprint purchased a solar farm in Southern
and helping create a cleaner, less polluted California for $2 billion. Google reported it
environment. invested over $450 million last year in solar
projects. GE announced in 2011 that it’s
going to build the largest solar plant in
America, capable. of powering 80,000
homes each year.
6
14. 20 OR 25 YEAR
RENEWABLE
ENERGY INVESTMENT
OPPORTUNITY
15. Alternative Markets
PARTNERS
PARTNERS
SOVENTIX
www.soventix.com
Soventix GmbH was founded in April 2010 In June 2011, Sovello Projects was
as Sovello Projects GmbH and grew rapidly renamed Soventix, backed by the
as a large scale solar installer in Germany international financial investor Vorndran
and market leader in its domestic market. Mannheims Capital Advisors GmbH, (former
Today Soventix designs, builds and VENTIZZ Capital Partners Adisory AG) which
operates high quality solar power systems has had previous successes in the
all over the world and has offices in photovoltaic industry with companies Ersol,
Germany, Australia, South Africa, Canada PV Crystalox and 1366 Technologies.
and the USA.
EON
www.eonenergy.com
E.on is one of the UK’s leading power and gas from E.on at home and at work –
gas companies – generating electricity, and making them one of the top energy
retailing power and gas – and is part of the companies in the UK and as part of the
E.on group, one of the world's largest E.on group, also one of the top energy
investor-owned power and gas companies. companies in the world.
Five million people get their electricity and
7
16. Alternative Markets
PARTNERS
GOOD ENERGY
www.goodenergy.co.uk
Good Energy were the first energy supplier
to offer 100% renewable electricity to UK
households when they were founded in 1999.
Producing electricity purely from wind,
water, sun and sustainable bio generation, Good Energy's
Good Energy is making fundamental projected 2012/13
fuel mix
changes to the way energy is generated
and used in the UK. Wind: 57%
Hydro: 7%
Good Energy has always believed the UK Solar: 30%
can be powered purely from renewable Biogen: 6%
energy. From sunshine, wind, water and
sustainable biogen, it produces 100% clean
energy.
40,000 UK Solar Installations
Producing 30% of its green electricity from a growing community of over 40,000 independent
suppliers across Britain. Green energy pioneered incentives for renewable generators
almost a decade ago and have been offering an expert Feed-in Tariff service through award-
winning schemes ever since.
Certified Green Investment Partner
Good Energy is fully verified by the Green Energy Supply
Certification Scheme, the industry's equivalent to Organic
Certification.
8
17. Alternative Markets
PARTNERS
Paul O'Brien Solar Installations Progen Solar Ltd
www.pobsolar.co.uk www.progen.co.uk
Paul O’Brien Solar Installations are a ProGen is committed to providing only the
leading installer of both commercial and most environmentally safe and ethically
domestic solar systems. With offices in sound products, protecting the environment
Bristol, Newport and Belfast and 1000’s of for future generations. With ProGen Solar
satisfied customers, they have built their we offer an extensive choice of solar
reputation on the professional, friendly, high systems designed and manufactured to the
quality service they provide. highest standards. ProGen conducts home
energy surveys making it easy for you to
access the government energy grant
funding and the F.I.T (feed in tariff). We will
even supply an Energy Performance
Certificate. Each one of our installations is
backed by an Independent Warranty so you
can rest assured that our promises are kept
and our guarantees upheld.
Property Solicitors
www.arcpropertysolicitors.com
Arc Property Solicitors specialise in clients around the country and last year
residential and commercial conveyancing. alone we handled in excess of £400m in
We are property specialists and offer property transactions.
nationwide conveyancing both online and
offline. Unlike many other conveyancing We are committed to providing a modern,
companies we employ fully qualified efficient conveyancing service from our
solicitors - as well as conveyancers - to head office in Harrogate, North Yorkshire.
ensure we are able to provide a fast and We've streamlined our procedures to speed
thorough conveyancing service. As we're a up the conveyancing process. Much of the
registered solicitors practice, we are work is carried out online and we also
regulated by the Solicitors Regulation operate a paperless office policy, so your
Authority. We have acted for thousands of files are only ever a couple of clicks away.
