Impact Report 2023 | Schroder BSC Social Impact Trust plc
Schroder BSC Social Impact Trust plc | Impact Report 2023
CASE STUDY: Rathbones Charity Bond, Coigach
SBSI’s investments in Rathbone Charity Bonds support the market for charities raising capital from public bond markets. This includes Coigach Community CIC, a community interest company which owns and operates a 500-kw wind turbine on a remote peninsula in the north-west Highlands of Scotland. Coigach’s charity bond refinanced higher cost loans used to install the turbine. The community of Coigach faces many challenges common to remote locations including: a lack of affordable housing, decreasing levels of health provision and a fragile economy reliant on the traditional industries of fishing and crofting.
In response, the Coigach Community Development Company – a local charity established by residents in 2010 – led the development of the wind turbine, which started generating electricity in March 2017. Coigach Community CIC donates 100% of retained profit to Coigach Community Development Company, funding a variety of community projects including grants for residents for education, training, wellbeing and support with energy costs. On a longer-term basis, there are also projects to develop affordable housing and transport links and increase employment.
£115k profits generated for community projects
1,763Mwh renewable energy generated
Rathbones Charity Bond
SBSI Investment £241,000
Financial drivers and risk mitigation
Impact return and risk mitigation
Revenues from the turbine’s energy generation benefit from the Government’s Feed In Tariff Scheme, linked to RPI
What: Access to affordable renewable energy and support for community projects W ho : Members of local communities facing rural development challenges How Much: 1.7GWh renewable energy generated in the year to March 2022, with £115k profits donated as community contribution in the same period Contribution: Delivering additional funding targeted to community need Risk: Alignment risk that revenues are not targeted at areas of community need, mitigated through the long-standing Community Development Company, established by residents with a community focus
Sweet Sp o t
The bond is therefore able to pay interest of 5% a year increasing annually in line with inflation (RPI)
Asset-backed: bonds are secured by a first legal charge over the turbine
User Voice
Coigach’s board of directors are elected by the local community. Full membership is open to all local residents, while 12-15 year olds are also encouraged to join as junior members to represent the views of local young people and children.
Any reference to sectors/countries/stocks/securities are for illustrative purposes only and not a recommendation to buy or sell any financial instrument/securities or adopt any investment strategy.
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