What is community ownership of renewables, and what could it mean for the
future of Scotland’s energy generation?
by Liam Kirkaldy Apr
When Eigg switched on its electricity grid on 1 February 2008, it marked
the first time in the history of the island that residents and businesses
had continuous access to power.
Up until then each resident had been dependent upon costly and inefficient
generators. In introducing an integrated system of wind, water and
solar-based renewables, fed into a stand-alone, localised grid, the island
went from being reliant on diesel generators, to being the world’s first
self-sufficient, renewable powered island.
Maggie Fyffe, a member of the Isle of Eigg Heritage Trust, says the change
came when the island’s residents took ownership of the island.
“We’d never had mains electric, I’ve been here thirty years and I can
remember it being talked about the whole time. The idea was to persuade
someone to put a sub-sea cable in, but no one would consider it because of
the size of the island – there wouldn’t be much profit versus the cost of
putting it in. But when the trust bought the island it came up again and we
thought about using renewables. We got involved with a company called
E-Connect, which suggested an island-wide grid, using three technologies –
hydro, wind and solar. We managed to raise £1.6 million, then we built it.
She continues: “It has made a huge difference to costs. Diesel is
expensive, getting them serviced is expensive, and it is a total nightmare
if they break down, so everybody was absolutely delighted when we got the
mains switched on. There has been a huge amount of interest
internationally, people have come from all over the world to look at it –
it was the first system to link up all three technologies.”
Community ownership is a fairly wide-reaching concept, covering people
coming together to work on energy efficiency or combating fuel poverty, to
communities bulk-buying energy to get a cheaper price or managing part of
the grid. Generally though, it means a community buying a stake in
electricity generation – allowing them to invest the profits in services of
benefit to those in the surrounding area.
In the years since the Eigg community first took control of energy
generation the idea has spread. The Scottish Government has put its weight
behind growing the community ownership model, launching the CARES loan
scheme in 2011, which provides finance to groups during the pre-planning
stage and setting a target for 500MW of energy generation to be community
and locally owned by 2020.
Energy and Enterprise Minister Fergus Ewing said: “I’ve seen first-hand how
some of the money from renewables is directly making a difference. It was
remarkable to see how the purchase of a fishing boat in Orkney brought jobs
to a number of young people in a rural area. Local communities should
follow suit. They need to be empowered, to identify the issues and
opportunities in their area and decide what to do about them. Ownership of
renewable energy projects like hydro or wind schemes is a means to do that
by providing a long-term income stream which communities can use towards
supporting social and economic activity.”
The Government claims that hitting the 500MW target could be worth up to
£2.4bn to Scottish communities as well as rural businesses over the
lifetime of the projects. Ewing says it can provide a viable future for
some of Scotland’s most fragile rural areas. He believes that communities
are attracted to the idea of owning energy generation; they just need a
push in the right direction.
Jennifer Ramsay is a Community Benefit Officer for Local Energy Scotland –
the organisation charged with helping deliver the Scottish Government’s
policy. She says: “The main benefit to the CARES pre-planning loan is that
if the project doesn’t get planning, or it hits some other insurmountable
hurdle, then we can write off the loan. It de-risks the early stage of
planning, making it easier for communities to look at these projects.
“Communities feel that if there is going to be a wind farm near their town
then it’s an opportunity to benefit from it, their attitude is different if
they can think: every time that turbine goes round it means more money for
community projects,” she adds.
But the idea is attractive on a number of levels.
Anne Schiffer, Energy Campaigner at Friends of the Earth, says: “It allows
ordinary people to take an active role in a green energy revolution but
communities are also much more positive about energy infrastructure like
wind turbines if they have a stake in them. For the developer, the benefit
is that by offering community ownership, it is much easier to convince
people to have a wind farm near their community.”
She continues: “An example is a project in Nielston which is run by a
community development trust in partnership with a commercial developer. The
wind farm will generate an estimated £10 million over the lifetime of the
project which it will use to develop projects outlined in the town’s vision
document. The community benefited from partnering with a commercial
developer who carried the risks at the early stages and brought a wealth of
experience that helped to move the wind farm from the drawing board into
reality.”
Part of the attraction then, lies in the idea of working in partnership.
Community groups are unlikely to have the skills and resources necessary to
take on a project on their own, since they are likely to lack the time,
money, technical expertise and experience of the planning process necessary
to make a scheme work. For the developer, working with the community is
much easier than working against them, which is often the perception with
the development of large-scale renewable projects such as wind farms.
Scotland Against Spin is a campaign group aiming to raise awareness of what
it sees as the damage done to the natural environment by renewable
projects. Linda Holt, spokesperson for the group, argues that community
ownership is a positive step, though she is sceptical of claims that the
community ownership model could transform Scotland’s energy generation.
She says: “Certainly they are a great idea if they make financial sense and
a community wants them. But getting a community wholeheartedly behind a
wind development is very difficult, particularly if it will impact some
members of the community more negatively than others.”
The Neilston project Anne Schiffer mentions serves to illustrate some of
the challenges in calling a project ‘community owned’.
The community raised £950,000 for the 10MW project – allowing it to own a
28 per cent stake. But, unlike in an island project like Eigg – with the
sea providing a clear, natural boundary to the edge of the community – it
is much harder to define what constitutes the community of Neilston.
Holt says: “The community wind farm at Neilston is a notorious example
because it simply ignored the community at Uplawmoor which would be exposed
to the harshest impacts. Wind projects have a record of creating conflict,
division and a legacy of bitterness and disengagement in rural communities,
and being a ‘community’ project is no safeguard against this outcome.”
But perhaps the single biggest barrier to the widespread adaptation of
community energy developments is the fact that it is virtually impossible
for community energy groups in Scotland to supply to local residents (Eigg,
which uses a mini grid, is an exception).
One of Friends of the Earth’s partners is a large Belgian cooperative
called Ecopower, with around 43,000 members. The coop generates electricity
and sells it back to those in the community, reducing their energy bills in
the process. This is much harder in the UK, leading to a gap between owning
a stake in generation and seeing it reflected in energy bills. According to
Ecopower, people who own part of renewable energy projects also tend to
become more efficient users, because they make the connection between
generation and consumption.
But this is likely to change, with a project run by Good Energy near
Aberdeen currently going through the planning process offering an example
of how the model could move forward. The project will be community-owned in
the normal way – with profits going towards community development – but if
residents use Good Energy as their supplier, and live within a certain
distance of the wind farm, they also get a local electricity tariff –
meaning lower bills.
There are questions though, over how applicable European examples are to
Scotland – with even campaigners accepting that the local ownership model
has limits in a country hoping to export renewable energy across Europe.
Schiffer says: “Scotland has 25 per cent of the wind potential in Europe,
but a population of around five million people. Now, obviously, five
million people don’t need 25 per cent of the wind potential in Europe so in
this context I would say, ‘yes, we need more community energy’ but if we
want to do it on a larger scale, and export renewable energy across Europe,
then there is plenty of space for larger-scale projects.
“It is also important to remember that community ownership can speed up the
growth of renewable capacity in general. We could wait for international
action by governments, but that could take years, whereas something like
the feed-in tariff, allows people to own electricity generation today and
can therefore drive renewables forward very quickly.”
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