REScoop.eu has been operational since 2013 and throughout the years it identified some impeding challenges when it comes to financing an energy transition that would lead to energy democracy.
We noticed that renewable energy projects typically require large investments at the beginning, making it hard for starters to launch their first projects. Our experience is that local citizens come on board more easily once the project is operational and people can actually touch/see it. Established REScoops - on the other hand - often raise funds easily but sometimes they lack good projects, leaving them with unused funds in their bank accounts.
We noticed that individual REScoops often lack the financial capacity to do big projects. As a consequence, REScoops are sometimes forced to disclose part of the projects to limited companies. This has been the case for Zeeuwind and Deltawind for instance, two local REScoops who managed to develop a 105 MW wind project in the Netherlands and who were forced to sell 50% simply because they couldn’t raise enough funds themselves. Doing local and thus smaller projects typically leaves REScoops with less economies of scale, less power in negotiations with suppliers and considerably higher interest rates for their loans.
Furthermore, we noticed that local authorities – especially municipalities - face difficulties in writing, executing and financing sustainable energy action plans despite their political engagement and good intentions. An evaluation of the Covenant of Mayors clearly shows that local authorities lack technical expertise, financial resources and public support for sustainable energy projects.
With support from the Executive Agency for Small and Medium Sized Enterprises (EASME) of the European Commission, the European federation of renewable energy cooperatives managed to come up with a solution that can answer these challenges.
With REScoop MECISE – which stands for European Mutual for Energy Communities Investing in a Sustainable Europe – the European federation of renewable energy cooperatives (REScoop.eu) will launch a European Cooperative Society (SCE) which will be open to energy cooperatives, as well as municipalities and institutional investors.
REScoop MECISE will provide financing to starters and take ownership in local RES and EE projects. Once these projects are up-and-running, REScoop MECISE will support a local energy community to raise funds from local citizens and replace the Mutual. That’s how the REScoop MECISE SCE will maintain its revolving character.
By aggregating funds from cooperatives, municipalities and institutional investors, citizens will finally get the chance to do big projects. Upscaling will automatically lead to economies of scale and gains on purchasing power. Upscaling projects to over EUR 25m will also make them eligible to soft loans from the European Investment Bank.
Finally, REScoop MECISE will foster collaborations between energy cooperatives and local authorities, particularly by helping the latter overcoming the challenges they face. By aggregating RES and EE projects at the local level, municipalities and REScoops could reach the EUR 30m threshold that is required to apply to ELENA and get grants for technical assistance on the implementation of energy efficiency, decentralized renewable energy and urban transport projects and programmes. Through ELENA, REScoop MECISE will support the set-up of Project Development Units (PDU) all over Europe. Once these projects have reached the final stage of development, REScoop MECISE can support them in setting the right Public Private Partnership and apply for soft loans from the European Investment Bank.
We aim to launch REScoop MECISE in 2018.