My son, Sam, turns 21 tomorrow! Wow… that is irrefutable proof that I am now, officially, middle-aged (as much as I hate to admit it).
I’ve spent the last week catching up with Sam and the many friends I made in the beautiful and vibrant city of Missoula where I lived for many years before returning to Australia in 2012. I encourage anyone who happens to be passing through Montana to spend some time in Missoula, not just for the natural beauty of its rivers, mountains and forests, but to experience the wonderful community spirit and engagement that makes Missoula a truly unique place in the world. I’ve never been anywhere that has even half the amount of community activity that Missoula has on a daily basis. From farmer’s and craft markets, to free concerts in the park, gallery walks, sporting and recreation events, talks, festivals, music and dancing… there is always something going on here. And not only is it going on but the entire community engages in it as well, so everything feels well-supported and vibrant. It was a great place to live and remains a wonderful place to visit.
Ethical Investment Possibility
Meanwhile, I’ve just received notice of an exciting renewable energy development back home in Australia.
As someone who is constantly on the lookout for socially and environmentally responsible ‘ethical’ investment opportunities, I am excited about the possibility of buying shares in a new, innovative, community-owned renewable energy company called Enova Energy.
Based in the Northern Rivers Region of NSW, Enova will be giving preference to local residents in its initial share offering to be made in September, 2015. However, from August 13th, any Australian resident will have the opportunity to apply to buy shares in the company. Even if you have no interest in investing, it will be interesting to watch Enova develop and to see how it manages to compete with the big energy companies like Origin and AGL. In short, the company aims to:
- Be a locally-owned energy retailer with a strong focus on renewable energy;
- Install and maintain solar power (plus energy storage) systems;
- Assist its local customers with improving energy efficiency and reducing energy costs;
- Use local suppliers and installers wherever possible;
- Return a significant proportion of its profits to the local community in the form of assistance to low-income customers and education about renewable energy to the wider community;
- Pay dividends to its shareholders;
- Encourage and assist other communities to establish their own local energy companies.
The Company Prospectus details an impressive list of experienced managers and directors along with their relevant experience and financial interests in the company. The following italicised quotes are taken directly from the Prospectus outlining the business model and prospects of the company. I have copied these here purely for informational purposes and it is not intended as financial advice. I encourage anyone interested in possibly investing in this socially and environmentally responsible enterprise to read the full Prospectus which can be downloaded at the bottom of the following webpage: http://www.enovaenergy.com.au/investors/
“Investment Overview – Enova Community Energy provides a unique investment opportunity to residents of the Northern Rivers Region of New South Wales and others. We are pioneering a community owned energy retail model that provides a pathway towards offering 100% renewable energy to our residential and small business customers, and ultimately delivering a return to investors. In the Directors’ view our nimble and collaborative locally based social enterprise model is sustainable and can be replicated and scaled across like-minded Australian communities.”
“The Company will be engaged in: a) retailing energy, offering attractively priced GreenPower energy to residential customers, with the objective of delivering 100% renewable energy to our customers; b) installing and maintaining solar technologies including energy storage technology; c) providing tailored energy solutions for residential, business and government customers, individually or in groups; and d) providing education in energy efficiency and assistance in lowering energy costs.”
“We will encourage and facilitate the development of local renewable generation and aim to be a model for other communities in developing a renewable energy future”
“In line with its focus on providing environmental and social benefits to the community, Enova intends to invest an amount equal to the dividends paid to its shareholders in community benefit projects that support the ability of low income residents to participate in energy efficiency and renewable energy services.”
”Offer Price: $1000. Total number of Shares offered under the Offer: 3953. Total number of Shares on issue on Completion of the Offer: 4000. Amount to be raised under the Offer: $3,953,000.”
“Offer open: 13 August 2015. Offer close and Applications due: 11 September 2015 5.00pm[(AEDT)] . Allotment: 14 September 2015. Expected despatch of holding statements: September 2015.”
“How are Enova’s environmental outcomes different to our competitors’ – Enova’s large competitors offer GreenPower – which is made up of high quality, accredited Australian generated renewable energy – as a full price add-on. Enova will offer GreenPower at discounted prices as its core offering.”
