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transcript
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International (West EU) models of
cooperatives and case studies
Author: Jaroslav Klusák
1.1. Introduction
Energy communities are defined in two separate laws of the Clean Energy Package. The
revised Renewable Energy Directive (EU) 2018/2001 sets the framework for ‘renewable
energy communities’, including renewable energy. The revised Internal Electricity Market
Directive (EU) 2019/944 introduces new roles and responsibilities for ‘citizen energy
communities’ in the energy system covering all types of electricity.
The revised Renewable Energy Directive defines citizen energy communities as “a new type
of entity due to their membership structures, governance requirements and purpose”. The
Directive also spells out specific characteristics of such communities in terms of their sizes
and ownership structures.
Roberts et all (2019) view energy communities as a non-commercial type of market actors,
as they focus not only on non-commercial economic gain but also on environmental and
social community objectives. When operating on the market without discrimination, these
communities must comply with rights and obligations as other market parties and their
activities must not distort the competition.
Energy communities are incorporated as a non-commercial type of market actors that
combine non-commercial economic aims with environmental and social community
objectives (Roberts et al., 2019). The revised Electricity Market Directive states that ‘citizen
energy communities constitute a new type of entity due to their membership structure,
governance requirements and purpose’. The revised Renewable Energy Directive refers to
the specific characteristics of local renewable energy communities in terms of size and
ownership structure.
Therefore, the directives frame energy communities around specific criteria and activities
to ensure they have an equal footing when operating in the market without discrimination
(Roberts et al., 2019). But they must do so without distorting competition and without
foregoing rights and obligations applicable to other market parties.
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Under the same legislation it is obligatory for Member States to provide an enabling
framework to promote and facilitate the development of renewable energy communities as
a way to expand renewable energy. Member States are also required to take renewable
energy communities into account when designing their renewable energy support schemes.
In the revised Electricity Market Directive, the enabling framework is more intended to
create a level playing field for citizen energy communities as new market actors.
In general, citizen energy communities and renewable energy communities are involved in
both traditional and new business type of activities. They are allowed to carry out similar
activities, including, among others, generation, distribution, supply, storage of energy or
provision of energy-related services. In each separate segment of the market they must
comply with relevant market obligations and regulations.
Recurrently energy communities generate renewable energy, however in recent years
there is a growing trend of energy communities encompassing several additional services.
In 2020 the Joint Research Centre published a report (Caramizaru, Uihlein 2020), which
provides a detailed overview of energy communities’ activities based on an analysis of
24 energy cooperatives in Europe.
The activities are as follows:
▪ Generation – an energy source is owned, usually a renewable one. Generated
power is not self-consumed but fed into the network and sold to the supplier (e.g.
Hillerød Biogasification)
▪ Supply - the sale and resale of electricity and gas to costumers (e.g. ECOPOWER)
▪ Consumption and sharing: energy community owns and produces energy, which
is subsequently used and shared inside the community (e.g. Eigg Electric)
▪ Distribution – network owned and managed by the community, usually combined
with generation, i.e. local distribution grids or small-scale district heating and
(bio)gas networks (e.g. Eigg Electric)
▪ Energy services: a whole range of services aimed at energy efficiency or energy
savings, from renovations, energy auditing, energy management to financial
services
▪ Electro-mobility: car sharing or charging stations management (e.g. Courant
d’Air, or Mobicoop)
▪ Other activities: soft measures, including consultancies, information sharing and
awareness raising in the field of energy communities (e.g. Energie Solidaire
Enercoop, France
The declared 24 case studies show most energy communities own and generate energy.
On top of that, some are involved in both generation and supply (Ecopower), while the
combination of generation, supply and distribution performed by EWS Schönau is quite
rare. Advisory role of energy communities looks fairly strong; activities are tailored to local
needs and cover a variety of energy efficiency measures, ranging from lighting upgrade to
building renovations. ‘e.g.Courant d'Air, Ecopower, Ecotrajet1
Mobility is an increasingly popular activity in communities. Communities offer citizens an
opportunity to use electric cars easily, while minimising parking and fuel costs. In addition,
electric cars can be used in flexible management of energy produced in local renewable
energy power plants.
1 See https://www.ecopower.be/energiebesparing/ecotraject
https://www.ecopower.be/energiebesparing/ecotraject
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Nevertheless, energy communities can also play an important role beyond what its “local
community” remit. Some cooperatives supply their electricity to a large number of retail
consumers, e.g. EcoPower supplies cover 2% of Flemish households2.
Figure x Overview of cooperatives activities
Source: Caramizaru et al., 2020
1.2. Legal structures
There is a few possible legal structures to establish an energy community. Such model
should be selected that enables to carry out planned services an energy community is to
provide and anticipated governance model, defining levels of citizen engagement and
participation in the energy community.
An overview of available legal structures and their definition has been adapted from
Caramizaru, A. and Uihlein, A. 2020
Table x Possible legal structures for energy communities
Legal structure Description
Energy cooperatives • the most common and fast growing form • primarily benefits its members • popular in countries ahead with renewables and community energy
Limited partnerships • allows participating individuals to distribute responsibilities and
generate profits
• governance based on the value of each partner’s share
2 https://www.rescoop-mecise.eu/aboutmecise/ecopower
0 5 10 15 20 25
Generation
Supply activity
Energy efficiency
Distribution activity
Electro mobility
Consumption and sharing
Flexibility and storage
Financial services
https://www.rescoop-mecise.eu/aboutmecise/ecopower
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Community trusts and foundations
• aims to generate social value and local development rather than
value for individual members • profits are used for the community as a whole (for-the-public-good
companies)
Housing associations • non-profit associations can offer benefits to tenants in social
housing • ideal for addressing energy poverty
Non-profit customer-owned enterprises
• deal with the management of independent grid networks, e.g. community district heating networks common in countries like Denmark
Public-private
partnerships
• local authorities enter into agreements with citizen groups and businesses to ensure energy provision and other benefits for a community
Public utility company • invested in and run by municipalities on behalf of taxpayers and
citizens
• less common, but are particularly suited for rural or isolated areas
Source: Caramizaru et al., 2020
The majority of citizen-led initiatives are cooperatives. Cooperatives are a type of social
and economic enterprise that enables citizens to collectively own and manage renewable
energy projects (Yildiz et al., 2015). Local or from the neighbouring area residents can
invest in renewable generation by buying shares to finance a project (Walker, 2008). In
some cases, citizens can also consume and share renewable energy.
Strong community tradition of Germany or Sweden seemed to have contributed to a wide
spread of cooperatives in these countries. On the other hand in the UK renewable
communities are linked to industrial and provident societies with an aim to benefit the
community as a whole.
In a cooperative, the distribution of profits is limited and surpluses are reinvested to
support its members and/or the community. The allocation of revenues from the projects
is regulated by the statutes of the cooperative, which relate to its main purpose.
Sometimes they can be distributed amongst the members through capped dividends. Other
initiatives may provide energy benefits in the form of lower energy prices. Cooperatives
are based on democratic governance - i.e. decisions made on a ‘one member – one vote’
principle.
There are several umbrella organisation, uniting citizen-led communities at national and
EU levels. Energy4All3 is an example of a UK-wide network facilitating knowledge and
experience sharing. At the EU level the most prominent is the European federation of
renewable energy cooperatives, REScoop.eu4, which brings together more than 1,500
energy cooperatives and thus represents 1 million citizens.
Another legal form for citizens’ participation includes limited partnerships, with a limited
liability company as a general partner (Gesellschaft mit beschränkter Haftung & Compagnie
Kommanditgesellschaft - GmbH & Co. KG). The model is suitable for larger projects with
high investment volume. It became particularly popular for citizen-owned wind parks in
Germany. One example is Sprakebüll which started as a community-wind farm pioneered
by a group of villagers based on the GmbH & Co. KG model. Voting rights are proportional
to the capital invested, instead of the traditional one member – one vote cooperative
principle (Co2mmunity, 2019).
3 See https://energy4all.co.uk/ 4 See https://www.rescoop.eu/
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Development trusts are favoured in Scotland. The community group solely owns the
renewable installations, raises funds and distributes income to community projects. An
example is the Isle of Eigg and its off-grid system5.
In the Netherlands, there are several legal models used to set up energy communities.
