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Dalavich Improvement Group (DIG)

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Dalavich Improvement Group (DIG) DIG River Avich Hydro Project v 1.4 June 2014 Dalavich Improvement Group (DIG) River Avich Hydro Project Business Plan June 2014 Scottish Company No. SC227767 Scottish Charity No. SCO32664 Page 1 of 25 DIG River Avich Hydro Project v 1.4 June 2014 1 Executive Summary Dalavich Improvement Group (DIG), a charitable organisation supporting the communities of Inverinan, Dalavich, Lochavich, and Kilmaha, is proposing to develop a community hydro- electric power scheme on the River Avich, on land currently owned by Forestry Commission Scotland (FCS). The scheme is a long-term income generating project. The money generated by the scheme, after deducting operating costs, will be used to fund a range of projects, not currently funded by national or regional organisations, that will benefit both residents and visitors and improve the long-term viability of the communities. The intention is to establish a trading subsidiary of DIG, known as River Avich Community Hydro (RACH). RACH will be an Energy Supply Company and will own and operate the hydro-electric system. As a trading subsidiary, any surplus made will be gifted to DIG free of corporation tax, for distribution to approved community projects. There will be two distinct committees: One will manage the implementation of the Project, formation of the Operating Company, and initial start-up of the Hydro Scheme. The second will be the Committee that oversees the allocation of funds, this sub-committee will be an integral part of DIG. The project has 65.1% support from within the community. A postal ballot of all those on the electoral roll in the operating area covered by DIG demonstrates that 89.9% of the 72.5% who voted are in favour of the project. A total of 109 papers were distributed, with 79 papers being returned. The Hydro Scheme is located on the River Avich, just above the outskirts of Dalavich, and is a run of river system not requiring a dam. The proposed design will involve constructing a new intake weir beside the existing intake weir on the river. The new turbine house will be located alongside the ruins of an earlier turbine house and will utilise a similar pipeline route as the earlier scheme with due consideration for the heritage of the area. The hydro turbine is expected to be rated at 350kW subject to variation in the proportion to flow of water down the river. In the unlikely event of water shortage (none has been recorded in the last 25 years) priority will always be given to the private domestic water supply that extracts water from the existing intake weir. Power produced by the turbine will be sold to the National Grid via a buried power cable connecting to existing power lines which are approximately 150 m from the turbine house. A feasibility study has been commissioned from Gregor Cameron Consultancy Ltd who are a project management consultancy specialising in hydropower schemes. They have produced the Environmental statement as required by the Scottish Environmental Protection Agency (SEPA). This includes a full environmental assessment of the impact on local ecology. This study has not identified any showstopper problems for the scheme. The cost estimate for the project is in the region of £900,000. The current proposal (subject to negotiation) is that capital costs will be paid off over 12 years. It is estimated that from year 2 there would be £40-60,000 per annum available for community projects during the payback period; this would increase to £180,000 after the finance costs have been repaid. Scottish Company No. SC227767 Scottish Charity No. SCO32664 Page 2 of 25 DIG River Avich Hydro Project v 1.4 June 2014 Table of Contents 1 Executive Summary ............................................................................................................................. 2 Table of Contents ................................................................................................................................... 3 2 Business Objectives ............................................................................................................................. 5 3 Project Objectives ............................................................................................................................... 5 4 Introduction ........................................................................................................................................ 5 4.1 Background Information .............................................................................................................. 5 4.2 Geography of the Site .................................................................................................................. 6 4.3 Local Community .......................................................................................................................... 6 4.4 Avich Hydro Community Fund ..................................................................................................... 7 5 Organisation and Management .......................................................................................................... 8 5.1 Stakeholders & Partners .............................................................................................................. 9 5.2 Supporters .................................................................................................................................... 9 5.3 On-going management .............................................................................................................. 10 6 Financial Assessment ........................................................................................................................ 10 6.1 Assumptions ............................................................................................................................... 11 6.2 Income & Expenditure ............................................................................................................... 11 6.3 Procurement Strategy ................................................................................................................ 13 6.3.1 Feasibility, Outline Design and Consenting ......................................................................... 13 6.3.2 Detailed Design and Management ...................................................................................... 13 6.3.3 Supply, Installation, and Commissioning of Plant ............................................................... 13 6.3.4 Startup Operation of RACH ................................................................................................. 13 7 Project Resources .............................................................................................................................. 14 8 Project Delivery ................................................................................................................................. 14 9 Risk Assessment ................................................................................................................................ 14 9.1 Major Risks ................................................................................................................................. 14 9.2 Risk Register ............................................................................................................................... 15 10 Summary of Benefits ....................................................................................................................... 15 10.1 Long Term benefits .................................................................................................................. 15 10.2 Short Term and specific benefits ............................................................................................. 15 10.3 Employment Opportunities ...................................................................................................... 16 10.4 Green Energy ............................................................................................................................ 16 10.5 Other Benefits .......................................................................................................................... 17 Scottish Company No. SC227767 Scottish Charity No. SCO32664 Page 3 of 25 DIG River Avich Hydro Project v 1.4 June 2014 11 Managing the Land ......................................................................................................................... 17 12 Communication Strategy ................................................................................................................ 17 13 Project Timescales .......................................................................................................................... 18 14 Appendices ...................................................................................................................................... 20 14.1 Map of Area ............................................................................................................................. 20 14.2 Project Team Experience ......................................................................................................... 21 Ronald ‘Ronnie” Maceachen ........................................................................................................ 21 Christine ‘Chrissie’ Sugden ........................................................................................................... 21 Sheila Clark ..................................................................................................................................
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