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The Horizontal, Collectivist Kilowatt
by Shiva Patel & Dave Ron ( shivapatel [at] gmail.com )
Tuesday Oct 9th, 2012 11:35 PM
The article below looks at co-operative approaches to broadening California’s renewable energy (RE) market. In addition, there is a discussion of the global perspective on energy co-operatives drawing on examples from Europe, meanwhile focusing on creative initiatives across northern California—and The Bay Area specifically—laying the groundwork for community-based approaches to renewable energy.
Imagine a world where communities own the power they produce, thriving in an energy economy that is sustainable, democratic and accountable. Instead of external financiers benefiting from profits, returns on investment go back into those hands directly involved, or towards fostering more community power.

Today, the majority of small-scale photovoltaic (PV) solar installations in California are turnkey operations provided by private renewable energy (RE) companies. At least three-fourths of the solar residential market opted for solar service and third party-owned systems over private control and operation in a survey of the 13 highest-growth solar cities of California. These findings, from a spring 2012 study by PV Solar Report--a solar market research association, also observed a decline from the previous year in the average household median-income of these PV-propping zones.

Power purchase agreements or solar leases fall under this arrangement, allowing the user to pay strictly for, or earn the benefits from, the electricity generated by their system, respectively. As can be expected, not every house has an optimal roof for PV-siting, nor do its residents have the necessary capital.

A renewable energy co-operative has the advantage of taking an otherwise disparate legal and financial entity, such as a cluster of homes or neighborhood, and offering a model by which to pool space, financial and sweat equity (i.e. effort-based contributions).
As a result, individual households can become players in small-scale power production, collecting profitable returns based on affordable investment requirements. RE co-ops can also directly benefit the local economy by adopting a community-oriented regional sourcing approach. Such service models can offset the potentially high upfront costs of panel installation and maintenance, thereby reducing barriers to solar power in low-income communities.

“Public dollars are reserved for large corporate entities rather than the people and community groups who put those dollars in,” says Lynn Benander. Benander is President and CEO of Co-op Power in Massachusetts, a consumer-owned renewable energy cooperative guided by a “multi-racial, multi-class movement, working on social justice issues”.

Already, in the ten years since it’s founding, Co-op Power has created over 150 full-time green jobs with living wages, and 10 businesses—half of which are solar installation organizations. They pulled it off by raising over a quarter million dollars in cooperative member equity. “You need a large group of consumers to achieve a buying pool that has an impact in the energy industry,” say Benander. Equally important, however, is the ability of these ownership models to empower neighborhoods and communities to generate the kilowatts they consume.
Community ownership of RE systems also ensures transference of technical knowledge that is relevant to social or cultural mores, and rooted in the need for self-reliance, adaptive capacity, and accessibility.

The Clean Energy Collective, based in Carbondale—a fitting name given its aim—Colorado, is bringing green kilowatts to consumers by leveraging community members’ collective purchasing power to build and maintain RE systems. The systems are owned by the central utilities’ consumers, while sited and operated by the Collective.

Globally, Europe has led the way with a strong co-operative energy sector. More than 50 percent of renewable energy generation in Denmark and Germany is categorized as community-owned and cooperative-based. Incentive programs and policies such as the feed-in tariff have been a major driver for this growth in renewable energy co-operatives.

Rather than mobilizing private loans for initial working capital and member shares, one increasingly popular option is crowd-funding. Crowd-funding through social media can offer interest-based returns or instant rewards based on low-risk, low-cost, one-time investments secured through a diverse and geographically dispersed network of online contributors.

In concert with crowd-funding, seed capital can be streamlined from network affiliate RE co-op project revenues. In such a model, any of the operating surplus generated by each co-op of the REC network—discounting a conservative amount allotted as an insurance to support guarantees on operational co-ops—can be transferred to a Community Projects capital pool to be used towards financing new developments. These can include community-scale wind power, geothermal, alternative fuel and sustainable transportation opportunities.
Throughout the country, state incentives and utility rebates are springing up in an effort to promote residential net metering and RE installation. These include the California Solar Initiative, the Xcel Colorado Solar Rewards program, and the Commonwealth Solar II Program in Massachusetts.
While these programs have seen their fare share of residential uptake, without adequate roof or lot space, and homeowner status (tenants need not apply) there are limitations to eligibility.

Establishing a network of mutually supportive REC’s focuses the returns on investment on the community and improves transparency in a power production sector largely defined by proprietary bidding and private investment. It simultaneously promotes energy autonomy and interdependence; giving disenfranchised communities the opportunity to engage in a critical aspect of urban life almost exclusively reserved for industry specialists and developers. At the same time, by decentralizing and democratizing the means of power production, jurisdictions diversify their energy lifelines, thereby improving energy security for everyone.

Back in the Northeast US, members of Co-op Power took the floor during their annual meeting last week to reaffirm the impact the Co-op has had in their lives. “We need to talk and work together in our local communities. We almost forgot to talk to each other. We have to take our power back”, said one member. “I have let that power be taken away from me over the years”, said another member. “I want to work for creating a better tomorrow by being involved today.”

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Dave Ron has over eight years of experience in sustainability consulting and energy engineering. He has worked with municipalities, universities, community organizations, and industry in RE development, energy modeling, green buildings engineering, climate change adaptation, and the intersection of these issues with social justice.

Shiva Patel has 3 years of experience in renewable energy start-ups, non-profits, and think tanks. The crux of his work has focused around RE deployment and advocacy/policy initiatives. Shiva is a graduate of UC-Berkeley with a dual degree is Environmental Economics & Policy and Interdisciplinary Studies: Food & Energy Sovereignty.