DGRV annual survey of energy cooperatives: renewed drop in number of new energy cooperatives

Further fall in newly founded energy cooperatives / Tendering rules planned in the Renewable Energy Sources Act (EEG) unsuitable for citizen-generated energy / Heating networks require follow-up funding for biogas

Berlin, 6 July 2016. With just 40 new energy cooperatives being set up in 2015, the number of newly founded cooperatives fell by another 25% compared to the previous year. This significant drop in the already low level last year is revealed by the annual survey undertaken by DGRV – Deutscher Genossenschafts- und Raiffeisenverband – presented today in Berlin with the German Renewables Energies Agency (AEE).

"The boom years are over for the time being. Above all, it is the financial restrictions for new photovoltaic projects which are seriously hampering the activities of energy cooperatives. The introduction of tendering sets up yet more barriers to citizens' energy," comments DGRV Chairman Dr. Eckhard Ott.

The first four calls for tenders for open-space photovoltaic installations reveal that the declared political objective of stakeholder diversity cannot be guaranteed. Just 0.22 per cent (in terms of installed capacity) of bids were won by energy cooperatives. This figure explains why the new tendering scheme for wind power introduced by the 2016 EEG is attracting criticism – despite the citizens' energy rule proposed by legislators. This rule is intended to permit citizens' energy companies to enter auctions at an early planning stage.

"We very much welcome the consideration given to citizens' energy in the draft bill. However, the rule does not eliminate the fundamentally higher risk borne by small players, such as energy cooperatives; in fact, it intensifies the risk even further," continues Ott. Even if an auction is won at an early planning stage, there are still numerous reasons why a project can fail in the following approval process. The citizens' energy cooperative would then have incurred planning costs through no fault of its own and would, in addition, be liable for penalty payments. These could be as high as €45,000 per installation. For this reason the DGRV proposes the option of allowing citizens' energy companies to withdraw selected bids at a later time without being subject to penalties.

In contrast, the DGRV welcomes the development of district heating cooperatives: 145 such cooperatives have been founded, more than 50 in the last three years alone. As 65 per cent of district heating cooperatives use a biogas plant as their main source of heat, in the long run these plants will require follow-up funding. This is because district heating networks often remain operational for longer than the 20 years for which feed-in tariffs are paid for biogas plants under the EEG.

Local authorities are reliable partners for energy cooperatives which run district heating networks. This is apparent from an additional flash poll undertaken by the AEE among the latter's prize-winning energy-generating local authorities. Two out of three pioneering local authorities stated in the survey that they had stepped up their district heating activities over the last 12 months. "Energy cooperatives and local authorities are ideal partners for the supply of heating to residential areas," explains AEE Managing Director Philipp Vohrer. "District heating networks are often run as cooperatives by home owners themselves with planning and organisational support from local authorities."

However, local authorities which generate their own power do not rate the general framework for the development of renewable energy at the local level very highly. While conditions for district heating are still, on average, regarded as satisfactory, views on electricity and mobility are assessed far more critically, scoring an average of 3.96 and 4.14 respectively. "Local authorities and energy cooperatives are the most important guarantors for acceptance of the energy transition among the general public. This means that it is extremely important for the success of the energy transition as a whole that a favourable framework is established," according to Vohrer.

The DGRV asked 812 energy cooperatives which were founded between 2006 and 2015 (based on 273 questionnaires returned). In total, energy cooperatives have already invested around 1.8 billion euros in renewable energies. This is the fifth time the survey has been conducted. The results are available at www.genossenschaften.de/energie.

The AEE flash poll was sent to representatives of 100 local authorities which generate their own power in Germany (return rate: 30). Infographics on the survey are available at https://www.unendlich-viel-energie.de/mediathek/grafiken/blitzumfrage-energie-kommunen-2016

more information in German: www.genossenschaften.de/bundesgesch-ftsstelle-energiegenossenschaften