One to mention is Duurzaam Ameland (“Sustainable Ameland“); a partnership between the
municipality of Ameland and a number of companies in a covenant. The goal is to make
the island's energy supply more sustainable in a few years. It brings together several
projects (innovative energy grid, solar park, sustainable green lighting, hybrid heat pumps
and sustainable public transport)6.
A specific measure can be found in Poland; in line with the EU legislation on renewable
energy sources a definition of „energy cluster“ was introduced. The clusters do not have a
legal personality, however they can be perceived as a local energy community consisting
of both public and private actors that is in charge of balancing demand and supply on a
local level.
Housing associations can be found in many European countries. In Växjö Sweden a housing
association Lyckansberg’s solar plant has been producing solar electricity for its tenants
for past two years.
Non-profit customer-owned enterprises are legal forms for community ownership
represented in Denmark. In 1962 Marstal District Heating was established and today
supplies district heating to 1460 consumers in Marstal. It produces heat from the sun,
burning word chips and heat pumps plus the rest from bio-oil. In this model, profits are
paid back to the members in lower energy prices. Only property owners in Marstal eligible
to connect to the grid can buy the shares in the network
5 http://www.communitypower.scot/case-studies/projects/eigg-electric/
6 https://www.duurzaamameland.nl/
http://www.communitypower.scot/case-studies/projects/eigg-electric/https://www.duurzaamameland.nl/
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Table x Advantages and disadvantages of legal structures
No Legal structure Main factors for establishment Initiator Energy market Advantages Limitations
1 Energy cooperatives
▪ supply issues -use of local RES
▪ sustainability issues
▪ communities
▪ open/liberalised
with high competition between producers
▪ open to everyone
▪ small initial investment (share purchase - in
case of Ecopower (250 EUR)
▪ guaranteed dividends in case of profits
▪ no entry, or exit fees
▪ possibility to be also a customer of the cooperative
▪ lack of sufficient resources in initial phases
▪ limited access to
locations for RE facilities
▪ limited access to the electricity grid
▪ lack of available support mechanisms for project development
2 Limited partnerships
▪ supply issues -use of local RES
▪ sustainability issues
▪ communities
▪ private business
▪ dominated by a
few incumbent producers and suppliers
▪ sufficient resources in initial phases
▪ access to locations for RE facilities and grid
▪ personal and technical capacities of the involved companies
▪ capacity for project development and
financing
▪ open to limited number of communities and companies
▪ higher initial investment
▪ not guaranteed dividend in case of profits to local
community
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3 Community trusts and
foundations
▪ supply issues -use of local RES support mechanism
▪ communities
▪ dominated by a few incumbent producers and suppliers
▪ ownership rights defined by equity
▪ possibility to be also a customer of the trust
company
▪ access to locations for RE facilities and grid
▪ necessity to own the property
▪ not guaranteed dividends in case of profits
▪ lack of available support mechanisms for project development and
financing due to previous
centralized system
4 Housing associations
▪ supply issues -use of local RES
▪ support mechanism
▪ citizens
▪ houseowners
▪ open/liberalised with high competition between producers
▪ open to everyone houseowner
▪ small initial investment
▪ guaranteed dividends in case of profits
▪ no entry, or exit fees
▪ possibility to be also a customer of the cooperative
▪ necessity to own the property
▪ lack of available support mechanisms for project development
▪ specific model just for group of homeowners
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Non-profit
customer-owned enterprises
▪ supply issues -use of
local RES
▪ sustainability issues
▪ price of energy
▪ citizens/communiti
es
▪ open/liberalised
with high
competition between producers
▪ open to everyone houseowner
▪ small initial investment (together with purchase
of estate)
▪ guaranteed lower price
of energy
▪ additional economic benefit from the visitors
▪ necessity to own the property
▪ lack of available support
mechanisms for project
development
▪ sensitive to changes in legislation and feed in tariffs
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6 Public-private partnerships
▪ supply issues -use of local RES
▪ sustainability issues
▪ communities
▪ private business
▪ open/liberalised
with high competition between producers
▪ sufficient resources in initial phases
▪ access to locations for RE facilities and grid
▪ personal and technical capacities of the involved companies
▪ capacity for project development and financing
▪ open to limited community and companies
▪ higher initial investment
▪ not guaranteed dividend in case of profits to local
community
7 Public utility
company
▪ supply issues -use of local RES
▪ sustainability issues
▪ municipality
▪ private business
▪ open/liberalised with high
competition
between producers
▪ sufficient resources in initial phases
▪ access to locations for RE facilities and grid
▪ personal and technical
capacities of the
involved companies
▪ capacity for project development and financing
▪ open to limited community and companies
▪ higher initial investment
▪ not guaranteed dividend
in case of profits to local community
▪ stakeholders outside of the local region
In the text below 7 case studies mentioned above are deeply analysed - three of them based on direct interviews (Ecopower, Marstal, Eig Electric)
and four of them based on available information through the web pages (due to not availability for direct interviews).
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1.3. Case studies
1.3.1. ECOPOWER (Belgium) - Energy cooperative
Ecopower is a cooperative producer and supplier of renewable energy. Those who invest
in production can consume their own Ecopower power at home. Their mission is to develop
a democratic, decentralized and sustainable energy system and to strive for 100%
renewable energy for electricity, heat and mobility. Ecopower already unites 58,000
citizens who together produce green, Belgian energy, in 2018 they saved around 60,000
tons of CO2. By making ordinary citizens the owners of wind turbines, solar panels, small
hydropower plants and the pellet factory, support for renewable energy is increased.
Ecopower controls energy supplies, so they become independent of energy imports and
large commercial companies.
Ecopower works according to the international principles of cooperative, which have been
established by the International Cooperative Alliance (ICA) and are referred to simply as
the ICA principles. In addition, all seven are listed.
▪ Voluntary and open membership
▪ Democratic control by members
▪ Economic participation by the members
▪ Autonomy and independence
▪ Education, training and information
▪ Cooperation between cooperatives
▪ Attention to the community
Business model
Ecopower is a cooperative what means that profit is not the main purpose of establishment.
The main aim is to supply and produce our members with green electricity form the whole
country at the lowest possible price. The business model is, that Ecopower gather equity
from their members and invest this equity into renewable production (wind, solar, hydro,
wood pallets, etc.) and this produced electricity is sold back to Ecopower members. To
obtain (buy) electricity it is needed to be a member of Ecopower, wood pallets can be also
sold outside of Ecopower (members have a discount).
Cooperative price of electricity is sold “at cost”, meaning that no profits are included into
the final price. Electricity is sold to members as a service and if any profits occurs, these
profits go into reserves and is possibility to give also dividends to members. In Belgium,
when you are classified as cooperative on the national level, dividends are evaluated as
cost, so when cooperative distributes dividends to their members in accounting system are
profits decreased or zero and cooperative doesn´t need to pay any extra taxes from profit.
The electricity price is cheapest on the yearly basis in comparison to other suppliers, but
on the other hand Ecopower is not able to react on current changes on the market, e.g.
during Corona crisis is not Ecopower the cheapest one, but in long time (annual) evaluation
is.
Ecopower is quite big with annual turnover of 36 million EUR. In 2019 profit was 1.5 million
EUR, dividends were 2% and 440 thous. EUR was indicated for reserves.
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Details of energy communities on national level
There is no special support for energy communities in Belgium. Investment support for
cooperatives is the same as for other SME companies (it means can be supplied in large
share in comparison to multinational companies). On the other hand, in Flanders (where
Ecopower operates) is planned to define energy communities and cooperatives as based in
the “winter package” with the aim to support local and small players (citizens,
municipalities, SME).
Energy (electricity) price is based on the overall cost (production and distribution). These
prices differ every year and each customer has the same price for the electricity.
Support scheme for common RES and community RES projects does not differ in Belgium,
there is mostly not direct investment, or operational support. Just existing indirect support
was already mentioned - cooperative can use dividends in accounting system as cost and
decrease profit taxes.
Ecopower has 60 thous. members. General Assembly (in 2020 physically and online about
1.000 people attending) take cares about “big lines”, e.g. discussion about new production
of wood pallets, installation of new sources, etc. There is also Board, which takes mostly
operational decisions and daily Steering Committee where people of different groups
(engineers, accounting, technical stuff) take common decisions. There is also 5 members
which have controlling functions and are in contact with the Board and giving information,
advices, suggestions to other members on the General Assembly. Together 44 people is
working for Ecopower.
