Bob D'Haeseleer is a local depute for spatial planning, housing, youth and sustainability in Eeklo and a representative of the Board of Directors and of the General Assembly of Vereniging voor Openbaar Groen (VVOG).
Can you shortly describe the project where you applied the innovative financing models?
When we started working on the cooperative model in Eeklo, the market for wind energy was not saturated yet and we had a freedom to design the project the way we wanted to. Instead of trying to sell the land to wind developers, we decided to establish a fixed price (5000 EUR per wind turbine per year) and ask bidding companies for non-monetary offers so all citizens, who are affected by presence of the wind turbines can also benefit from them. That is how Ecopower, a fully cooperative company, has been selected to build and operate those wind turbines.
In this model, citizens can buy shares of the wind plant and each year receive a part of the profit from the produced energy. But that is not all. Also the citizens who didn’t want to or weren’t able to invest in the shares, can gain from the wind turbines. How is that possible? Well, each year Ecopower allocates 5000 EUR per wind turbine into an environmental fund. Then, this environmental fund is used for other green energy or energy efficiency projects. For example, a part of the money from the environmental fund were used as subsidies for inhabitants who carried out energy efficiency renovations of their houses. We have also used those money to set up a solar roof for a bike station, where electric bikes can be charged for free, and bought a bio-gas turbine to connect the city heating with the gas network etc.
Thus, the environmental fund is not allocated in one big project but supports several smaller initiatives. Often, that may seem counter-intuitive to politicians, as they prefer to develop one big project, which can be showed off at the end of their terms. However, our model works and is more sustainable, as it is oriented on long-term thinking. And especially in ecological projects, such a holistic approach is needed.
Why did you decide to use such a model in Eeklo?
The municipality decided to set up that kind of model in order to share the benefits of wind energy with citizens and convince them to the wind power. The idea came from the administration of the city. Actually, it was one of the civil servants who proposed this solution in order to optimize the project, instead of maximizing it. We wanted to make sure that the inhabitants of Eeklo will benefit from this project over many year and make a sustainable connection between the project developer and the municipality.
What advantages of this model can you see?
I can see 3 main advantages of our model:
- Democratic support of the whole community for the wind energy. The great thing about this approach is, that it builds support for wind power amongst citizen. While in other municipalities in Belgium there is growing resistance against wind turbines, it is not the case in Eeklo. We believe that wind is a common good so profits that come from wind should be a common good.
- This approach boosts local economy and helps the citizens to live better. Socio-economically, Ekklo is one of the poorest municipalities in Flanders. Our model allows us to keep the profit local through community projects and the cooperative structure of the economic model, thus the income of citizens can increase.
- One of the extra benefits Ecopower offers to Eeklo is an energy consultant assigned to the city. This consultant is hired by Ecopower but advises the city. He helps us set up new projects and decide which buildings in the city should be renovated. He also looks for other energy efficient solutions that could be applied.
What where the biggest problems in implementation of this innovative model in your municipality?
The biggest problem is, that our approach is new and we need to convince people that it is a good investment and to buy the shares. As the support from the local community is necessary, we had to find credible advocates for the project within this community. We managed and all first three wind turbines were funded by local citizens. But then, that’s not enough. Continuous communication with citizens is necessary for the success of such a project.
How do you evaluate the whole experience?
It is extremely interesting and positive to see that the different approach than the normal market model can lead to long-term benefits. There is one very crucial thing we have learnt. It is not only important to set up an energy project but to get the right organizational structure and the right financing model behind it. These are the real key success factors. The green energy projects should not be only about the percentage of green energy produces or saved. They should be about much more – about how to connect the energy revolution with the democratic revolution and to try to give back the power to the people.
More information on the cooperative model developed in Eeklo can be found in our Innovative Financing Models matrix.