What is community energy?

Community energy can bring economic benefits to local citizens, it can strengthen communities’ social ties and it can offer solutions to our energy challenges. So what is community energy exactly?

community-energy-copenhagen-wind-turbine

 

Copenhagen’s offshore wind turbines are 20% community owned

 

Below, I’ve described the variety of initiatives that could be described as ‘Community Energy’. In particular I’ve looked at three financial models in operation in Australia – donations, investments and bulk buys. Community activism leading to re-municipalisation and community-led energy program delivery are covered as international trends.

The common theme of all versions of community energy is that they engage citizens in non-traditional ways around energy supply and use. The carrot that community energy dangles is the unlocking of local benefits that existing energy markets have failed to deliver so far. The transformation of our energy systems is underway – community energy can play a key role in shaping the energy systems of the future and demanding that they are equitable, efficient and resilient.

Community energy advocates are motivated by the opportunity to:

  • Deliver the profit of renewable energy projects to a broader section of the community (eg rather than a single corporate investor)
  • Unlock projects that wouldn’t otherwise occur (eg by developing projects, reducing costs and offering finance)
  • Help all of us rethink what the energy system of the future might look like. (therefore the sector plays a role in advocating for policy changes and supporting innovative energy solutions)

Governments are motivated to support community energy because:

  • Community-scale projects sit between utility and household scale and is a missing part of the market at present, even though the financial opportunity is already there.
  • Community support creates social licence for renewable energy more generally and de-risks innovative projects.
  • Community energy fits with the policy ambitions of cleaner, more affordable energy and secure supply. Governments can benefit as this sector develops an effective community delivery model.

Community energy is not every community scale project or every off-grid / embedded network project. Without community ownership or community benefit these are simply private sector business models. Likewise, local government could start to play a stronger role in owning and operating community scale energy systems and government models would emerge. Regardless of the key players behind a project, it seems important that a diversity of local projects continues to develop and, over time, Australian communities can have a richer appreciation of the benefits that are unlocked under the different models.

Community Energy Examples

DONATION MODEL

Donations can come in the form of grants or many ‘crowdfunded’ donations from individuals. Donations can be used as a gift to the project, but also as a loan. The advantage of the latter is that donated funds can be re-used in a type of revolving fund.

The donation model allows supporters to contribute to something practical and long lasting. In some cases the supporters value growth in clean energy and reduction of greenhouse gas emissions. Often donors are supporters of the host organisation which will ultimately benefit from reduced energy bills.

The donation model could also be powerful when a project is not sufficiently profitable for the private sector, or when there are risks involved due to technology or the host organisation.

CORENA (Citizens Owned Renewable Energy Network Australia corenafund.org.au) runs a revolving fund sourced from individual donations with the aim of reducing greenhouse gas emissions. CORENA only loans to not-for-profit community organisations and works with each organisation to make sure the project reduces emissions and will pay for itself – usually within 5 years. Each loan is interest free. Once the loan is repaid, the organisation keeps the system and the monthly energy bill savings. CORENA has also supported other groups to set up revolving funds.

The People’s Solar (thepeoplessolar.com) is a dedicated crowdfunding platform for community energy projects. Such projects also regularly appear on other crowdfunding sites like StartSomeGood and Chuffed.

Totally Renewable Yackandandah (totallyrenewableyack.org.au ) is a typical community which has successfully driven a range of projects throughout the town. Each project has been cobbled together using grants, loans, donations and finance from the host organisation as necessary.

Powershop, an electricity retailer, encourages its customers to donate to clean energy projects and collects the money in small amounts through its billing arrangements.

Return to the Top

INVESTMENT MODEL

Many citizens are keen to invest in renewable energy projects, particularly for causes that are dear to them, organisations that are local to them or sites that will have an impact on them.

International precedents

In Denmark, creating social licence by allowing those affected to own and profit from renewable energy is seen as a key to wind energy development. Denmark runs four community programs to support wind power: 1) 20% of each project must be opened up to community shares, 2) community coops can access up to 10mKroner for project feasibility studies, 3) green scheme pays for projects to ‘enhance local scenic and recreational values’ and 4) a compensation scheme recognises changes in land values due to wind turbine proximity

In the UK, community shares is a particular organisation model with light handed financial regulations that allows for community investment from many individuals. Organisations from football clubs to renewable energy projects have used the model to create investments that are ‘owned’ by their supporters. The projects typically pay dividends back to both their supporters and to a local cause or community and the profitability can range markedly from a nominal return up to 8%.

Hepburn Springs Wind Farm (hepburnwind.com.au/ ) was the first site in Australia to build a community owned wind farm. The site has two wind turbines which feed power to the local community in Hepburn Springs, Vic. The group learnt so much about how to develop a project of this magnitude and navigate the energy market that it created a community wiki – embark.com.au to share the learning with other communities that also wish to develop community energy.

