Bristol Free School funds solar PV installation through Savings & Feed-in-Tariffs
Bristol Free School (BFS) was opened in September 2011 in conjunction with a local organisation, Parents Voice and its sponsor Russell Education Trust (RET). It was the first of the RET Free Schools. The school’s energy needs will increase as the premises are extended; however, as is common in the education sector, cash is restricted.
Schools account for a large part of public sector energy use and as such are an important target for energy efficiency improvements. As a mainly new construction, planning approval for the school buildings was conditional on a sustainable energy implementation. Part of this was a solar PV installation generating electricity for the school. However, the capital cost of the project is significant and BFS were constrained, as are other Academies, in terms of grant from UK Government and outside investment. Grant funding would have, in any case, made the school ineligible to claim the significant sums available under the Feed-in-Tariff for solar PV installations.
RET undertook a closed procurement quotation exercise: Solarsense UK Ltd was the successful supplier, installing a 42.16kWp system comprised of 172 x Renesola 245Wp module PV arrays feeding 2 x PowerOne 20TL inverters. The installation was funded by AFM Solutions through a profiled, almost cash neutral Operating Lease – a sine qua non for the Trust’s balance sheet which also allows repayment in line with savings and FiTs, thereby delivering close to a “cash neutral” off balance sheet solution to the problem.
Choosing AFM Solutions to structure the operating lease finance, Richard Elms of RET said: “It was key to Bristol Free School that we secured an Operating Lease for the funding of this project. Graham Seeley of AFM Solutions engineered this and gave us sterling support with our auditors in the understanding of the true nature of the finance. The school can now count on a secure form of finance and considerable FiT revenues over the next 2 decades.”
Under our facility:
- We settled invoices from the contractor, paying the supply chain direct
- We carried the costs through the installation project cycles
- We delivered an Operating Leases with deferred payments to spread the costs in an EFA compliant transaction
- The installation was implemented in a timely fashion
- Energy costs are managed and now lowered
- Cash neutral solution with payments tailored to savings and FiT revenues over 7 years
- At the expiry of our funding, the school will have 13 years of government Feed in Tariff revenues
- Over the 20 year FiT period, the school is expected to make a net surplus of £128,000 from this project