CECHR Annual Symposium Dundee, 11th February 2015
New Investors New Financial Mediators New Energy Dr Ariel Bergmann Centre for Energy, Petroleum and Mineral Law and Policy University of Dundee
CrowdFundRES – Unleashing the potential of Crowdfunding for Financing Renewable Energy Projects • Horizon2020 research project - 1 February 2015 • University of Dundee participating as a major consortium partner. • The Dundee School of Business and the Centre for Energy, Petroleum, and Mineral Law and Policy (CEPMLP) • Prof Matthias Klaes • Prof Bruce Burton • Dr Ariel Bergmann “Crowdfunding can be defined as a collective effort of many individuals who network and pool their resources to support efforts initiated by other people or organizations. This is usually done via or with the help of the Internet. Individual projects and businesses are financed with small contributions from a large number of individuals, allowing innovators, entrepreneurs and business owners to utilise their social networks to raise capital.”
A new form of disruptive finance Crowdfunding- can potentially provide £100’s million for renewable energy projects in Europe in the coming decades. In the UK, almost £1.1 trillion are in traditional bank savings accounts, the vast majority of accounts are earning at less than 1% interest rate.
1% of £1.1trillion equals….£11billion! Average investment earnings rate for the larger more successful crowdfunding platforms is 6.5%.
The Research The research is to identify the effectiveness of crowdfunding platforms in coordinating investors and project developers, and identifying opportunities for this type of financing to increase its impact. 1) Evaluate crowd funding platforms 1) New financial sector, unregulated, minimal standards 2) Analysis of investors 1) Who, why, motivations, preferences 3) Analysis of projects 1) Who, why, motivations
My primary contribution – Choice Analysis: What are the characteristics of a project that determine an investors likelihood of investing? How does the marginal cost of financing change as key characteristics change? Tech type … Project scale … Experience … Conspicuous conservation … Due diligence? Others????
Deliverables 1. Gain a deep understanding of the public’s perception of crowdfunding 2. Analyse the challenges faced by the application of crowdfunding for renewable energy projects in Europe 3. Develop guidelines that support easier, more effective and wider accepted practices in crowdfunding renewable energy projects 4. Apply the guidelines and review them based on practical experience 5. Promote the crowdfunding concept and its advantages among those who could contribute or raise funds