ClearSky Solar (clearskysolar.com.au/ ) The clearsky model is to develop projects at the $100,000 size, often on the rooftop of mid-sized businesses who don’t want to make the upfront capital investment. ClearSky limits each project to 20 investors and typically offers returns from 5-8%. The projects are each set up under a trust mechanism. An investment offer usually sells out within 24hrs, demonstrating that project development is the bottle neck.

Pingala (pingala.org.au/ ) demonstrates that partnering with a business like Young Henry’s Brewery and reaching their fans can create a robust investment community.

Sydney Renewable Power Company (www.sydneyrenewable.com/ ) has taken a traditional approach and will raise $1.5m from over 500 shares in a share offer, for a 520kW solar array on the Sydney Convention Centre.

Return to the Top

BULK BUY MODEL

The third model attempts to cover those scenarios where the funders and the beneficiaries are the same people but the benefit has been gained by working together as a collective. Bulk buy models emerged as rooftop solar started to become popular. In return for reducing the costs of customer acquisition, equipment providers often provide a benefit to aggregators, or discounts to the community of buyers.

There have been many once-off initiatives with little ongoing presence. The following list gives a sense of the different models that have been explored.

Sun Crowd (suncrowd.com.au/ ) is currently running bulk buy initiatives for solar systems with battery storage, capitalising on the market’s need for vetters of new technology.

Victor Harbour Council (victor.sa.gov.au/solar ) granted the tender for their solar program to Zen Energy in 2009 to provide a reliable solar panel installation service to residents. Essentially the Council provided vetting of the provider and (from memory) Zen provided a small community benefit in return. Other versions of this model such as Our Solar Future (oursolarfuture.nsw.gov.au/) use independent community groups such as the Alternative Technology Association or the Moreland Energy Foundation (MEFL) to provide the vetting services.

There are many other ‘collective’ scenarios where a private sector partner seeks to reach a community through a trusted community partner and share the benefits with that partner.

A school in WA sold solar panels to its parent community in return for a free panel on the school.

Energy Locals (energylocals.com.au/ ) is a new social enterprise retailer seeking to sell electricity through community groups in return for benefits (such as a solar system) for the community group.

The housing development sector often has captured communities in apartment buildings and other multi-residence housing developments. Sometimes these developers deliberately choose to install an embedded network and capture the electricity sales to those within the development. Sometimes this is simply a historical decision. More recently, new development projects are driven to consider this option by the increasing cost of connecting to the electricity grid. Fremantle in WA[1] will have a grid connected system with storage and peer to peer trading – an experiment in new technologies and reducing the capacity required from the grid. Newcastle in NSW[2] will have a development that chooses to be completely off-grid. There are just two of many examples.

[1] https://onestepoffthegrid.com.au/peer-peer-solar-trading-kicks-off-wa-housing-development/
[2] smh.com.au/it-pro/business-it/offgrid-suburb-a-perfect-storm-for-energy-giants-20151207-glh7l5.html
Return to the Top

RESPONDING TO COMMUNITY DEMANDS

In USA and Germany there has been multiple examples of disenfranchised communities taking energy matters into their own hands. When private sector utilities have failed to deliver cleaner energy, despite repeated requests, communities have voted to change the status quo.

Some of these movements have focused on bringing grid ownership and control back into Local Government hands. In the case of California, the wholesale purchasing of energy became the role of groups of Councils under community choice aggregation schemes. This drives the development of locally produced power projects.

Enova Energy (enovaenergy.com.au/ ) in Northern NSW is Australia’s first example of community ownership within the mainstream National Electricity Market (NEM). Enova is an electricity retailer with an ownership structure similar to a Trading Coop – voting rights are limited so large funders do not control the entity. Approximately $300 million a year is spent on electricity in the Enova region. The company estimates it can return as much as $80 million a year locally in the form of profits, jobs, and sourcing local staff and suppliers. They are also working in partnership with local businesses and the wider community to harness more renewable energy sources, reflecting the values of their local shareholders and customers.

Return to the Top

ENERGY PROGRAM DELIVERY

Finally, one of the features of international community energy that is mostly lacking in Australia is the richness of program delivery across the energy sector by numerous NGOs with differing relationships to governments. NGOs tackle everything from energy efficiency and fuel poverty to electricity market innovation and industry development. Invariably government or legislated targets create foundational funding streams but the community sector is able to reach multiple sources of funds and be agile enough in its business model to be continuously providing those services which are most needed and valued.

Moreland Energy Foundation (http://www.mefl.com.au/ ) exists because the Moreland Council owned its own electricity infrastructure at the time of privatisation in the 90’s in Victoria. As a result they made the decision to re-invest the value of selling assets into energy service delivery.

