Step by Step Project GuideDirectors2022-07-14T17:25:14+01:00
Step by Step Project Guide
This guide should help new community energy groups navigate their way through the various stages of delivering a project. The steps set out here may differ slightly between technologies, but should provide groups guidance for most projects.
Check sites against site criteria, as set out in the technology guidance documents found in step 1.
Be realistic about the location of any potential project. It is unlikely that you will want to travel long distances to a project, especially when regular site meetings and visits are an important part of developing and maintaining a community energy project.
If the site is committed to the process and to the environmental outcomes, it will work. If they are not, it will fall at the first legal hurdle.
Contact installers/ developers for a rough idea of installation costs and how much energy might be produced/ saved.
Does the project work technically? – can you find a suitable site, are there planning and permitting requirements (e.g. from the local authority, national grid etc).
Does the project work as a business? – groups should complete a quick financial assessment of the project to make sure the figures stack up.
Does the project benefit the community? – what are the local social and environmental outcomes that can be achieved through the project, could individuals from the community be trained to help with the install for example.
Get the site owners to work with you to get legal documentation in place for the chosen site. This guarantees tenure over or access to the site for several years through a lease, a licence, or a service agreement.
Legal documentation should also set out the arrangements regarding operation and maintenance, insurance, and what would happen in various scenarios including end of system life. Other documentation might include: Memorandum of Understanding, Exclusivity Agreement, PPA, Confidentiality Agreement for a Lease, Multi-technology Contracts, Section 119 valuation if working with a charity and more.
Pure Leapfrog have developed a number of legal templates available to purchase here.
Alternatively, groups might secure the site after completing a full feasibility study (step 8).
The first phase of funding is for development, site assessments and advisors. Grants can be a useful form of funding at this stage. If you receive a grant, stage payments may be dependent on you reaching targets.
To help with obtaining funding, letters of support from important stakeholders, like the local council, can help.
There are a range of financial options for groups: finance and grants from banks, local authorities and other reputable institutions like Lombard, Carbon Offset Funds, crowdfunding, bonds, share offers, and fundraising. Alternatively a group might opt for a different type of model such as, the site owner pays for the system and the group manages the project for example.
The installer will likely create a Construction Phase Plan, which groups should feed into, as should the site owner.
The project may be lowdown on the site’s owner’s priorities and groups may find that installation (and maintenance visits after installation) gets disrupted at short notice. Constant and good communication between all parties is crucial.
After installation, make sure site owners know how to use the system correctly.
Sign up for any subsidies that are applicable, and enter into a Community Benefit Agreement to receive/ pay Community Benefit Payments, if applicable, or pay into a community fund.
A community fund uses the profit from a project to deliver wider benefits including training and community support services. Community energy projects should be doing as much as they can for the community.
The group should consider ahead of time, what plans are in place to remove the system at the end of the contract? For example, groups may decide to remove the system and recycle parts, or to donate the system to the site owner for them to benefit from further savings until the system’s end of life.
Ideally a group should have people in it, or access to people, with skills in various areas i.e.: accountancy, property law, project and contract management, construction, green technologies, marketing and more. Get pro bono help where you can.
Social and environmental benefits can include: addressing the climate crisis and reducing CO2 emissions, supporting and advising fuel-poor households, awareness raising and behaviour change, apprenticeships and shadowing, increase in skills, knowledge, and confidence, climate action education for school children, tree planting, protecting and increasing biodiversity, other financial benefits for the local community, community cohesion and empowerment.
For all project types, groups need enthusiastic support from site owners and decision makers, or the project may fail. Often gaining access to decision makers can be difficult, but sometimes sharing a problem with other groups can help to find a solution.
The Standard Mark is awarded to community share offers that meet national standards of best practice, but it requires a lot of work from groups.
Patience and tenacity are key to successful community energy projects.