Swedish Solar PV cooperatives
– Dick Magnusson & Linda Lundmark –
The solar PV development has been slow in Sweden in an international comparison. Much of the recent year’s investment in renewable energy took place in the 1990´s in wind power and biomass, and during this time several wind cooperatives were established. It took until 2009 before the similar organisational idea reached solar photovoltaic (PV) systems, when the pioneers in Sala-Heby started Sweden´s first solar PV cooperative. They have inspired several other similar cooperatives in Sweden and have thus lead the way.
1. What is the new solution or approach?
The example presented is cooperatively owned solar PV plants in Sweden. The main innovation is the organizational structure, as cooperative ownership of solar PV was nonexistent in Sweden until 2009. In 2017, it existed 7 active solar cooperatives in Sweden, and a few more were in formation, and most of them are similarly structured and based on the same business model. They are incorporated associations (ekonomisk förening), which means that members are not economically accountable personally, the organization is started by three or more persons, members buy shares in the organization and pay a yearly fee, and the organization needs a board of directors. The members decide on investment and plans and the organization own the plant. The plant is connected to the electricity grid and the produced electricity is sold to the spot market, meaning that members do not receive the electricity direct from the plant as it is prohibited by the electricity laws. The profit is either reinvested in the plants or yield might be provided to the members.
The technical innovation is often limited. In the pioneer case, “Solel I Sala & Heby”, some of the production plants are terrestrial, in comparison to for example roof-top mounted, which was not common in Sweden at the time, but had been tried out for solar heating. The size of the first plants were larger than the average system, as Sala & Hebys largest plant has a maximum capacity of 312 kW, but in today’s standards it is not of an extreme size.
The niche activities are rather in the social and organizational forms in most of these organizations. The goals are not economically, there are rather environmental and sustainability goals leading the way. This can be seen, for example, in the fact that members do invest in cooperatives but do not always get a dividend until several years later, if any, and they rather see their contribution in the fact that they invested in renewable energy. The innovation have circulated among the started solar PV cooperatives. They have all started after Sala & Heby and most of the ones have been in direct contact with them
What has been evident among the successful cases has been the close connection to energy companies and/or grid owners. It has meant that regime actors have been involved from the start and have not thus seen the project as a competitor and instead they have been able to take advantage of the competence in the organization. In general, the reactions from the regime and the public have been either positive or ignoring. These organizations are in total rather few and the production capacity is limited and thus not really a threat or forcing any changes among incumbent actors. One can rather see that the business model has been adopted by energy companies, which have been inspired by the pioneers.
2. Where and how did it start? By whom?
The development of the solar PV technology has been rapid in recent decades, with the German development leading the way. Sweden has not had the same swift development, even though installment of individual systems in recent years have increased. The interest for solar PV inspired the inter-municipal energy company Sala-Heby Energi, owned jointly by Heby and Sala municipalities, to find solutions for cooperatively owned solar PV production plants. The idea started from the CEO at the time, Kenneth Mårtensson, who had built solar heating plants in his previous job and after some advertisement for solar PV, they invited interested citizens to meetings on the subject. After successful meetings they advertised in order to test interest among citizens to buy shares if the price was 10,000 SEK. Due to the high interest, they decided to start later in 2009 the organization was founded and the first plant was built and ready in 2010.
It is clear from interviews and documents that Solel I Sala & Heby ekonomisk förening was the first of all the organizations and that most of the followers have been in direct contact with them, either through study visits or personal contacts, and they have also read about them. The innovation has thus clearly been transferred, and adjusted to local contexts, between these different organizations. Sala & Heby had initial goals to be an inspiration for others, which is clear in early documents, but have not made any profit in circulating it. Solel I Lindesberg is one example of a cooperative started after much contact with Sala & Heby, using a similar model and also with much support from the energy company and municipality.
Important key persons and contacts were within the municipal energy company when forming Sala & Heby, as the CEO was in a position where technical, juridical and economic resources was in-house. The company became a member in the organization, as did the municipality, and in several of the other successful cases, the strong connection to the municipality cannot be underestimated.
3. Which reactions and barriers did it encounter?
It can be concluded that the innovation came to a large degree from within the regime, as it was started by an energy company, although with high degrees of citizen involvement. Many of the following initiatives have been started through cooperation with energy companies and thus one can see that the regime did not actively try to block the innovation, it was rather supported or ignored. It must be remembered that these plants in total are, in a national context, small and thus not really a threat to the incumbents business at this stage, it is rather the individual solutions that potentially could do so but it has not been actively blocked, rather the opposite. In general the support for solar PV has increased in Sweden, as investment support to individual households was increased from 20 to 30 percent and several energy companies, both municipally owned and privately, are supporting grid connection for solar PVs.