9
18. 20 OR 25 YEAR
RENEWABLE
ENERGY INVESTMENT
OPPORTUNITY
19. Alternative Markets
RISK ASSESSMENT
RISK ASSESSMENT
GENERAL RISK WARNING law, HMRC practice or in the tax treatment
Potential investors should carefully consider of the investment or any of the Investors.
the following risk factors in relation to the
investment, which individually or in OPERATIONAL RISK
aggregate could have a material effect on In the event of unforeseen circumstances or
the investment return, and should consult any natural disasters, out of control of any
their financial advisor before investing. one person or entity the returns payable
may fall. Under these circumstances, there
REVIEW AND EVALUATE is no assurance given the investment will
Prospective Investors are not to construe achieve the target of return. The income is
the contents of this document as tax or legal ultimately determined by the amount of
advice. Prospective Investors should power which is produced through each
carefully review and evaluate the risks, and individual solar installation and the amount
other information contained in this of power produced, depends on the amount
document before making the decision to of sunshine received at the site. An average
invest in the SPV. If in any doubt, meteorological calculation, (Pvsol) has been
prospective Investors should immediately used in order to determine a conservative
seek their own personal advice from their amount of sunshine.
independent professional advisor, who
specialises in advising on the acquisition of NO FORECASTS
shares and other securities, or other Historical facts, information and trends
advisors such as legal advisors and gained from historic experiences, present
accountants. facts, circumstances and information, and
assumptions from all, or any of these do not
SUITABILITY OF INVESTORS guide the future. Aims, targets, plans,
An investment of this nature is only suitable intentions and projections referred to are no
for investors who are capable of evaluating more than that, and so do not imply a
the merits and risk of such an investment. forecast. Past performance is not
Prospective investors should consider necessarily a guide to future performance.
carefully whether an investment is suitable
for them in light of their personal TAXATION
circumstances and their financial resources Each investor must consider their own tax
and should take appropriate independent position, and must take their own specialist
professional advice. advice. Any potential investors who are not
UK resident for tax purposes are strongly
LEGISLA TION advised to seek specialist advice on their
The information in this document is based own position.
on the understanding of current law and
practice. None of the Directors, agents, or
any of their advisors can accept
responsibility if there is any change in the 10
20. Alternative Markets
RISK ASSESSMENT
RISK ASSESSMENT
NO INVESTORS’ money laundering prevention checks as
COMPENSATION SCHEME detailed in the application process, and is
The Investors Compensation Scheme as duly authorised to complete and sign off the
operated by the Financial Services required detail on the Introducing Advisors
Compensation Scheme in the United Kingdom section of the application form.
is not available for claims relating to investment
into the Alternative Markets Portfolio. REJECTION
Any potential investor not meeting the
MONEY LAUNDERING requirements will have their application
Procedures for the prevention of money rejected as we are under a legal duty to
laundering measures aimed towards the comply with the Anti-Money Laundering
prevention of money laundering, require Regulations.
each applicant to verify his/ her identity and
source of funds and wealth to the COMPLIANCE
Administrator. Applicants, depending on All investors should complete the
their structure, will be required to provide application forms fully and comply with the
the Administrator with evidence of identity information/requirements stated therein.
and source of funds and wealth, as more
particularly set out in the application form DATA PROTECTION
provided to applicants. This obligation is The Company and or the Administrator may
absolute and the Administrator will notify the hold personal data relating to the past and
supplicant if proof of identity in addition to present Shareholders. Personal data may
that specified in the application form is be retained on record after it is no longer
used. Such personal date is processed by
required.
the Administrator to maintain the register of
members and mailing lists, which may
VERIFICATION involve sharing such data with third. By
In accordance with the Money Laundering becoming registered as a holder of a lease
Regulations 2007, the investment from the Alternative Markets, a person
administrators will require verification of the becomes a data subject and is deemed to
identity of every potential investor and any have consented to the processing by the
authorised intermediary acting for a Company or the Administrator of any
personal data relating to them in the
prospective Investor. Any forms submitted
manner described above. Any details or
must be completed in full, and the payment
information submitted during the course of
mechanism as detailed in the application the application will be retained on a
forms and shareholders and subscription database at its registered office, under the
documentation must be adhered to strictly. provisions of the Data Protection Act 1998.
