What is Brighton Energy Co-operative? Brighton Energy Co-operative is the trading name of Brighton Energy Limited, a Community Benefit Society registered in England, Registration number: 31107 R.
Has this been tried before? Yes! Click here to read about other successful cooperative energy schemes. One local to Brighton & Hove: OVESCO, based in Lewes, successfully raised £307,000 in its share offer in 2011 to put solar panels on the roof of the Harveys’ warehouse in the town. Underpinning community solar schemes is the Government-backed feed-in-tariff (FIT), which guarantees fixed payments for generating renewable energy for 25 years.
How Brighton Energy Co-operative make money? Brighton Energy Co-operative will generate revenue via 1) FIT revenue from each of its sites and 2) selling any electricity not used to Good Energy. The tariff increases annually in line with the Retail Price Index (RPI). Both 1) and 2) will be paid to Brighton Energy Co-operative through Good Energy.
What is the current status of the project? Brighton Energy Co-operative has secured four sites for its solar panels: two at Shoreham Port, one at St Georges Church (Kemptown) and one at City Coast Church (Portslade). Each rooftop will generate between 10-45kWp — in total enough to power 40 homes and save 1,085 tonnes of carbon dioxide over the scheme’s lifetime. You can join Brighton Energy Coop by investing in the Coop – in this way we raise the funds for purchase and installation of the solar panels. Once installation is complete, Brighton Energy Co-operative will start generating green, community-owned energy.
What happens if Brighton Energy Co-operative doesn’t raise enough money? If the community share issue fails to raise the required cash, the directors will try to raise money from alternative sources. If they feel that this changes the fundamental nature of the original proposition, they will give investors the chance to withdraw their application.
Who will manage the project?
Brighton Energy Co-operative members will own the solar panels and associated equipment. The Brighton Energy Co-operative board will manage the installation of the panels and will deal with ongoing maintenance. The board is responsible for authorising payments to shareholders in accordance with the terms set out in the share invite document and in the Rules of the Society.
How do I know it will be properly managed? Brighton Energy Co-operative has a board of experienced directors, which can be changed at the AGM if shareholders are not satisfied. More importantly, all stakeholders have an incentive to make this work — Brighton Energy Co-operative needs its share of the revenues from the project while Shoreham Port, St Georges Church (Kemptown) and City Coast Church (Portslade) will receive free or discounted electricity.
How do I get involved in Brighton Energy Co-operative’s share invite? You become a member of Brighton Energy Co-operative by purchasing shares. Each share is worth £1: the minimum you can buy is £400 & the maximum is £20,000. Owning shares means you can participate in BEC’s operation through its “one member, one vote” principle, regardless of how many shares you own. Members will elect the board of directors at the annual general meeting (AGM) on a three-year rotation. All applications are subject to the terms set out in the Rules of the Society.
Do I have to live in Brighton & Hove to be an investor?
No, you can live anywhere in the country as long as you are a UK resident.
What happens to my shares if I die? In the event of the death of a shareholder, the repaid value of the shares will normally be added to the estate for probate purposes. Our application form offers the option (if you so wish) to elect to nominate a recipient for the value of the shares in the event of your death.
Can I hold shares on behalf of children? Shareholders must be at least 16 years old. You have the option of holding shares on behalf of someone who is under 16, which is set out in the application form.
What will Brighton Energy Co-operative’s revenue from the feed-in-tariff be spent on? The revenue from the generation, sale, and export of solar electricity from Shoreham Port, St Georges Church (Kemptown) and City Coast Church (Portslade) sites will be used to:
pay any maintenance & repairs required for the panels and associated equipment
pay for the running costs of Brighton Energy Co-operative
payments into a sinking fund for replacement of the inverters
fund annual interest payments to investors (commencing at the end of year 3 of operations), and capital repayments
fund low-carbon community projects (see below)
What types of community projects will Brighton Energy Co-operative invest in? These have not been set yet, but typical projects might include:
home-retrofit schemes to help householders reduce energy bills
awareness-building projects to help the elderly and fuel poor to take advantage of Government and council subsidies that could help reduce energy bills
school programmes to develop teaching projects looking at renewable energy
community engagement work to encourage people to adopt low carbon lifestyles
Brighton Energy Co-operative will work closely with the council, local community groups and NGOs to ensure that the projects it invests in will have the maximum benefit to the city and local communities.
