Newtown brewery Young Henrys raised $60,000 this week for a community-based solar fund to enable it to add more solar panels to its brewery.
The investment is being facilitated by the Pingala Co-operative, which started as a community renewable energy organisation in Sydney. The project will allow around half of Young Henrys energy usage to be derived from solar panels on its own brewery.
Young Henrys co-founder Richard Adamson said that they had worked with Pingala before to launch the Young Henrys solar project initially in 2016, raising $17,5000 in nine minutes, and they wanted to team up again to expand the project.
“This will be an extension on our current 30kW panels, adding an extra 39kW, which will be amazing. It should do over half our electricity needs on the site,” he said.
The other half of Young Henrys energy usage is sourced through an ENGIE Power Purchase Agreement.
“We’re partnering again with Pingala, they started with a grant from the City of Sydney but they’re standing on their own two feet now.
“It allows people to invest in sustainable business solutions in the local communities and getting solar in energy-intensive industries.”
Young Henrys is no stranger to sustainability projects, having invested in CO2 recovery with its algae project. Its credentials as an environmentally conscious brewery have only grown in recent years, which has translated into huge popularity of the funding raise with Pingala this week.
“For this one, we had an Expressions of Interest this week and we’re up to $60,000 already [as of Tuesday 11th May],” Adamson said.
The Co-operative works by signing up a host, in this case, Young Henrys. The initial raise will help pay for the installation of the solar panels, after which a power purchase agreement is signed, and electricity generated from the panels is sold and used by the occupants of the building, rather than going to the grid.
Then, as Young Henrys pays off its solar panels over a ten year period, money is returned to the Co-operative and paid out to its investors as dividends.
This revenue stream will repay the community investors with a rate of return between 5 to 8 per cent per annum through the Pingala Co-operative.
Shares are valued at $1 in packets of 250 with four bundles allowed per person according to Pingala.
Unlike other crowdfunding projects which often do not return dividends, there is a return on the Pingala platform of up to 8 per cent per annum.
“There’s a return of around 5-8 per cent depending on the project, and we lease the panels from Pingala, so we don’t have to fork out for the infrastructure,” explained Adamson.
“The banks basically pay nothing at the moment so that’s astonishing, and the money is always working to further install more projects.”
During the first round in 2016, Young Henrys may not have been able to fund the project themselves, but by 2021 the Sydney brewery would have been able to pay for the solar infrastructure themselves.
However, Adamson said that being part of the project, engaging consumers, and helping people who would like to invest in renewables but might not have been able to on a smaller scale makes it worth it.
“Yeah, we don’t have to do the capital outlay but the beautiful part is getting people involved.
“Initially when we first did it it would have a been a trench [to pay for it]. However, we could probably do it now and give people the opportunity to invest and get involved.
“It’s conscious consumerism, which is a big factor for people’s decision making now, they want to support companies that align with their values.
“People do think about these things when they make their decisions, it’s not all about great beer, although that’s a big thing, it’s about other things that people are passionate about too.”
Listen to the Beer is a Conversation podcast with Oscar McMahon and Dan Hampton of Young Henrys.