Ecotricity EcoBonds - 7% fixed rate, 4 year term

mr_fishbulb

There is an article about this today on the Motley Fool - http://www.fool.co.uk/news/investing/company-comment/2010/10/28/go-green-for-7-a-year.aspx

premierfella

A pretty fair and comprehensive assessment by the Fool.

I took a look at the EcoBond, but in addition to the risks decided against as I am personally always suspicious of companies that are happy to have customers as holders of their debt but don't feel inclined to allow them to take an ownership stake.

bobkin100

Sceptic001 wrote: »

What are the comparable rates for corporate bonds issued by other electricity generators?

(Interesting website, sabretoothtigger. I wish they would also show the cost of generating each type of electricity. I note that 11% of my last bill was to cover the subsidy for renewables :mad:)

I am an Ecotricity customer, but also an accountant/ bookkeeper. I have had a fairly successful business for years until those astute paragons of how not to run a business, the bankers, wrecked the economy in 2009. This is my personal opinion:

There are a couple of people who are expressing doubts not about this bond issue but about renewable energy, so lets use some facts here:

It has been estimated that the average UK onshore wind farm will pay back the energy used in its manufacture within around 6 months. Throughout its working life, a wind turbine can produce eighty times the amount of energy needed to make it. And most of the metal work can be recycled. A modern wind turbine is designed to operate for 20+ years. A typical wind turbine in the UK will, in fact, generate some electricity for 80 to 85% of the time.

Renewable electricity output, from whatever technology, receives a Renewable Obligation payment in acknowledgement of its clean, low carbon output which is paid via consumer bills. However,oponents of wind energy seem far less concerned about the larger subsidies given to fossil fuels. According to the New Economics Foundation report, 'Up In Smoke' (2004), industrialised countries (OECD) provided a subsidy of $73 billion a year to their fossil fuel industries in the 1990s, with a further $162 billion subsidising fossil fuels in non-OECD countries.

Now the bond issue. All the information positive and negative, is in the Invitation Document, as required by law. It is evident that the company is in a very strong position. This country has an obligation to provide at least 20% of its energy from renewable sources by 2020. Therefore, it is extremely likely that the current high growth in renewables will continue. It also has a full order book, hence the need for more funding. Finally,Ecotricity has been operating since 1996 and is clearly solvent.

You must make your own decisions about whether or not to invest. Take advice if you need to, but please beware of naysayers bearing incomplete and inaccurate dogma.

I have put my money where my mouth is and have sent off for some of the bonds today.

Comet54

The Ideas Factory web site currently has a solar panel investment idea
looking for funds.
Have a look and see what you think. I can't make up my mind about it.