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News & Articles on Community Power

December 16, 2012
Paul Gipe

Community Power Update for North America 2012


Community wind energy as found in continental Europe represents an extremely small niche market in North America, despite more than a decade of effort by proponents in Canada and the USA.

Community wind represents less than 2% of the nearly 47,000 MW of wind in the USA, and an even smaller percentage of the slightly more than 5,000 MW of wind in Canada.


Note: This article was originally written for the World Wind Energy Association in March 2012.


If we define community solar photovoltaics (solar PV) as including residential, governmental, and non-profit ownership, some two-thirds of the nearly 4,000 MW of solar PV developed in the USA qualify as "community solar".

Until Ontario, Canada, launched its Feed-in Tariff Program, most if not all of Canada's solar PV was community-owned. However, since 2006 the percentage of locally owned solar PV has decreased dramatically in Canada.

Encouragingly, there are several thousand megawatts of community-owned renewables at various stages of development in North America.

This analysis considers only wind and solar PV. There is very little biogas generation in either Canada or the USA.

 

What is "Community Power" in North America?

The definition of what constitutes community power in North America varies widely. It is easier to define what it is not than what it is.

To most, community power projects are not large central-station power plants developed and owned by remote corporate entities, traditional electric utilities or their subsidiaries.

In contrast, community power projects are typically characterized by small, distributed projects often connected at distribution voltages and owned in part or predominantly by people living in the community or the surrounding area where the project is located.

It is important to note that while community power projects in North America are typically small by North American standards, community power should not be relegated to a "small project ghetto". As seen in Europe, community power can refer to projects of any size. Though often small, they can be quite large.

Growth of Wind & Solar in North America

The commercial development of wind began in the USA during the early 1980s after the California wind rush from 1981 to 1985, however, nearly two decades passed before substantial growth resumed

By the year 2000 there were only 2,600 MW of wind capacity installed in the USA. Through the first decade of the 21st century, wind grew relatively steadily, reaching nearly 47,000 MW by the end of 2011.

 

Canadian development of wind energy didn't begin in earnest until 2006 when there was 1,500 MW of cumulative capacity in service.

As in the USA, growth of wind energy in Canada has been relatively steady since 2006, reaching 5,300 MW by the end of 2011.

 

Development of solar PV has lagged far behind that of wind energy. Nevertheless, by the end of 2011 there was nearly 4,000 MW of solar PV capacity operating in the USA, and more than 500 MW operating in Canada.

California accounts for nearly two-fifths and New Jersey accounts for one-quarter of solar PV capacity in the USA.

Ontario accounts for more than 80% of all solar PV in Canada.

Community Wind in North America

The seminal research on community wind development in the USA was conducted by Mark Bolanger for Lawrence Berkeley National Laboratories (LBNL) in 2001.(1) The report focused on how community wind was being developed in Europe and described various approaches to its implementation in the USA. Since then, Bolanger has tracked community wind development in the USA and his data appears in annual assessments of wind growth in the USA by LBNL.

The most recent assessment by LBNL on wind development in the USA is for 2010.(2) Bolanger calculated that only 2% of the 40,000 MW in operation at the end of 2010, or 715 MW, was community-owned.

 

Bolanger defines community wind as projects using turbines over 100 kW in size and completely or partly owned by towns, schools, commercial customers, or farmers, but excluding publicly owned or municipal utilities.

Windustry's Lisa Daniels, argues that community wind should include municipal and publicly-owned utilities as they are owned "by the people". If these utilities are included, the total of community-owned wind reaches 5% of cumulative wind capacity in the USA.

In addition, there are between 100 and 150 MW of small wind turbines that may be in service in the USA. Because most if not all small wind turbines are used in applications that might qualify as community power, small wind turbines could add from one-quarter to one-half percent of total installed wind capacity represented by community wind in the USA.

Comparable data for small wind turbines in Canada doesn't exist.

There is even less community wind in Canada than in the USA. There is essentially one community-owned wind turbine in Canada, the 600 kW WindShare turbine developed by the Toronto Renewable Energy Cooperative. Thus, only 0.01% of wind capacity in Canada meets the traditional definition of community wind.

Community Solar PV in North America

Solar PV is even more modular than wind energy and is well suited to extremely small projects in distributed applications, such as on residential rooftops. Historically, most solar PV in North America has been installed on residential rooftops. However, that has begun to change as solar PV has become more cost-effective.

Under California's Solar Initiative, two-thirds of solar PV has been installed on residential rooftops. This portion of the market owned locally will undergo dramatic change in the next two to three years as massive central-station solar PV power plants are brought on line in California.

In contrast to California, New Jersey's solar program has always been oriented toward commercial development, and residential applications are merely a byproduct. In New Jersey only 25% of solar PV capacity has been installed on residential rooftops.

