The world's first consumer-owned wind farm
This week the programme is sponsored by Ripple Energy. They're doing something that's unusual, and also a first; and they want to share the opportunity with you. And with 20 years' experience in the wind power industry, Sarah Merrick is their founder and CEO. She told Chris Smith the plan...
Sarah - What Ripple does is we enable individual households to own a bit of a wind farm, and have the low-cost, clean electricity that it generates supplied to their home. Our first project is now open, it's Graig Fatha in South Wales. So we're really keen for people to be able to join the project and be part of what is the UK's very first consumer owned wind farm.
Chris - Can you tell us a bit about how this business will work, Sarah?
Sarah - Customers become a member of a co-op which owns the wind farm; and it's all very, very democratic, it's one member one vote; so you simply decide how much of the wind farm you want to own depending on how much electricity you use, then you can just sign up and join in literally a couple of minutes on our website, and you become a member of the co-op and you own your bit of the wind farm. And then we go away and build it! And then once it's operational, you get your share of the electricity that the wind farm generates supplied to your home via the grid, and then the savings that are associated with your ownership are just applied to your bill automatically each month, basically. So we take care of everything, right from gathering the thousands of people together, managing the bills of the wind farm, and then managing their relationship with our supply partners so that everyone gets savings that you apply to their bill straightaway.
Chris - How much is this going to cost to build?
Sarah - The cost of building the whole turbine is just over 4 million pounds. And then an individual household's share of that, if they wanted the wind farm to generate as much electricity as they use each year, the upfront cost is around 18-1900 pounds. And for that, they would get savings of around 25% on their electricity bill. Because the electricity is coming from the grid, you still need to pay all the grid charges; there's lots of taxes and levies as part of your electricity bill as well, you still need to pay all those bits. It's the electricity part of your electricity bill that you get the saving on. So over the 25 year lifetime of the wind farm, we estimate it's around a 25% reduction on your electricity bill each year for the 25 year lifetime.
Chris - And therefore, how many years after I've invested is it before I've effectively got my money back in saved electricity?
Sarah - We're expecting it to be around 14 years based on the government's electricity price assumptions. If electricity prices are higher than those assumptions, the payback is shorter because your savings would increase. If the price of electricity goes down, your savings reduce as well.
Chris - What happens if I move house though?
Sarah - Because it's attached to you and not your home, if you move you just phone up your supplier like you would if you moved home, and just say, "hey, I've moved," and they just then supply it to your new home. So it's really portable. It goes wherever you go, essentially.
Chris - You said that the average household investment will be about 2,000 pounds. So you must be, if you want to raise 4 million quid, you must be looking for about 2,000 subscribers.
Sarah - Yes. Just over 2000 subscribers. Because it is limited, we're expecting it to fill up by the end of August.
Chris - Is that the point of return, where you've got to be in the door by the end of August or the opportunity is going to pass?
Sarah - Exactly, yes. Once the wind farms full, there's no more of it to be bought by anyone, so people need to get in in the next three or four weeks in order to be able to benefit, and be part of the UK first consumer owned wind farm.
Chris - And when will it actually become operational? When would I start to see money flowing in to discount off my bill?
Sarah - We're expecting it to be spring next year, sort of April time. It's a relatively easy build, it's just a single turbine so it shouldn't take very long to construct. People would see savings on their bill from around April 2021 onwards.
Chris - And this is a first, isn't it? I don't think anyone has actually tried to do this with a wind turbine like this before. Why did you decide to go down this path?
Sarah - It's a world first! Having worked in the wind industry for so long, I saw that it was possible for big companies like Google and Facebook, they could own bits of a wind farm or a whole wind farm themselves; but it seemed really unfair that me as an individual consumer, I wasn't able to actually own what is now the UK's cheapest source of power direct. People want to act on climate change, and they want low-cost electricity as well. So that's why I set up Ripple to solve that for people.
Chris - And what safeguards are there so that people who do decide to invest know that their money is secure, and that the company for 25 years is going to be there, and they're going to get their money back?
Sarah - The co-op owns the wind farm, and they will do for 25 years. Ripple doesn't own the wind farm; we're the managing agent. so we just bring everything together and make it happen.
Chris - And if I decide I want to invest more than 2,000 pounds, are you taking bigger subscriptions so a person could therefore discount proportionately more of their electricity costs?
Sarah - The most that you can invest would be the equivalent amount of the wind farm that would generate your consumption plus 20%. So you're owning a bit of a wind farm to get low-cost, clean electricity that you use yourself.
Chris - So if you have now convinced listeners to the Naked Scientists that this is a good idea, what should they do?
Sarah - They can join Ripple - just go to rippleenergy.com - and you can sign up there. We're expecting it to close around the end of August, so people need to act pretty quick if they want to be part of this project.