Will Brighton Energy Co-operative start up more solar energy projects? After completion of the initial programme, Brighton Energy Co-operative will continue to identify projects to invest money generated from the first four sites in line with its objectives. If the directors are unable to identify further projects, then funds may be made available to allow share withdrawals exceeding the annual cap. Such decisions are at the discretion of the directors, but it’s their intention to consult with members prior to committing Brighton Energy Co-operative to a course of action.
How do we know how much sunshine there will be? How much sunshine there is will have a bearing on the amount of electricity produced by the solar panels and therefore the revenue generated by the solar panels. The good news is that the amount of sunshine in Brighton & Hove is among the highest in the country — 4.66 hours a day — but of course there’s no guarantee this will remain the same for the next 25 years.
However, we can estimate the likely electrical output of the solar panels, which depends upon latitude and the orientation of the panels, by using Government data on sunshine hours and intensity. This is what installers and developers use, and this is what we have used when making our calculations.
Solar panels’ performance also drops off over time, so in our financial projections we have used the guaranteed degradation rate, which guarantees that the output will be at least 85% of the nameplate figure in 25 years time. In fact, manufacturers expect the actual degradation to be less then 5%. This potential upside will be shared between investors and Brighton Energy Co-operative.
What happens if there is damage to the solar panels? The panels will be covered by insurance, which will cover the cost of replacement for the usual risks, including accidental damage.
What happens if Brighton Energy Co-operative has already raised enough money? Once the community share issue has raised the full amount needed to finance the solar installation, the directors will close the share offer. Any applications received after the share offer has closed will be returned to the investor.
When and how can I take my money out? There is only one class of ordinary withdrawable share. The shares are not transferable; they may not be sold.
The shares can be withdrawn on three months’ notice and up to a maximum of 5% per annum of issued share capital in issue at the start of the financial year (the cap). All applications received will be processed on a first-come, first-served basis. Any applications received but not approved for withdrawal in the year will be rolled forward to the next year until the application for withdrawal amount has been repaid in full.
Where a year’s cap has not be used in full the directors may decide to roll this forward to the following year. If Brighton Energy Co-operative receives applications for withdrawals that exceed the cap, they may seek to increase the amount of withdrawals over the cap subject to the circumstances of Brighton Energy Co-operative at that time, or seek to raise additional capital to finance share withdrawals.
The withdrawal of shares is currently suspended until 1 February 2015. The scope for being able to withdraw shares in the future will be dependent upon Brighton Energy Co-operative developing a successful business and hence cash flows to pay out share withdrawals or contingent on Brighton Energy Co-operative raising additional capital for the purpose of paying out share withdrawals.
In the case of joint investments, all investors concerned must agree to a withdrawal.
Shares will be repaid at the original price (subject to comments hereafter).
Brighton Energy Co-operative directors have the right to change the notice period for withdrawals, or to suspend withdrawals.
Brighton Energy Co-operative directors have the right to write down the value of shares, if the liabilities of Brighton Energy Co-operative (and its share capital) should exceed the value of its assets. Members who then withdraw their shares will only receive the written down value of their shares.
In the event of Brighton Energy Co-operative ceasing to trade, members will be re-paid up to a maximum of £1 for every £1 share owned, once all creditors have been repaid in full. Any remaining assets and surpluses shall not be distributed to members, but instead shall be transferred to some other non-profit body or bodies subject to at least the same degree of restriction on the distribution of surpluses and assets. See clause 69 of the Rules of the Society.
Is my share purchase subject to EIS tax relief?
Note: tax treatment depends on the individual circumstances of each member and may be subject to change in the future.
The Enterprise Investment Scheme (EIS) provides UK taxpayers with attractive tax incentives when they invest in EIS Qualifying Companies.
The following gives a summary of some of the current tax reliefs available under EIS, which may be applicable to members of Brighton Energy Co-operative.
Income tax relief: an individual can invest up to £500,000 per tax year in EIS qualifying companies and benefit from 30% income tax relief in the year of investment. EIS enables a 30% tax reduction from the investment. This means that if you make a £5,000 investment, for example, it will cost you £3,500.
The individual can only claim this relief if they hold less than 30% of the shares, are not an employee of the EIS qualifying company and hold the shares for at least three years. The minimum investment is £500 to claim the relief.
Loss relief: if the shares in an investee company were to be sold at a loss, the loss could be offset against income tax or capital gains tax of the investor.
Inheritance tax (IHT) exemption: shares in EIS qualifying companies would generally be expected to attract business property relief at rates of up to 100%, provided the underlying investment has been held for at least two years.