Characteristics of the system in which the business model operates
The cooperative operates in the open free energy market. Free market motivates for
keeping electricity price low in other case are customers able with no robust administrative
barriers to switch from current supplier to another one with no fees.
Capacity and production.
In the beginning Ecopower starts with wind turbines, nowadays have 53 installations of
wind with total installed capacity of 110 MW and annual production of 200 GWh. PV systems
are also part of the Ecopower assets with capacity of 460 kWp.
Nr of members and customers
The whole cooperative includes 60.000 members. Just in 2019 3.000 new members occurs
with average share of 1.000 EUR, what is 3 mil. EUR available more as equity. Ecopower
is supplying to 55.000 members. 75% of members have just one share (250 EUR).
The market share of Ecopower is 1.7% of the whole Flanders electricity market.
Energy price
Community price for electricity is unique (just one tariff not distinguishing between day
and night, etc.) with the tariff of 30 eurocents/kWh.
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Target market
The electricity produced in Ecopower installations is sold on the market. Electricity market
is opened and free in Belgium, but is regionalized, so Ecopower is not able to enter the
whole Belgian market, but can sell electricity just in Flanders. Electricity is sold on the base
of bilateral contracts between customers (members) and energy company.
Financial viability
Energy cooperative is financially viable and using standard financial indicators:
▪ yearly budget
▪ financial surplus
▪ energy price
▪ pay-back-time
▪ share of dividends
▪ share of reserves, etc.
For electricity prices there are concluded long term contracts with customers as majority
of production is based on the wind energy (with marginal operational cost), energy
company is able to guarantee long term mostly stable prices and has also be competitive
with other suppliers as they have just 1,7% share in Flanders electricity market.
Pay-back-time period of Rescoop investments is 10-12 years.
Decision making
Decision making is based on the of Board of Directors concerning mostly operational issues
based on the approved budget, actions, maintenance, etc. Once a year there is a General
Assembly available also for a public attending by 500 -1.000 people a year. This General
Assembly has competencies also for approvement of new investments and for approval
majority of attended people is needed. Within General Assembly also new ideas of
shareholders and management are discussed.
Shareholders
Shareholders of energy community are just citizens, there is no other entity able to attend
General Assembly and affect future steps of energy community. There are also no larger
and smaller shareholders in the terms of cooperative control, each shareholder from
60.000 has the same rights and just one vote for General Assembly and also the right for
the same share of potential (e.g. 2% in 2019).
The number of Ecopower shares is limited to 20 per person with total amount of 5.000
EUR. As a couple you can therefore buy a maximum of 40 shares.
Main principles of Ecopower are as follows:
▪ share costs 250 euros and retains its value
▪ no entry or exit fees
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▪ share is always fixed for a period of 6 years
▪ each shareholder has one vote at the general meeting
▪ if profit allows, a dividend will be paid, max. 6%
It means, when you are a direct co-owner of all Ecopower production installations with one
share, approximately 350 kWh of Belgian green electricity is generated each year by this
share and saving 130 kg of CO2.
Strong points
Strong points can be sum up as:
▪ lower price – in comparison to other electricity suppliers in the region (with
difference up to 5 eurocents/kWh.
▪ profits and benefits are distributed within the community (members) and not
leaving the region to the hands of another companies
▪ long term profits – grandparents buying shares for their grandchildren
Barriers
Barriers can be sum up as:
▪ at the beginning to get and involve enough people for the first investment into wind
turbine
Lessons learned
Main lessons for other replications are to:
▪ have good economical calculations and feasibility studies at the beginning to be
sure about potential profits and benefits, which can be redistributed
▪ easy process to become a member
▪ focus on good PR campaign (also based on economic evaluation) to involve crucial
mass of people at the beginning
▪ ensure long term cheap price of energy in comparison to other energy sources
available in the region
1.3.2. Marstal Fjernvarme (Denmark) - Non-profit customer-owned
enterprises
Marstal Fjernvarme started as a consumer-owned co-operative with the installation of the
initial district heating network in the 1960s. Since then, the company is still owned by the
inhabitants of Marstal, nowadays Marstal Fjernvarme cover 1.600 households.
The inhabitants of Marstal financed the original district heating network in the 1960s.
Subsequently, the company financed the transition by tapping into available subsidies and
funding programmes:
▪ 35% of the costs were covered by subsidies from an EU fund (40 Mio DKK)
▪ remaining money (90 Mio DKK) was raised through so-called Kommune Credit,
which is a Danish funding programme that allows borrowing money at favourable
rates.
Since 1994, Marstal Fjernvarme has gradually started transitioning to a renewable energy
system. Nowadays, the company provides heat to the settlement of Marstal from 100%
renewable energy sources, 50-55% comes directly from the solar heat collectors, 40%
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from wood chips, 2-3% from a heat pump. The remaining energy comes from the
combustion of bio-based oil.
Annually, between two and four thousand people visit Marstal Fjernvarme.
Business model
Every customer is a owner of the company, what means Marstal Fjernvarme has
1.600 owners (houses connected) to the grid, so if anybody buys a house in Marstal
Fjernvarme, he is automatically partly owner of the energy community (company). The
price of the house also includes “entrance fee” for membership in cooperative. Company
is operating with no profits, every year after approvement of final financial statements is
profit (surplus) distributed to the owners of the cooperative. In case there is no profit in
current year, company is able to increase heat price, or to take any loan in the bank, if
approved.
Cooperative price for heat is compared to about 500 prices of other heating companies in
Denmark and the price is constantly somewhere in the middle. Prices differs every year
and depends on current investments, when for example investment for changing of heat
source was realized, there was a need to pay a loan and caused increase of price in
comparison to other companies. It happens in the early 1990s, the chair of the board, the
manager of Marstal Fjernvarme, and one of EnergiPlans owners initiated the energy
transition in Marstal. The first solar heating system was installed at the local swimming
pool. After showing promising results, the solar heating system for the local grid was
introduced and were thus able to provide energy to households at a lower price.
Energy community is quite big with annual turnover of 20 million DKK (2,5 mil. EUR).
Details of energy communities on national level
There is no special support for energy communities in Denmark. Investment support is
mostly focused on new smart technologies as more efficient storage systems, etc., but
when you include in the project any ordinary solutions, investment is not able to get any
subsidy from national, or EU level.
Energy prices are set up from two parts. Firstly from fixed price (including loans and
salary), which depends on the size of the house and secondly from variable price (including
fuel cost), which depends on the energy consumption of houses (customers). These prices
differ every year and each customer has the same price for the heat. This is also common
and same approach how to calculate heat price for no community systems.
Support scheme for common RES and community RES projects does not differ in Denmark,
there is mostly not direct investment, or operational support. Just existing indirect support
that green energy is free of carbon, or other taxes. Support of RES was based on the source
and technology (last support was focused on windmills) instead of the ownership of the
project (community vs. non community).
There is a board of 5 people which manage the day-to-day business activities. To be a
member of the board, you have to be a citizen of Marstal Fjernvarme and be connected to
heating plant. Every 2 years are board members re-elected on the General Assembly by
the members of the energy community. The general assembly has also the last word in big
decisions such as the installation of the solar heating system, etc.
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Characteristics of the system in which the business model operates
The energy community operates in the open free energy market. Free market motivates
for keeping heat price low in other case are customers able with no robust administrative
barriers to switch from current district heating to another source and district heating
system should be shut down in the future. There is just a fee needed to be paid for
disconnection depending on the size of the house in average about 10.000 EUR.
Capacity and production.
In the beginning in 1960´s the main source were 6 oil boilers, which are still working but
not using at all due to their expensive operation. Nowadays are boilers feed by biooil and
woodchips. System is also connected to 33.000 m2 of solar (thermal) panels with big water
tank of 75.000 m3 and to 1.5 MW heat pump.
Annual energy production is 30.000 MWh, 50% of the production is provided by sun, 40%
by wood chips, 5% by heat pump and 5% by biooil boilers (which are used just in the case
of cold winters).
Nr of members and customers
The whole energy community includes 1.600 members (households), what means about
86% of all houses in Marstal, with average rate of 2,5 people in a household energy
company serves to 4.000 customers.
