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The ViSEnet Blog

Rinne-Koski, Katja

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[katja.rinne-koski] - 06. Aug 2021, 13:13

Community energy cooperatives

Energy transition to a zero-carbon society is happening. People need to have a say in the energy transition. It is proven that when community members are involved in the construction of a wind farm or a bio-mass power plant, public acceptance of the project increases tremendously. Countries need energy communities and energy cooperatives for local sustainable development.

An energy community is a way to organise and manage collective energy actions for the benefits of the local community. It works based on democratic principles, in which every member of the community can participate in decision-making in an equitable manner (one member, one vote), and where there are participatory management practices, transparency in decision-making and financial accountability. The main purpose of the energy community must be to provide environmental, economic or social benefits to its members or local community. Also, community members can achieve a financial return on their investment.

A cooperative is a form of business ownership run by and for their members. Their members voluntarily cooperate for their mutual social, economic, and cultural benefit. Like other cooperatives, an energy cooperative is a member-owned corporation created to provide a service for its members that the individual members could not provide for themselves.

A renewable energy cooperative, for example, could be an initiative of local communities and citizens to promote the production and consumption of renewable energy. It is formed by a group of community members that shares a common long-term goal for a sustainable future of energy at the local or regional level. Through active citizenship involvement, the energy cooperative encourages the citizens to become prosumers. Prosumers mean that people act as both producers and consumers of energy in an attempt to democratize energy supplies by shifting away from relying on large companies.

The core values of an energy cooperative are the principles of self-help, self-responsibility, democracy, equality, equity and solidarity (International Cooperative Alliance 2017).

There is a high potential for energy cooperatives to meet emission targets and supply local communities with decentralized, affordable, safe and renewable energy. In Western Europe, these cooperatives primarily operate wind farms, bioenergy and photovoltaic farms with local and regional scope. They have been supplying and producing renewable energy for the local communities, promoting the energy transition from conventional fuels to green energy.

In Eastern Europe, including Romania, cooperatives are a known concept, but this model is linked with ‘old-fashioned’ and ‘socialist’ images. Cooperative structures are fragile and carved by a profound distrust towards authorities. People have little experience with setting up and managing energy cooperatives that are economically successful and at the same time democratic and cooperative.

Energy cooperatives can act as vehicles for broad democratization and empowerment, fostering self-reliance through collective action and shaping relationships between institutions and civil society that encourage participation.

Energy Cooperative (https://cooperativadeenergie.ro/) is the first cooperative in Romania, which will produce and supply 100% green energy to its members, "shareholders" and its customers. The Energy Cooperative operates as a business that includes two main directions of activity: supply and production of electricity from renewable sources for the community of cooperating members. The cooperative members bring together experiences and expertise from business, renewable energy, NGO sector, rural development, and civic activism.

Energy Cooperative disseminates clear and reliable information to the local community. They operate between national/regional governments and individuals/firms and can play an important role in solving market failures and promoting collective action in rural areas.

Dr. Carmen Păunescu
Expert of the VISEnet project, Romania

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