In 2016, Nottinghamshire Pension Fund invested £1.5 million in Nottinghamshire Community Energy (NCE). The pension fund’s investment provided longterm funding to help finance the construction and management of a solar farm with the aim of benefitting the local community. The project also ran a shares scheme for local people and businesses to invest shares in the project.
NCE is a Community Benefit Society and receives payments under the Feed-in Tariff scheme and income from the export of electricity to the national grid. NCE has a 25-year lease with the landowner.
Based in Rushcliffe, Nottinghamshire, the 5-megawatt community solar farm creates the following benefits for the local community:
- Clean energy is generated to power 1,150 local homes.
- 100% of surplus profits are used to provide an annual £20,000 to a Community Fund. The fund supports projects in Nottingham City and Nottinghamshire that address renewable energy generation, wildlife conservation, climate change mitigation, carbon reduction and reducing fuel poverty.
- Up to a 7% return for those who invested in the shares scheme.
The LGPS fund’s investment in the project is a good example of a direct investment by a pension fund which delivers positive local environmental, social and economic impacts and also involves community ownership and a revenue-sharing arrangement that provides long-term funding to local community-led projects.