Brighton Energy Co-operative has applied for advance clearance of its status as an EIS qualifying company. However, final approval is only available from HMRC by application after issuance of shares. Assuming this approval has been gained, Brighton Energy Co-operative will issue application forms to members who will then individually need to seek approval of their claims for tax relief. There is no guarantee that Brighton Energy Co-operative will be granted EIS qualifying company status.
Brighton Energy Co-operative received EIS qualifying company status for it’s start-up capital issue. However, Brighton Energy Co-operative must re-apply for this latest share issue.
What are the potential financial returns? It is Brighton Energy Co-operative’s intention to pay investors interest of 4% per annum commencing at the end of the financial year 1 July 2015 and for the remaining 22 years.
What happens to these returns if there is inflation in the economy? The feed-in-tariff income increases every year in line with the Retail Price Index (RPI). The annual RPI rate assumed in the financial projections is 3% (RPI was 5.2% in the year to April 2011). So if inflation remains above 3% then, all other things being equal, BEC will pay investors more interest than forecast. Conversely, if inflation drops below 3% for a long period, then total interest payments will likely be less than forecast.
What risks are there? Brighton Energy Co-operative is a limited liability organisation, and members’ liability is limited to the value of their shareholding. However, you may wish to speak to an Independent Financial Advisor before you become a member and purchase shares, and you should read the share invite document [link here to prospectus] carefully.
The directors have identified the following key risks, which may impact the value of shares:
• BE is unable to raise sufficient capital to develop any renewable energy projects,
• BE is unable to secure planning permissions at suitable sites,
• BE is unable to secure suitable sites ,
• Changes in Government legislation may reduce revenues generated from the Feed-in-Tariff scheme,
• Local weather conditions may affect the amounts of electricity generated,
• Projects may be delayed due to technical, financial or legal matters,
• There may be interruptions to the generation of electricity caused by financial or legal matters which may reduce and/or delay revenues,
• There may be interruptions to generation of electricity caused by mechanical/electrical failure of equipment which may reduce and/or delay revenues,
• There may be a delay in Feed-in-Tariff registration which may delay cash inflow,
• Overhead costs are estimates and may go up or down over time,
• BE may not be able to meet debt repayments due to risk factors above reducing available cash for repayments.
The directors seek to protect against these risks through implementing prudent management practices.
When do I have to make up my mind? The share offer is open from 16th May to 20 June. If we have received the full amount of funding in advance of this, the directors will close the offer early. If funding is still required after this date, the directors may extend the fundraising period.
Who should I contact if I’m still unsure? We’re more than happy to answer your questions. You can contact us here.
Download our share invitation by clicking below: 
Or download our application form:
Frequently asked questions
What is Brighton Energy Co-operative?
Brighton Energy Co-operative is the trading name of Brighton Energy Limited, a Community Benefit Society registered in England, Registration number: 31107 R.
Has this been tried before?
Yes! Click here to read about other successful cooperative energy schemes. One local to Brighton & Hove: OVESCO, based in Lewes, successfully raised £307,000 in its share offer in 2011 to put solar panels on the roof of the Harveys’ warehouse in the town. Underpinning community solar schemes is the Government-backed feed-in-tariff (FIT), which guarantees fixed payments for generating renewable energy for 25 years.
How Brighton Energy Co-operative make money?
Brighton Energy Co-operative will generate revenue via 1) FIT revenue from each of its sites and 2) selling any electricity not used to Good Energy. The tariff increases annually in line with the Retail Price Index (RPI). Both 1) and 2) will be paid to Brighton Energy Co-operative through Good Energy.
What is the current status of the project?
Brighton Energy Co-operative has secured four sites for its solar panels: two at Shoreham Port, one at St Georges Church (Kemptown) and one at City Coast Church (Portslade). Each rooftop will generate between 10-45kWp — in total enough to power 40 homes and save 1,085 tonnes of carbon dioxide over the scheme’s lifetime. You can join Brighton Energy Coop by investing in the Coop – in this way we raise the funds for purchase and installation of the solar panels. Once installation is complete, Brighton Energy Co-operative will start generating green, community-owned energy.
What happens if Brighton Energy Co-operative doesn’t raise enough money?
If the community share issue fails to raise the required cash, the directors will try to raise money from alternative sources. If they feel that this changes the fundamental nature of the original proposition, they will give investors the chance to withdraw their application.
Who will manage the project?
Brighton Energy Co-operative members will own the solar panels and associated equipment. The Brighton Energy Co-operative board will manage the installation of the panels and will deal with ongoing maintenance. The board is responsible for authorising payments to shareholders in accordance with the terms set out in the share invite document and in the Rules of the Society.
