Allen Fabrications Ltd
Landlord invests to turn empty roof space into a profitable asset
Allen Fabrications Ltd are a high quality industrial and agricultural building designer and manufacturer who have been established for over 40 years. They also own, let and manage their own commercial property portfolio. Based in Evesham, Allen Fabs' clients are located throughout the Midlands and South Worcestershire. Allen Fabs have several commercial buildings at Vale Park West Industrial Estate in Evesham, on which they were looking to install solar PV.
Following several meetings and a competitive quote situation, Craig clearly saw the benefits of using a professional firm like Mypower, who have strong customer and project management skills, and would keep his tenants 'on board' throughout the project. Also, when it comes to construction, Allen Fabs know the importance of using a quality solar installation team who are appropriately trained and qualified to work on roofs, taking care not to cause damage. Although Allen Fabs had already been offered lower performing and cheaper solar modules, Craig appreciated the benefits of using the more expensive high quality, high-yielding panels. This, along with their excellent project management background, ensured the contract was awarded to Mypower.
Within 2 months of the first meeting, all consents had been obtained, systems designed, installed and operational - all fully managed by Mypower on behalf of Allen Fabs.
Key facts and predictions for one of Allen Fabs' 50kW installations at 2020 rates
- 50kW - supplied and installed by Mypower costing £32,500 (exc. VAT)
- 47,000kWh - electricity produced per annum
- 4.38 p/kwh - equivalent forward purchase price of 1,082,391 units of electricity over 25 years including estimated Operating & Maintenance costs.
- 11.9 tonnes - CO2 emissions avoided per annum.
- £5,739 - projected first year income and savings, assuming 75% onsite usage.
- 17.7% - projected first year return on capital invested, before capital allowance benefits.
- 5.7 years - system payback before finance, tax and capital allowance benefits.
- £232,425 - total projected income and savings over 25 years after indexation.
- 68% - saving from solar PV electricity compared to grid supplied electricity at 15.3 p/kWh.
Redundant roof space becomes profit source for landlord
- An ROI in excess of 17% for turning a roof space liability into an asset.
- A greater attraction for tenants means improved letting ability, while improving the building's EPC rating ensures that the Minimum Energy Efficiency Standards (MEES) are met, and penalties avoided.
- Additional protection given to the roof by reducing UV deterioration.
- Minimal maintenance and running costs as solar is easily be managed by an admin function.
- Carbon reductions to landlord's business portfolio.
Win-win for landlord and tenant
- Allen Fabs share some of the commercial benefits with their tenants by offering a discounted electricity rate, passing on a 15% discount from 15.3p to 13p/unit.
- Protection against rising electricity demand and costs, as tenants' electricity requirements are likely to increase with demand for electric vehicles (EVs). There is, therefore, a greater need for cheaper, cleaner electricity.
- Tenants' customers and employees see a very tangible demonstration of how their business is tackling climate change.
- Almost 12 tonnes of CO2 avoided per annum.
Five systems and counting
Mypower have installed a total of five commercial solar PV systems for Allen Fabs. Craig can now sit at his desk and monitor the daily solar production on his laptop knowing that, as a landlord, he made a good investment - turning dead roof space into a profitable asset. Craig is now looking at other buildings within his portfolio to assess their suitability for solar PV. We look forward to many more projects with Allen Fabs.
"I had been thinking about investing in renewable energies to make our properties more attractive to tenants. Solar was a logical investment and offers protection against rising electricity costs which means we can pass the savings onto our tenants".
Craig Sharp, Managing Director - Allen Fabrications Ltd