6 Wind Cooperatives

6 Wind cooperatives 6.1 Introduction1 Th is chapter deals with the performance of wind cooperatives. Comparing wind cooperatives with small private investors and energy distributors, based on the total capacity installed over the last 5 years, one comes to the conclusion that wind cooperatives have been of minor importance. Th e highest market share (6% in 994) was in fact a clear exception, and in most years, their market share was less than 5%. We will show that this inferior position on the market coheres with some exceptional organisational characteristics. Wind power exploitation is not a way to make money for this entrepreneurial group, but a way to promote a sustainable society based on renewable energy sources. Th is idealistic background, just as the voluntary character of the organisations, infl uenced their behaviour in each of the three market periods and clearly distinguished this group of investors. All 25 Dutch wind cooperatives were founded during a relatively short period, from 986 to 992. By now, of these have been disbanded or have merged. Th e majority of the cooperatives that continued to exist are small organisations with only a limited number of turbines. We will show that the few cooperatives that performed better changed of character: they chose to professionalise to a more or lesser degree. In addressing this exceptional entrepreneurial group and its market performance, special attention is paid to community ownership in some other countries. We will see that Dutch wind cooperatives deviate from cooperative arrangements in Denmark and Germany, i.e. countries in which community ownership has played a major role in the successful development of wind power. 6.2 Cooperative arrangements Cooperatives are not unique for the fi eld of electricity production. We notice various forms of cooperative arrangements at diff erent fi elds of activity. Cooperatives can be defi ned as collaborative eff orts directed at supplying and selling a product at the members’ costs and risks. Th e members occupy an important position in the cooperative. Th ey set out the line of policy and they originally provided for the fi nancing of the organisation. Th is section summarises the history of cooperative arrangements in general, in order to indicate to which type of cooperative arrangement the Dutch wind cooperatives belong. Th e fi rst cooperative arrangements came into being halfway the 9th century. Th ese cooperative arrangements principally were credit providers (Engelaar, 2000 in Loenen van, 2003). In the course of the 20th century cooperatives became active in other areas of work, such as the 2 agricultural producing, processing and service industries. Individual market shares were negligible in agriculture, where sales markets are neither transparent nor readily accessible. By joining forces, individual farmers were able to strengthen their market position. Th ey were able to enhance that position through the enlargement of the scale of cooperation (Glasbergen, 2000: 244-245). Th ese agricultural cooperatives developed into large organisations able to compete with large private companies. Th e principal aim was to improve the economic position of the individual members. It would take until the 980s before new types of cooperative arrangements came into existence: environmental cooperatives and food cooperatives. Th ese new variants still sought to generate sources of income, but the motivation went beyond monetary benefi ts. Members shared an idealistic motive. Th ey recognized a common interest in producing environmental quality for pay. Environmental cooperatives emanated from the agricultural sector in response to the increasing environmental pollution caused by that sector and to the burden of environmental rules that eroded the economic position of farmers. Th e notion of the environmental cooperative was grounded in the idea that a market should be created for environmental pursuits. Slightly more than 2% of all agricultural enterprises were involved in these small organisations, with a membership of 25 to 200 farmers (Glasbergen, 2000: 245-246). Food cooperatives eventually were pure idealistic organisations. Th ey bought organic products from wholesalers in order to sell these products against cost price to the members. Members did not emanate from the agricultural sector and did not seek to generate sources of income. Whereas a professional staff managed the large agricultural cooperatives, volunteers principally managed the smaller environmental and food cooperatives. Th ree types of cooperative arrangements can be derived from this short historical description. Sector bounded large-scale cooperatives with a pure economic objective; these cooperatives aim at generating sources of income by increasing the productivity from the sector and are managed by a professional staff , 2. Sector- or not sector bounded small-scale cooperatives with a hybrid objective; these cooperatives aim at generating sources of income by supplying and selling high-quality and environmentally friendly products and are principally managed by volunteers; although they sometimes work with a professional staff , 3. Not sector bounded small-scale cooperatives with an ideological objective; these cooperatives aim at supplying and selling high quality and environmentally friendly products and are managed by volunteering citizens. For the fi rst and second types of cooperative arrangements, economic incentives are the main driving force behind investment decisions. Th e third type of cooperative arrangement deviates on this aspect. For this type, idealistic incentives, such as environmental considerations, are the decisive input to investment decisions. Th e Dutch wind cooperatives belong to this third and most recent type of cooperative arrangement, as we will see in the next section. 22 6.3 Characteristics of Dutch wind cooperatives Th e Dutch wind cooperatives are organisations in which citizens have a common interest in producing and selling wind power on the electricity market. Th e following characteristics describe these organisations: . they have a strong idealistic background; ideological incentives are the main driving force behind activities, 2. they are locally or regionally oriented organisations, 3. the members are citizens with no professional connection to the electricity sector, 4. the members serve to generate social support and they originally provided for the fi nancing of the organisation, 5. the organisations are managed by volunteers, although some work with a paid staff , 6. and there exists a rather closed collaborative approach among the cooperatives. Th e fi rst feature of the Dutch wind cooperative is the idealistic background. Th e origin of the Dutch wind cooperatives is strongly linked to the Dutch Organisation for Renewable Energy (Organisatie voor Duurzame Energie- ODE) (see section 3.3.3). In the 980s, workers from ODE visited all kinds of local groups, including environmental protest groups, to explain and promote the concept of wind cooperatives. ODE focused its attention on the coastal areas because the GRONINGEN Noordenwind FRIESLAND De Eendragt DRENTHE Waterland WWC Kennemerwind ZEK LAND OVERIJSSEL Meerwind Delft Uwind GELDERLAND WDE ZUID- UTRECHT HOLLAND Windvogel Deltawind NOORD-BRABANT Noord-Brabant Zeeuwind LIMBURG 50 km 6696 Figure 6.1 Location of wind cooperatives that were in operation in the Netherlands in 2004. 23 effi ciency of wind turbines in the inland section of the country was insuffi cient in those days. As a result, 25 cooperatives were established, during a relatively short period from 986 to 992, especially in what are known as ‘wind-abundant areas’. In the meantime, of the wind cooperatives have been disbanded or have merged (see appendix 6.). Most of these mergers have taken place between small cooperatives from the same region, which experienced problems due to a lack of human capacity. Figure 6. provides an overview of the location of wind cooperatives that continued to exist in 2004. Th e founders of the cooperatives objected to nuclear power and wanted to off er an alternative. Th is idealistic background clearly distinguishes this type of entrepreneur. Th e main interest is not to make money by wind power exploitation, but to promote a sustainable society based on renewable sources. Cooperatives try to achieve this aim, by developing wind projects based on strong local support and public participation. For some cooperatives (ZEK and Noord Brabant), the main purpose was (and is) to demonstrate the feasibility of wind power exploitation in their region In addition to developing wind power projects, most cooperatives also developed other activities – such as providing information and lobbying, and supporting the application of other forms of renewable energy- to a greater or lesser degree at the local or regional level2. Th ey inform the local population and politics through demonstrations and fairs, lectures at schools, newsletters and websites. Th e information is not restricted to wind energy, but encompasses renewable energy in general. Cooperatives perceive that these information activities are highly appreciated, just as the opportunity for citizens to participate in their projects. Various interviewees explicitly advanced the perception that citizens value wind cooperatives more positively compared to other types of wind power entrepreneurs. Eleven cooperatives lobby to infl uence local and regional policy making on wind energy, i.e. the adoption of wind energy in the municipal and regional

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