Energy price
Community price for heat is compared to about 500 prices of other heating companies in
Denmark and the price is constantly somewhere in the middle. Comparison can be made
with a “standard” house in Denmark which is assumed to have 130 m2 with 4 people living
using 15 MWh per year for heat and such as typical house pay 2.000 EUR for heating per
year also in Marstal, which means average price of 130 EUR/MWh, more info can be found
in statistics of Danish Energy Agency www.ens.dk.
Target market
The energy (heat) produced in Marstal is used solely for self-consumption and no surplus
is sold on the market. Heat market is opened and free in Denmark, but due to geographical
reasons, there is just possibility for Marstal customers to be connected to district heating,
or to use own individual systems. Heat is sold on the base of bilateral contracts between
customers (members) and energy company.
Financial viability
Energy community is financially viable and using standard financial indicators:
▪ yearly budget
▪ financial surplus
▪ energy price
▪ pay-back-time
http://www.ens.dk/
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For energy prices there are concluded long term contracts with customers as 50% of
energy is based on the sun (with no, or marginal operational cost), energy company is able
to guarantee long term mostly stable prices.
Pay-back-time period of Marstal investments is 10-15 years.
Decision making
Decision making is based on the of Board of Directors (5 members) concerning mostly
operational issues based on the approved budget, actions, maintenance, etc. Once a year
there is a General Assembly available also for a public attending by 50-60 people a year.
This General Assembly has competencies also for approvement of new investments and
for approval majority of attended people is needed. Within General Assembly also new
ideas of shareholders and management are discussed.
Shareholders
Shareholders of energy community are just citizens, there is no other entity able to attend
General Assembly and affect future steps of energy community. There are also no larger
and smaller shareholders in the terms of energy community control, each shareholder from
1.600 has the same rights and just one vote for General Assembly and also the same right
for potential surplus and profits generating by energy company.
There is no payment for share, anybody who is connected to district heating is part of the
system and can benefit from potential profits and from the heat price. Just in case when
anybody is buying a new house, he has to pay for the connection to the district heating
system, payment is about 3.000 EUR. For existing buildings, there is no need for payment
to enter and be part of energy company.
Strong points
Strong points can be sum up as:
▪ lower price – in comparison to other individual heating systems in the region
▪ no operation – in case there is any problem with heat, no extra costs are needed
from household, just calling operators of district heating system, which is
responsible for heat supply
▪ profits and benefits are distributed within the community (members) and not
leaving the region to the hands of another companies
Barriers
Barriers can be sum up as:
▪ at the beginning (1960´s) to get and involve enough people connected to the grid
▪ nowadays is problem with electricity price, which is cheaper and heat pumps
become more competitive in price
▪ investment financing at the beginning of the whole process - nowadays there is not
too much opportunities to get investment support for conventional technologies and
advanced are still expensive
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Lessons learned
Main lessons for other replications are to:
▪ have good economical calculations and feasibility studies at the beginning to be
sure about potential profits and benefits, which can be redistributed
▪ focus on good PR campaign (also based on economic evaluation) to involve crucial
mass of people at the beginning
▪ ensure long term cheap price of energy in comparison to other energy sources
available in the region
1.3.3. Eigg Electric (Scotland) - Community trusts and foundations
The new Isle of Eigg electrification scheme is a community inspired project to electrify the
whole island. The system started generating power in 2008 and continuous power was
made available for the first time to all residents and businesses on the island. Further, for
the first time, the renewable resources of wind, water and solar generated electricity were
integrated into a grid system designed to supply an isolated and scattered small
community.
The electricity system is entirely stand-alone. It has no external input from a mainland
utility and is operated and maintained for the community by Eigg Electric Ltd. a wholly
owned company of the Isle of Eigg Heritage Trust. Repair and servicing is the responsibility
of a trained maintenance team of island residents.
The whole project was recognized as the Best Community Initiative at the 2008 in Scottish
Green Energy Awards.
Business model
There are no shareholders in this community trust. The first step was to buy in 1997 the
whole electric system on the island which was privately owned before and to provide
residents stable 24/7 electricity supply by local (community) company, what means Eig
Electric has 47 households (about 100 people) and 10 businesses connected to the grid.
The electric system was bought by three organizations at the beginning - Highland Council,
Isle of Eigg Heritage Trust and The Residents of the Isle of Eigg. Later on the Isle of Eigg
Heritage Trust had three subsidiary companies
• Eigg Trading Limited owns and manages An Laimhrig which houses the island Shop
and Post Office, Tearoom, Craft Shop, Trust office, waiting area and toilet /shower
facilities
• Eigg Electric was set up to build and manage the islands’ electricity grid
• Eigg Construction Limited was set up to undertake renovation works on the Trust’s
properties.
Energy community is quite small with annual turnover of 100 thous. EUR and investment
cost were 1.6 mil. EUR also supported by European Regional Development Fund.
Details of energy communities on national level
There is no special support for energy communities in Scotland. Investment support is
mostly focused on new smart technologies as more efficient storage systems, etc., but
when you include in the project any ordinary solutions, investment is not able to get any
subsidy from national, or EU level.
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Electricity price is set up individually with no need to be competitive due to closed island
system as mentioned the main reason for establishment of community trust was delivery
of 24/7 electricity. The price is almost higher than price from other bigger electrical
companies. Revenues from selling of electricity are mostly used for repairment works and
local employees of Eigg Electric. On the other hand at the beginning of the project residents
of Isle of Eigg were ask, what price level they afford and this level is trying to be fixed or
increased just only in very small level or if really necessary.
Support scheme for common RES and community RES projects does not differ in Scotland,
there is direct investment support, but in case you obtain any investment support, you are
not able to reach to any kind of operational support. Support of RES is based on the source
and technology instead of the ownership of the project (community vs. non community).
There is a voluntary Board of Directors which meets regularly in case of new investments
(actually expansion of the electric system), if the whole system doesn´t operate as
supposed, or if there are some new busines, etc.
Characteristics of the system in which the business model operates
The energy community operates in the closed (island) energy market. The market doesn´t
motivate for keeping electricity price low.
Capacity and production.
The system consists of three hydroelectric generators a group of four small wind generators
and an array of solar electric panels sited at different locations around the island as
determined by optimum availability of resource. The hydroelectric capacity is
approximately 110kW, the maximum output of the wind farm is 24kW and the solar electric
panels can produce up to 10kW (since increased by a further 40kW). The total generating
capacity of the whole system is approximately 184kW.
A bank of batteries, capable of providing power to the whole island for up to 24hrs, has
been designed into the scheme to enable us to optimise our usage of energy from the
renewable resources. To cover occasions when renewable generation is low, the system is
supported by a pair of 70kW diesel generators, which act alternately as back up and
reserve, and can be switched into the system automatically as a part of the control
strategy.
Total annual production is 250 MWh.
Nr of members and customers
The whole energy community has no members as mentioned, is just private company and
such as company supplies electricity to 47 households (100 people) and 10 businesses.
Energy price
Community price is higher in comparison to annual electricity price in Scotland and
currently Eig Electric charge 250 pounds per MWh.
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Target market
The whole output of all the renewable energy generators is sold on the island. The whole
production is brought together, controlled and distributed to all households and businesses
on the island by way of an island-wide high voltage grid of approximately 11km length.
Consumers are supplied via transformers which convert the grid voltage to domestic
voltage and which are located in close proximity to clusters of properties. These same
transformers provide the means of access to the grid for the energy produced by the
renewable generators. Contracts are directly between Eig Electric and customers
(households, businesses).
Financial viability
Energy community is financially viable and using standard financial indicators:
▪ yearly budget
▪ financial surplus
▪ energy price
▪ pay-back-time
Eig Electric is preparing “management account” every three month to have updated data
about financial situation of the company.
Decision making
Decision making is based on the of Board of Directors concerning mostly operational issues
based on the approved budget, actions, maintenance, etc. There is a community meeting
every month in case of lower production, increasing of the system, repairment, etc. and
reported to Board of Directors.
Shareholders
There are no shareholders.
