Wind farms – financial structures to maximise returns By Jamie Ritchie
When embarking on a wind farm project, the main priority for many people is to progress the planning application and commercial feasibility study to ensure your renewable energy project delivers on green credentials and is financially rewarding.
Often the challenges you face to get over the first hurdles are time consuming and intensive which can mean that other important considerations are not reviewed as early as they should be. It is vital that you think about how to maximise the financial rewards of the development, in conjunction with your planning and commercial studies.
The first step is to take ownership of the financial projections and modelling to ensure the significant costs of planning and commercial assessment is an investment worth making.
The next consideration is likely to be how you will finance the development. If you are self-funding, how do you minimise the personal financial risks? And if you are looking to raise funds via debt and equity, how do you achieve the funding required that will maximize personal value?
The renewable energy team at Johnston Carmichael has significant experience in the sector and can add value, not only in the preparation and presentation of the financial model, but also support your approach to debt and equity providers.
It is also important to consider the tax implications of the scheme and of your investment.
For example, have you considered how you want the profits to be shared or what the best tax structure to minimise your liabilities is? Do you want the development to act as your pension or will you pass the funds onto your children?
The most appropriate structure for you will depend upon your personal objectives and circumstances.
At Johnston Carmichael we firmly believe in playing our part in creating a sustainable future. As renewable technology develops, we are building on our existing knowledge and expertise in the renewable energy sector, and as the market develops, we are committed to playing a key role in ensuring that Scotland becomes a global hub for sustainable energy.
Once the renewable project has been developed and has started to operate; your bjectives have been achieved, or have they? By careful planning upfront and early engagement, we can provide continued and rounded support in helping achieve your goals.
Developing a structured process upfront will deliver improvements in the efficiency and the quality of timely management information which can be instrumental in ensuring your scheme runs profitably and with good cash flows.
At Johnston Carmichael we have introduced many similar systems and can advise on the most appropriate solution for you. Alternatively it may be preferable to outsource the management accounts production.
As renewable technology develops, Johnston Carmichael is continuing to build on its significant knowledge and expertise in this sector, supporting over 70 renewable enterprises across a variety of sectors in Scotland. We can provide support with: Business structuring, company set up and financial modelling; raising finance; tax planning advice including the application of capital allowances; accounting support; audit and tax compliance; and assistance with contract reviews, tenders and business strategy.
We are committed to playing a key role in ensuring that Scotland achieves its objective of becoming a global hub for sustainable energy.
If you would like to discuss how we can assist you please do not hesitate to contact your local Johnston Carmichael office or visit www.jcca.co.uk for further information.
Jamie Ritchie, Director, Corporate Finance and Head of Renewable Energy at Johnston Carmichael. Email: jami…@jcca.co.uk or call 01224 212222.
We are well placed in the market both geographically, with offices in eleven locations, and in terms of our significant knowledge and expertise to offer a high quality value for money service.
For more information about how Johnston Carmichael can help your business, please visit our website for details of your nearest office.
Johnston Carmichael has thirteen offices in twelve locations throughout Scotland.