I’ve written in my last few posts about my intention to focus in on models to pursue energy democracy–the idea that, as we transform our energy systems to run on renewable and stored energy, we should also aim for an equitable distribution of the ownership and control of these resources. There are a variety of ways of pursuing this goal (The Next System Project counts at least 22), and most energy democracy initiatives combine these different approaches to meet the needs of their communities.
To start, I thought I’d bring you the story of just one of these groups, a Spanish renewable energy cooperative called Som Energia.
Som Energia represents one of the largest categories of groups pushing for energy democracy: the utility alternatives. Like utilities, they aim to provide a reliable energy supply to consumers, but the role they play in the energy system may be different based on their regulatory environment. Perhaps more notably, they are increasingly opting for models that put stakeholder welfare above private profits.
The Spanish government liberalized electricity markets in 2003, separating energy production from grid maintenance and giving citizens the freedom to choose their electricity provider. Som Energia established itself as a legal provider of energy in 2011. It uses a relatively simple model, producing what it can from its own renewable energy installations, and buying enough from the nationwide electricity market to meet the demand of its rapidly growing member base.
But the group’s objectives differ from those of a typical energy provider, and in more ways than its exclusive focus on renewable energy. On its website, Som Energia lists the motivations of its members:
-To put in motion an energy model that is renewable, efficient, and in the hands of the citizenry
-To nurture a more social and caring economy
-To break away from the existing utility oligopoly
-To receive transparent information and a fair treatment [from their Energy Service Provider]
To these ends, Som Energia is set up as a democratic, not-for-profit cooperative. New members hand over a one-time, 100€ contribution to the cooperative’s social capital. They are then free to establish contracts with the cooperative to supply their homes or businesses with renewable electricity, and to share a limited number of these contracts with friends and family. Each full member can also cast their ballot in votes at annual assemblies, giving them a say in the cooperative’s major steering decisions. The cooperative’s not-for-profit status and largely volunteer leadership structure is designed to keep energy prices as low as possible, and it means that any excess funds are reinvested into the group’s growth and the furthering of its goals.
In Spain, as elsewhere, large segments of the population have yet to see a full recovery from the 2008 and 2011 economic crises. The nation’s youth still labor under persistently high unemployment. “Energy poverty” made headlines in recent months, after rising energy costs left 5 million Spaniards, or more than 10 per cent of the population, struggling to cover their gas and electric bills. The left-wing Podemos party, which was founded in 2014 on a platform opposing economic austerity and inequality, rose to control 20 per cent of parliament in its first two years of existence.
It is in this context that Som Energia has seen six years of steady growth, starting this month with more than 30,000 members who together hold nearly 50,000 contracts. It hasn’t just employed anti-oligopolic rhetoric, but begun to address itself towards its goal of a more fair and open business model. It lists the rights of its members to examine its books and to vote in its elections and run for office. It has also established a proactive policy to address energy poverty, dedicating a third of the voluntary donations it receives to debt forgiveness.
While its rapid growth has lent Som Energia power as a constituency and a given it a growing base of volunteer power, its production has lagged behind the demand of its members. The group states its eventual goal as total self-sufficiency, but as Cristian Rubio i Rodeja, a representative of the Barcelona branch of the cooperative, told me in a recent email, its current energy production accounts for only six per cent of the members’ consumption. The cooperative’s members have successfully crowdfunded wind, solar and biogas installations, but have found that the time frame for returns can make it difficult for people to repeatedly invest in new projects.
While this may be dispiriting to some, it is also important to note that the very decision to purchase energy as a public cooperative increases the members’ democratic control over their energy supply; every day, more than 43,000 people vote in the Spanish energy markets for clean, renewable energy and a more just economy. This model is also one of the primary reasons that the cooperative has been able to grow so fast, since the cooperative is able to provide renewable energy to any new member without needing to first build its own infrastructure.
Responsibility for the cooperative’s success doesn’t rest solely on the shoulders of its founders planning and its’ members hard work. The members’ ability to choose their energy provider is predicated on the 2003 legislation that liberalized energy markets. In the majority of US states, large utilities still hold a monopoly on production, and consumers have no choice over their energy provider.
Such rules made sense when lawmakers first put them in place. Large coal and hydropower plants required huge amounts of capital, and getting them built required investors to be confident that the things would actually be used. As renewables paired with storage have become viable replacements for these large projects, though, the once-sensible policies have become hopelessly antiquated.
Even in Spain, though, smaller groups like Som Energia are at a disadvantage. Many of the big energy vendors in Spain are the same companies that run the country’s short-range (city- and town-scale) energy grids. Everyone who moves their energy over this grid–including the cooperative’s members–has to pay them a fee, giving them added cash flow and thus an extra cushion for incidental costs, like the short-term forgiveness of unpaid bills. The fact that one company can both own the grid infrastructure and compete with other companies to sell the electricity that moves over that grid gives Som Energia a competitive disadvantage and lessens its ability to finance relief for energy poverty.
I’ll leave you with the words of Àngel Campabadal, a member of the cooperative whom I met in Barcelona last January:
If the people could produce their own small-scale energy and be independent of the system, those that manage the system would be bankrupted…These big companies, their economic power is very much linked to the system as it is today. So, what do they do? They lobby the government to hinder the growth of independent generation.
For Campabadal, the ultimate goal of energy democracy isn’t just the ability to steer our energy future, but to own it. Only with that additional, more elusive level of control will we see the full benefits of the next energy system.
Seems like a good reason to lobby right back.
All translations are my own.