Community Powerhouses (see cpagency.org.au/ ) featured in the Home Grown Power Plan for the last federal election campaign, supported by GetUp and Solar Citizens. The concept of communities delivering energy options and services for locals (possibly under a Landcare for energy model) is well supported by international successes.

Return to the Top
Posted in Community energy | Leave a comment

Five reasons why we need a broader set of voices to shape our energy transition

community energy congress 2014.png

Attendees at the 2014 community energy congress – next on 27-28 Feb 2017*

The electricity market is a unique complex beast. When we discuss how it must change, it is easy to get drawn into technical issues that rely on detailed knowledge of how the system works. Even inside the system, those across the electrical engineering, the regulation and the financial markets are rare and it is all three of these systems that function in concert.

The insiders to this system use this complexity to their advantage. Energy reform discussions involve the energy companies, the regulators and market operators and the energy policy experts within governments. Outsiders may be consulted but rarely get opportunities to set the agenda and are frequently at a knowledge disadvantage when advocating for changes. The attitude toward the general public can be downright patronising at times.

The situation is not unique to energy – all experts tend to place faith in their ability to see what is needed in terms of a change agenda and implement it in what appears to be the best way from their perspective. Various academic fields of study point to the limitations of an expert and insider led approach to change.

I’ve been thinking about what the ‘change agenda’ in electricity is missing because insiders give little credence to the views and involvement of outsiders. This blog is an attempt to highlight some opportunities that would flow from a different approach.

1. Missing voices – experts are valuable, especially if they come from other disciplines.

At the heart of the story is that the electricity sector doesn’t know what it doesn’t know. How will we use energy in future? What priorities will we place on sustainability, flexibility and ownership? What technology is over the horizon? We don’t have great ways to experiment with the future either in order to learn. One of our challenges is to see a broader set of voices designing our future energy supplies – from industry and economic development, product manufacturers, the cleantech sector and consumers themselves.

2. Reform vs Transform – a paradigm shift relies on an outside perspective

When one is completely surrounded by a context, the context becomes invisible and never challenged. A paradigm shift is more easily imagined from outside the system. If we were to design our electricity system from scratch, it could look completely different with today’s options – especially if we included the entire supply chain from raw materials to the end needs of consumers.

3. Values vs Knowledge – some design questions are about fairness and sovereignty 

Our current Government has recognised that ordinary citizens can play an important role by spending time with an issue and moving from a flippant opinion to a deeply considered judgement. This deliberative process allows the Government to understand how citizen values from representatives of different demographics in our community can be applied to the decision at hand. The design of our energy market could change the relative contributions of business and households, of high and low income and of solar owners compared to those who can’t produce their own electricity for whatever reason. The structure of our market could change who owns and profits from electricity supply and where the jobs are generated. Without citizen voice, the electricity sector makes an enormous assumption that they can speak to the priorities of citizens or that the existing balance of values remains suitable.

4. Timeframes – we need a clearer picture of the end destination before focusing on small changes

100% renewable energy can seem an unrealistic goal for someone within the electricity system, steeped in the culture of ensuring the lights don’t go out. 100% renewable energy seems like a necessary and immediate priority for a climate change activist. The ordinary punter sees the debate play out in the media with each side amassing its most convincing evidence that they are right. This is hardly a good platform to explore what our options might really be. In the meantime, energy market reforms inch along delivering greater ‘efficiency’ and fixing hiccups without a clear eye to the future. The decision making chain can only be empowered to set reforms in the longer term context when we create the opportunity to engage the insiders and the outsiders in helping shape and believe in an ambitious low carbon vision.

5. Only the community can determine the goals of the changes

I’ve assumed throughout this piece that the electricity system needs fundamental changes. The biggest reason is climate change. Energy is the biggest contributor to Australia’s carbon emissions and the world is already a decade behind the critical window to act that the IPCC identified in 2007. Renewable electricity may well play a key role in serving our transport and heat needs in addition to electricity. The technology we need is rapidly becoming available at costs that are under the price of fossil fuels. Achieving fundamental systems changes within our energy regime is the key to heralding a new clean energy era in a timely way.

I remember the Total Environment Centre lobbying governments over a decade ago to recognise the need to tackle climate change explicitly in the objectives of the Electricity Act. The proposal was considered unnecessary by the economists in charge of electricity market reform and I have no doubt that we would have seen different outcomes if the sector had stepped up to play a role in reducing Australia’s carbon emissions. Even the renewable energy target, which has been a fundamental driver of changes, is tacked on outside the core design of the electricity market.

I think our energy transition will happen in a more timely way and with better and more transformative outcomes – if we broaden the participants in our energy change agenda.

