Boosting Energy Communities Through Crowdfunding
- October 25, 2021 at 5:56 pm #19739Joan SeguraKeymaster
Energy communities are becoming increasingly important when it comes to green energy and energy transition. This is largely due to increased public awareness of climate change and the way energy is produced. Another key factor for the development of these is the continuously decreasing prices of renewable energy sources, which also makes this sector much more attractive to citizens.
Among the main advantages of the energy communities, it is worth highlighting that they provide proximity and democratised energy. As they are close to the territory where the energy is going to be consumed, they can know more accurately the energy demand of consumers, thus lowering production costs and reducing the loss of efficiency when transporting energy from large production plants.
In addition, these figures provide important economic and social benefits in the territories where they are implemented, as they help to stimulate local activity, generate employment and fix population in municipalities with demographic challenges. Despite this, they often encounter major barriers to accessing traditional financial markets.
When talking about communities, we cannot forget about the existing funding possibilities for them. In recent years, crowdfunding has established itself as the main tool for financing projects through a collective of people. Therefore, in the case of financing energy communities, crowdfunding is also playing a very important role in the development and creation of these communities. Thanks to crowdfunding, all citizens can participate in the energy transition.
Currently, there are many platforms dedicated to financing renewable energy production through crowdfunding. Some of them are also incorporating the financing of energy communities into their business model.
Following, we will see and analyse different cases where the successful financing of energy communities has been achieved through different crowdfunding modalities.
Crowdfunding financing for the installation of solar panels in a homeowners’ association in Barcelona
This project has been financed through the crowdfunding platform Ecrowd!, based on the crowdlending model and specialised in financing investment projects with a social impact. This platform has numerous investments for the production of renewable energy but is also incorporating projects for the financing of energy communities.
The shared self-consumption photovoltaic installation, which managed to raise €37,100 through 107 investors, will provide energy for the common services and will be associated with the 60 homes in the building. It is expected to produce 38,280 KWh per year, representing an estimated saving of €2520 per year for the community and a reduction in emissions of 4Tm/year.
This investment will also be directly supported by grants from Barcelona City Council.
Photovoltaic installation for shared self-consumption in Albalat (Valencia)
This project is managed by the Valencian energy cooperative Sapiens Energía, which is promoting the generation of energy communities across the Valencian Community. The beneficiaries of this energy community will not simply be the inhabitants of Albalat who decide to participate in it. Thanks to the launch of the crowdfunding campaign, private investors who are not in the town but who want to participate in the initiative and therefore obtain an economic interest rate, will also be able to participate in it.
Despite not having achieved 100% of the funding through crowdfunding, €54,400 has been obtained out of the target of €80,000, which means 68% of the investment through 20 investors. Thanks to this, the project has now been built and is ready to be launched. As it is a Crowdfunding lending modality, investors will have an annual interest rate of 3.5% for 4 years. The project has also been supported by grants from the Valencian Institute for Business Competitiveness (IVACE), through its plan to promote electricity self-consumption in local energy communities.
It is estimated that 200 people could benefit from this initiative, providing a family saving of €130 per year and €10,320 per year if all beneficiaries are considered. This project also aims to reduce the energy bills of 6 families living in energy poverty in the locality. Check out their page here.
CéléWatt, a Solar Park on Trees
This project consists of a local energy community in Carayac, France. The governance of the solar park is community based and citizen-led, combining crowdfunding with cooperative management. The launch and creation of the community solar park was managed by a group of a dozen volunteers living in the area that became administrators of the CéléWatt cooperative. The total investment in this project was €237,000 through a crowdlending campaign.
The main objective of this campaign is to achieve a cleaner energy consumption for the inhabitants of the village, but it should also be noted that one of the main challenges is the promotion of local employment, therefore, it has been tried that the vast majority of the materials needed for the installation of the panels are produced locally. As a particular feature of the project is that all the solar panels are installed on a raw-wood structure sustainably sourced from surrounding woods.
The Carayac solar park is expected to have an annual production of 32,000 kWh, which is the energy consumption of 220 inhabitants. This will lead to a reduction of costs in the long term, a reduction of pollutant emissions in the area and also the creation of local employment.
Participatory photovoltaic of Pommerieux
This project consists of the installation of photovoltaic panels on three public buildings, with the aim of covering 80% of the electricity demand through renewable energies. The project has been financed through the French Civic Crowdfunding platform Colleacticity. The crowdfunding model chosen to finance this campaign was lending, raising a total of €20,000 through 46 co-financiers. The total amount of the investment for this project is €46,200, the rest of the funding being covered by a grant from GAL Sud Mayenne and the Contrat Régional du Pays de Craon.
As this is a lending modality, investors will benefit from an interest rate of 1.80% for 7 years. The minimum funding required to participate in the project was €100.
These examples show how through crowdfunding platforms, a company, a local authority or a community developing a renewable generation plant or an energy efficiency can involve citizens and other stakeholders in the investment, allowing them to invest, become shareholders and benefit from the return on the investment itself.
- This topic was modified 8 months, 1 week ago by Joan Segura.
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