The main barrier had to do with a taxation that was installed in 2016 on a total power over 255 kW, where energy tax was introduced for 0,29 SEK per kWh. It was stated it had to with EU-regulation but massive criticism and reinterpretation of the law lead to a decrease to 0,005 SEK per kWh. This was seen as an obstacle for the cooperatives as most of them had a total production above this, but that obstacle is no longer present.
Sweden has a tax reduction on electricity for micro producers, as you can obtain 0,6 SEK per kWh up to 18000 SEK per year. However, solar cooperatives are not eligible for this reduction and it is argued by lobby organisations that it is a barrier for the development.
The initiatives that have not been successful have stated different reasons for this. In one case it had to do with difficulties cooperating with the grid owner, in others it was internal struggles in the organization, so it cannot be concluded that the barriers have been uniform or related to regime reactions.
4. How is it talked and written about?
The solar PV cooperatives have been getting quite some recognition, mostly on a regional level. They are, in comparison to wind cooperatives, framed much more through the lens of environmental friendliness than economic aspects. The inititives are talked about as groups of peolple coming toghether to help solving environmental and climate change concerns. The cooperatives themselves very much uses the same tactic, as the economic return for the members is only in the long-term the emphasis is on renewable energy production.
The cooperatives are few in their number and other organisations, focusing on solar PV-development in general rather, have more power to influence legislation to a large degree than the cooperatives. The cooperatives are working on a local scale rather and do not seem that active on a national level, meaning that the framing have little impact in this matter.
5. How is public and political support created?
The support for the cooperatives have mainly been enrolled on a local level. As some of them have been started by municipal energy companies together with citizens, they have gotten support from officials through regular networks and through personal contacts. The support from municipalities and energy companies have in most cases been unproblematic thanks to good interpersonal contacts.
The public support have differed, as they have all needed to attract members. The largest cooperatives have 150-200 members and they have been attracted through public events, newspaper articles, advertisement, and through existing environmental groups. Most of the cases have stated that it has been successful and that the first members were rather fast to attract but that it stabilized after a while.
One of the initiatives had trouble with the connection costs and decided to contact a nationally prominent supporter of small-scale energy production, the company ETC, and could through their help get support in the development as well as a business deal that both benefitted from. Several of the others have been in contact with ETC as they have a site with several renewable energy production plants for display and knowledge transfer.
Four generations of ecovillage development in Sweden – A work in progress
– Dick Magnusson & Linda Lundmark –
Several initiatives striving towards more sustainable localized lifestyles have been developed in Sweden since the 1970s in a variety of settings, sizes, organizations and with a variety of resource and energy efficient technologies. A difficult and bureaucratic planning process and the maintenance of a stable internal organization have been especially challenging to these initiatives. This text aims to explain the different barriers, trends and the historical development of Swedish ecovillages.
1. What is the new solution or approach?
Ecovillages in Sweden have typically involved a combination of social and technological innovations adopted in a local context to enable more sustainable lifestyles with a reduced environmental impact. For example, different experimentations regarding co-housing which differs from the mainstream institutional housing arrangements is common in ecovillages. These social innovations are often combined with, or giving way to, other technological innovations which might involve small scale energy systems, urine separating toilets, use of different construction material and the development of new recycling and resource use practices. Since these technological and social innovations can be described as, to a large extent, different or detached from already established practices, Swedish ecovillages have experienced resistance, especially during implementation processes, from mainstream actors and structures.
2. Four generations of ecovillages
The development path for Swedish ecovillages can be described through four different historical generations with different associated aims and organizational principles. The first initiatives were started in the 1970s and today around thirty ecovillages exists in the country. These are varying to a great extent when it comes to organization, implemented technologies and number of members.
The first generation of ecovillages, containing the key pioneers Tuggelite, Solbyn, Rumpan, Skognäs and Skärhäll, was characterized by strong idealism. Most of these initiatives came from grassroots environmental citizen groups which were influenced by other environmental movements like ‘the green wave’ and the anti-nuclear movement.