How do I know it will be properly managed?
Brighton Energy Co-operative has a board of experienced directors, which can be changed at the AGM if shareholders are not satisfied. More importantly, all stakeholders have an incentive to make this work — Brighton Energy Co-operative needs its share of the revenues from the project while Shoreham Port, St Georges Church (Kemptown) and City Coast Church (Portslade) will receive free or discounted electricity.
How do I get involved in Brighton Energy Co-operative’s share invite?
You become a member of Brighton Energy Co-operative by purchasing shares. Each share is worth £1: the minimum you can buy is £400 & the maximum is £20,000. Owning shares means you can participate in BEC’s operation through its “one member, one vote” principle, regardless of how many shares you own. Members will elect the board of directors at the annual general meeting (AGM) on a three-year rotation. All applications are subject to the terms set out in the Rules of the Society.
Do I have to live in Brighton & Hove to be an investor?
No, you can live anywhere in the country as long as you are a UK resident.
What happens to my shares if I die?
In the event of the death of a shareholder, the repaid value of the shares will normally be added to the estate for probate purposes. Our application form offers the option (if you so wish) to elect to nominate a recipient for the value of the shares in the event of your death.
Can I hold shares on behalf of children?
Shareholders must be at least 16 years old. You have the option of holding shares on behalf of someone who is under 16, which is set out in the application form.
What will Brighton Energy Co-operative’s revenue from the feed-in-tariff be spent on?
The revenue from the generation, sale, and export of solar electricity from Shoreham Port, St Georges Church (Kemptown) and City Coast Church (Portslade) sites will be used to:
What types of community projects will Brighton Energy Co-operative invest in?
These have not been set yet, but typical projects might include:
Brighton Energy Co-operative will work closely with the council, local community groups and NGOs to ensure that the projects it invests in will have the maximum benefit to the city and local communities.
Will Brighton Energy Co-operative start up more solar energy projects?
After completion of the initial programme, Brighton Energy Co-operative will continue to identify projects to invest money generated from the first four sites in line with its objectives. If the directors are unable to identify further projects, then funds may be made available to allow share withdrawals exceeding the annual cap. Such decisions are at the discretion of the directors, but it’s their intention to consult with members prior to committing Brighton Energy Co-operative to a course of action.
How do we know how much sunshine there will be?
How much sunshine there is will have a bearing on the amount of electricity produced by the solar panels and therefore the revenue generated by the solar panels. The good news is that the amount of sunshine in Brighton & Hove is among the highest in the country — 4.66 hours a day — but of course there’s no guarantee this will remain the same for the next 25 years.
However, we can estimate the likely electrical output of the solar panels, which depends upon latitude and the orientation of the panels, by using Government data on sunshine hours and intensity. This is what installers and developers use, and this is what we have used when making our calculations.
Solar panels’ performance also drops off over time, so in our financial projections we have used the guaranteed degradation rate, which guarantees that the output will be at least 85% of the nameplate figure in 25 years time. In fact, manufacturers expect the actual degradation to be less then 5%. This potential upside will be shared between investors and Brighton Energy Co-operative.
What happens if there is damage to the solar panels?
The panels will be covered by insurance, which will cover the cost of replacement for the usual risks, including accidental damage.
What happens if Brighton Energy Co-operative has already raised enough money?
Once the community share issue has raised the full amount needed to finance the solar installation, the directors will close the share offer. Any applications received after the share offer has closed will be returned to the investor.
When and how can I take my money out?
There is only one class of ordinary withdrawable share. The shares are not transferable; they may not be sold.
The shares can be withdrawn on three months’ notice and up to a maximum of 5% per annum of issued share capital in issue at the start of the financial year (the cap). All applications received will be processed on a first-come, first-served basis. Any applications received but not approved for withdrawal in the year will be rolled forward to the next year until the application for withdrawal amount has been repaid in full.
Where a year’s cap has not be used in full the directors may decide to roll this forward to the following year. If Brighton Energy Co-operative receives applications for withdrawals that exceed the cap, they may seek to increase the amount of withdrawals over the cap subject to the circumstances of Brighton Energy Co-operative at that time, or seek to raise additional capital to finance share withdrawals.
The withdrawal of shares is currently suspended until 1 February 2015. The scope for being able to withdraw shares in the future will be dependent upon Brighton Energy Co-operative developing a successful business and hence cash flows to pay out share withdrawals or contingent on Brighton Energy Co-operative raising additional capital for the purpose of paying out share withdrawals.
In the case of joint investments, all investors concerned must agree to a withdrawal.
