Financial participation of communities and citizens

Best practices of how financial participation of communities and citizens has been effectively implemented and improved social acceptance can be found in the respective best practice case studies covering community wind farms in Schleswig-Holstein, in Germany and the renewable energy cooperative Som Energia, in Spain.

The best practice case covers three different community wind farms in the districts of Northern Friesland and Dithmarschen which have been initiated by local farmers, landowners and other stakeholders. A key rationale was to avoid the involvement of external investors, to keep added value in the region and to ensure benefits for the entire community. The three cases cover elements of both active and passive financial participation of communities and citizens. Active financial participation allallows citizens to buy shares and participate directly as partners, together with the municipalities. Passive financial participation of citizens took place at different levels: on the individual level, conflicts among the landowners was achieved by developing land lease pooling model. This allowed even those landowners to benefit from the land lease payments, whose land was not directly used as a site for the turbines. On the community level, the operators provided for additional compensation payments to the municipality. In Neuenkirchen, for example, the mayor and the managers of the wind farm agreed that 1% of the company’s annual remuneration for the produced electricity would go to a no-profit civic association. These mechanisms ensure that even those members of the community would benefit, who did not participate actively as shareholders. Furthermore, the entire community benefited from trade tax revenues, but also the income/profits coming out of the project. The operators of the analysed community wind farms also pursue local contracting and hence contribute to strengthen local employment.

With more than 50,000 members and 50 GWh of electricity production per year, the cooperative is the first and largest energy cooperative in Spain. As energy cooperative, Som Energia is investing in energy sources and production, provides reliable and fairly priced energy, and promotes use and production of sustainable energy. Thus, through financial participation, this cooperative engages citizens and communities in the energy transition (mettere link glossario) , by giving them the opportunity to both buy and invest in energy from renewable sources. In this case only active participation both at direct and indirect level took shape. As for direct participation, by providing citizens and communities with the opportunity to invest in and consume wind energy directly, an immediate link between citizens and means of energy production is established, increasing also the awareness and interest in such types of energy. Through enabling groups of citizens to invest in renewable energy, particularly on local projects devoted to local communities, an indirect financial benefit is generated for the entire local community. The initiative also supports landowners to install wind energy to be purchased subsequently by the cooperative itself for a fair price. Collectively, this demonstrates how the cooperative participates in improving distributive justice by promoting a fair distribution of costs and benefits.

Here below further readings on the concept idea of the two best practices and some detailed analysis.

Concept idea
Synthesis & comparative analysis of best practice case studies for promoting the social acceptance of wind energy pages 54-56

Analysis of financial participation within Best Practice of Schleswig-Holstein
Synthesis & comparative analysis of best practice case studies for promoting the social acceptance of wind energy pages 79-96

Analysis of financial participation within Best Practice of Som Energia
Synthesis & comparative analysis of best practice case studies for promoting the social acceptance of wind energy pages 203-213