Strong points
Strong points can be sum up as:
▪ 24/7 accessibility of electricity supply
▪ 95% energy system based on renewable sources
▪ no operation – in case there is any problem with electricity supply, no extra costs
are needed from household, just calling operators of Eig Electric
▪ support from operators (private company) at the beginning who knows a lot of
technical info about generation and distributing system
Barriers
Barriers can be sum up as:
▪ at the beginning to get finance for investment and to ensure sufficiency reserves
for repairment
▪ system has been designed to provide at least 95% of the power consumed on the
island, however, it is of limited capacity, especially in the summer months when we
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may have little wind or rain. To avoid the possibility of overload and to ensure that
electricity was always available equally to all consumers, a decision was taken early
in the design of the project to cap the supply to all outlets. Domestic and small
business premises were to be capped at 5kW and for larger business premises at
10kW. All consumers were provided with energy meters to measure power
consumption and indicate when the cut off point was approaching.
Lessons learned
Main lessons for other replications are to:
▪ have good economical calculations and feasibility studies at the beginning to be
sure about potential profits and reserves for repairment
▪ focus on good PR and information campaign (also based on economic evaluation)
to involve crucial mass of people at the beginning
1.3.4. Eoliennes en Pays de Vilaine (FRANCE) – Limited partnership
L’association Éoliennes en Pays de Vilaine (EPV) is a REScoop that has been working on a
wind energy project for more than 15 years. In 2013 they established their first wind
project. As a REScoop with no production of their own they needed to find a way to cover
the first phase of the authorisation process for the wind turbines. In order to do this
effectively the REScoop has set up a professional company with the involvement of
different local stakeholders.
In 2006 the wind project came at a stage where it could not be done by only volunteers.
The association decided to hire an employee and created a company Site à Watts (SARL -
limited liability company) to keep the project from going to other private developers. With
the support of many voluntary workers, Site à Watts obtained two construction permits in
2009 and 2011, allowing the creation of Bégawatts a separate company that will be
responsible for the exploitation of the new wind park.
The REScoop EPV brought several stakeholders together to set up the company Site à
Watts. First there were the founding members EPV, 25 founding members, three local
investors clubs (CIGALES in French) and a semi public company from the Department of
Loire-Atlantique (Société d’Economie Mixte in French) invested in the capital of this
company. The company works now as a project developer that only develops citizens
owned wind parks in France.
The total costs for development of a wind project was around 250,000 Euros per project,
not taking into account the time spent by the voluntary workers. To get the venture capital
together for setting up the company that would undertake this development EPV included
several stakeholders:
▪ 25 founding members invested 400,000 Euros
▪ CIGALES (other stakeholders - investor clubs) which invest only locally and in
ethical and solidarity-based projects representing more than 700 people
▪ Energie Partagée Investissement which is a national citizen investment fund that is
authorized by the public financial authority to conduct public offerings
▪ Group of local entrepreneurs in the sector of social and solidarity-based economics.
All the studies and applications were done by Site à Watts with the help of volunteers. The
different studies (wind, noise, impact studies, architectural plans, legal statutes, economic
expertise) were validated by specialized firms. However, the founding members kept the
coordination and the management under their own control. Today it is Site à Watts
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Développement that takes in charge the technical, legal and financial follow-up of the
project.
EPV wanted to mobilize as many small actors who will be implicated and empowered in the
management of their needs for electricity. To keep a role for the public and private local
actors involved they used a cooperative governance: one member = one vote inside each
body of the organization. The company is structured with different bodies of stakeholders.
There are five bodies in the governance of Bégawatt:
▪ Body of founders that holds 35% of the votes
▪ Body of “citizens investment clubs” - 30% of the votes
▪ Body of Actors of the local investment - 12% of the votes
▪ Body of actors of the social economy - 5% of the votes
▪ Body of Energie Partagée Investissement holding 18% of the votes.
1.3.5. Bostadsrättsföreningen Lyckansberg (Sweden) - Housing
associations
Lyckansberg's solar cell plant was commissioned on April 18, 2018. The plant produces
electricity for the association's common purposes (58 households) such as lighting, laundry
rooms, sauna and other functions in the association room.
At certain times, when production of electricity generates a surplus, then that electricity is
sold online. At other times, when association has a higher need than the plant produces,
then electricity is purchased from the grid.
The plant produces as much electricity as the association consumes for common purposes
during one year, e.g. about 55,000 kWh. Since it is difficult to predict the development of
electricity prices, it is difficult to say exactly when the plant has earned its investment
value, but a target value is 12 years. Thereafter, the plant will only mean a saving for the
association. Guaranteed service life is 25 years on the solar cells.
The association has been granted 30% in support of the investment from the state solar
cell grant. The cost of the investment before grants is about SEK 800,000.
1.3.6. Duurzaam Ameland (Netherland) - public-private partnership
Sustainable Ameland is a partnership between the municipality of Ameland and a number
of companies. The goal of this partnership is to make the island's energy supply more
sustainable in a few years. Sustainable Ameland started in 2007 with a number of
interesting experiments.
In Sustainable Ameland, the municipality of Ameland works together with companies
Eneco, GasTerra, NAM, Signify, Liander, TNO and EnTranCe and The Amelander Energy
Cooperation (AEC).
The municipality of Ameland is planning to develop an innovative energy grid together with
residents, companies and local parties. Such a network, which continuously coordinates
supply and demand of sustainable energy, is necessary for the truly sustainable energy
supply that the island has in mind. This grid is an initiative of the partners of the
Sustainable Ameland Covenant.
The following projects have been realized:
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▪ the addition of sustainably generated hydrogen in the natural gas system, a natural
gas filling station and buses running on natural gas (now replaced by fully electric
buses)
▪ a large solar park (6 MW peak)
▪ 45 fuel cells - mini CHPs
▪ LED -lighting in the villages and rural areas
▪ more than 130 hybrid heat pumps in rental homes and private home ownership.
Unique to the transition of Ameland are the large investments of private companies, and
the relative small financial contribution of the municipality. Only in three projects the
municipality contributed directly from its own financial resources. In three projects the
municipality was responsible for the subsidy request. All the covenant parties provide a
large in-kind contribution. The 8 innovation projects were all realized within the Duurzaam
Ameland collaboration. However, not every covenant partner has contributed to the
realization of each project. Only the first project –The Natural Gasstation - has been
realized by all covenant partners. The parties collectively decided and equally invested in
this station. The other 7 projects are executed by the municipality in collaboration with one
or two private parties of the Covenant, sometimes with local parties involved.
Future plans are to convert Duurzaam Ameland initiative into a program with a dedicated
program director with a joint budget and agreements on activities and to include the local
citizens of Ameland more into future projects.
1.3.7. Hillerød Biogasification (Denmark) - Public utility company
In the Danish town of Hillerød the company BioSynergi Proces ApS developed one of the
first biogasification plants. The company gave citizens in Hillerød the opportunity to be
investors and owners of the company that was to run the plant. Within 2½ months in the
autumn of 2011, 1,050 shares at a price of 1,000 euro each were sold.
The investors organised themselves in the democratically run company called Hillerød
Biogasification P/S and transferred the responsibility of the plant operation after the
completion of the project into this company.
The biogasification plant can produce 300 kW power and 750 kW heat. The plant is powered
by an uncomplicated and efficient gasification process that turns wood chips into
a combustible gas, which is used as fuel by an engine that generates electricity and heat.
Electricity is supplied to the grid, while heat production is supplied to the existing district
heating system, which is owned by the local municipal heating company. District heating
is showing its potential in terms of integration of renewable energy systems in existing
facilities, as the plant is connected and partially replaces the fossil gas based heating plant.
Electricity production revenues are generated according to the principles of the Danish law
on promotion of renewable energy, while heat production is settled after an agreement
with the local district heating company. It is agreed that the heat price for the chip-based
generation shall be lower than natural gas price.
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2. PAST LOCAL BEST PRACTICES. CASE STUDIES
2.1. OVERVIEW
Renewable energy sector in the Republic of Moldova is at the very beginning of its
development. Even if the first Law on renewable energy was adopted in 20077, there are no
significant progress achieved in these years.
In terms of overall renewable energy share, the figure of 28% is mainly due to use of low
technology biomass in the households’ sector8. This high share can be explained through the
energy poverty, which comprises a large population, especially in the rural area.
Renewable energy share in the electricity sector is around 2%. In the same time, renewable
energy use in the transport sector is negligible.
The existing renewable electricity generation capacities raised significantly in the last three
years, before the new Law no.10/2016 promoting the use of energy from renewable sources9
entered in force in 2018.
