Who needs pinhole cameras?

Unfazed by cloud cover in Oxford, our Infrastructure team took in last week’s eclipse by observing the impact on our portfolio of solar panels.

Given the level of cloud cover disrupting the view of this celestial event from our Oxford headquarters, not to mention the dangers of squinting at the sun, the geekier amongst our number chose to watch the effects of the eclipse via the safety of our computer monitors.

Our portfolio of megawatt-scale solar installations is monitored remotely via an online portal, providing 15-minute real-time data that allowed us to track the progress of the moon across our local star. What we saw was a fantastic graphical representation of this notable event.

Whilst the effects at an individual plant level were not dissimilar to the passing of a large storm cloud, the combined impact simultaneously on all plants was rather more unsettling, as outputs dipped in unison. The overall loss of power production, even over the course of a single day, was very modest. Particularly in view of the fact that the event took place early in the morning at the start of Spring, when even on a perfect, cloudless day the panels would producing some way short of their maximum potential. In addition, many of our sites were showing the effects of the same cloud cover that hindered the view of so many sky watchers that morning.

However, as the screenshot below clearly shows, the eclipse had an unequivocal and pronounced effect on the panels. The skies were clear over our Devon based assets (in red) and cleared beautifully over the course of the morning across the country to deliver a wonderful first day of Spring.

Having proved the link between power output and sunshine, which was not really in too much doubt, it was interesting to reflect on the importance of ‘fuel mix’ and grid balancing arrangements in our national power supply. An event like this leads to a substantial trough and peak in national energy demand as people stop activity to watch and then switch on kettles after they come back in from the cold. Hydro and anaerobic digestion provide more-or-less continuous power levels to the grid, but solar and wind assets make up the bulk of the UK’s renewable energy supply, and the power they produce can fluctuate. As such, smart grid management, energy storage and short term balancing infrastructure will become increasingly important to the running of an efficient national grid. All areas of activity for the Oxford Capital infrastructure team.

The future certainly looks interesting and hopefully bright.

Estimated reading time: 2 min

 

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

  1. You could lose all the money you invest
    1. If the business you invest in fails, you are likely to lose 100% of the money you invested. Most start-up businesses fail.
  2. You are unlikely to be protected if something goes wrong
    1. Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
    2. Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here.
  3. You won’t get your money back quickly
    1. Even if the business you invest in is successful, it may take several years to get your money back. You are unlikely to be able to sell your investment early.
    2. The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
    3. If you are investing in a start-up business, you should not expect to get your money back through dividends. Start-up businesses rarely pay these.
  4. Don’t put all your eggs in one basket
    1. Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.
    2. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. https://www.fca.org.uk/investsmart/5-questions-ask-you-invest
  5. The value of your investment can be reduced
    1. The percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
    2. These new shares could have additional rights that your shares don’t have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

 

If you are interested in learning more about how to protect yourself, visit the FCA’s website here.