Community Ownership and Renewable Energy in Scotland. Mike Danson, Professor of Enterprise Policy Heriot Watt University CRED Seminar, Carlisle, 20 th March 2013. Introduction. Rationale Literature Review Externalities Methodology – critical discourse analysis Case Studies Findings
Professor of Enterprise Policy
Heriot Watt University
CRED Seminar, Carlisle, 20th March 2013
Findings of a YouGov poll suggest 62 per cent of Scots would be generally for large scale wind projects in their local council area, more than double the number (24 per cent) who said they would support shale gas, and almost twice as much as nuclear (32 per cent).
It was an even more positive outcome for hydro power which scored top with 80 per cent of those surveyed saying they would be generally for a large scale hydro project in their area, considerably more than other forms of generation such as gas (42 per cent), oil (37 per cent) and coal (34 per cent).
Main form of alternative energy - wind farms
Opposition as planning applications grow and scale increases
60% refusal rate for planning applications in England and Wales (Cass et al., 2010)
Recent press reports in Herald, Guardian, Shetland Times etc. would suggest this is not diminishing
Suggested that ownership in the UK impacts on refusals (Khan, 2003; Brunt and Spooner, 1998; Toke and Elliot, 2000)
Khan (2003) identifies three ‘conflict dimensions’
‘Conflict Dimensions’ aka externalities
Loosely defined as ‘costs or benefits of an activity which are not reflected in the price’
Positive and negative externalities exist through wind farm production
Usual way of dealing with externalities - attempt to ‘internalise the externality’
Encourage the positive (e.g. subsidy), reduce the negative (e.g. taxation)
Three research questions:
Only a small number of wind projects are running. Gigha; Udny 800kw community wind turbine in Aberdeenshire
Relatively small scale
Neilston Development Trust’s community windfarm – in planning. (49.9% / 50.1%) with, Carbon Free Development Ltd, four turbines installed capacity of 10 MW. commercial company undertakes all technical aspects including obtaining finance.
Limited ownership: owns 6%
In other words, those who are paying the visual "price" of having the construction of wind turbines are receiving the benefits of the revenues they generate.
Stimulates and supports social capital
In the case of Neilston, the plan is for profits to be shared almost 50/50. This would lead to a revenue flow of £2.4 million over the first 10 years and a total of £10.5 million (before tax) over 25 years.
Internalisation of negative externalities is constrained - an individual or household must have income to invest - and even this is limited to 5% of the project value. Also a disconnect between those bearing the brunt of the negative externalities and those who profit from co-operative membership. There is the community fund, but this represents only a small proportion of the total project revenue.
Different ownership models of renewable schemes (esp. wind)
Focus on how the revenue produced is distributed
Smaller schemes internalise the externalities
Smaller schemes also increase positive externalities
However, positive externalities from reduction of CO2 lower so the impact is much less.
CBOs and Danish experiences – more equitable, build popular participation, spread ownership and decision-making rights
Supportive state institutional and regulatory mechanisms to promote and foster more decentralised forms of collective and public ownership
Professor Mike Danson, DLitt, AcSS, FIED, FeRSA externalitiesSchool of Management and Languages
Heriot-Watt University Edinburgh, EH14 4ASScotland
+44 (0)131 451 3840 t+44 (0)7948 276398 m
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