The Tuggelite project was run by a group of academics with high competence striving towards alternative, more sustainable forms of living with new energy efficient technologies which differed from the common large-scale housing projects. A report was published by this group, called the ‘Välsviken report’, containing ideas from the initiative. A close connection and vital knowledge exchange took place between the pioneers (Tuggelite, solbyn and later Understenshöjden) where Solbyn took influence from the Välsviken report. Solbyn also received crucial knowledge regarding sustainable house construction due to the involvement of the architect Krister Wiberg, who later continued assisting a number of other projects. Additional assistance in the development of these early ecovillages came from the building company HSB. At this time, in the 1990s, when the ecovillage movement started to take form, Boverket developed the definition of ecovillages and made it possible for these projects to obtain loans for their developments. However, despite this support many of these first initiatives struggled with malfunctioning technologies, internal organization struggles, resistance from established structures and they were usually located far away from city centers by municipalities.
During the second generation of ecovillages, which started around the early 1990s, a majority of the projects was top-down, initiated by entrepreneurs. A trend had started to take form towards ecological building, along with the Agenda 21-projects, where this type of development was more accepted by municipalities and politicians. Knowledge from the earliest pioneers had become more broadly diffused and to some extent taken over and applied by construction companies. However, criticism regarding this top-down development relates to not sufficiently taking into account the perspectives of the citizens. Conflicting objectives therefore occurred between residents and contractors. There was, in some cases, a greater focus on finishing the projects during a shorter time span or on making the houses more aesthetically appealing, resulting in higher expenses. Parallel with this development was thus a number of bottom up initiatives developing similarly to the initial projects.
During the third generation, in the 1990s, the ecovillages started moving closer to city centers and construction companies and citizen groups learned from previous experiences. This period can be described as a relatively successful combination of top down and bottom up approaches where new versions of earlier technologies were implemented and where the perspectives of the citizens were taken into account to a greater extent during the construction phase. Traditional study visits contributed to the spread of knowledge during this period, however the construction company HSB and the architect Krister Wiberg were still of key importance regarding the generation and travel of innovations. After this period, between 2001 and 2007, a stagnation occurred with no new developments and where some existing ecovillages decided to replace the initial technical systems with more traditional ones. There was a general sense of being caught up by the mainstream. What was once considered extreme and alternative technologies (for example waste separation and sewage systems) was not so alternative anymore.
The fourth, and most recent, generation of ecovillages started in 2008. This wave came at the same time as an increasing environmental awareness trend in Sweden. The projects were now solely initiated by the grassroots-groups and they were inspired by ecovillages from the first generation. They are relatively diverse and located in rural areas, now with a greater focus on agriculture and permaculture, and they were not assisted or backed by construction companies. They can also be described as more internationally networked, through spreading of knowledge through blogs and social media, due to increased internet usage.
3. Main barriers for ecovillages?
During the historical development of these various initiatives in Sweden, since the 1970s, ecovillages have struggled with a variety of social, technological and institutional barriers. During the initial phase there were especially difficulties when it came to organization or implementation of sustainable technologies. However, the idea- and knowledge transfer through both people, organizations, books and reports have been of vital importance in order to learn from mistakes and improving and advancing sustainable technological innovations. In some regards the technological innovations which were first initiated by the grassroots seem to have spread successfully and become more established among regime actors and mainstream structures. This occurred (as explained above) during the second generation when large construction companies, for example HSB, started to adopt these ideas and technologies in their housing projects. However, it could be questioned whether the top down approaches could be defined as ecovillages since the original values of grassroots initiatives were more or less absent. After the third generation, sustainable technologies in ecovillages seemed to have become caught up by the mainstream where these technologies were not considered as extreme anymore. However, since the first ecovillages were pioneers in developing innovations like sewage systems, biogas boilers and waste separation, they might definitely have played a large part in influencing the social mainstreaming of these technologies. Overall, grassroots initiatives attempting to implement local energy solutions have met resistance in Sweden due to a centralized energy system and a strong municipal planning monopoly and municipal ownership of energy plants. A number of ecovillages, attempting to implement local energy systems, also experience lacking support when it comes to getting sufficient allowance from the government.
Another main barrier, which have been historically encountered by ecovillages, and which is still a challenge among new ecovillages and those currently under development (for example Grönbo and Hållkollbo), relates to a bureaucratic and difficult planning processes in engagement with municipalities. The type of housing developments and the alternative sustainable solutions have still not become established and therefore initiatives like tiny houses, separate sewage systems and other implementations and practices meets resistance. A number of ecovillages have also had to spend time, during the planning process, trying to change legislation regarding very specific issues, for example getting allowance for smaller biogas containers and allowance to mix human urine in organic farms. NIMBY related criticism from neighbors have also been common throughout the historical development of ecovillages. In addition, not only the initial planning and implementation phase but also the maintenance of sustainable technologies, practices and the commitment within the social community is of importance and have, in some ecovillages, been challenging to maintain.
