We’ve tried to anticipate any questions you might have about Ecodynamic and our projects. If your query isn’t answered in our FAQs, contact us and we’ll get back to you as soon as we can.
The steps taken to develop Ecodynamic are:
- Establishing and registering a Community Benefit Society (the Society), called Ecodynamic Community Benefit Society Limited, with the Financial Services Authority (FSA).
- An Engineering, Procurement and Construction (EPC) company was selected, specialising in the low-carbon generating equipment for the target install area.
- Ecodynamic was made investment-ready, through a business plan, website and share offer document.
- The project is marketed to potential members (investors) who are invited to join and invest in the Society via online or postal application.
- When the target investment level of £350,000 is reached, Ecodynamic will purchase Croft West Wind Turbine, which should be operational during February 2013
- Each member has one vote.
- The project will be installed and the equipment commissioned in February 2013 – generating low carbon electricity, attracting a quarterly Feed in Tariff (FiT).
- Interest paid on shareholdings is distributed to members annually, in arrears.
- All the steps taken so far to get to this stage have been funded by Croft West Ltd, a wholly owned subsidiary of the Biodynamic land Trust
Biodynamics is based around respecting the basic principles at work in nature. It is a complete system in which all the different components of the farm are seen as parts of a greater whole. With farm animals at the centre a self-sustaining, balanced and harmonious environment is the result.
Soil fertility is optimised by introducing special manure and herb-based preparations to both the fields and compost to enhance and stimulate microbiological life. These have been shown to significantly improve the health and well being of soil, plants and animals, as well as enhancing the vitality, flavour and keeping qualities of the produce for the benefit of the consumer. With the soil locking up 25% more carbon than conventional farming methods, the health of the planet is also cared for.
The result is a rich and diverse farm built on sound organic principles which is embedded and sensitized to its surroundings and produces food with an individual quality and taste.
For more on biodynamics, see the Biodynamic Association website, and for organics, see the Soil Association website. Sustainable, farming can also include other approaches such as the agro-ecological approach of the Via Campesina, permaculture, enlightened agriculture
To develop community share issues for renewable energy projects, food businesses, and grassroots projects around the UK.
- As with all projects, the manager has to choose a competent, reliable EPC (Energy, Procurement and Construction) contractor. A risk is that the EPC contractor does not perform to contract or expectations.
- If the wind speed levels are lower than expected the forecasted returns might be lower.
- Insurances, warranties and manufacturer guarantees are in place to de-risk the investment as much as possible.
- The Financial Services Compensation Scheme does not protect members’ funds.
The Enterprise Investment Scheme (EIS) is a government scheme that provides a range of tax reliefs for investors who subscribe for qualifying shares in qualifying companies. There are five current EIS tax reliefs available to investors in companies qualifying under the EIS.
As with any tax matter, you should seek the advice of a qualified professional.
A summary of the benefits is as follows:
- Income tax – reduction of income tax liability by up to 30% of the amount invested, if qualifying EIS investment is held for no less than three years from the date of issue. Hence, for every 100p invested you would receive a tax relief of 30p.
- CGT freedom – no ‘capital gains tax’ is payable on the disposal of shares after three years, provided the EIS initial income tax relief was given.
- IHT Relief – ‘Inheritance Tax’ – Shares in EIS qualifying companies will generally qualify for Business Property Relief for Inheritance Tax purposes at rates of up to 100% after two years of holding such investment, so that any liability for Inheritance Tax is reduced or eliminated in respect of such shares.
- CGT Deferral Relief – Tax on capital gains realised on a different asset can be deferred for as long as the EIS qualifying shares are held or even indefinitely, where disposal of that asset was less than 36 months before the date of the issue of shares in the EIS investment or less than 12 months after it.
- Loss Relief – If EIS shares are disposed of at any time at a loss (after taking into account income tax relief), such loss can be set against the investor’s capital gains, or his income in the year of disposal or the previous year.
Ecodynamic adheres to EIS legislation and compiles company information for a designated tax inspectorate. It is then up to the individual to complete the EIS tax relief section on their self-assessment form, or hand over the information to their tax advisor
The return will be less than predicted if the wind blows less than predicted. However, there is an allowance for annual variation in the projections. The proposed interest payment will be voted on at the AGM.
Yes, as long as the maximum “A” share holding isn’t reached per member. The limit is £20,000 per member per Industrial and Provident Society for “A” shares.
All shares in the society are ordinary shares with a nominal value of one pound each. Each share issuance is independent from one another; a future project offer cannot use funds from this Croft West Offer or vice versa, without a members vote. Under Rule 3.2 Ecodynamic has applied for a change in share class, in order for transferable shares to be issued on specific projects for sums above £20,000, if the share issue is not taken up in full.
The society may use its property and profits only to promote its objects. The society will not pay members any dividend, bonus or other share in profits. However, the Society can pay interest on shares. The directors will set the rate of interest. In setting the rate, the society’s directors will take particular account of the society’s intention to provide an opportunity for the biodynamic, organic, low carbon community to contribute financially to other biodynamic, organic, sustainable communities, with the expectation of a social dividend, rather than a personal financial reward.
The minimum shareholding is 500 shares and the maximum shareholding is currently 20,000 shares for the first project.
No, however they can be withdrawn.
Members can withdraw their shares by applying to the Ecodynamic board. The board will meet semi-annually, unless an extraordinary meeting is convened. Withdrawal requests will be considered on a “one-in-one-out” basis, unless in the event of a member’s death or an exceptional circumstance.
There is a limited amount of capital per annum in the Ecodynamic reserves. Therefore, withdrawal will be considered when there is a matching sum to replenish the amount being requested for withdrawal. There will be a ‘bulletin board’ on the Ecodynamic website for members, which will advertise withdrawal requests. If there are sufficient funds available withdrawal requests will be considered for cancellation.
Members are not to benefit financially if the society converts, or transfers its business or is wound up.
75 tonnes of carbon dioxide approx will be save each year.
If you can’t find an answer to your question please contact us and we’ll be pleased to help.