OXFORD taxpayers will fund renewable energy projects around the county as part of a £2.3m deal.
The money is set to be loaned to a community-based social enterprise called Low Carbon Hub to fund solar panels for schools and businesses around Oxfordshire.
In return for this money, the city council is expecting to get its money back, plus around £34,000 interest, which works out at about 1.4 per cent.
But the city council’s financial chief has warned that the return on the investment is “minimal” and there are risks associated with the investment.
The city council’s deputy leader Ed Turner has said the money would be invested back into some of the authority’s capital projects.
He said: “We think it is win-win because on the one hand it represents a good investment for the council and we will get our money back with interest and it will enable Low Carbon Hub to reduce the carbon footprint of buildings in Oxford and elsewhere.”
When asked whether taxpayers’ money from Oxford should be used to subsidise schemes around the county, Mr Turner said: “It wouldn’t be the right thing to do if it cost us money but the benefit from it will be ploughed back into Oxford.
“It makes good sense and at the end of the day we all share one climate, and climate change doesn’t stop at the boundaries of the ring road.”
He added that the city council earns an average of 0.89 per cent on its other investments.
Low Carbon Hub has a list of projects it wants to get off the ground and it was agreed the council would loan the funding. It is estimated that the project will fund solar panels for 25 schools, of which three will be in Oxford, and two businesses, none in the city.
But Nigel Kennedy, the city council’s head of finance, said: “The financial case is not strong since the return in cash terms is minimal for the increased risks taken on, the greatest of which is the failure of the share issue to enable the return of the council’s loan in the specified period.”
The city council has agreed savings of £5.4m as well as increase council house rents, parking charges and council tax.
The money for the loan comes from the city council’s capital programme but this is phased over several years.
One of the projects which will benefit from the city council’s capital project later this year is the refurbishment of Cutteslowe Park’s lower pavilion.
Kit Villiers, chairman of the Friends of Cutteslowe Park, said: “The pavilion does look a bit of a dump and an eyesore at the moment. It would be a pity to think of the work not happening quickly.”
The Oxford Mail contacted Barbara Hammond of Low Carbon Hub, but she declined to comment.
A decision on the scheme will be made by the city executive board at at 1.30pm on Wednesday, at Oxford Town Hall.
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