Pulling together
There are many reasons to welcome a diverse mixture of types of wind power ownership, says Dave Toke
Community wind power of various sorts has been a big success in Germany, Denmark and The Netherlands, contributing large amounts of capacity. Commercially sized community wind power has not featured so prominently in the UK, but the wind power market in the UK is still a little more diverse than may sometimes be realised.
The stories of idealistic communal ownership of wind power in Denmark, which pioneered the development of wind technology, are things that many wind industry executives want to play down today. They say that wind technology is now part of the mainstream energy industry and its image can do without theories promoted by 'fringe hippies' or romantics.
In reality, matters are a little more complex than this. Different places have rather different cultures and physical environments and it is probably much too simplistic to paint the wind industry as being either 'old-style hippies' or 'new-style big industrialists'. For a start, it is actually quite difficult to say where 'community' wind power ends and so-called industrial wind power starts. Certainly, at one end of the scale, there are the portfolios of transnational corporations (TNCs), and at the other end there are windfarms that are owned by local cooperatives. There is also a lot that is in between these apparent poles and everybody in the business has to keep their eyes firmly fixed on the bottom line. What is best will vary from time to time and from place to place.
The definition of 'community' ownership should be understood in the context of a continuum of ownership between transnational and local ownership. Besides local ownership through cooperatives, there is also community ownership through local farmers. It should be remembered that the first British commercial windfarm was established by a farmer, Peter Edwards, on his own land. A handful of British farmers or local entrepreneurs have developed their own projects since then. Further along the continuum there are projects that are organised by remote companies, but whose equity is raised through public share offers. In the UK and The Netherlands, idealistically-oriented companies - such as Energy4All, tap into the ethical funding market to raise funds. However, in Germany, where public share offers have provided a large slice of equity capitalisation for the wind market, these types of operations are best classified as corporate independents who raise equity from popular rather than private sources.
In Germany, the large bulk of the wind power is owned either by independents, cooperatives or farmers. According to data from Enercon, around half of the total German wind capacity has been developed by companies called 'Kommandistengedellschaften', whose equity has been derived from public share offers. Much of the rest of the capacity has been developed by 'Bürgerwindparks', which is owned by local citizens or farmers. Some of these local citizen-owned windparks are actually quite large in size, built up usually incrementally to 50MWe or more.
This picture may be changing now that new development has moved more to the East and offshore, and also because Germany's tax laws have been changed to reduce the effective return on investments. The growth of offshore windparks in Germany and the UK has been heralded as evidence of a further shift of the industry towards TNC ownership. In fact, even this part of the picture is more complex since the early domination of the offshore windfarm sector by TNCs may be relaxed in the future. This is because of the entry of independent companies into the offshore windfarm sector, now that the banks are warming to the idea of participating in project financing of offshore wind farms.
In The Netherlands, the site of the first project financed offshore windfarm (Q7), there has been a mixed culture of wind power ownership. Approaching half the onshore capacity is owned by local farmers, local entrepreneurs or cooperatives, and the rest by the utilities. Sweden, as well as its Danish cousin, boasts a strong independent, often community or farmer-owned wind sector, and as the Swedish renewables obligation is increased, so will the prospects for this independent sector. Irish wind power development has been built mainly by locally based companies.
Domination
Although the majority of British wind power is owned by the electricity majors, their domination of the wind market is not total. There are independent companies of various shapes and sizes who operate in the UK. Some of these companies act as effective 'turnkey' developers before selling them on to vertically integrated electricity majors, and some who maintain a longer-term relationship with the projects they have developed.
There are many reasons to welcome a diverse mixture of types of wind power ownership. For a start, it means that the sector is more competitive. It should be obvious that if local, independent, as well as transnational companies are trying to establish projects, then capacity will grow more quickly and extra channels of investment will increase the total wind generation market. This can only be good for wind business.
Where projects are promoted by indigenous people, there may be planning advantages, as local networks can be deployed to support the case for allowing planning permits for projects. Certainly, the costs of making planning applications will be much lower if much of the work is done, or at least sourced, by local farmer or community developers. Yet calling something community-owned, or even saying that some shares will be offered to local people, is not a panacea for blowing away planning problems. The case history of the Awel Aman Tawe Wind Farm project is a testament to that. In this case, no amount of publicising the intention of selling the shares in the scheme to the public was able to overcome the hostility, all too common in Wales, to windfarm development. Compared to many places on the continent, the UK is very often a hostile planning environment. Local landscape amenities are defended strongly, and indeed often by fanning grossly exaggerated fears of the likely effects of what windfarms will do in practice.
Wind developers cannot be blamed for such hostility. However, there are community-oriented activities that can be usefully deployed to help. Yet it is not always obvious that the thinly spread personnel of some wind development organisations use all the levers that are available. It is, for example, possible to mobilise campaigners to encourage local people to write to their councillors in support of the projects. Community funds can be offered to the local parish council, development work can often be given to local companies to boost local jobs, and, yes, offering shares to local people is good public relations. Independent companies such as Wind Prospect and Falck Renewables are among the mainstream companies that have tended to be associated with a number of these stratagems. These two companies have, respectively, offered shares to the public in the Deeping St Nicolas windfarm in Eastern England and the Boyndie scheme near Banff in North Scotland. There have also been efforts by npower renewables to unlock the benefits of local promotion of wind power through its 'Windworks' programme.
This is not pure community ownership in the Danish or German sense, of course, meaning majority equity ownership by people in the local area who have developed the project themselves. There have, however, been a few notable examples in the UK of various types of community projects. The Baywind Co-operative was established through a six turbine project in 1996, and it raised its funds through selling shares to a large number of ethical investors. This led onto to the creation of Energy4All, which exists to help and encourage popular ethical investment in wind power. This organisation has helped fund other fully cooperatively owned projects, including Findhorn in North Scotland, Bro Dyfi in Wales and the recently commissioned 6.5MW project at Westmill in Oxfordshire. This latter project is the culmination of many years of effort by Adam Twine, the farmer upon whose land the windfarm is sited.
Efforts
There are various efforts to create community windfarms in Scotland. A 900KW project at Burray on The Orkneys, owned by local people, was installed in 2005, and the Scottish Executive's Scottish Community and Household Renewables Initiative helped establishea 675KW project on the island of Gigha at the end of 2004. Indeed, the Scottish Executive is increasing its funding of community renewables initiatives.
Consent
There are ongoing efforts by farmers to install projects. The Moel Maelogen and Amegni windfarm projects in North Wales are promoted by local farmer cooperatives. They have done well to gain planning consent for a total of around 31MW of capacity, in what is a difficult planning environment.
We can see that while the UK has much less community wind power than various other continental countries, the ownership patterns are a little more diverse than is commonly realised. Cultural factors have generated the differences in the amount and type of community ownership. However, there is an important common cultural thread that runs through wind power everywhere. The technology still needs long term financial guarantees to grow, and it needs ways of maximising the diversity of its support and practice in order to maintain the support of the public for policies necessary to promote wind power and renewable energy. An attitude that encourages diversity of wind power ownership is an important part of this strategy.
Dr David Toke is senior lecturer in Environmental Policy at the University of Birmingham.
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