Almost all the existing operating capacities are working on the so-called „old support
mechanism”, which is a variable tariff calculated on the yearly basis, based on the effective
expenditures supported by the power plant. Currently all the generation capacities sum up
around 47 MW power, out of which 42 MW are operating with the „old support mechanism”.
The majority of the installed capacities are in wind energy, while quantitatively the biggest
number of projects are in the solar photovoltaic energy. Business stakeholders in private sector
drove implemented projects. In the public sector, mainly the International Financial
Organizations supported the renewable energy projects. European Union Project „Energy and
Biomass” funded over 30 MW in heat only boilers for the public sector.
There are also other successful projects in the renewable energy field, which are smaller and
rather have a demonstrative or pilot scale.
The vast majority of the renewable energy projects in the public sector were
implemented with the international donors’ community support.
Net metering mechanism was launched in 2018 and according with the last ANRE Report10,
by the end of 2019 was reported approximatively 1,5 MW installed capacity. All generation
capacities are in solar photovoltaic panels, distributed along the 127 prosumers, with an
average figure of approximatively 10 kW per one prosumer.
2.2. PAST AND EXISTING BEST PRACTICES ON LOCAL ENERGY PRODUCTION
Projects chosen to be presented here were selected based on the criteria what fits in a way
the energy cooperative goals. Whether the project is a small community scale project or has a
various combination of the renewable energy technologies or even has implemented using an
innovative financing scheme, all of them were analysed carefully.
7 https://www.legis.md/cautare/getResults?doc_id=91763&lang=ro 8 https://www.energy-community.org/implementation/Moldova/RE.html 9 https://www.legis.md/cautare/getResults?doc_id=106068&lang=ro 10 http://anre.md/storage/upload/administration/reports/495/RAPORT%20DE%20ACTIVITATE%20ANRE%202019%20.pdf
https://www.legis.md/cautare/getResults?doc_id=91763&lang=rohttps://www.energy-community.org/implementation/Moldova/RE.htmlhttps://www.legis.md/cautare/getResults?doc_id=106068&lang=rohttp://anre.md/storage/upload/administration/reports/495/RAPORT%20DE%20ACTIVITATE%20ANRE%202019%20.pdfhttp://anre.md/storage/upload/administration/reports/495/RAPORT%20DE%20ACTIVITATE%20ANRE%202019%20.pdf
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2.2.1. Festelita Village / Energy Efficiency Excellence Center
NGO Moldova Social Innovation Fund together with Festelita Village Hall implements a pilot
project under the Covenant of Mayors11.
The project comprises comprehensive measures in the energy efficiency and the renewable
energy fields12.
The project has the following components:
• Public street lighting with LED - first project funded by NEFCO in Moldova13;
• Biomass boiler in 4 public buildings, namely kindergarten, school, culture house and
village hall;
• Planting the energy crops field: 5 ha of energy willow and 2 ha of energy poplar;
• Construction of the 300 kW solar photovoltaic park what will cover the public electricity
demand;
• Solar hot water collector installation for the domestic hot water preparation in the
kindergarten.
Way of financing the project also may be considered innovative since it combines many
financing institution - UE Delegation, Energy Efficiency Agency, Nordic Environment
Corporation, crowdfunding etc.
Energy efficiency excellence center in Festelita village combines a various number
of the sustainable energy technologies in one single community.
According with the project concept, electricity generated by the photovoltaic park will be
injected into the grid, without using storage batteries.
Excess of biomass coming from the energy crops will be sold to the households by the
municipal enterprise established in this regard. In the village there are 1 thousand households
what uses wood and coal stoves for heating.
2.2.2. Cantemir Town / CanTREB Project
NGO Alliance for Energy Efficiency and Renewables together with the Cantemir Town Hall
implements a pilot project within the Covenant of Mayors14.
This project combines implementation of the comprehensive measures in the energy efficiency
and the renewable energy fields15. As the above-mentioned project, CanTREB Project aims to
implement sustainable energy measures within the public sector buildings.
The project includes the following components:
• Four education buildings comprehensive energy efficiency measures;
• Four individual heating points - very small scale of district heating;
• Two biomass heating plants;
11 https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=17001 12 https://www.eu4moldova.md/en/content/creation-excellence-center-through-piloting-demonstrative-new-energy-efficiency-technologies 13 https://www.nefco.org/news/first-nefco-financed-energy-efficiency-project-to-take-off-in-moldova/ 14 https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=17021 15 https://www.eu4moldova.md/en/content/thermal-rehabilitation-educational-buildings-cantemir-cantreb
https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=17001https://www.eu4moldova.md/en/content/creation-excellence-center-through-piloting-demonstrative-new-energy-efficiency-technologieshttps://www.eu4moldova.md/en/content/creation-excellence-center-through-piloting-demonstrative-new-energy-efficiency-technologieshttps://www.nefco.org/news/first-nefco-financed-energy-efficiency-project-to-take-off-in-moldova/https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=17021https://www.eu4moldova.md/en/content/thermal-rehabilitation-educational-buildings-cantemir-cantrebhttps://www.eu4moldova.md/en/content/thermal-rehabilitation-educational-buildings-cantemir-cantreb
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• Biomass fuels form waste and wine yards;
• Smart metering for energy consumption;
• Four by 10 kW of photovoltaic systems on each building based on net metering;
• Wind turbines with a capacity of 50 kW based on net metering for water supply system.
Project is financed through a synergy of various donors, in particular Covenant of Mayors -
Demonstration Projects, EU Delegation, GEF Small Grants Program and others.
Four individual heating points, which supplies heat to the two kindergartens and two
schools, from two biomass heating plants, represent a small-scale district heating
system.
The innovation of this project is that it combines a various number of technologies and involves
different public stakeholders.
2.2.3. Ungheni City / EU4Ungheni Project
Ungheni City Hall is a beneficiary of the European Union project - EU4Moldova: Key Regions16.
In the same time, Ungheni is a Covenant of Mayors signatory17.
With the support of the NGO Association for Energy Autonomy were drafted a feasibility study
on 950 kW photovoltaic park construction what will cover entire electricity consumption of the
municipal public buildings in a yearly basis.
In the field of renewable energy city has one small scale off-grid, battery storage, solar
photovoltaics system installed at the 9 levels block of flats funded with Polish Aid. In the city
there are in operation private initiative of 650 kW solar tracking photovoltaic system at the
carpet factory. Photovoltaic park works based on the „old support mechanism”.
In Ungheni there is free economic zone and a special trading regime18. Industrial
enterprises from Ungheni covers automotive, carpets, furniture, meat sectors.
In the city there are quasi-district heating system - 12 district heating natural gas fired heating
plants which provides heat mainly to public buildings and very few apartments.
2.2.4. Riscova Village / Eco-Village Moldova Project
NGO Eco-Visio promotes energy efficiency, efficient use of natural resources and use of
energy from renewable sources. Mainly based on crowdfunding the NGO have built a training
center – Eco-Village Moldova19.
Center use high performance insulation materials, passive heating and renewable
technologies like biomass boiler house, solar water heating and solar photovoltaic system.
In particular Riscova Eco-Center includes the following topologies:
• Pellets heating boiler;
• Solar collectors for domestic hot eater preparation;
• Photovoltaic system on-grid 2,7 kW;
16 https://eu4ungheni.md/ 17 https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=16267 18 http://www.freezone-ungheni.md/en/ 19 https://www.ecovisio.org/ecovillage
https://eu4ungheni.md/https://www.eumayors.eu/about/covenant-community/signatories/overview.html?scity_id=16267http://www.freezone-ungheni.md/en/https://www.ecovisio.org/ecovillage
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• Clay and straw buildings.
Riscova eco-village unites various financing sources like grants, foreign Aid, crowd
investing, crowdfunding, volunteer, in-kind works and own resources.
The innovative part of the project is that the biggest part was built based on crowdfunding
campaigns. It is example of the small-scale project with a down-up approach.
2.2.5. Pitusca Village / PDG Fruits Farm
PDG Fruits represents an agro-industrial processing farm which besides the fruit growing
combines the renewable energy generation20.
The agricultural farm involves the followings technologies:
• Wind turbine with a capacity of 1,3 MW which works at the „old support mechanism”;
• Rooftop solar photovoltaic panels with a total capacity of 200 kW working based on the
net metering mechanism.
