The Growing Community Social Enterprise Movement
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August 29, 2010The ABC’s Inside Business has provided a very positive picture of Hepburn Wind an Australian community owned social enterprise.
This registered cooperative is Australia’s first community owned wind farm.
A Strong Conclusion From Collaboration
Hepburn Wind chairman, Simon Holmes a Court’s concluding statement to reporter Rebecca Nash says it all:
“There’s a real appreciation that we can get on and take constructive action right now. We don’t have to wait for government, we don’t have to wait for a CPRS. We can take action today on climate change.”
The Inside Business Hepburn Wind Discussion
SIMON HOLMES À COURT: We’ve unlocked a whole new class of investor. The community social enterprise investor. We’ve shown that given the opportunity the community is willing to put in very patient capital into building their own renewable energy infrastructure.
The fossil fuel industry is losing its social licence. There’s not a lot of support for building more coal plants.
REBECCA NASH: Five years ago a small group of Daylesford locals resolved to build a wind farm the community could embrace.
SIMON HOLMES À COURT: In the scheme of the wind industry Hepburn is a very small project. We’re building only two turbines. But what is amazing to everyone in town and what really captures our imagination is that it just takes only those two turbines to generate as much power as our town uses on an annual basis.REBECCA NASH: A cooperative structure was chosen for the project.
SIMON HOLMES À COURT: The nature of cooperatives, one member one vote not one share one vote was very important in establishing the authenticity of the project that it really was community owned and not a corporate project or a commercial project in the first instance.Hepburn Wind is a $12.9 million project. We originally expected that we would raise about half in debt finance and then of the remainder about half through the community and half through the institutional investors.
We found very low interest from institutional investors in the project and that’s a lot due to the scale of the project, we’re very small. So we redoubled our efforts in the community and the community, we’re very proud, put together nearly $8 million for the project.
We currently have 1,200 members, the majority of whom are local and the median share holding is about two to three thousand dollars.
REBECCA NASH: Community and investor education is a constant, with tours provided to other wind farms.
SIMON HOLMES À COURT: We’re still out there at least once a month just telling people about the vision for the project, dispelling any fears or myths about wind farms. A lot of people are really not sure about wind farms until they see them, until they stand underneath the turbine.REBECCA NASH: Now the turbines are on their way, the next step is finding a buyer for their electricity.
SIMON HOLMES À COURT: To the retailers we’re talking to we might represent one,two or three days of their annual demand. So we’re not so interesting from an energy sale but what we do offer is a large group of members who would be prepared to sign on as customers.
There’s obviously value to a retailer in gaining customers, but there’s also value to a lot of retailers in being associated with successful community based renewable energy project.
REBECCA NASH: Hepburn Wind has welcomed new federal legislation which separates domestic and commercial renewable energy certificates.
SIMON HOLMES À COURT: Unfortunately we still have a very significant surplus of renewable energy credits that will take quite a few years to wash through the system.
There are a lot of projects that are ready to go except for financing where financing is keyed off the energy market prices so a lot of projects are waiting for a recovery in the market and won’t get up.
REBECCA NASH: Another hurdle is the differing planning laws in Australia.
SIMON HOLMES À COURT: Around the country the planning frameworks are in flux and there’s quite a lot of uncertainty. A lot of the planning issues have long been solved in Europe, and Australia’s still working their way through it.REBECCA NASH: Hepburn Wind is setting up a non-profit organisation to help other community energy projects get off the ground.
SIMON HOLMES À COURT: Not a week goes by without another community calling us up and saying how do we start, how do we build our own project and communities need to know how to do it. They need large access to information resources. They also need assistance with capital raising.
REBECCA NASH: For Hepburn Wind members, the last five years have been empowering in more ways than one.SIMON HOLMES À COURT: There’s a real appreciation that we can get on and take constructive action right now. We don’t have to wait for government, we don’t have to wait for a CPRS. We can take action today on climate change.
A great model for other collaborative community efforts in sustainable economic development
2 Comments
I have just completed my 20th Federal Campaign as an Independent. Hopefully the 3 Independents will have Federal cabinet refocus to include initiatives important to Rural regions.
My political platform has always been related to the development of Regional and Rural Australia by attracting large numbers of affluent overseas and Australians to have one to four week, big local spends, stays in Rural Regions. The key to this happening is the establishment of an inland Network of Rural Inland Discovery, 7/24 local hosting, and local Tours, Resorts. See http://www.yestogether.com
Long ago the GOTWS, Giant Overseas Tourist Wholesale Suppliers, in Europe said if we built these Inland Resorts, to meet their customer specifications, they could send us up to 30,000 visitors a week, who can spend from $200 to $1000 a day.
Perhaps their is a Rural Community, Leader, Banker, MP, Council, progressive individual for all Australians, reading this , interested in shareholding in these developments, in any practical way, like as has happened with these Turbines. If there is I invite you to email me on ruralprogress@netscape.net to chat about the idea.
There is an old saying that 1 + 1 equals 3 and 2+ 2 equals 7.
Well done to Gail and PWF for sharing this information about the community funding of the Turbines.
At the risk of sounding negative about such a great ideal in Social Enterprise initiative, let me raise the point by asking whether any of the investors in the above project would like to invest in some sort of primary production enterprise where the production is sold exclusively to the two main supermarket chains. I’m sure we are all familiar about these stories.
Most if not all the investors would say “no way” as there is simply no reasonable possibility of making a respectable return on one’s investment.
The question is then, why invest in production of electricity which is sold into a grid & provided to consumers by large corporations who have total control of the retail electricity market over which the producers (like farmers) have no control.
Unless the investors were prepared to invest further by rolling out an NBN style network directly to consumers, this type of project is doomed from the outset & is quite frankly a poor investment & I can understand why commercial financing is hard to come by.
It would be far better to spend the capital installing solar panels on one’s roof where you can directly benefit from the investment.
Grand ideals are not always so grand when the reasoning is not thought through properly.