What is community based energy development?

Community-Based Energy Development or ‘C-BED’ is a scheme which maximizes the use of local and regional resources primarily for developing renewable energy generation facilities. The underlying goal of most C-BED initiatives is to leverage shared resources, such as land, money, expertise etc. in order to help grow and sustain the local community; essentially conforming to the ‘local is better’ motto.

In rural areas, C-BED aims for enhanced economic agricultural or ranching benefits with the help of land lease or royalty payments obtained from utilizing the land for renewable energy generation. Ideally, Community-Based Energy Development projects are jointly owned and operated by farmers, local businessmen, schools and other community members who come to share in the growth of such initiatives. When established, C-BED schemes bring about significant improvements in trade, jobs, personal profits (which are shared by the members of the C-BED project) and the local/ regional tax base.

Without a C-BED initiative, the majority of renewable power projects would be owned by large, external developers whose primary purpose is to extract and exploit the resource without adding any value to the local economy or stability of local power markets.

Community-Based Energy Development creates a steady market for energy that can be re-used (once built, wind farms generate reliable power at a fixed cost; and since wind is a free resource, spikes in fossil fuel costs can be avoided), which in turn greatly aids in local and regional energy independence and economic development activities.

What are the many benefits of Community-Based Energy Development and why is the government supporting it?

There are many advantages that Community-Based Energy Development brings about in societies. The government recognizes this fact by encouraging and supporting wind energy in many ways, mainly in the form of subsidies and grants. There are several economic benefits of this long-term activity which immensely assists rural and regional communities. Such projects are also environmentally-friendly and promote local and national energy independence.

With Community-Based Energy Development, it is good to note that these initiatives are normally sponsored by local area banks or rich farmers and the profits of the ownership remain within the community itself.

C-BED projects support and yield jobs for union and local contractors, engineers, accountants, lawyers, bankers and main street businesses.

If compared with out-of-area owners, a higher percentage of money utilized for the purpose of construction, operations, maintenance etc. stays with the local community and the regional area. Also, more of the dollars spent on electric bills directly circulate back into the local and regional communities as the power is not being brought from afar.

C-BED projects generally target and serve local energy needs and as such typically do not need new transmission lines and leverage the existing distribution lines in the community, which can support the output power load. Even when projects sell power to far away markets, their dispersed nature and smaller size allow C-BED projects to fit onto the existing power grids more easily than big projects. With increasing demand for energy and consequent congestion on the nation’s transmission grids, C-BED provides for a viable and cost-effective solution (remember, as costs are mostly shared, this includes interconnection cost sharing, which is one of the highest incurred project development costs).

Some Highlights of Economic Benefits of Community-Based Energy Development projects

- In May 2005, a US Dept of Energy study revealed that wind power brings more direct economic benefits to local economies as compared to any other form of new electricity (including coal and natural gas).

- In Sept 2004, the US General Accounting Office stated that wind systems produce two to three times more jobs and three times more local dollar impact compared to "out of area" interests.

According to wind resource maps, the potential of wind has barely been fully tapped. Biogas, solar, bio-diesel, small hydro and other non-wind renewable energy sources are viable in various geographic areas.

Community based energy development programs are a great boon to local and regional communities which has lead to it being backed strongly by the government.