Shares will be repaid at the original price (subject to comments hereafter).
Brighton Energy Co-operative directors have the right to change the notice period for withdrawals, or to suspend withdrawals.
Brighton Energy Co-operative directors have the right to write down the value of shares, if the liabilities of Brighton Energy Co-operative (and its share capital) should exceed the value of its assets. Members who then withdraw their shares will only receive the written down value of their shares.
In the event of Brighton Energy Co-operative ceasing to trade, members will be re-paid up to a maximum of £1 for every £1 share owned, once all creditors have been repaid in full. Any remaining assets and surpluses shall not be distributed to members, but instead shall be transferred to some other non-profit body or bodies subject to at least the same degree of restriction on the distribution of surpluses and assets. See clause 69 of the Rules of the Society.
Is my share purchase subject to EIS tax relief?
Note: tax treatment depends on the individual circumstances of each member and may be subject to change in the future.
The Enterprise Investment Scheme (EIS) provides UK taxpayers with attractive tax incentives when they invest in EIS Qualifying Companies.
The following gives a summary of some of the current tax reliefs available under EIS, which may be applicable to members of Brighton Energy Co-operative.
Income tax relief: an individual can invest up to £500,000 per tax year in EIS qualifying companies and benefit from 30% income tax relief in the year of investment. EIS enables a 30% tax reduction from the investment. This means that if you make a £5,000 investment, for example, it will cost you £3,500.
The individual can only claim this relief if they hold less than 30% of the shares, are not an employee of the EIS qualifying company and hold the shares for at least three years. The minimum investment is £500 to claim the relief.
Loss relief: if the shares in an investee company were to be sold at a loss, the loss could be offset against income tax or capital gains tax of the investor.
Inheritance tax (IHT) exemption: shares in EIS qualifying companies would generally be expected to attract business property relief at rates of up to 100%, provided the underlying investment has been held for at least two years.
Full details can be found on the HMRC website.
Brighton Energy Co-operative has applied for advance clearance of its status as an EIS qualifying company. However, final approval is only available from HMRC by application after issuance of shares. Assuming this approval has been gained, Brighton Energy Co-operative will issue application forms to members who will then individually need to seek approval of their claims for tax relief. There is no guarantee that Brighton Energy Co-operative will be granted EIS qualifying company status.
Brighton Energy Co-operative received EIS qualifying company status for it’s start-up capital issue. However, Brighton Energy Co-operative must re-apply for this latest share issue.
What are the potential financial returns?
It is Brighton Energy Co-operative’s intention to pay investors interest of 4% per annum commencing at the end of the financial year 1 July 2015 and for the remaining 22 years.
What happens to these returns if there is inflation in the economy?
The feed-in-tariff income increases every year in line with the Retail Price Index (RPI). The annual RPI rate assumed in the financial projections is 3% (RPI was 5.2% in the year to April 2011). So if inflation remains above 3% then, all other things being equal, BEC will pay investors more interest than forecast. Conversely, if inflation drops below 3% for a long period, then total interest payments will likely be less than forecast.
What risks are there?
Brighton Energy Co-operative is a limited liability organisation, and members’ liability is limited to the value of their shareholding. However, you may wish to speak to an Independent Financial Advisor before you become a member and purchase shares, and you should read the share invite document [link here to prospectus] carefully.
The directors have identified the following key risks, which may impact the value of shares:
• BE is unable to raise sufficient capital to develop any renewable energy projects,
• BE is unable to secure planning permissions at suitable sites,
• BE is unable to secure suitable sites ,
• Changes in Government legislation may reduce revenues generated from the Feed-in-Tariff scheme,
• Local weather conditions may affect the amounts of electricity generated,
• Projects may be delayed due to technical, financial or legal matters,
• There may be interruptions to the generation of electricity caused by financial or legal matters which may reduce and/or delay revenues,
• There may be interruptions to generation of electricity caused by mechanical/electrical failure of equipment which may reduce and/or delay revenues,
• There may be a delay in Feed-in-Tariff registration which may delay cash inflow,
• Overhead costs are estimates and may go up or down over time,
• BE may not be able to meet debt repayments due to risk factors above reducing available cash for repayments.
The directors seek to protect against these risks through implementing prudent management practices.
When do I have to make up my mind?
The share offer is open from 16th May to 20 June. If we have received the full amount of funding in advance of this, the directors will close the offer early. If funding is still required after this date, the directors may extend the fundraising period.
Who should I contact if I’m still unsure?
We’re more than happy to answer your questions. You can contact us here.