PDG Fruits is a representative example when the agricultural cooperatives through
the integration of the renewable energy may became energy cooperatives.
Idea of the project is that the own electricity generated locally will cover the need of the existing
agricultural cold storage.
2.2.6. Alava Village / Traditional Farm
Traditional Ltd represents another agro-industrial processing farm which combines fruits
growing and the renewable energy generation21. Project is very similar to the previous one
since it involves agricultural cold storage powered by the 100 kW photovoltaics park.
The generated electricity woks at the net metering mechanism and have benefited from the
agricultural subsidies.
The only difference with the previous project is that there is no wind energy generated on-site.
Nevertheless, it confirms the potential of the agricultural cooperatives’ transformation into the
energy cooperatives.
2.2.7. Milesti Village / Solar water pumping
Village had benefited from international donors funding for the implementation of the water
supply and sanitation project though Austrian and Swiss Aid22.
The potable water pumping satiation is powered 100% with the solar photovoltaic energy.
Project concept was that instead of electricity storage water is stored. In sunny days when
water consumption drops water is stored in the storage tanks. The installed capacity of the
photovoltaic park is 40 kW.
20 https://pdgfruits.com/en/eco-energy/ 21 https://agrobiznes.md/seminar-cum-sa-reduci-costurile-de-energie-in-depozite-frigorifice-sau-la-procesarea-produselor-horticole.html?fbclid=IwAR3n5OY1maOglGbTIXQYbnXks_9APOkdinyu0Ik4T312vwC2xeIyq8rDh8A 22 http://news.ungheni.org/2019/07/03/in-milesti-a-fost-lansat-primul-sistem-fotovoltaic-de-pompare-a-apei-potabile/
https://pdgfruits.com/en/eco-energy/https://agrobiznes.md/seminar-cum-sa-reduci-costurile-de-energie-in-depozite-frigorifice-sau-la-procesarea-produselor-horticole.html?fbclid=IwAR3n5OY1maOglGbTIXQYbnXks_9APOkdinyu0Ik4T312vwC2xeIyq8rDh8Ahttps://agrobiznes.md/seminar-cum-sa-reduci-costurile-de-energie-in-depozite-frigorifice-sau-la-procesarea-produselor-horticole.html?fbclid=IwAR3n5OY1maOglGbTIXQYbnXks_9APOkdinyu0Ik4T312vwC2xeIyq8rDh8Ahttps://agrobiznes.md/seminar-cum-sa-reduci-costurile-de-energie-in-depozite-frigorifice-sau-la-procesarea-produselor-horticole.html?fbclid=IwAR3n5OY1maOglGbTIXQYbnXks_9APOkdinyu0Ik4T312vwC2xeIyq8rDh8Ahttp://news.ungheni.org/2019/07/03/in-milesti-a-fost-lansat-primul-sistem-fotovoltaic-de-pompare-a-apei-potabile/http://news.ungheni.org/2019/07/03/in-milesti-a-fost-lansat-primul-sistem-fotovoltaic-de-pompare-a-apei-potabile/
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This project is innovative one since it is the first public water supply system powered with
renewable energy. In addition, combining water supply service and renewable energy use it
exercise strong social impact.
2.2.8. Crasnoarmeiscoe Village / Biomass heating
Village have implemented four projects what consist in biomass heating of all public buildings
in the community - two kindergartens, mayor’s office and lyceum. In one kindergarten were
installed also solar hot water collectors.
Investments were possible due to „Energy and Biomass” Project in Moldova and it is a unique
village where all public buildings are heated with biomass23.
By implementing biomass heating in absolutely all public buildings,
Crasnoarmeiscoe village became an example of the local energy autonomy.
However, each public building has its own heating plant, that is no heat pipes between them
what would represent a district heating system.
In addition, in the village were implemented other two energy efficiency projects one is windows
replacement in lyceum and another is street lighting.
2.2.9. Causeni Town / Biomass heating
Causeni town is signatory of the Covenant of Mayors24. In the same time, few public institutions
in the town has biomass heating plants.
The town has benefited from the international Aid funding to install biomass heating plant within
the district hospital. Heating plant is integrated with the solar hot water collectors. Another two
big buildings are the and Youth and Sport Center and the Firefighters Station.
The difference from the others projects is that the biomass boilers installed here is the biggest
one’s operation in public buildings. Like in Crasnoarmeiscoe, each public building has its own
heating plant, that is no heat pipes between them what would represent a district heating
system.
2.2.10. Edinet City / Wind park
Edinet city is signatory of the Covenant of Mayors25. City is the one of the biggest communities
in the North part of the country which host Edinet Industrial Park - special trade zone26.
Currently in Edinet are installed five wind turbines which sum up 7,6 MW of wind power.
Initiative is absolutely business driven. Investment are done by the four different enterprises.
Economic cooperation between the four renewable energy generation companies is
a premise for the energy cooperation and respective energy cooperative
establishment in the city.
23 https://www.md.undp.org/content/moldova/en/home/presscenter/pressreleases/2018/peste-5-000-de-oameni-din-raionul-hanceti-au-acces-la-energie-re.html 24 https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=18251 25 https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=17830 26 http://edinet.business/
https://www.md.undp.org/content/moldova/en/home/presscenter/pressreleases/2018/peste-5-000-de-oameni-din-raionul-hanceti-au-acces-la-energie-re.htmlhttps://www.md.undp.org/content/moldova/en/home/presscenter/pressreleases/2018/peste-5-000-de-oameni-din-raionul-hanceti-au-acces-la-energie-re.htmlhttps://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=18251https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=18251https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=17830https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=17830http://edinet.business/
27
All wind turbines installed in Edinet are operating according with the „old support mechanism”,
injecting electricity into the public grid.
2.2.11. Taul Village / Wind park
The concept of the Taul’ project is very similar with Edinet. The only difference between them
is that Taul represents a rural settlement with less population and respective smaller energy
demand.
In the village are operating three wind turbines with a total installed capacity of 3,9 MW. Wind
park is owned by the single company and is operation according with the „old support
mechanism”.
In addition, Taul represent a village with tourism attraction potential, since in the village are
located the famous Pommer Mansion and its biggest Dendrologic Park27. Pommer Mansion
hosts agricultural college heated with a biomass boiler.
2.2.12. Razeni Village / Community Biogas Project
Razeni is signatory od the Covenant of Mayors28. Village have implemented three energy
efficiency projects in two kindergartens and one school what consists in thermal insulation of
buildings. Another energy efficiency project is related to LED street lighting.
Currently in Razeni, within the social canteen is ongoing project what aims to use food scraps
for the biogas production29. Project is a small-scale imitative managed by a consortium of
public associations with funds offered by the international Aid.
2.3. PAST AND EXISTING BEST PRACTICES SUMMARY
Past and existing best
practices
Biomass
heating
Solar PV
farm
Wind
energy
park
Buildings
insulation
LED street
lighting
Agriculture
farm
Crowd-
funding
Festelita Village /
Energy Efficiency
Excellence Center
✅ ✅ ✅ ✅ ✅
Cantemir Town /
CanTREB Project ✅ ✅ ✅ ✅ ✅
Ungheni City /
EU4Ungheni Project ✅ ✅
Riscova Village / Eco-
Village Moldova
Project
✅ ✅ ✅
Pitusca Village / PDG
Fruits Farm ✅ ✅ ✅
Alava Village /
Traditional Farm ✅ ✅
27 http://www.travelomoldova.com/places-to-visit/%C8%9Aaul-park/#.XzfoAegzaUk 28 https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=26642 29 https://www.gen-europe-biogas.info/moldova
http://www.travelomoldova.com/places-to-visit/%C8%9Aaul-park/#.XzfoAegzaUkhttps://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=26642https://www.covenantofmayors.eu/about/covenant-community/signatories/overview.html?scity_id=26642https://www.gen-europe-biogas.info/moldova
28
Milesti Village / Solar
water pumping ✅
Crasnoarmeiscoe
Village / Biomass
heating
✅ ✅ ✅
Causeni Town /
Biomass heating ✅
Edinet City / Wind
park ✅
Taul Village / Wind
park ✅ ✅
Razeni Village /
Community Biogas
Project
✅ ✅
29
2.4. ENERGY COOPERATIVES CASE STUDIES
Based on the existing positive experience described above and energy cooperatives potential,
different case studies are described further. Case studies were chosen in a geographically
balanced manner, being represented from the all three development regions: North, Centre
and South.