If you are interested in a more academic perspective, it looks like Andy Stirling agrees with me in this paper: “From a normative view, participation is just the right thing to do. From an instrumental perspective, it is a better way to achieve particular ends. In substantive terms, it leads to better ends.”
And this paper on Transforming the UK Energy System: Public Values, Attitudes and Acceptability shows us how what the public want and what we talk about in the energy sector can be aligned but different – super important when a divisive issue such as climate change needs to be turned into an everyday issue like a better electricity system.
Finally, I think Judith Innes is on the right track here and would like to see us try creating the conversations, institutions and agreements that her DIAD process advocates – Diversity, Interdependence and Authentic Dialogue.
* more information on the 2017 community energy congress can be found here: http://c4ce.net.au/congress/
Posted in Changemaking, Community energy, Policy Ideas | Tagged , , | 1 Comment

Who is leading our energy transition?

churchill

With thanks to the Winston Churchill Memorial Trust of Australia

Today the ideas from my Churchill Fellowship had their first big outing – I was asked to speak at Adelaide’s Festival of Ideas. Here is the speech I prepared, slightly more polished than the one I gave.

———————-

For years I have imagined a different type of energy system to the one we have.

I worked in industrial energy efficiency – with co-generation, we could improve the energy efficiency of electricity from 40% to 80%. There were so many energy efficiency opportunities that businesses and buildings didn’t pursue. With demand management, we could take a woefully under-utilised electricity infrastructure and improve it. With renewable energy, we could clean up our energy system and move toward sustainability

There was so much we could do better.

I was influenced by Amory Lovins. Way back in the 70’s, in the wake of the oil crisis, he popularised the notion of the soft energy path. He coined the term Nega-watts and showed how the energy you don’t use is the cheapest energy of all. And most importantly for me he showed that a decentralised system could have much more cost-effective economics than the centralised systems we are lumbered with. The hierarchy introduces numerous cost inefficiencies as we build infrastructure that is poorly utilised – because we need to cover the peak moment. The individual scale also introduces inefficiencies, as we cover for every possibility. In fact the improved economics of neighbourhood scale repeats itself across infrastructures, from telecoms to sewerage systems. A pattern that is repeated in the nodal thinking of networks.

So finally, 20+ years later, we are getting our energy transition – the drivers for change are getting stronger and change is essential if we are going to tackle climate change – and we must.

The energy system I imagine has changed somewhat – Who knew solar panels would be so cheap, batteries would be sexy and Tesla would be a household name?

And more than ever, that vision of a decentralised system, a renewable, efficient, resilient – and smart – system seems possible. It seems right. It seems better.

So now I imagine a network of microgrids, something akin to the internet. Every grid can act self-sufficiently and there is plenty of interconnection. The energy we need can be generated close to the point where we use it. And I suspect our heat and transport needs will increasingly be provided as well by the renewable electricity we can generate.

Which brings us to our question, “who’s leading our energy transition”.

I’ve just been fortunate enough to travel on a Churchill Fellowship to look at energy transitions in different countries through the lens of community energy and citizen-led changes. I wanted to see how the decision making about energy systems at the local level might be helping provoke change at the system level. I went to the world leaders – Denmark and Germany, I saw three quite different markets and systems across three different past of the United States and I went to the UK and Japan.

I looked at the technology, but really we have the technology and have had for quite a while.

I looked at markets and incentives but increasingly renewable technologies are becoming the cheapest alternative regardless of government policies.

So really the areas of change where we need to look most closely are in our social and political systems. This is where the answers lie and this is what I needed to investigate.

How do we get the energy transition that:

  • We want
  • We need
  • And is the best we can have?

Lets run through the obvious contenders for who should be leading our energy transition?

The energy ‘system’

I often refer to the energy regime as all those energy companies, energy regulators and policy makers that work together in the paradigm/framework that is the current design of our energy system. We mustn’t think of this as a monoculture or a strictly bounded group but nevertheless, they work with similar perspectives on how the system operates and should operate even with the changes that they see coming.

Of course, with all the levers these people control, they are the obvious candidates to lead an energy transition but they can’t. They don’t do disruption, they do incremental change, they don’t do paradigm shift. The innovation literature, and more recently that on sociotechnical transitions describes how the disruptors to a system need to come from outside. Disruption starts as a niche is turned into a success after which the mainstreaming of technology, ideas and business models seems to grip hold of the whole industry. Thomas Kuhn also described the value of this outside perspective when he coined the term ‘paradigm shift’ in his “Structure of Scientific Revolutions”.

Many in the system are aware of the changes and trying to figure out what to do. Green Mountain Power in the US has asked itself, what does our business model look like when we sell 40% less power because our customers produce their own electricity. Market operators in California are pondering what the value proposition of the grid looks like when you start from the basis of off-grid.

There are plenty of smart cookies inside the system, some are champions for a better system and many are good folk with deeply held values about the importance of the work they do, keeping our lights on. But I don’t believe the leadership we need will or should come from inside the system.

