Posts Tagged ‘Community Power projects’

By Ingo Koenig

I was interviewed recently on the differences between Community Power projects in Germany and Ontario.

In Germany wind power is “big business” and up to 90% of wind farms have community participation. After comparing the FIT rules, the tax rules, incentives and legal structures we came to the conclusion that the main difference is in the motives and scope for community projects. In Germany the drivers for the vast majority of community are:

  • A passion to change the energy landscape from coal/nuclear to renewable sources
  • Share the burdens and benefits of the project with other members of the local community
  • Earn some decent returns on your investment (of time and money)

In Ontario, however,  this last point is undermined and almost a “no-no” when discussing Community Power projects. Almost exclusively co-op and not-for profit structures are discussed as entities with equal (or no) profit-sharing and one-share-one-vote etc.

However the co-op-model has not been applied to many wind or solar farms in Germany.  Personally I do not know of any. For the most part, there have been Limited Partnerships with profit-sharing and voting based on equity-share.

This model attracted a high number of highly educated and sophisticated individual investors into the industry. These same people very often switched their careers and are now entrepreneurs, managers, professional advisors etc. for renewable energies enterprises. This in turn has meant a professionalization of the community projects they own and run and results in better returns for the community projects. And again, more people are attracted into the community power space.

Something to think about when in Ontario Community Power projects are regarded as “granola-bar-eater-projects” by some of the “big players”.

Ingo studied business administration and economics at Kiel University where he received a PhD in economic policy and also earned an MBA from the University of Southern California in Los Angeles, USA. Visit www.koenigconsultants.ca

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