The market for solar PV outside New Jersey and California is primarily residential rooftops. That is expected to change.

It is likely that two-thirds of all the solar PV in the USA has been installed on residential rooftops and would qualify as locally-owned and, therefore, as community solar.

 

Of the nearly 4,000 MW of solar PV installed in the USA by the end of 2011, only 2 MW was collectively or cooperatively owned. This represents less than 1% of total installed US solar PV capacity.

While Ontario, Canada has the most favorable policy environment for community solar in North America, very little has been installed since the province's Feed-in Tariff program went into effect in late 2010.

Currently only 4 MW of the solar PV developed in Ontario, or less than 1% of total solar PV installed in Canada, qualifies for the province's definition of community power.

 

Near-Term Prospects for Community Power in North America

Though community wind, and to a lesser extent community solar, has lagged behind that of community ownership in Germany, there are prospects that it could increase markedly in the next few years.

Ontario has the most favorable policy environment for community power in North America. It is the only jurisdiction in North America with a comprehensive feed-in tariff policy like that in Germany, and it is one of only two jurisdictions in North America that has a specific policy for community ownership.

Ontario's policy has specific provisions for community-owned projects and for projects owned by aboriginal Canadians or métis

Individual farmers, community groups, cooperatives, and other "local" owners qualify for a "bonus payment" under Ontario's Feed-in Tariff Program of $0.01/kWh for wind energy. Locally-owned projects using other technologies also receive a bonus payment based on their productivity relative to that of wind energy.(3)

Aboriginal wind projects receive a bonus payment of $0.015/kWh. The Ontario program was specifically designed to boost participation in renewable energy by aboriginal groups in Ontario and also boost their economic development. The Ontario program is the only one of its kind in North America.

 

The Ontario program apportions the bonus payment based on the amount of local ownership. Local ownership of more than 50% qualifies the project for the full bonus payment.

 

By early March 2012, Ontario had received applications for nearly 3,600 MW of renewable capacity from more than 400 community and aboriginal projects, roughly split between the two categories.

Community power and aboriginal projects account for 4% of all applications in Ontario's Feed-in Tariff Program, 17% of all capacity applying for contracts, and 18% of all contracts awarded.

Despite the promise, however, no projects have yet entered operation.

One 4-MW wind project of two turbines on a 3-acre (1-ha) site on Manitoulin Island in Lake Huron went into commercial service sometime in late spring. The pioneering project developed by the M'Chigeeng First Nation, has been dubbed the Mother Earth Renewable Energy Project.

Nova Scotia, one of Canada's Maritime provinces, has implemented a feed-in tariff program solely for community-owned renewables, what it calls ComFIT.

Considering the program's strict requirements, ComFIT has awarded a surprising number of contracts since its launch in 2011. While some may argue over defining "community-owned" renewables to include a biomass combined heat & power plant at a pulp mill, there are now nearly 60 MW of contracts awarded.

 

Millbrook First Nation of Truro, Nova Scotia has won a contract for 6 MW project consisting of three turbines with a German engineering and development company, Juwi. The German firm has been active in building community-owned or regionally-owned wind, solar, and biogas projects in Germany.

In neighboring Quebec, a small community in the Lac St. Jean region north of the provincial capital of Quebec City has won a 25 MW contract to build a locally-owned wind plant, Val-Éo, scheduled for completion in 2015.

In the USA, the state of Minnesota has had the only policy specifically designed for community ownership. Its C-BED, or Community-Based Energy Development has resulted in the most community wind in operation in both the USA and North America.

While Minnesota's neighbor has no specific policy for community wind, Wisconsin's first community wind project came on line in early 2012. The Cashton Greens Wind Farm was developed for the Organic Valley cooperative and Gundersen Health System. Organic Valley is the largest farmer-owned cooperative of organic growers in the USA. The two-turbine, 5-MW project is a first for Wisconsin.

Conclusion

Currently community power represents an extremely small portion of the new renewables developed in North America. Nevertheless, several thousand megawatts of newly contracted capacity are now on the books, mostly in the Canadian province of Ontario. How much of that will be built is unknown.

Even where the policy environment is supportive--and much of North America has no formal support for community power--it remains extremely difficult, for a host of reasons, to bring community-owned, or locally-owned projects to fruition.


1. Community Wind Power Ownership Schemes in Europe and their Relevance to the United States by Mark Bolanger, LBNL, 2001.

2. 2010 Wind Technologies Market Report by Ryan Wiser, et al, LBNL, 2011.

3. Note that the bonus payments and the tariffs for each technology are under review and the new prices are expected to be published by mid-March, 2012.


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