The clean tech businesses

So the obvious replacement to insider driven change would be disruptor driven change but I’m not convinced these guys will lead the energy transition either – they are definitely part of the solutions though. We have to be honest with ourselves that our energy systems do not operate like free markets. They are a much more artificial construct where every change in profitability is negotiated and arbitrated within the rule making system.

I have often met alternative energy businesses and felt they are not invested in fixing the system over the long term, but rather focused on how to make the existing rules profitable. This is necessary for them and the main measure that their product offers value. For example we get discussions about ‘behind the meter systems’, operating beyond where the rule making reaches and ‘self-consumption’ to offer the solar owner value by using their own surplus inside the household. I believe, though, that the real value of surplus solar is in our community at the time the load is needed. If I am not home but over at the library, surely it makes sense that the library could buy my surplus instead of paying premium rates on the market.

The traditional market is wondering how much of these new markets it can incorporate into its own business but it seems unlikely that they will make much headway into consumer products markets they can’t control – choices in appliances, vehicles, solar systems, batteries etc will become the norm for households.

GE has developed a start-up style spin off called Current, to try and innovate in this space. They know their existing business model might not survive.

Nest thermostats, part of Google, highlight how well they help householders manage energy and get the best electricity deals. They know how to deliver service offerings to customers and believe they could take over from retailers.

It is clear that part of the paradigm shift we need is to see the whole system, right down to how we use energy and including heat and transport.

The politicians

As we understand the changes needed to be less related to technology and its price and more related to social constructs and its governance, politicians are the obvious candidates to lead our energy transition. But through my travels I was reminded that politicians are constrained in how much they can achieve by how much the voters will let them. They are also easily captured by the sector, because the access, lobbying and resources that energy industries can afford is far greater than individual citizens.

Importantly, we can’t expect politicians to get heavily involved in the details of change and the system controls the information flows about possibilities and opportunities because at the end of the day the technical and regulatory operation of an electricity system is complicated. As an ex-bureaucrat I’m aware that the guardians of the system often have many reasons to slow down change.

Citizens and community

So that leaves us. We are the ones that can lead and need to lead our energy transition.

My travels have reinforced that our community provides essential insights into this journey. We can provide the innovation – not only which technology works best for us but which values we bring to its use and its ownership. We can provide different perspectives and pose different paradigms for the value that energy use adds to our lives.

Only community can create the conversation about change, draw more people in and provide the political cover our (formal) leaders need.

And it must be left to community to define the values and the goals of the system.

I went to many communities that had asked nicely for energy systems to better support climate action goals. In the cases I studied, the governments and energy companies failed to respond to these requests and pushed those communities into a determined fight – often lasting up to a decade. In most cases the communities were winning the fight and speeding up the purchase of significantly more renewable energy with better support for rooftop solar, local generation and energy efficiency. Governments and companies ignore the community’s desire for a low carbon world at their peril. But we don’t have a decade for a long protracted fight, we urgently need faster climate action.

When I talk about community I am thinking about a spectrum with a role for everyone from activists to system defenders. Because all those other actors I have mentioned also have a role as citizens.

We need the pragmatists to get things done, but we can never lose sight of the highest principles we need to achieve. If we don’t build an equitable, community serving system we will fail, so we need those activists who defend the principles and advocate for the best possible system.

We need those willing to work on co-designing the future, happy to engage deep into the details of the system architecture. And we need those working in the big picture, co-opting folk to think about the vision and the values we bring to bear.

I am interested in working in the middle spaces where people check their power at the door and bring an open mind to the discussion about what could be. The interpreters speaking the language of electricity and community, the convenors, the bridge builders. [Although I am reminded that we can all find a common place to start from and stop treating ourselves like different worlds that need to be bridged.]

We need to understand that change starts from within. Being open to others’ ideas and open to learning and growth makes this a more effective journey. And because we are a social species we need to enjoy the process and the journey.

Here are some further recommendations from the experiences of my Churchill Fellowship:

Every community’s solution is unique, we need to do the work of understanding ours. Many things from elsewhere won’t work. I marvelled at the solar heating in Denmark because we don’t need to heat our houses when the sun shines. Our resources are different, our industrial base is different, our loads are different. We have an opportunity to really exploit our abundant renewable resources for economic benefit. Most of the places I visited are rolling out solar panels despite the fact that the same panel there produces half of what it would produce in sunny South Australia.

So many of the places I visited told me a deeper story about their place and community – what’s our story? Some say South Australia was founded on a utopian vision and that striving for better is simply part of our DNA. Barbara Pocock points out that even early on we created land rules that would squash speculation and ensure land was used for the benefit of the wider economy. And we are famous for our progressive social policies giving early rights to women to vote and overturning discriminatory laws in the 70’s under Dunstan. We need to bring these stories to the fore in order to believe our ability to lead and to develop an excellent energy system. Because in those stories lie the values that need to be embodied in our system – low carbon and sustainability, broad economic benefits and equity.