2.4.1. Riscani City
Riscani has not signed the Covenant of Mayors and has not drafted yet the Local Energy
Efficiency Action Plan. In the same time, were implemented several energy efficiency projects
with the Energy Efficiency Fund support, in particular:
• Riscani District Hospital (insulation of walls and windows replacement);
• Riscani Nursing Home (insulation of walls, attic and basement);
• Kindergarten no.10 Riscani (insulation of walls and windows replacement);
• Theoretical Lyceum „Dimitrie Cantemir” Riscani (insulation of walls and windows
replacement);
• Public Health Center Riscani (insulation of walls and basement and windows
replacement);
Currently in the city there are no any renewable energy project have been implemented.
Electricity system operators has reported two connection permits issued for 56 kW power
generation.
2.4.2. Edinet City
Edinet has signed the Covenant of Mayors but has not drafted yet the Sustainable Energy
Action Plan and has not drafted yet the Local Energy Efficiency Action Plan.
In the same time city had implemented one energy efficiency project with the Energy Efficiency
Fund support, in particular:
• Edinet District Hospital (insulation of walls and attic and windows replacement).
In addition, city had implemented one energy efficiency project with the National Regional
Development Fund support, in particular:
• Public Health Center Edinet (insulation of walls and attic and windows replacement,
internal heating and ventilation systems improvement).
City has one the biggest wind power generation capacity installed within the city in country:
private investments of 4 companies in 5 wind turbines with a total capacity of 7,6 MW.
City hosts Edinet Industrial Park: within the Industrial Park one of the residents uses biomass
for steam generation in the juice production process.
2.4.3. Drochia City
Drochia has signed the Covenant of Mayors and submitted the Sustainable Energy Action Plan
but has not drafted yet the Local Energy Efficiency Action Plan.
City had implemented several energy efficiency projects with the Energy Efficiency Fund
support, in particular:
• Drochia District Hospital (windows replacement);
• Drochia Musical School (walls insulation).
30
City had implemented one energy efficiency project with the National Regional Development
Fund support, in particular:
• Public Health Center Drochia (insulation of walls and attic).
In Drochia is located the biggest biogas power generation capacity installed within the city in
country: Private investment in 3 CHP units based on internal combustion engines with a total
capacity of 3,6 MW where part of energy is used internally in the sugar production process.
2.4.4. Calarasi City
Calarasi has signed the Covenant of Mayors, submitted the Sustainable Energy Action Plan
and has drafted yet the Local Energy Efficiency Action Plan.
City has implemented several energy efficiency projects with the Energy Efficiency Fund
support, in particular:
• Theoretical Lyceum „Vasile Alecsandri” Calarasi (insulation of walls and windows
replacement and natural gas boilers installation);
• Calarasi District Hospital (insulation of walls and windows replacement);
• Kindergarten no.2 Calarasi (insulation of walls and windows replacement);
• Public street lighting with LED.
City has implemented one energy efficiency project with German Aid support, in particular:
• Calarasi District Hospital (natural gas boilers and solar hot water collectors).
Currently city has ongoing energy efficiency project implemented in the frame of Covenant f
Mayors - Demonstration Projects what involves modernization of the public street lighting with
LED.
In addition, city has implemented one comprehensive energy efficiency project with the support
of German KfW bank, in particular were built a kindergarten what corresponds to a passive
house standard.
City has very few renewable power generation - around 20 kW of solar photovoltaics. System
operators has reported one connection permit issued for 190 kW.
2.4.5. Nisporeni City
Nisporeni has signed the Covenant of Mayors but has not drafted yet the Sustainable Energy
Action Plan and has not drafted yet the Local Energy Efficiency Action Plan.
City has implemented several energy efficiency projects with the Energy Efficiency Fund
support:
• Kindergarten no.1 Nisporeni (insulation of walls and attic and windows replacement);
• Culture and Youth Center (insulation of walls and attic and windows replacement);
• Gymnasium „Stefan cel Mare” Nisporeni (insulation of walls and attic and windows
replacement);
• Theoretical Lyceum „Mircea Eliade” Nisporeni (insulation of walls and windows
replacement);
• Gymnasium „Mihai Eminescu” (insulation of walls and attic and windows replacement);
• Public street lighting with LED.
In addition, city has implemented one energy efficiency project with the National Regional
Development Fund support, in particular:
31
• Nisporeni District Hospital (insulation of walls and attic and windows replacement).
Nisporeni has implemented two renewable energy projects with the support of Energy and
Biomass Project, in particular:
• Kindergarten no.1 Nisporeni (biomass boilers and solar hot water collectors).
Electricity system operators has reported two connection permits issued for 2 MW power
generation.
2.4.6. Trebujeni Village
The reason to select this 2 thousand inhabitants’ village is that it is located within historical and
archaeological complex „Old Orhei” - one of the most visited place by tourists30.
Village is located near the river Raut and there was a project to build a run-on-river micro-
hydro power plant of 1,2 MW capacity31.
2.4.7. Cantemir Town
Cantemir has signed the Covenant of Mayors and submitted the Sustainable Energy Action
Plan but has not drafted yet the Local Energy Efficiency Action Plan.
City has implemented one energy efficiency project with the Energy Efficiency Fund support,
in particular:
• Cantemir District Hospital (insulation of walls and attic and windows replacement).
Cantemir has implemented one energy efficiency project with the National Regional
Development Fund support, in particular:
• Cantemir District Hospital (insulation of walls and attic and windows replacement);
Cantemir has ongoing two energy efficiency projects implemented in the frame of Covenant of
Mayors - Demonstrational Projects, in particular:
• Thermal refurbishment of 2 Kindergartens, a Lyceum and Gymnasium in Cantemir;
• Green Light Moldova - Modernization and Saving Energy in Street Lighting.
Cantemir has very few renewable power plants with a capacity of 100 kW solar photovoltaic
panels.
2.4.8. Causeni Town
Causeni has signed the Covenant of Mayors and submitted the Sustainable Energy Action
Plan but has not drafted yet the Local Energy Efficiency Action Plan.
City has implemented one renewable energy project with the National Regional Development
Fund support, in particular:
• Youth and Sport Center Causeni (biomass boilers);
In addition, Causeni has implemented two renewable energy projects with the Energy and
Biomass Project support, in particular:
• Causeni District Hospital (biomass boilers and solar hot water collectors);
• Causeni Firefighters Station (biomass boilers and solar hot water collectors).
30 https://moldova.md/en/content/old-orhei 31 https://journal.ie.asm.md/assets/files/12_03_29_2015.pdf
https://moldova.md/en/content/old-orheihttps://journal.ie.asm.md/assets/files/12_03_29_2015.pdf
32
2.4.9. Purcari Village
The reason to select this 2 thousand inhabitants’ village is that it is located near the „Chateau
Purcari” - one of the most visited wine factories by tourists32.
2.5. ENERGY COOPERATIVES CASE STUDIES SUMMARY
2.6. ENERGY COOPERATIVES RECOMMENDATIONS FOR PILOT IMPLEMENTATION
In this part, we would like to summarize practical steps for establishment and operation of
energy cooperatives on local level. Regardless of dominance of energy efficiency measures
proposed in the case studies above, we focus mostly on energy cooperatives projects based
on installation and operation of renewable energy sources with the main aim to pull in these
projects also local community. The following methodology (steps) can be used by local
authorities when preparing community (energy cooperative) projects.
1. Feasibility and economical studies
32 https://purcari.wine/en/page/history/
https://purcari.wine/en/page/history/
33
Crucial evaluation of potential project including optimal capacity of RES, investment
cost, possible external financial sources (subsidies, community financing, municipal
budget, etc.) and based on these technical and economic figures also presumed
revenues for investors.
2. Approval of the form of project implementation and its financing
In this step agreement (contract) between municipality and municipal company
responsible for operation of energy cooperative project is needed. In this contract is
required to agree on the financing and form of the operation (mostly municipal company
is responsible for financing and operation).
3. Investment agreement (contract) for investors
Agreement which defines duties and benefits of investors is part of the whole
„searching money” process. In