At its discretion, however, the Administrator
may accept a money laundering certificate
as evidence that the Introducing Advisor
has diligently carried out the appropriate 11
21. 20 OR 25 YEAR
RENEWABLE
ENERGY INVESTMENT
OPPORTUNITY
22. Alternative Markets
FAQ
What is the process of investment years for all clean energy produced. The
FAQ
(cash and SIPP/SASS investor)? energy providers issue quarterly
performance figures to the energy
The process is simple and similar to regulator OFGEM who makes payment to
purchasing property. To register your the energy supplier. You then receive
interest you must complete and return a 100% of the FIT payment direct from the
reservation form and supply proof of your energy supplier.
identification in line with money laundering
regulations. Contracts will then be sent How do I know my system/s will
and settlement made to our UK based perform well?
Solicitors, Arc Property Solicitors, who,
acting on your behalf, check all documents Each individual solar installation is
and title are correct before authorising the installed and fully operational,
transfer of the lease to your chosen having passed stringent due diligence and
beneficiary. Quarterly feed in tariff quality control before being added to the
payments will then be made to an account Alternative Markets portfolio. Each installation
of your choice. The process is simple and is fitted with a generation meter, which is
similar to purchasing property.To register your enabled, using GPRS technology to
interest you must complete and return a transmit data to a central collection point.
reservation form and supply proof of your This data indicates how much electricity
identification in line with money laundering each system generates per day. These
regulations. Contracts will be issued to figures are compared with regional
your SIPP trustee, and settlement made to generation meters to ensure expected
our UK based solicitors Arc Property performance and to flag up any service
Solicitors, who, acting on your behalf, issues.
check all documents and title are correct
before authorising the transfer of the lease
to your SIPP/SASS. Quarterly feed in tariff compensation scheme?
payments will be sent directly to your
SIPP/SASS account. No. The Investors Compensation
Scheme as operated by the
Financial Services Compensation Scheme
scheme work? in the United Kingdom is not available for
claims relating to investment into the
In order to help meet European Union Alternative Markets.
targets for carbon reduction, the
government introduced Feed in Tariff’s or
FIT’s to incentivise clean energy
production. The scheme guarantees to pay
a fixed price, index linked for up to 25 12
23. Alternative Markets
FAQ
What is PVGIS (Photo Voltaic Can ownership of my lease be
FAQ
Geographical Information transferred?
System)?
Yes, you may reassign ownership of
PVGIS is a free to use web based your lease as you wish. This is a
tool for the calculation of solar energy simple, standard transaction for your
yield. Built for the European Union Joint solicitor.
Research Council and generally recognised
as the most precise predictive measure of
future performance. PVGIS provides
detailed estimates of energy output based
on the equipment used, precise location of
each installation, climatological data from
the European Solar Radiation Database
and other calculations.
What happens if my system
malfunctions or is stolen or
damaged?
Your system is fully insured for
damage, malfunction, loss or theft.
Any interruption in performance will be
quickly highlighted and the appropriate
action taken to get things back on track.
What happens to the systems at
the end of the lease period?
At the end of your lease, the solar
panels are legally transferred to the
home owner on whose roof they are
situated. As the panels have an effective life
span of maybe 50 years, they will continue
to produce clean, green, subsidised
electricity for many years to come.
13
24. Alternative Markets
REFERENCES
REFERENCES
The following industry references have been utilised in the production of this white paper.
Alternative Markets cannot be held responsible for any information utilised from these reference
articles. For any questions on the contents of the items below please refer to the article’s
author.