I think a useful place for us to start this work is in articulating the desired goals of the system. In even the most simple system diagram we can see that the goal of the system is hugely influential in where the system heads. The understanding of everyone about how new alternatives better meet the goal is part of the movement building that must be done. And the feedback on how the system is failing to meet even existing goals is also crucial. In the wake of Adelaide’s recent blackout, these conversations are alive and well – although disappointingly politicised.

My ultimate goal is tackling climate change. Electricity and the wider energy system are not the only systems that need reimagining. Our food, waste and mobility systems all leave us sighing, “we could do so much better”. But in our transition toward 100% renewable energy we have made an impressive amount of progress and we are poised to tackle our challenges quickly and well.

This gives me hope. The smarter we get about this transition, the better we can tackle the bigger challenges that await us.

Thank you.

Posted in Bright Ideas, Changemaking, Community energy, Talks | Tagged , , , | 2 Comments

Was this Adelaide’s ‘Superstorm Sandy’ moment?

On Wednesday evening a significant storm took out the entire South Australian electricity grid. Most suburbs were blacked out for at least 4 hours, businesses closed and traffic snarled slowly home as it navigated a city in darkness without traffic signals.

The population is in shock. Nothing like this normally happens.

It would be wrong to compare the storm to Superstorm Sandy which devastated New York and left some inner city suburbs without power for 2 weeks. But the surprise we’ve experienced is worth dwelling on because, like New York, this moment could be a catalyst for a better electricity system.

New York’s ‘reforming the energy vision‘ or REV process is the talk of the town across the USA and micro grids is today’s buzzword. In 2014 Governor Cuomo announced $40million in prizes for communities that build local energy supplies, aiming to increase the resilience of New York State’s electricity infrastructure.

Those in charge of the process have a vision. Audrey Zibelman has come from the cleantech sector, she understands the opportunities that new technology is presenting and the need to reform the entire electricity system to get the most benefits. Richard Kauffman emphasises the opportunity to make the electricity grid a more efficient investment, ‘can you believe that this asset is so poorly utilised and utilisation is getting worse?’, He asks.

Halfway around the world in Japan, a similar conclusion has been reached in the wake of the Fukushima disaster. In Higashimatsushima, a development with replacement homes for those who lost theirs in 2011 is the site of a smart grid experiment aimed at community resilience. The electricity infrastructure feeding the 85 households includes solar power, battery storage and backup biodiesel generation. It can operate self sufficiently if power is lost in the region and, during prolonged blackouts, can service the hospitals and community hall. The community has embraced the new system enthusiastically and talk about the benefits. These are citizens that have already lost their homes in one disaster – and they are keen to see their micro-grid play a role in the broader region if they have power while others don’t.

microgrids

with apologies to Joel Pett and his excellent cartoon from the 2009 Climate Change Summit in Copenhagen

Are micro grids relevant to us? I believe they are and we are better placed than most of the world to realise the benefits.
South Australia is already moving into a new era with its energy system. We have an abundance of renewable energy to exploit with the challenges of how best to do so, flexibly and affordably. We have a growing amount of energy supply at the local level through rooftop solar and an active discussion about how soon we will be able to afford batteries.

After Wednesday, we are focused on the value of energy security. It’s a no-brainer that we should build a renewable energy grid that works aswell, if not better than the current system.

denmark-distributed

Roughly 1985 and 2005

So let me offer one last story, this one based in Denmark. Many of you may know that Denmark had a key policy moment in the 70’s when it decided not to pursue nuclear energy and instead set about diversifying its energy mix and making it more efficient. The small wind turbines that littered the countryside in the 90’s heralded the start of its famous wind industry. Many villages invested in combined heat and power generators (DCHP) to produce electricity and feed waste heat into district heating networks. The picture above shows the decentralised nature of energy supply by the middle of last decade. And so an experiment was born to see if this could be converted into energy resilience. The Cell Controller project tested if a whole region could be disconnected from the main grid and continue to keep the lights on. This was done with variable loads, unknown wind supply, a controllable CHPgenerator and some battery storage.

 

We are almost ten years on from the Danish experiment and technology is moving apace. South Australia needs to have a serious discussion about the shape of its future grid and how to build the infrastructure that will benefit us the most. I have no doubt this will involve some commitment to experiments and innovation – not processes the electricity regime is renown for. Superstorm Sandy did it for New York. Let’s hope this latest event can be used as a catalyst to force some future planning and design into our energy market.

