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The shift to decentralised, modular energy technologies means communities now have an opportunity to own and operate their own power supply systems.
By forming a cooperative, households pool their resources to invest in energy projects. They then share the benefits – such as reduced electricity bills and profits from sales into the grid.
This approach is reducing utility costs, expanding energy access, and creating local jobs. More importantly, says the European Commission’s Adela Tesarova, the community ownership model will lead to more inclusive societies, with better social cohesion.
The European Union already has about 10,000 energy communities. According to the commission’s projections, by 2050, nearly 50% of the bloc’s consumers will also be ‘prosumers’ of renewable electricity – meaning they will either sell electricity from their own home systems or via a cooperative they participate in.
In the US, co-ops now have 14GW worth of renewable energy capacity between them, according to stats from industry association NRECA.
The model is gaining traction in other regions as well. Here’s how five groups from different parts of the world are going about things:
The Bristol Energy Cooperative, a non-profit in the UK, has so far installed 10MW of solar power capacity and 100kW of battery storage, using funding from 1,500 investors (community members, local businesses and other groups).
The cooperative started small, with an initial focus on rooftop solar installations at community-owned and commercial buildings, co-founder Andy O’Brien tells me.
It then developed two 4MW solar farms, and started funding micro-grids for new housing projects. Most recently, it entered into a joint venture with Thrive Renewables to build a 20MW / 30MWh battery storage facility.
To make a return on its investments, the co-op enters into power purchase agreements (PPAs) with businesses and other off-takers, and also sells power into the national grid. Generous feed-in tariffs naturally increase the viability of projects.
To build scale as a cooperative, partnerships are critical, O’Brien says. The group has partnered with the Bristol City Council, and runs an entity called Zero West, which brings local decision-makers, legal professionals, financiers and businesses together to move things forward.
Funding from impact investors and development finance institutions also helps to get projects off the ground, as does pro bono support from law firms (to ensure all structures and legal agreements are solid).
Regulators could make things easier for co-ops by redirecting fossil fuel subsidies towards community energy projects, O’Brien argues.
In Australia, meanwhile, cooperatives have been given a significant boost by a national funding programme.
For example, one co-op, which has 2,000 members and installed two wind turbines back in 2011, will now build a 10MWh battery thanks to the country’s A$200 million Community Batteries for Household Solar programme.
The government aims to fund 400 community batteries across Australia.
In Brazil, RevoluSolar is taking solar power to low-income communities, which remain underserved by large utilities.
The organisation partners with local communities in the favelas of Rio de Janeiro, and is gearing up to replicate its model with Amazonian communities who don’t have grid access.
It trains community members – mostly black women – to manage the installation process and comply with regulations. Electricity cost savings generated from solar installations are partly directed towards covering each cooperative’s operational costs.
“We rely on strong institutions already in the community, and partner with them – we don’t want to create new structures,” says Eduardo Avila, executive director at RevoluSolar. “Communities must be highly involved in the designing and planning process.”
RevoluSolar wants to integrate its approach into Brazil’s low-income housing programme.
Other interesting cooperatives worth keeping an eye on:
In Colombia, the La Estrecha Solar Community in Medellín has yielded some useful insights.
This native Hawaiian community is reclaiming its energy sovereignty.
The Sun Exchange, which is based in Cape Town, South Africa, and raises funding via blockchain-based crowdsales for each of its projects, has installed 9.2MW of solar power to date.
Puerto Rico’s first cooperatively managed microgrid will use Rivian batteries.
The India Smart Grid Forum aims to promote the uptake of rooftop solar by facilitating electricity trading amongst members of a community, using blockchain technology. One benefit here is that this reduces transmission losses (where electricity is lost while being transported via long-distance power lines).