“Trading in Enova Shares will be less liquid than shares listed on the ASX. Since shares will not be listed it will not be possible to sell through a broker. We intend to maintain a Community Notice Board on our website where it will be possible to list interested sellers and buyers in order to facilitate contact between them although share prices can not be listed on the Community Notice Board. Shares can then be transferred via the Share Registry. The Registry should be contacted to obtain a transfer form.”
“The shares will not be listed on the ASX or any securities exchange in the short term. The Board will maintain a watching brief and consider listing in the medium to longer term”
“Each applicant is entitled to up to 5 voting shares. If more than 5 Shares are allocated to an applicant, the remainder of the allocated Shares will be non-voting shares as set out in the Constitution. Preference in allocation will be given to investors from the Northern Rivers Region.”
“Any person resident in Australia may apply however preference in allocation will be given to those people resident in the Northern Rivers Region, who is resident within postcodes: 2460 to 2487 inclusive. Applicants will be allocated a maximum number of 5 voting shares. All additional shares sought and allocated will be non-voting shares.”
“The Company also reserves the right to approve a system which allows Shareholders who are customers of Enova to direct the Company to use the dividends to pay their Enova electricity bills.”
“The Directors accept that following the Guidance contained within ASIC Regulatory Guide 170: Prospective Financial Information they are required not to provide forecast future earnings as the Company is in an early stage of development and there are significant uncertainties associated with such forecasting.”
“The payment of a dividend by Enova is at the discretion of the Directors and will be a function of a number of factors … No assurances can be given by any person, including the Directors, about the payment of any dividend and the level of franking on any such dividend. Subject to these considerations the board anticipates a payout ratio of 80% of NPAT (Net Profit After Tax) to be divided equally between shareholders and the NFP (the Not For Profit arm called Enova Community). A payout ratio of 80% equates to a dividend payout of 40% of statutory NPAT.”
“Reaching a point where Enova is financially sustainable and able to commence payment of dividends rests upon a number of assumptions, including the rate at which it can grow its customer base. In this respect, Enova will need to secure 5000 customers, representing around 4% of households in the Northern Rivers Region, by June 2018”
“Our overwhelming point of difference is that we will be local and majority community owned, with a strong commitment to reducing our carbon footprint, supporting local employment and investing profits for community benefit. The initial response to this positioning has been very positive.”
“As a committed local employer, Enova intends to engage with local suppliers and service providers wherever possible in order to maximize economic and social benefits to our region.”
“In addition to attractive FITs, GreenPower options or lower price, Enova also intends to provide energy audits, tariff assessments, and assist customers in assessing and installing solar and other energy saving equipment to help customers lower their energy cost and save on greenhouse gas emission.”
“Initially the installation arm will focus on the traditional, small scale solar PV for homes and shops, large scale PV for factories and commercial premises and solar hot water. Over time we will support other existing and emerging energy management technologies and energy efficiency tools and equipment.”
“There are a number of risks and threats, both specific to Enova, and of a general nature, which may either individually, or in combination, materially and adversely affect the future operating and financial performance of Enova and the value of Shares. Many of these risks are partially or completely outside the control of Enova, its Directors and management. There can be no guarantee that Enova will deliver on its business strategy, or that any forward looking statement contained in this Prospectus will be achieved or realised.”
“There is interest from other communities in establishing a similar structure or in our supporting them using our own systems and operations. We intend to assist such communities to set up similar models by sharing our experience and developing a coalition of likeminded community energy companies that can share costs and systems; spread risk; bulk buy equipment; and trial new and innovative offers.”
I intend to apply for one or more shares although, if all of the shares are taken up by local residents of the Northern Rivers region, I may well miss out on the opportunity. All of the above is for information purposes only and is not intended as financial advice. If you are interested in the prospects of Enova Energy please read the entire Prospectus and consult your own financial advisor before making your own decision to invest. Once again, the full Prospectus can be downloaded at the bottom of the following webpage: http://www.enovaenergy.com.au/investors/