By now the environmental advantages of a shift towards renewable energy have been widely recognised. A transition to renewable sources of energy is more sustainable, mitigates the impacts of climate change and can be a driving force for economic development. However, this transition does not only mean a change in the resources of energy. More significantly, it provides the opportunity for structural change and the redistribution of (economic) power. It enables participation and ownership for less privileged parts of the population. The concept behind this grander restructuring is called Energy Democracy.

What does Energy Democracy mean?

According to the Climate Justice Alliance‘ definition: „Energy Democracy represents a shift from the corporate, centralized fossil fuel economy to one that is governed by communities, is designed on the principle of no harm to the environment, supports local economies, and contributes to the health and well-being for all peoples.“ Thus it connects the transition to renewable energy with a process of democratisation, focusing on social benefits and their fair distribution and not on economic advantages for a few[i].

Energy democracy includes several basic principles, that can be translated into actions:

• Transition to renewable, sustainable, and local sources of energy replacing fossil fuels. The foundation for the development of energy democracy is the transition from unsustainable, often centralised sources of energy to renewable energy which are modular and can be deployed even in the most remote regions.
• Universal access to affordable and clean energy, so that everyone has the opportunity to use renewable energy as they wish. This can lead to local economic value creation, because small and medium sized enterprises can form or grow, due to their reliable access to energy. Further, the deployment of decentralised RE systems often leads to a reduction of the energy bill, as costly kerosene for lamps does not need to be acquired anymore.
• Ownership of the energy transition and the decision-making processes connected to it. The people using the energy should be an active part of the decision-making process on how to foster and distribute it. They should decide on the transition to renewables and how to go through with it, ultimately also benefiting from financial returns.
• A just transition that includes the restructuring of the energy system into one that benefits the people. Just transition means particularly the redistribution of power and wealth within the energy system.

The multi-faceted concept of energy democracy aspires to transform societies by democratizing the way in which power is produced and consumed. The movement, therefore, combines the social struggle for a more democratic and inclusive society – in which everyone can afford energy, has access to decent work and a say in how communities are governed – with the necessary transition to renewable energies that contribute to a safer environment for people and life around the globe. Therefore, it addresses both the issue of fossil fuels and their detrimental impact on our environment. As well as the fact that the current energy system is mostly controlled by corporations and serves economic interests of a few, often disregarding the needs and safety of people [ii][iii][iv].

Energy democracy is closely connected to the idea of community energy. The essence of both concepts is the participation and ownership of the local population in the energy system. Ideally, they decide what kind of energy they want to produce, in what way and how to distribute it. This also enables them to make decisions over spending of financial returns which could, for instance, be used to install further energy projects or maintain streets. The production and distribution of energy become democratic and fair with the interests of the local population at heart, hence contributing to local value creation. Consequently, communities are able to develop a sense of ownership in the energy transition[v]. The modularity of most renewable energy sources further supports this development, by being able to be installed even in the most remote regions, and often the transition to renewable energies goes hand in a hand with the democratisation of the energy system.

(Read about the example of solar home systems here: What are Solar Home Systems? (worldfuturecouncil.org))

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Challenges for energy democracy around the globe and how to overcome them

Often communities are met with little support from governing authorities and face many risks when starting the process towards renewable energy and energy democracy[i]. Thus, challenges for energy democracy and active participation of community actors remain manifold: The difficulty of allocating financial means; navigating within a policy framework that is designed for large-scale, centralized projects; lack of understanding around the advantages of energy democracy and community energy.[ii]

However, there are many different communities advocating for a shift to renewable energy and greater participation in the energy transition.

There exist countless examples, showing us that energy democracy and a Just Transition to renewable energy is possible; for instance in the communities of Rio de Janeiro in Brazil, where social organisations have implemented concepts of energy community and whole neighbourhoods are now supplied with energy from solar panels installed on the roofs of their houses.; or in the rural areas of Bangladesh where villages that were previously not connected to the national electricity grid are now producing their own energy through solar home systems.

Energy democracy presents itself as a bottom-up approach with strong local actors and solutions that arise from within the community. In order to strengthen energy democracy and overcome the challenges for people to get engaged in the energy system, we need strong policy frameworks supporting people’s participation and rapid deployment of renewables. This can be achieved through various political and technological support measures, for instance, local ownership quotas, virtual net energy metering, Feed-In-Tariffs (FiTs) or One-Stop-Shops. To further allocate financial resources innovative financing mechanisms are necessary though. Those could be crowdfunding, concessional loans or grants which can help to reduce (perceived) risks with financing RE projects. Both should be coming from public sources of financing as well as from private sources.

Moreover, to create greater motivation for the establishment of energy democracy and community energy, better awareness for the benefits of community owned energy systems needs to be achieved.  For example, achieving universal energy access, the creation of green jobs, gender equity, access to education and local economic development. Incentives for storage need to be created. Overall, a stronger focus on distributed energy systems, rather than centralised systems is essential and should be apparent through measures such as FiTs, premiums, as well as ambitious targets for renewable energy.

Realising the opportunity of a transition to renewable energy as a chance for structural change in the energy system and a just transition, is essential. The World Future Council (WFC) is currently working with legislators and parliamentarians, particularly from countries of the Global South, to support this process. Specifically, to encourage the development of policy frameworks that provide better support for communities in their transition and help them tackle the challenges that they are facing.

Read Here about the projects of the WFC:

Global Renewables Congress – Legislators for Renewable Energy

Climate and Energy – World Future Council 

You might also like:

What is just transition? And what does it mean for the energy sector? (worldfuturecouncil.org)

What are Solar Home Systems? (worldfuturecouncil.org)

https://www.worldfuturecouncil.org/community-energy-rio-de-janeiro/
https://www.worldfuturecouncil.org/lessons-learned-100-re/
https://www.worldfuturecouncil.org/climate-change-poverty-energy-renewable-energy-solution-africa/
https://www.worldfuturecouncil.org/women-forefront-energy-revolution/
https://www.worldfuturecouncil.org/100re-sdg/

Sources:

i Energy Democracy – Climate Justice Alliance
ii Climate justice and energy – Friends of the Earth International (foei.org)

iii What is energy democracy? – The Earthbound Report
iv PRINCIPLES OF ENERGY DEMOCRACY | ENERGY DEMOCRACY (energy-democracy.net)
v Definition, benefits and potential of community energy | Community Energy England

vi IRENA Coalition for Action, 2020
vii IRENA Coalition for Action, 2020