Author: Jarra Hicks

In this article we look at community energy in Canada and the United States of America (USA).

Canada

With the exception of large hydropower, renewable energy (and community-owned renewable energy in particular) is still in its infancy in Canada. Although wind power development has grown by 40% each year since 2000, Canada still has one of the least developed renewable energy resources in the world. In 2009, only 0.6% of Canada's electricity came from renewable energy sources (excluding large hydropower).

The Canadian Wind Energy Association estimates it would take just 0.25% of Canada's landmass to supply their total electricity needs from wind power.

Since the late 1990s, many groups and co-operatives across Canada have been trying to establish community renewable energy (CRE) projects (mostly wind, some biogas). But despite a great deal of local effort, there's been very little success — mainly due to regulatory and market constraints.

To make the situation particularly difficult, electricity laws and the laws governing co-operatives are made at a state level, so the conditions for CRE vary widely across the country. To date, Canada has only one fully community-owned wind turbine, the WindShare Co-operatives 750 kW turbine in Toronto 1 .

Other part-community-owned projects have been set up whereby a community has formed a partnership with a developer or municipality to plan, fund and deliver a project. This is the case with the Scotian Windfields Community Wind Development program in Nova Scotia, the Prince Edward Island Energy Corporation and the Bear Mountain Wind Partnership in British Columbia.

To encourage CRE, Canada needs policies which provide:

  • the right to connect to the grid without undue cost
  • a legal obligation for the priority purchase of wind energy by electric utilities
  • a guaranteed fair price for that energy. 2

The state of Ontario introduced a Green Energy Act in 2009 to address these issues. It now has one of the most progressive renewable energy policies in North America and CRE projects are already lining up to benefit. Critical to the development of this policy was years of lobbying by the Ontario Sustainable Energy Association. They pushed for policies using the positive experiences of CRE in Germany and Denmark.

The Green Energy Act gives all renewable energy generators the right to connect to the grid, with a guaranteed funding structure. This provides secure, stable and competitive prices for renewable energy through 20-year power purchase agreements (PPAs). The feed-in tariffs set the price in the PPAs according to the type of technology and ownership, size and location and these very from 11.6 to 89.3 per kW.

This policy supports new technologies including wind, biomass, biogas, solar, hydropower and geothermal. Extra incentives are also available for community and First Nation (aboriginal) owned renewable energy. It also works alongside Ontario's policy to phase out all coal-fired power stations by 2014, increasing the share of renewable energy (including hydropower) to 50%.

A handful of CRE co-operatives are already benefiting (see the Canada - Pukwis Community Wind Park Case Study).

More information

Canadian Wind Energy Association
Christianson, R. (2005) Danish wind co-ops can show us the way
Gipe, P. (2007) Wind Energy Co-operative Development in Anglophone Canada, Canadian Co-operative Association
MacAuthur, J. (2010) Status of Social Economy Provision of Wind Electric Energy in Alberta, BC-Alberta Research Alliance on the Social Economy, Athabasca University
Ministry for Energy and Infrastructure (2010) Ontario Green Energy Act
Ontario Sustainable Energy Association
Pukwis Community Wind Park

USA

During the USA farm crisis of the 1980s, increasing competition and mass-production reduced profitability. Farmers came together to find new ways to put more value into agriculture — to provide for their families and keep farming and rural communities alive.

In states like Minnesota, where wind resources are abundant, wind developers approached farmers to lease their land for wind farms. Under this model, farmers signed 20 to 40-year contracts, but received less than 1% of the profits. Farmers knew there must be a better deal for them in wind development. The answer was in farmer and community-owned wind farm development, although this didn't become a reality until the early 2000s (see the United States - Minwind I - IX Wind Farms article for more details).

In recent years, CRE has taken off in parts of the USA. Although many projects are still in the feasibility, planning or assessment phase, there are dozens of community wind and solar initiatives with big and inspiring visions. There are also a number of co-operative and farmer-owned biogas and ethanol plants across the food belt of America, turning farm waste into electricity and fuel (the Piedmont Biofuels Co-op, for example).

In America, the laws governing renewable energy development and co-operatives are made at a state level, so it varies widely across the country:

  1. Minnesota and Massachusetts have fairly progressive renewable energy policies that encourage community-ownership of renewable energy.
  2. Colorado, Washington, Vermont and Maine have laws to encourage community-owned solar farms.
  3. Some states, such as California, have done a great job of fostering renewable energy, but with very little community involvement.
  4. Other states have neither renewable energy policy or development, let alone community-owned renewable energy.

Where CRE does exist in the US, it takes many forms. There's an emphasis on farmer-owned renewable energy and projects which offer economic support to rural farming communities (see Minwind I - IX Wind Farms Case Study). Other projects are joint ventures with local councils (see Ellensburg Community Solar Project Case Study) or with bigger renewable energy developers (such as the Trimont Area Windfarm). Structures also vary from limited liability companies (LLCs) to co-operatives.

Community solar

While the most common technology for CRE is wind, a new approach to community solar farm ownership is slowly developing. Community solar, sometimes also referred to as Solar Gardens, are collectively owned solar farms on public or third-party land, or buildings. The pooled funds from community members are used to buy and set up the solar farm. Electricity produced is generally sold to the grid according to a PPA. Investors are reimbursed for the percentage of power produced by the percentage of solar panels their investment bought. In several states (Washington, Colorado, Massachusetts, Vermont and Maine) people who own shares in a community owned solar project, qualify for state renewable energy incentives, which makes such projects all the more appealing. As of June 2010, a community solar bill is being considered in the US Senate.

There are over 11 community solar projects underway across at least five states in the US. These projects vary in their degree of community involvement and ownership, but all have opportunities for community investment. Some, such as the Falmouth and Brewster Community Solar Garden projects, are entirely community initiated, run and owned. Others, such as the Ellensburg Community Solar project and the Sacramento Municipal Utility Districts Solar Shares program are joint ventures between several entities, with the local council playing a key role (see the Ellensburg Community Solar Project Case Study). Others are owned and run by electricity developers with community members as investors.

The nature of household solar installations means renters, apartment owners, people with shaded roofs and people with insufficient funds to buy a whole unit are excluded. However, many people in the community support the idea of solar power. By pooling funds to create a solar farm on public land, you can overcome all these barriers. Plus, the community solar group takes care of all installation and maintenance, without households needing to organise or learn these skills.

More information

Bolinger, M. (2001) Community Wind Power Ownership Schemes in Europe and their Relevance to the United States
Bonneville Environment Foundation and North West Sustainable Energy for Economic Development (2009)The Northwest Community Solar Guide
Kildegaard, A. & Myers-Kuykindall, J. (2006)Community vs. Corporate Wind: Does it matter who develops the wind in Big Stone County?, University of Minnesota.
Northwest Sustainable Energy for Economic Development, Minwind I and II, one of the first farmer-owned projects in Minnesota Windustry (2002)
Windustry (2009)

Related articles

Benefits of community energy projects
History of community energy
Community energy in Japan
Community energy in Australia
Community energy in Europe
Community energy in the developing world

Footnotes

Footnotes
Ref Notes
1

MacAuthur, J. (2010) Status of Social Economy Provision of Wind Electric Energy in Alberta

2

Gipe, P. (2007) Wind Energy Co-operative Development in Anglophone Canada, Canadian Co-operative Association