Posted in Community energy, Energy Efficiency, Policy Ideas, Random | Tagged , , | Leave a comment

A visit to Coop Power

On Wednesday I was hosted by Lynn Benander at Coop Power in western Massachusetts. I gave a talk to a great bunch of coop members and active citizens in the local Climate Action Now chapter. It was very interactive – we all like to hear inspiring stories from other regions and be reminded that many people all over the globe are grappling with an energy transition in their own ways.

I have written previously about my summary of Australian community energy for my presentation in Fort Collins. By contrast, this time I spent much more time summarising the global  initiatives that I am visiting on my Churchill Fellowship. You can see my slides for the CoopPower presentation here.

The most inspiring stories have a history. When communities made key energy decisions in the 70’s or 90’s – say in the case of Burlington and Schonau – they are now held up as examples for change. Community initiatives certainly take time to mature.

biodiesel

The Greenfield biodiesel plant – community funded!

Coop Power has been working at energy democracy for a decade. Climate Action Now are also very active, having recently won an initiative against a substantial gas pipeline through their region. I was privileged to visit Coop power’s new biodiesel plant. The members have raised $10m over the past decade to build this facility which will use waste vegetable oil and make the region more energy self sufficient. We also talked about the spin off businesses that Coop Power has created. A number of solar installation businesses have spun off from the parent group. Many of these sold out to larger installers so Coop Power has kept a stake in more recent businesses such as Energia.

This energy efficiency business is a success story on a number of levels. It is staffed largely by young Latino men who have dropped out of high school. The skills and confidence has been so important to these guys, especially when they are among the few in their communities who have a job. I spoke with one of their first recruits who explained that the trainers from Coop Power had kept challenging him, setting high expectations that they knew he could reach. He now sits on the board and Energia is actively talking about becoming a worker-owned Coop. Energia also introduces energy efficiency to whole communities that might not readily reach out to government programs. (most energy efficiency in the USA is backed by some sort of state government energy efficiency obligation).

Here’s more about what Coop Power does, Lynn was interviewed by Radio Ecoshock, (which is heard on 90 stations in 4 countries including Australia). Here’s a link to the whole show, which usually focuses on climate science and policy and citizen responses to climate change, a good one to subscribe to if you like podcasts.
And Coop Power has also been showcased on The Leap site for Naomi Klein’s, ‘This Changes Everything’ climate media project.
Posted in Random, Talks | 1 Comment

Australian Community Energy

Following this excellent Guardian article by Matt Charles-Jones, I thought it worth summarising the best examples of community energy in Australia.

CORE

Image from C4CE.net.au

A core group of people need to be credited with the foresight to build a backbone organisation for community energy – The Coalition 4 Community Energy, C4CE. This gives the sector insights into what each of us is up to and measurements on our collective impact.

You can quickly see a concentration of projects in Victoria and NSW. To some extent this is caused by state politics. In NSW regions have been awarded over $1m, typically as $50,000 grants, to deliver community energy projects. In Victoria, lobbying by local sustainability groups has resulted in strategic government investment in Community Energy. And speaking of politics – with a federal election looming, C4CE members have been instrumental in developing the Home Grown Power Plan as a proposal for all politicians to chew on in the lead up to July 2.

No summary of noteworthy projects can go past Australia’s first community owned wind farm in Hepburn Springs and the Embark wiki that was set up to ensure that the learning in Hepburn was used to help other groups.

Others have followed the shareholder model – although not necessarily with the community benefit commitment (Hepburn wind plows $30,000 per year back into community projects). Repower ShoalHaven put their grant money into a solar system on the local club, a great way to engage a community through the facility at the heart of social activities. Clearsky Solar do not link their investments to local investors but it is worth noting the 20 investors per trust model that avoids more complex financial regulations. Each project is snapped up in less than 24hrs with reasonable returns of around 8%.

And in those three projects you can clearly see the issue some people have with the tag “community energy” when applied to shareholder models. You do need to work harder to ensure a project benefits everyone in the community – not just the investors, trust or coop members.

In NSW, one region decided to invest its grant money in a business case for moving to Zero Net Energy. Towns bid for the honor of being the Z-Net town and Uralla was chosen. The resulting blueprint is available for any town or region to use. The project was led by Moreland Energy Foundation and supported by Starfish initiatives – (both excellent organisations with objectives rooted in delivering community benefits).

NSW is also the home of Australia’s first community owned energy retailer – Enova. They have recently fundraised $3m through a share offer to invest in the necessary billing systems and regulatory capacity to play with the big boys on the Australian market. What makes them ‘community’ is that no shareholder can have more than three votes regardless of no. of shares owned. Enova will also invest a portion of profits back into community projects.