It can be stated that these initiatives still encounter several barriers after four generations of experimenting with new local configurations. However, these ecovillages could be described as a work in progress much thanks to the lessons that are continuously learned due to the increasing circulation of knowledge and ideas.
4. Framing and mobilization efforts
While an early generation of ecovillages were developed by groups of people that lived in the same area and already knew each other, the internet era has made it possible for some recently developed ecovillages to be initiated by one or a few individuals who later invited others to join them. The sharing of information to gain new members, to spread ideas and to influence change have been made easier though social media, forums and blogs. Many of the newer ecovillages therefore have an easier access to knowledge than earlier generations. Suderbyn and Stjärnsund, who both have a large national and international network, have been especially active and successful in attracting members and volunteers through social media. These ecovillages are involved in many overlapping organizations, trying to influence politicians while promoting quite radical social changes and alternative lifestyles to overcome climate change. This approach has attracted mainly likeminded people. However, the communication approach varies between different ecovillages where others have a softer communication approach, not arguing for as radical lifestyle changes but for the implementation and integration of more sustainable technologies and practices. Many of these ecovillages are mainly providing information through their own websites to receive new members.
Development of Swedish wind cooperatives – Struggle for establishment
– Dick Magnusson & Linda Lundmark –
Since the deregulation of the Swedish electricity market, in January 1996, many wind cooperatives have been developed by individuals and organizations with an ambition to produce their own affordable renewable wind energy. However, in recent years wind cooperatives started to experience major barriers due to decreasing electricity and electricity certificate prices and changed tax legislation. The historic development, barriers and mobilization attempts by wind cooperatives will be further described in this text.
1. What is the new solution or approach?
Compared to ‘grey’ energy, ‘green’ energy is relatively expensive, as negative externalities such as contributing to climate change or air pollution are not calculated in the price of ‘grey’ energy based on fossil fuel sources. As a consequence, ‘green’ renewable energy (RE) faces difficulties in entering the energy market. To enable and encourage the production of renewable energy, regulations need to be changed or created to make this happen. Changing governmental rules is never easy, especially if they go against the vested interests of both government and energy sector.
The postcode rose is a model which enables collective net metering for citizens away from their individual property or roof. Citizens within the borders of one postcode and adjoining postcodes. The regulation provides a tax discount on the energy tax for the citizens that collectively own the renewable energy production, for example through a cooperative or homeowner association (VVE).
2. Historic development of wind cooperatives
Sweden has a long history of centralized energy production where municipalities and the government owned energy company Vattenfall have been responsible for production and distribution of electricity. This along with a rigid energy market dominated by nuclear energy and hydro power have restricted the development of grassroots innovations for small scale renewable energy. In 1996 the electricity market was deregulated with the aim to allow for increased market competition, customer flexibility and system efficiency. With this change a number of municipalities sold their electricity and district heating companies and Vattenfall expanded to the international arena while the Finish energy company Fortum and the German company Eon entered the Swedish energy market. This liberalization also meant that grassroots initiatives now had a greater chance to produce their own renewable energy.
The first Swedish wind cooperative started in Näs at Gotland in 1990. The initiators were a group of people driven by environmental idealism. They received strong interest from the locals who were willing to invest in wind energy while not expecting to make economic profits. At that time the price was not cheaper than the electricity you could get from the energy company. From 1993 until 1996 a number of other wind cooperatives was formed mainly in southern Sweden but also one in Lysekil on the west-coast and two close to lake Vättern. Today there are in total 81 wind cooperatives in the country, contributing with around 10 percent of the total production of wind energy. Most of these wind cooperatives have been developed due to individual initiatives but some have also been assisted and initiated by municipality owned energy companies who have offered their customers the possibility to buy wind energy shares and transferred the wind power plants to an economic association. The first wind cooperative of this kind was formed in 1993 in Gothenburg by Göteborg energi. Other municipality owned energy companies who have followed this example are Örebro Energi, Halmstad Energi, Falkenberg Energi, Kalmar Energi, Varberg Energi, Lund Energi and Helsingborg Energi. These types of municipal initiatives have been described as a success factor by many energy cooperatives. This is because energy companies can contribute to vital knowledge and investment support during early stages. They also usually possess a large customer base which simplifies the process of finding and reaching out to members.
