Community ownership of wind farm projects can diminish the backlash against the renewable energy source.
By Brenda Bouw
When the 10 turbines started rotating at the Gunn’s Hill Wind Farm in late 2016, they brought more than just green energy to Ontario’s Oxford County – they brought in revenue.
Gunn’s Hill – owned by the Oxford Community Energy Cooperative (OCEC), the Six Nations of the Grand River and developer Prowind Canada – is Ontario’s first community-sponsored wind farm and Canada’s first wind initiative to include both coop and Indigenous ownership.
The $9-million project included individual investments of $1,000 to $10,000 from 136 coop members. The project is meeting its goal of providing a rate of return of between 10 and 11.11 per cent to investors, OCEC executive director Miranda Fuller says.
“The project isn’t just good for the environment but also directly connects citizens to their power supply,” says Fuller. “The idea of the community owning the power is a very powerful thing.”
Gunn’s Hill, which produces 18 megawatts or enough energy to power 6,700 local homes, is one of a small but growing number of community-owned renewable energy projects either operating or under development across Canada, despite numerous challenges ranging from costs and financing to sometimes fierce opposition from local residents.
In July, a new government in Ontario used local frustration with another wind farm – the nine-turbine White Pines Wind Project in Prince Edward County – to justify cancelling the project despite it being nearly completed. Shortly after, the government cancelled 758 renewable energy contracts for projects at varying degrees of development, two of which were also operated by OCEC.
Gunn’s Hill had its share of opponents when it was being developed, Fuller says. But it was approved following intense public consultation with locals and Indigenous communities.
“There will be some people that will never like it, that’s human nature,” she says. “You can’t negate someone’s feelings towards something and invalidate them, but you can open the experience to them and I think community coops do that.”
Besides the environmental benefits, these community projects have social and economic advantages, says James Tansey, a professor in the Sauder School of Business at the University of British Columbia.
“It can be as much about community building as it is about energy provision,” says Tansey.
With community-owned renewable projects, local members are largely in control of how the project is developed and managed, ensuring they’re aligned with community goals.
“That’s what makes them so exciting,” says Binnu Jeyakumar, electricity program director at the Pembina Institute. “You have a great participation from a whole variety of people … and you don’t have to be a homeowner to participate.”
But community renewable ownership faces unique barriers in Canada.
In Europe, where energy is much more expensive, governments have been more open toward local ownership as a solution. Canada has cheaper sources of energy, such as hydroelectricity and coal, as well as a more centralized energy planning system, which community-power proponents say undermines the development of smaller-scale renewable projects.
Still, some community projects have forged ahead in Canada and range in size from a few kilowatts to many megawatts. Examples include Toronto’s iconic 750-kilowatt wind turbine on the edge of Lake Ontario – the first turbine to be constructed in an urban centre in North America – and the 60 kW Nelson Community Solar Garden outside of Nelson, British Columbia, which describes itself as Canada’s first community solar garden.
A 2016 Toronto Renewable Energy Coop (TREC) study, done in collaboration with York University, shows a typical solar project in Ontario resulted in $2.06 in economic activity for every $1 in electricity purchases made through the province’s feed-in tariff program.
It also said the economic impact on the local community increased by 47 per cent when capital came from local investors and local firms. When that local ownership was combined with local solar manufacturers, the economic impact increased by 77 per cent.
Despite the positive economic numbers, the biggest challenge for community projects is often local buy-in, says David Cork, managing director of TREC and co-founder of the Ottawa Renewable Energy Co-op.
“Everyone thinks the problem is raising the money,” says Cork. “It turns out it isn’t. If you have an iconic project that’s meaningful to the community … then people will get behind it and they will invest.”
Community renewable projects generally bring a return on investment of between four and six per cent, he says.
Wind farms in particular face tougher community buy-in because of the size of the turbines, reported impacts on wildlife and noise complaints.
A 2017 Western University study of local wind farms shows that involving nearby residents in wind-farm planning and providing equitable local benefits can help increase support.
Authors Chad Walker and Jamie Baxter pointed to Ontario’s 2009 Green Energy Act, which reduced local input in the development of renewable energy projects in the province and, in turn, caused a lot of opposition and conflict in rural communities.
“The general lack of financial benefits and opportunities to invest in local wind projects in Ontario may be added to the long list of things responsible for intense pushback to development in the province over the past decade,” Walker said in releasing the report last year.
In Nova Scotia, on the other hand, where there were requirements for community-owned development, support for local wind projects was three times higher and perceptions of health effects were three times lower, the authors said.
The type of model best suited for a community depends on its unique needs and objectives, says Robert Hornung, president of the Canadian Wind Energy Association.
“If you’re looking for the lowest possible cost you’re going to do one thing; if you’re looking for something with community participation you’ll design a different type of framework to enable that,” Hornung says.
In Alberta, for example, the province’s renewable electricity program requires projects to have a minimum 25 per cent Indigenous equity ownership, “to encourage the greatest participation by Indigenous communities, create the greatest degree of competition among respondents, and provide the lowest cost for Albertans.”
In Oxford County, revenues from wind energy sales feed into a $25,000 annual community fund that is awarded to a related community project benefiting the region.
Fuller, the OCEC executive director, says years of hard work and consultation paid off, and recommends communities forge ahead with similar renewable projects – even if the provincial government is going the other way.
“If you have passion and if this is something you see a need for and a desire in the community you need to keep working and pushing,” she says. “It’s worth it.”
Originally published by the Corporate Knights, 11.12.2018, under the terms a Creative Commons Attribution-NoDerivatives 4.0 International license.