Ripple Energy wind farm?

Exiled_Tyke

TCA said:

I don't view it as an investment vehicle as such. To me it's a way of hedging your electricity expenditure, something you'd be spending money on anyway. Nothing more than effectively fixing the wholesale electricity part of your bill at cost. If I wanted a proper investment I'd buy shares in Vattenfall or the likes.

I thought Vattnefall was government owned and therefore not publicly listed? 

TCA

No idea. It was just the first renewable company that popped into my head. My point was that if you want to invest in the profitability of a renewable company, then you buy shares in one. Buying into a Ripple co-op isn't the equivalent.

QrizB

TCA said:

No idea. It was just the first renewable company that popped into my head. My point was that if you want to invest in the profitability of a renewable company, then you buy shares in one. Buying into a Ripple co-op isn't the equivalent.

Greencoat UK Wind might be a better example. Currently paying a 5% dividend yield (roughly the same as the ROI on Ripple).

(This is not investment advice, I'm just another random person on the internet. Do your own research.)

Exiled_Tyke

TCA said:

No idea. It was just the first renewable company that popped into my head. My point was that if you want to invest in the profitability of a renewable company, then you buy shares in one. Buying into a Ripple co-op isn't the equivalent.

OK but this is still investing in the 'profitability' of a renewable company - although the investment is probably more similar to a corporate bond paying regular interest rather than shares. That said QrizB's suggestion of Greencoat is an interesting one in that the company has a stable dividend policy (aiming to increase with inflation I think (from memory)  and could conceivably also used to hedge energy costs without the inflexibility of Ripple. I also like it because it's now buying UK off-shore turbines from Orsted (I think, again from memory). Obviously not a recommendation just my reasoning why I bought into Greencoat and not Ripple.  

TCA

With Ripple you're buying into a cooperative society that owns a wind farm. To me that's a far different proposition from investing in shares or bonds of a company, from which you'd expect stock market-like returns.

In my mind I'd invest in Greencoat to make money, not to hedge energy costs. The return from Greencoat is more than just a factor of high energy prices and low stable production costs, which is really all a Ripple co-op offers.

Different beasts in my opinion. If you want to make money investing in renewables, then Ripple is the wrong vehicle.

Exiled_Tyke

TCA said:

With Ripple you're buying into a cooperative society that owns a wind farm. To me that's a far different proposition from investing in shares or bonds of a company, from which you'd expect stock market-like returns.

In my mind I'd invest in Greencoat to make money, not to hedge energy costs. The return from Greencoat is more than just a factor of high energy prices and low stable production costs, which is really all a Ripple co-op offers.

Different beasts in my opinion. If you want to make money investing in renewables, then Ripple is the wrong vehicle.

There's not as much difference as you are suggesting.  Greencoat is entirely invested in wind farms and that is all. It doesn't invest in R&D or other technologies. It aims to produce returns primarily by dividends. These are currently roughly 5% (on the current share price) and expected to grow at RPI. So all in all: 

1. Like Ripple the returns are entirely dependent on the performance of the turbines. No investor should be expecting fantastic returns but should be expecting returns dependent on electricity production (from the wind conditions) and the market price of electricity. The returns on Greencoat should therefore reflect the performance of the renewable energy market more closely than the stock market as a whole. 
2. A key difference is that the Greencoat smooths the returns through its dividend policy but overall expects a similar performance. 
3. Ripple is expecting to produce returns of about 7% a year but over a limited life of 25 years. Greencoat is 5% but in perpetuity.  If returns are greater than expected the share price will increase but this should only occur is energy prices dramatically increase in the same way that the Ripple will present greater savings if prices are high. 
4. Greencoat is diversified across many wind farms and many turbines. The performance of one particular turbine or one particular farm will not affect overall performance too significantly or too adversely. Thus should be overall less risky. 

Therefore it is my conclusion that investment in Greencoat could be taken as a form of hedging against domestic electricity bills but with less risk and greater flexibility than Ripple. 

Reed_Richards

One difference between a cooperative like Ripple and a quoted company like Greencoat arises when it comes to voting.  As a shareholder you get, effectively, one vote per share.  In a cooperative it's one vote per member.  But whether you ever get to vote on anything meaningful either way is a moot point.  Has Ripple ever called a vote?  

QrizB

Reed_Richards said:

Has Ripple ever called a vote?  

The co-operative - "Co-Pilot Wind Project Limited", also here - is distinct from Ripple.

Coastalwatch

Reed_Richards said:

One difference between a cooperative like Ripple and a quoted company like Greencoat arises when it comes to voting.  As a shareholder you get, effectively, one vote per share.  In a cooperative it's one vote per member.  But whether you ever get to vote on anything meaningful either way is a moot point.  Has Ripple ever called a vote?  

Yes, we were all invited to the virtual AGM and to also vote for two members to become board members to act in the best interest of the Co-op and members alike. So not too different from board members elsewhere with the exception being that as volunteers they are not able to vote themselves salary increases.

Of course there are out of pocket expenses to be claimed which may be up for review from time to time.

Coastalwatch

Just logged on to my Ripple dashboard and find that they've now updated my return for the coming twelve months, £396 equating to a 14.6% return on our investment. Now, that was a pleasant surprise.