Abundance Investment has launched the UK’s first green energy ISA, an Innovative Finance ISA (IFISA) which allows people to invest directly in renewable energy projects, tax-free.
Abundance’s second Swindon solar bond can be held in Abundance’s tax-free IFISA wrapper and will fund a new solar farm on a Council-owned former landfill site at Chapel Farm in Blunsdon, Swindon.
The bond will have an average annual rate of return of 6 per cent over the 20 year term paid in twice yearly instalments with a minimum investment of just GBP5.
As with all investments via Abundance, holdings in this ISA can be traded at any time to others via the Abundance website at no extra cost.
The project follows the launch earlier this year of the UK’s first council solar bond in partnership with Swindon Borough council, which sold out a month early.
Bruce Davis, co-founder and joint managing director, Abundance, says: “We want to turn investing in ISAs from something gathering dust in the forgotten corner of a bank or riding the roller coaster of global stock markets into something that makes a difference in the real world. Investors’ money will be working harder than it would in the bank, boosting the UK’s green economy and sustainable infrastructure, and returns will be tax-free.
“Our second Swindon solar bond is just the start – we’ve got other exciting ISA investments on the way which can help ordinary people match their financial aspirations with their environmental values.”
The new IFISA has been made possible following a government announcement that from 1 November, the IFISA can include peer-to-peer investments such as debentures, allowing individuals to invest directly into businesses and projects to secure stable and attractive returns, tax free over longer terms, but with the freedom to cash in early by trading to others.
The new solar farm is expected to make a contribution from profits towards community initiatives and will help Swindon move closer to its goal to install 200MW of renewable capacity by 2020, enough to meet the equivalent electricity requirements of every home in the borough.
Completion of Chapel Farm, which would have a capacity of five megawatts (MW), would take the total to 167MW – over 80 per cent of the target.
