Crowdfunding for RES project - for Livingston Palais in Frankfurt
Published on 07 June 2019
Germany
Darmstadt
This is the good practice's implementation level. It can be national, regional or local.
About this good practice
The company Bettervest GmbH provides a platform for ecologically oriented crowdfunding projects. Worldwide it has collected money for 79 projects. Project size ranges from 50,000 to 2,500,000 Euro, in special cases project size may be smaller. Other than for most bank loans limited equity capital is required for this form of financing. The collected money can also be used as extra financing additional to bank loans thus allowing for project sizes that could otherwise not be realised.
For private investors the crowdfunding platform provides easy access to ecologically oriented projects. Investments are possible starting from 50 Euro. Thereby it allows for investments of private persons in projects carried out by ecologically oriented companies, public bodies/municipalities or various associations that would otherwise not be available for these investors. Beneficiaries of the practice are besides investors and project partners the beneficiaries of the specific project, e.g. the tenants whose electricity prices decrease.
An example of a project is a combined heat and power plant in the Livingston Palais in Frankfurt which decreases CO2-emmissions by 30% and generates revenues by selling electricity to tenants. 79,950 Euro were necessary for the realisation of this project. The required extra funds were collected via the crowdfunding platform of Bettervest GmbH. 108 parties invested in this project. Repayment is scheduled for a period of 7 years with a rate of return of 6,5%.
For private investors the crowdfunding platform provides easy access to ecologically oriented projects. Investments are possible starting from 50 Euro. Thereby it allows for investments of private persons in projects carried out by ecologically oriented companies, public bodies/municipalities or various associations that would otherwise not be available for these investors. Beneficiaries of the practice are besides investors and project partners the beneficiaries of the specific project, e.g. the tenants whose electricity prices decrease.
An example of a project is a combined heat and power plant in the Livingston Palais in Frankfurt which decreases CO2-emmissions by 30% and generates revenues by selling electricity to tenants. 79,950 Euro were necessary for the realisation of this project. The required extra funds were collected via the crowdfunding platform of Bettervest GmbH. 108 parties invested in this project. Repayment is scheduled for a period of 7 years with a rate of return of 6,5%.
Resources needed
Project size ranges from 50,000 to 2,500,000 Euro, in special cases project size may be smaller. Investments are possible form 50 Euro and due to German law limited to 1,000 Euro resp. 10,000 under certain circumstances.
Evidence of success
Crowdfunding projects bear the risk of total loss which is made transparent at the homepage. However, statistics of Bettervest GmbH indicate that a high number of projects is successful. Of overall 79 projects 6 failed, 64 are in the process of repayment and 9 have been repaid already completely. Average rate of return is 7.23%. Due to statistics by Bettervest GmbH investments have resulted in CO2-savings of 326,000 tonnes, on the average 8,200 tonnes per project.
Potential for learning or transfer
The crowdfunding platform provided by Bettervest GmbH takes up the problem that many potential private investors are willing to invest in ecologically sustainable projects on the one hand and many ecologically sustainable projects have problems finding enough financing. The platform gives these parties an opportunity to get together. This model could be opened for several more projects. It would be particularly interesting if projects would include a local/regional aspect by attracting local/regional investors for local/regional projects. Thereby it would not only provide for financing but also could raise significantly the level of acceptance of potentially controversial RES-projects. Furthermore, crowdfunding could be used more than currently for financing of public projects. These projects would be of special interest for private investors as public bodies have a low risk of bankruptcy.
Further information
Website
Good practice owner
Organisation
Bettervest GmbH
Germany
Darmstadt
Contact
Project Manager