In our transition to renewable energy, the technology of harnessing renewable resources for our electricity needs continues to evolve. Our major challenges come from funding the cost of technology and the overall management of this transition.
We All Share the Costs of Energy Consumption
When it comes to our health and the health of our ecosystems, we all share the cost of fossil fuel consumption. We also share the cost of electricity generation if we depend on centralized energy generation from our local electricity utility. Even if we are off-grid, we share the cost of lost foreign exchange when we import fossil fuels. We also share the loss of potential revenue from renewable energy generation.
The United Arab Emirates, for one, already understands this economic principle and renewable energy projects are being developed with this in mind throughout the Middle East and North Africa.
Also, all of us share the cost of fossil fuels when extraction, transportation or distribution accidents happen. This shared cost crosses political boundaries and sectors, as we saw with the $22.7 billion cost after the 2010 Deepwater Horizon incident.
This cost is even higher for countries and local economies that are heavily dependent on tourism or coastal ecosystems, such as fisheries. As one of his most significant environmental policy actions, President Barack Obama banned offshore drilling in the Arctic and the Atlantic between Norfolk, Virginia, and Canada.
So if we already share the cost of fossil fuel risk, isn’t it time for us to share the cost of the solution?
Cooperative Solutions Include Shared Financing
Shared solutions are already happening through the development of renewable energy cooperatives and cooperative financing.
A cooperative is “An autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.”
There Are Numerous Types of Cooperatives
Mt. Pleasant Solar Cooperative in Washington, D.C., is a group of neighbors collectively purchasing discounted solar power systems. They also advocate for solar policy changes in the nation’s capital.
Biofuel Oasis processes and sells biodiesel fuel made from purchased waste oil, including used vegetable oil used for cooking.
Purchasing/Shared Services Cooperatives
Amicus Solar is a cooperative of independently owned solar companies that pool their buying power and share best practices among 33 member companies in 26 states.
ZooShare Biogas Co-operative is a non-profit renewable energy organization, focusing on education and investment for the benefit of community-owned biogas plants. Members finance biogas production plants by buying bonds through the cooperative and earning a return on their investments. This is a hybrid of the consumer-owned and producer-owned models because investment bonds yield a direct return on investment (ROI) rather than the indirect ROI of membership discounts.
Cooperatives follow seven principles that can be beneficial to our transition to renewable energy.
Principle 1: Voluntary and Open Membership – Any and all of us can have access to the benefits of affordable renewable energy.
Principle 2: Democratic Member Control – Cooperative members must actively participate in setting policies and decision making. The operation of the cooperative can include energy consumption monitoring, data collection and the performance of renewable energy systems.
Principle 3: Members Economic Participation – Members provide the initial capital and maintenance costs required for renewable energy projects. A portion of this investment becomes the common property of the cooperative. Members receive compensation and benefits. Compensation can include investments in creating financial reserves and supporting other cooperative activities, which can continue to create an efficient renewable energy policy climate.
Principle 4: Autonomy and Independence – This principle ensures that even if external partnerships are developed, democratic control is retained by co-op members. This also means the primary accountability for renewable energy projects’ efficiency rests with co-op members regardless of global trends and externalities. Rather than waiting for global or local trends to pan out, co-ops must proactively protect their own investments.
Principle 5: Education, Training and Information – This ensures the fostering of a productive and practical institutional culture. Also, lessons learned about the benefits and challenges of the co-op are shared with members, staff, external policymakers, opinion leaders, youth and the energy sector.
Principle 6: Cooperation among Cooperatives – Renewable energy cooperatives can form partnerships to advocate for government subsidies and incentives. Also, cooperative renewable energy projects and cooperatives can serve the energy needs of other cooperatives, readily providing access to a customer and membership stream. At the same time, partnerships between cooperatives can provide the data demonstrating the societal and financial benefits of renewable energy. This is necessary for continued progress towards a 100% renewable energy future.
Principle 7: Concern for Community – Concern for community instills concern for the hidden costs of fossil fuels, the added value of increased quality of life from renewable energy and the mitigation of any societal or environmental impacts of renewable energy projects.
Cooperative development requires mutual trust to facilitate working together for:
1) down payments on renewable energy loans;
2) property and infrastructure for collateral;
3) energy-efficient and renewable energy infrastructure (e.g., electric vehicles that double as energy storage for local utility); and
4) the social relationships required for successful and effective renewable energy projects.
Cooperative development yields an ROI that can be invested in other areas of the economy and fuel the transition to 100% renewable energy. These include raising capital for investment in energy; efficient, smart technology; and sustainable products that can be manufactured from renewable energy.
Investing Together Creates the Strongest Network of Advocates
Groups that have a financial interest and have invested together form the strongest network of advocates for both off-grid and centralized energy generation. They will have the experience to foster advocacy in a practical way. This advocacy calls for better rates from the utilities or the adaptation of renewable energy incentives.
This is important in an era when energy advocacy associations and daily online campaigns are not proving sufficiently effective. Advocacy associations are largely ineffective when they are not united in understanding that their financial survival or livelihood is dependent upon cooperating and advocating for progress.
Energy advocacy associations are even more effective when they are linked together in the same geographic area. In a place-based scenario, our joint presence makes us accountable to our environment.
If we are ready to experience the benefits of renewable energy, sober up from the toxicity of fossil fuels, work toward a renewable energy future and feed this future cooperatively, then there is no better time than now to take our first step.
This is a guest post by Ariana Marshall, Ph.D., Faculty Member, School of STEM at American Public University and Caribbean Sustainability Collective Director. Dr. Ariana Marshall is a faculty member with the School of Science, Technology, Engineering and Math, American Public University. She is the Director for the Caribbean Sustainability Collective and focuses on culturally relevant sustainability and climate change adaptation. Ariana completed her doctorate in environmental science at FAMU.