Wind cooperatives have taken more or less influence from each other during the years, mainly during the initial planning and development stages regarding organizational, economic and legislative questions. Many of the wind cooperatives that started around the time of the electricity market deregulation was initiated by individuals with an environmental commitment, similarly to the case in Gotland. The pioneering cooperatives experienced some difficulties in receiving new members, however this became easier due to a growing interest during the late 1990s and early 2000s when the economic situation also became better for many wind cooperatives. These initiatives received necessary support from the green electricity certificate system which was initiated in 2003. This system implies that for every MWh of renewable energy produced the producer receives a certificate from the Swedish Energy Agency that can be sold on the open market, contributing to an increased income.
However, around 2010 the development trend for wind cooperatives were changing. Changed tax legislation and decreasing electricity prices and electricity certificate prices started posing economic barriers for many wind cooperatives and since then around 20 cooperatives have been decommissioned.
3. Legislative and economic barriers
Changes in the Swedish tax legislation, in 2008, implied that wind cooperatives now had to pay a so called withdrawal tax “uttagsskatt” since their electricity price was offered below the market price. This law became highly criticized by many wind cooperatives who considered the law to be unreasonable since it did not take into account the large capital investments made by the shareholders, to produce their own electricity. The development of wind cooperatives decreased during this time due to a lack of interest from potential members. In addition, around the same time, due to high electricity production in Sweden, both the electricity and the electricity certificate prices were starting to decrease. This is another economic barrier which concerned especially the wind cooperatives who had started their organizations just a few years prior to 2012, when the investment costs where higher but when the economic conditions in general were better. Similarly to the withdrawal tax, the decreasing electricity and electricity certificate prices contributed to lower income for wind cooperatives and lower interests from potential members.
Many wind cooperatives are experiencing that the government is not doing enough to facilitate, or that they even oppose, the development of these local energy initiatives. The low electricity prices are the result of an overproduction on electricity in Sweden, where many wind cooperatives consider nuclear energy to be superfluous. In addition, in 2017, both nuclear energy and hydro power received tax reliefs from the state.
Another obstacle which have continuously affected especially wind cooperatives is a difficult planning and authorization process. This is due to both NIMBY related reactions from locals and obstacles from the Swedish military. Wind cooperatives also experience that the negative impact, caused by wind turbines, on the surrounding natural environment and species is considered and taken into account to a greater extent during this process in comparison to its positive and long term societal and environmental impact.
4. How is it talked and written about?
The main mobilization efforts among wind cooperatives have been regarding the taxation issues, especially the “uttagsskatt”, and the low electricity and electricity certificate prices. Efforts made attempting to change the current energy system and influence politicians differs to some extent between wind cooperatives. Bigger cooperatives like o2 el and Telge energi vind, who possess a lot of expertise and resources, have been quite active in trying to influence politicians to change or remove the withdrawal tax legislation from wind cooperatives. For example, through direct conversations with politicians, arranged meetings but also by writing debate articles. Among other wind cooperatives some have attempted similar methods to a smaller extent while others more or less have given up, feeling a sense of hopelessness and inability to influence. Most cooperatives however have a similar experienced of a quite bureaucratic and slow process, especially in attempting to change tax legislation. So far, these mobilizations efforts have not resulted in any concrete changes.
Regarding mobilization efforts, many wind cooperatives are also referring to the Swedish organizations SERO (Sveriges energiföreningars riksorganization) and SVIF (Svensk vindkraftsförening). SERO is a non-governmental organization supporting organizations that are engaged in different forms of renewable energy production in Sweden and SVIF is a similar organization however mainly focusing on promoting wind power development. Both of these organizations have a close cooperation and have been active in attempting to influence Swedish authorities and creating a supporting energy system for, among others, wind cooperatives.
Wind cooperatives have generally been getting positive mentions in news media. They are written about as economically favorable for the members, as they historically have been providing good economic returns. They are also considered as environmentally friendly, similarly to how wind power is generally described, but as some of the cooperatives have had internal struggles, they have also been getting some negative press due to those organsations.
In general, the wind cooperative development has been strong but is at the moment in flux due to changed prerequisites. The challenges will remain in the taxation and electricity price issues, but also if the, now somewhat, old organizations wants to carry on when the plants are reaching the end of their technological lifespan.