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UK PV market pulls in investors

Giles Hanglin, Savills said: "We have been and continue to operate a buyers’ group approach which has enabled us to more than halve installation costs for our clients over the last 18 months. Many of the schemes have been installed on buildings with high electricity demand, such as cold stores and grain stores.

"As the industry moves away from smaller scale systems under the FIT scheme and towards much larger field scale and very large roof schemes under the Renewable Obligation Certification (ROC) scheme, investors, from ethical power investors to pension fund investors, are showing more interest in the market. Any PV sites capable of an approximately 1Mw scheme and upwards will be very carefully considered by an investor, with good ground and roof rents being paid. PV offers a complete package technology; it has no moving parts, uses no fuel and requires very little maintenance, making it an ideal investment.

"Investors and landlords work together in a number of ways but these essentially boil down to paying a ground or roof rent for installing equipment. These rents will either be paid as a capital sum, a proportion of the FIT, cheap or free electricity sold to the landlord – obviously these depend on scheme sizes. Funders are also considering joint ventures with landlords."

Hanglin added: "Most importantly we are obtaining very high ground rents which can easily surpass what a farmer can achieve out of farming an acre of land, in particular marginal agricultural land; it is essentially a beneficial diversification option for marginal land or unutilised roof space."

Many of the large schemes (+ 25 acres) which were previously considered under the original FIT scheme, prior to the announcement of the Fast Track review in October 2011, will once again be of interest to many investors under the ROC scheme. Hanglin urges farmers in this situation to get in touch while the current window is open to assess sites and take them forward.

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