A BID has been launched to harness the power of the Water of Leith to generate electricity and money for local projects.
Residents in Balerno want to reinstate the hydroelectric power station at the Harlaw Reservoir dam in south-west Edinburgh.
The structure was part of a network which once powered mills across the region but has been defunct since the Second World War.
Balerno Village Trust has applied to the city council for planning permission in the hope of developing the structure by next year.
The 65-kilowatt plant is expected to cost £300,000 to rebuild and would be owned by a co-operative comprised of residents from the village.
The trust counts a renewable energy engineer and an industrial designer among its members and costs have been kept down by drawing up their own schematics and using research carried out several years ago.
Key to the success of the project is the Feed-In Tariffs – the government-backed incentive to encourage renewable energy.
It would be paid 3-5p for every kilowatt hour generated but 17-20p on top of that for generating renewable power.
Although initial estimates vary, the trust believes the plant could generate funds in the region of £55,000 per year.
Ian Hynd, 50, a board member and industrial designer, said the site was the natural choice.
He said: “The hydro scheme at Harlaw Dam was in operation between the First and Second World War but has been discussed since then.
“We were involved in the Water of Leith renewable energy study a few years ago, which focused on five sites in Edinburgh.
“The dam scheme was ultimately the only one which was economically viable, so when we were examining various schemes in the area the old hydro scheme just made perfect sense.”
The trust hopes to secure planning permission by Easter, begin selling shares later this year and construct the facility early next year.
The previous Water of Leith project, which did not move forward, aimed to install turbines similar to the hydro-dynamic screw at River Dart Country Park in Devon, which produces enough energy to power 100 homes for a year and saves the park £40,000 in electricity costs.
Despite the ambitious nature of the project those behind it are confident of delivering a project their community can be involved in running.
The trust said the city council had already shown an interest in making an education feature of the new hydro plant.
Mr Hynd said: “There are no grants or soft loans that are suitable for this kind of scheme, so we’ll look to raise the funds on the open market.
“One of the banks has intimated that they may be prepared to lend us half of the amount.
“The crunch will come when we sell the shares to fund the other half, but we’ll be offering investors a 4-6 per cent return, which is much higher than you’d get with bank rates.”