In Victoria, some towns have adopted ambitious targets. Totally Renewable Yackandandah is driven by an active group of citizens and has been awarding Golden Yacks to the best energy performers in town. Newstead, like Yackandandah, already had a history of trouble shooting infrastructure problems as a community. It was successful in getting $200,000 from the Victorian Government and has developed an MOU with its local electricity network provider to work together on the 100% challenge, improving the local supply at the same time. Tyalgum has come together as a community and workshopped the process of going off the grid altogether.CORENA banner

imageFinally, a post about community energy wouldn’t be complete without a plug for my favourite organisation – CORENA, Citizens Owned Renewable Energy Network Australia. CORENA has members and donors all over Australia who have gradually built up a revolving fund. To date the fund has delivered 11 projects on community buildings in most Australian states and territories. CORENA looks at all opportunities to reduce greenhouse emissions and often funds both energy efficiency and solar to best serve the community organisation. As repayments from savings and further donations flow into the fund, new community energy projects are built.

In this process, we must not forget the communities at the heart of our traditional energy system (and therefore our economy). These are larger communities, reliant on coal and going 100% renewables is not a simple option. Importantly, they are starting the energy transition conversation. Last week South Australia turned off its coal fired power station for the last time, having close its coal mine about 6 months earlier. The positive conversation we can have about the future there is largely thanks to the Repower Port Augusta campaign. We can’t underestimate the importance of working with the community to shape the town’s narrative, and doing the underpinning analysis to support hopes for a solar thermal power plant.

I am currently looking at community energy models in some of the leading jurisdictions around the globe and tomorrow I will be in Fort Collins, Colorado. This is a town that owns its own electricity system, is 50% owner in a coal fired power station and mine and is actively having the conversation about zero emissions. You can download the slides for the presentation I am giving in FortCollins here.

 

Posted in Random | 1 Comment

Imagining a Low Carbon Economy

Our economy is interlinked with our energy consumption – intimately. The Oil Crisis of the 70’s triggered a scramble of activity in Energy Departments around the world. Suddenly energy security could not be taken for granted and energy efficiency was an asset. The reliance of developed economies on oil became crystal clear.

Australia has had a more comfortable run than many economies. We had an abundance of fossil fuels and for many years ours was one of the cheapest places for energy intensive industries to locate. So to a large extent our energy resources have shaped our economic structure. We now have an economic transformation underway, and renewable energy resources that we must exploit if we are to successfully transition to a low carbon economy.

Low Carbon Jobs Forum AdvertI’m honoured to be joining our expert panel on Monday night to discuss New Jobs in a Transforming Economy. As part of signing up, we asked our audience of over 300 people to tell us what they most want to understand about this dual energy and economic transformation. I’ve published a sorted list of questions here and you can see many common themes are emerging.

The insights are fascinating.

Many of you are already eager to see a post-capitalist world emerge. What does the world look like when workers are no longer needed? How do we provide basic incomes to everyone? Can we make sure community, culture, arts etc. are more strongly valued? Could this be the trigger for us to finally develop sustainable ways of operating?

Justice and equity is front of mind. Will there be a shift in wealth and power? How do we manage unemployment? Can the new economy be fairer than our current industrial model? can we please make sure we retain the dignity of work and don’t leave people behind in this transition? (a theme shared with the Renewables for All project)

Some of you have been scanning the emerging technologies: automation, artificial intelligence, 3D printing. Some, emerging social models: co-working, microbusinesses, co-operatives, grassroots approaches, home and lifestyle based work.

Many of you jumped straight to the types of questions that we hope our economic development policy makers are asking: What will be our competitive advantage? What economies should we emulate? Where will the investment come from? Who are our competitors? Are we inviting enough or are we dreaming about what SA can become when we appear to be in such a sorry state?

And the concerns about skills hit us at a personal level. Where will I find a job? What should I study? What skills do my children need to gain in order to prosper in this brave new world? Are we doing enough to develop the right skills in our community and to help people transition from jobs in the industrial economy?

And finally, you have a clear focus on the question of How? How do we get this transition right? Are Governments doing enough? What should we get started on now? We started this process with a discussion paper and proposed a roadmap to help build a common understanding of the implications of the transition path we are already on. We are hoping to use this forum and further conversations at the Adelaide Festival of Ideas in October to build the next steps.

There are also many questions about renewable energy technologies, the proposed nuclear waste dump, and the numerous opportunities that you see in a future energy and economic system. These are not minor details. As I said at the beginning, our energy future will be instrumental in shaping our economic future. Discussing and imagining this future is a conversation we need to have.

A short plug for me: After many years talking about the technology and working on the financial viability of energy changes, I am about to spend three months investigating the social/governance dimension of our energy transition. You can read more about my Churchill Fellowship here and I hope to blog regularly while I am away. First stop the World Energy Innovation Forum at the Tesla factory in Silicon Valley – woohooo!

jobscloud

Posted in Random, Talks | 1 Comment