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Fesa B31 Solar Bürgerbeteiligung (Investment)

Article by: Paul Gipe

April 30, 2007

by Paul Gipe

Fesa’s B31 Solar PV project went into service in mid 2006. The 365 kW project was financed by Fesa as a solar bürgerbeteiligung or investment fund. While not a cooperative (voting control is determined by shares owned), Fesa’s B31 project enables many small investors to participate in German solar energy development.

Private investors provided one-third of the nearly €2 million project. Like many renewable energy projects in Germany, the debt was financed by a low-interest loan from KfW, the German bank for reconstruction.

In the first year of operation, Fesa’s B31 plant generated 400,000 kWh, 14% more than projected.

The B31 project is a group of three arrays built on a noise barrier to the B31 highway on the east side of Freiburg in Baden-Württemberg. Freiburg is on the edge of the Schwartzwald and the B31 routes traffic from the Black Forest into the city.

Freiburg is considered Germany’s solar city.

Fesa’s B31 project leases the land for the solar array from the federal government for a nominal fee of €500 per year.

The local electric utility is Badenova, a daughter company to EnBW, the regional utlity.

Badenova offered a contract to the B31 fund, but Fesa rejected it. The proffered contract included onerous terms allowing recapture of payments if the federal government revoked Germany’s EEG or Renewable Energy Sources Act.

Under the EEG, contracts are not required.

In the spring of 2007, Badenova offered the B31 Fund an improved contract and Fesa was weighing their offer.

Simple payback for the B31 fund is about 13 years.

About 0.6% of first-year revenues are reserved annually for removal of the solar plant at the end of its useful life.