Paragon Bank funds solar project for Scottish property group

Scottish commercial property company Castlecroft Group is expected to save more than £4,500 annually on energy costs following the installation of a rooftop solar system funded by Paragon Bank and delivered by HDM Energies.

Castlecroft, which manages more than 200 commercial properties across Perth and Dundee, has installed an 89.28kW solar photovoltaic (PV) system at its King James VI Business Centre in Perth.

The project has been financed through a Power Purchase Agreement (PPA), enabling the business to access renewable electricity without making an upfront capital investment.

The installation comprises 144 solar panels and is expected to generate more than 61,000kWh of renewable electricity annually, meeting approximately 37% of the building’s energy requirements.

The system is forecast to deliver first-year energy savings exceeding £4,700, with estimated savings of more than £185,796 over the lifetime of the agreement.

Under the 15-year PPA, HDM Energies owns and maintains the solar infrastructure, while Castlecroft purchases the electricity generated at a fixed rate of 18p per kWh, providing greater certainty over future energy costs.

The installation is also expected to reduce carbon emissions by approximately 14 tonnes annually. A further 100kWh battery storage system is planned to increase the building’s use of renewable energy and reduce reliance on grid electricity.

Jordan Black, Managing Director of Castlecroft Group, said:

“Through this scheme, we’ve been able to reduce our carbon footprint immediately without significant upfront capital investment, all while delivering long-term energy cost savings and price stability.

“Sustainability has become a core part of our long-term business strategy and by investing in renewable energy, not only are we improving the EPC rating of our building, we’re also protecting the environment and building a more sustainable future for our company, our clients and our community.”

Paragon commits £5.3m to renewable energy programme

The Castlecroft installation forms part of a wider UK programme delivered by HDM Energies and funded by Paragon Bank, which has attracted more than 100 organisations across sectors including manufacturing, agriculture, education, healthcare and retail.

Paragon’s SME Lending division has committed almost £5.3m to the programme to date, helping businesses invest in renewable energy infrastructure without significant upfront expenditure.

Collectively, participating organisations are projected to save more than £58m in energy costs, based on HDM Energies’ modelling, which assumes annual grid electricity price increases of 5% over 25 years.

Andy Craggs, Head of Renewable Energy Finance at Paragon SME Lending, said:

“Projects like this demonstrate how innovative funding models can remove traditional barriers to investing in renewable energy. We’re proud to partner with HDM Energies to help businesses take greater control of their energy costs.”

Dave Roberts, Managing Director at HDM Energies, added: “Castlecroft is a great example of how businesses can benefit from the transition to cleaner energy without the challenge of significant upfront investment and we’re thrilled to have helped them on their journey.”

The project highlights the growing role of alternative financing structures in helping SMEs and commercial property owners invest in renewable energy while managing operating costs and reducing carbon emissions.