If the project does not go ahead for any reason your share investment will be returned to you within one month of the share offer closing. However, we will not be able to pay an interest whilst we have your investment.

LCE wishes to raise all the money needed to install solar panels on all 4 buildings and other potential buildings by selling community shares. However, contingency plans are in place to raise any shortfall from a commercial lender and to pay off these loans as quickly as possible once revenue is being generated from the solar schemes. The projected cost of installing the solar schemes and its first year operational costs as well as future replacement of the inverters will be in the region of £_________.

LCE have set a threshold for the money to be raised from the sale of community shares of a minimum of one third of the full costs.

No. Community Benefit Societies are registered by the FCA, but Societies are not required to be authorised by it for the issue of withdrawable shares.

This means that community investors have no right of complaint to the Financial Ombudsman Service and cannot apply to the Financial Services Compensation Scheme.

Once LCE has been generating electricity for 4 months we will send you a form that you will need to complete and submit to the HMRC. The tax relief can be claimed usually against your self-assessment tax return of the tax year in which the shares were issued or an adjustment to any self-assessment payment on account due. You will have to make the claim on your tax return when you get it.

If you pay your income tax through Pay As You Earn (PAYE) you can request a change to your tax code.

The sale of community shares is not regulated by the Financial Conduct Authority because investors are deemed to be investing for social returns, not financial gain. This is good news for community ventures, which would otherwise face prohibitively expensive regulations when marketing community shares. However, it comes at a cost to community investors who have no right of complaint to the Financial Ombudsman Service and cannot apply to the Financial Services Compensation Scheme.

Community shares are more risky than keeping your money in a savings account with a bank or building society, where currently the first £50,000 is fully protected. You can lose everything you invest in a community shares offer. This is why it is important to look carefully at a community share offer before deciding to invest. More information on the risks is explained in the Share Offer Document. It is important that you read all Share offer Document fully before deciding whether to invest or not.

We would advise you to take appropriate independent financial and other advice

No. Others will not know how many shares you have bought only that you have bought some shares because you are a Member of Livewire Community Energy Limited.

Anyone who has a valid UK bank account and is over 16 can buy shares. It is then up to the Society to accept them as a Member.

You may want to buy shares because:

• You want to see the community in which you live or work benefit from the revenue the solar schemes generate
• You want to support a renewable energy scheme which contributes to climate change targets
• You want to be part of a democratic community run organisation
• You want to have more control over where money you invest in goes

Those buying shares will be largely motivated by a wish to support the solar schemes and its underpinning social purpose and objectives which benefit the community. It may also provide a good investment opportunity for your money with an average of ___% interest which is better than many high street banks and you may be entitled to the tax relief from HMRC on your investment if you are a taxpayer.

Shares cost £1 each and the minimum number you can buy is 250 or £250 worth of shares. The maximum that you can invest under the Seed Enterprise Investment Scheme is £20,000 or under the Enterprise Investment Scheme it is £100,000.

Yes. LCE has specified the terms for withdrawal in order to manage our finances, such as the period of notice of the intention to withdraw (3 months’ notice). The Directors also have the right to suspend withdrawal of shares.

Like most new Societies LCE will defer making provisions for withdrawal by suspending the withdrawal of share capital for an initial period of three years to ensure that the solar schemes will get established and become profitable.

There is a legal limit on the amount of withdrawable share capital that can be held by an individual member, and the Directors have some discretion about the amount of shares which can be withdrawn in any one year. However, it is the Society’s intention that, in addition to those shareholders who ask to withdraw their shares, LCE also has a planned programme to buy back shares as soon as the revenue from the solar schemes allows this.

Yes. It has been estimated that there are currently over 22,100 members of community energy groups in the UK providing funding for renewable technology such as solar, wind and hydro. Community Share Offers have raised nearly £13 million for investment in renewable energy up to June 2014. Set out below are a number of examples of community organisations who have raised investments from share offers for solar:

• Bath & West Community Energy
• Brighton Energy Coop
• Community Energy Warwickshire
• Low Carbon Hub
• Plymouth Energy Community
• South Brent Community Energy
• Sheffield Renewables
• West Solent Solar Co-operative
• Morecambe Bay Renewables Energy (MORE Renewables)

Recently in March 2015 High Winds Community Benefit Society, based in Cumbria, raised £3.6 million from a share offer for a community owned wind farm.

To visit their website click on the following link: http://www.highwinds.coop/

Community shares refer to a distinct type of share capital called “Withdrawable Shares” which provide capital for a community project and behave differently to conventional share capital, (which are known as ordinary or transferable shares). The difference is explained below:

Transferable or Ordinary Shares

Most companies, such as BT, use a form of share capital known as transferable or ordinary shares, which can be transferred or sold by shareholders to a third party at a mutually agreed price based on their personal valuations. Investors buy shares in the expectation of two types of financial return:

• Regular dividend on shares
• The possibility of capital appreciation, in which case they would expect to sell the shares at a higher price than they paid for them.

Shares in larger companies are bought and sold through stock markets, but these markets do not cater for smaller companies where there are very few buyers or sellers.

Withdrawable Shares

Withdrawable share capital is completely different. This type of share capital cannot be transferred between people. Instead Members wishing to withdraw their share capital will have to apply to the LCE Board after the third year of operation giving three months’ notice. Withdrawal of share capital is at the discretion of the Board, although will not be unreasonable refused as long as there are sufficient funds available.

Members of LCE will be allowed to withdraw their share capital, subject to the rules of the Society and, therefore, it provides a straight forward way of getting your money back when you want to cash in your shares if the Society has sufficient funds available at the time.

The value of shares is fixed and not subject to speculation. LCE has the power to reduce share values or suspend repayment of share capital if the Society is experiencing financial difficulties.

Shareholders have only one vote, regardless of the size of their shareholding, so the Society is democratic. There is a limit on personal shareholdings of up to £100,000 and there is also a limit on the interest paid on share capital. This is based on the principle that interest should be no more than is sufficient to attract and retain the investment.

LCE Community Benefit Society has adopted a statutory asset lock, which prevents the Society being sold and the proceeds of the sale being distributed amongst shareholders. This removes the possibility of capital appreciation and the scope for investor speculation.

The asset lock ensures that the solar schemes and any other LCE projects belong to the local community and if it is closed in the future any assets it has will be passed to a local charity or community organisation.

There is no legal definition of community shares. The term is used here to refer to a unique form of share capital called “withdrawable shares” which can only be issued by co-operatives or community benefit societies. Livewire Community Energy (LCE) is a Community Benefit Society and exists for the broader benefit of the whole community. LCE can, therefore, issue withdrawable shares.

Community share offers are now becoming an established way of raising finance for renewable energy projects that then go on to generate a benefit for the community.

The motivation for buying these shares is usually different from that of shareholders in companies. The primary motivation for purchasing shares in a social enterprise is to support the social purpose and objects of the Society. Financial motivation is at best secondary though the rate of return can be attractive.

These differences in investor motivation are enshrined in law by limits on the financial return on investment, restrictions on the scope for capital gains, and caps on the amount of capital an individual can invest.