DEPARTMENT OF ENERGY & CLIMATE
UK Energy in Brief: a summary of some of the key developments in the UK energy system
http://www.decc.gov.uk/en/content/cms/statistics/publications/brief/brief.aspx
CERTAINTY FOR FEED-IN TARIFFS
Energy and Climate Change Minister, Greg Barker
http://www.solarpowerportal.co.uk/news/exclusive_certainty_for_feed_in_tariffs
OFGEM FEED IN TARIFF TABLE
http://www.ofgem.gov.uk/Sustainability/Environment/fits/tariff-
tables/Documents1/Tariff%20Table%201%20August%202012%20PV%20Only.pdf
GOOD ENERGY FEED IN TARIFF COMMUNITY
http://www.goodenergy.co.uk/feedintariff
GREEN ENERGY SUPPLY CERTIFICATION SCHEME
http://www.greenenergyscheme.org/
UK DEPARTMENT FOR ENERGY AND CLIMATE CHANGE
http://www.decc.gov.uk
SOLAR POWER FOR WORLD’S POOREST
http://www.guardian.co.uk/environment/2012/jul/03/solarpower-renewableenergy
SAINSBURY'S CLAIMS TITLE OF BIGGEST SOLAR POWER GENERATOR IN EUROPE
http://www.guardian.co.uk/environment/2012/aug/03/sainsburys-biggest-solar-power-
generator-europe
Trademarks and Copyrights - All trademarks referenced in this document are recognised by Alternative Markets and remain the property of
their respective owners. Disclaimer of Liability - Alternative Markets makes no representations, warranties, or assurances as to the
accuracy, currency or completeness of the content contain in this document or any sites linked referenced. Limitation of Liability -
THE MATERIALS INCLUDED ARE PROVIDED "AS IS" WITHOUT ANY EXPRESS OR IMPLIED WARRANTY OF ANY KIND
INCLUDING WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT OF INTELLECTUAL PROPERTY, OR FITNESS FOR
ANY PARTICULAR PURPOSE. IN NO EVENT SHALL ALTERNATIVE MARKETS OR ITS AGENTS OR OFFICERS BE LIABLE FOR ANY
DAMAGES WHATSOEVER (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF PROFITS, BUSINESS
INTERRUPTION, LOSS OF INFORMATION, INJURY OR DEATH) ARISING OUT OF THE USE OF OR INABILITY TO USE THE
MATERIALS, EVEN IF ALTERNATIVE MARKETS HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGES.
14
25. ALTERNATIVE MARKETS
World Trade Centre, Zurich, Leutschenbachstrasse 95,
8050 Zurich, Switzerland
Tel CH: (+41) 43 508 1418 Email: info@alternativemarkets.co.uk
Tel UK: +44 (0) 2033 846 260 Web: www.alternativemarkets.co.uk
Opus Investment Group BVI Acorn MG
1 Berkeley Street Level 17, Dashwood House,
London W1J 8DJ DELIVERING INDIVIDUAL 69 Old Broad Street, London EC2M INA
& BUSINESS SUCCESS
Tel: +44 (0) 845 835 4772 Tel: +44 (0) 207 256 4284
Fax: +44 (0) 845 835 4772 Sales: +44 (0) 207 099 6580
Fax: +44 (0) 207 757 7423
Email: info@opusinvestmentgroup.com Email: info@acorn-mg.com
Web: www.opusinvestmentgroup.com Web: www.acorn-mg.com
E.on Soventix GmbH
Westwood Business Park Schifferstrasse 200
Coventry, England 47059 Duisburg, Germany
Tel: +44 (0) 24 7642 4000 Tel: +49 (0) 203 449 860 0
Fax: +44 (0) 24 7642 5432 Fax: +49 (0) 203 449 860 990
Email: info@eon-uk.com Email: info@soventix.com
Web: www.eon-uk.com Web: www.soventix.com
Good Energy Arc Property Solicitors
Monkton Reach, Monkton Hill The Studio, Greengate
Chippenham, Wiltshire SN15 1EE Cardale Park, Harrogate HG3 1GY
Tel: +44 (0) 845 456 1640 Tel: +44 (0) 800 612 9097
Fax: +44 (0) 1249 766091 Fax: +44 (0) 412 359 4688
Email: enquiries@goodenergy.co.uk Email: info@arcpropertysolicitors.com
Web: www.goodenergy.co.uk Web: www.arcpropertysolicitors.com
Paul O'Brien Solar Installations (SW) Ltd Progen Solar Ltd
Unit 6, Brookgate, South Liberty Lane 10 Old Wood Close, Chorley
Ashton Vale, Bristol BS3 2UN Lancashire, PR7 2FZ
Tel: +44 (0) 117 953 3234 Tel: +44 (0) 800 756 6299
Fax: +44 (0) 800 014 8072
Email: info@pobsolar.co.uk
Web: www.pobsolar.co.uk Email: info@progen.co.uk
Web: www.progen.co.uk