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EconPol Europe Survey: Europeans Very interested in Community Renewable Investments Run by Local Cooperatives

European citizens prefer investments in community renewable energy (CRE) projects that are administered by local community organizations rather than by utility companies. This is one key result of a recent survey by the research network EconPol, leading to a clear policy recommendation: if EU member states facilitate the setup of local cooperatives, i.e. by helping to navigate bureaucratic and regulatory burdens, CRE projects could become a crucial stepping-stone in reaching the EU’s newly set target of producing 40 percent of energy from renewable sources by 2030. “Certain project attributes provide higher incentives for citizen investment. The preference for locally run administrative entities is the one that stands out the most,” explains Valeriya Azarova, one of the study’s authors.

Other important drivers for citizen investment are beliefs that renewable energy projects create local job opportunities and that they improve the environment, according to the study. Interestingly, the analysis reveals that the belief in economic benefits matters more than the belief in environmental benefits. “Current CRE campaigns often focus on the environmental benefits of a CRE project. One major takeaway from our study is to go beyond the environmental aspects and to stress the regional employment and economic stimulus benefits of CRE models to potential citizen-investors,” Azarova adds.

Community renewable energy projects – sometimes also called energy cooperatives – refer to projects where citizens own or participate in the generation of renewable energy from a local electricity installation, usually solar photovoltaic installations or wind turbines. At present there are over 1,500 energy cooperatives in Europe involving over one million private citizens, with pioneering countries Germany, Denmark, and the UK dominating the market. The EconPol study suggests that – with the right setup – there could be a significant increase in the uptake of CRE schemes throughout Europe, but especially in countries where this model is not yet widely applied. “Turning passive bill payers into active participants in the energy market could be the way forward to a more sustainable Europe,” Azarova concludes. The research was conducted across 31 European countries with a total sample of 18,073 questionnaires.

Read the full paper: “All for One and One for Green Energy: Community Renewable Investments in Europe”, by Valeriya Azarova, Jed Cohen, Andrea Kollmann and Johannes Reichl, EconPol Policy Brief 37, September 2021

About EconPol Europe

EconPol Europe – the European network for economic and fiscal policy research – is a network of 14 policy-oriented university and non-university research institutes across 12 countries, who contribute scientific expertise to the discussion of the future design of the European Union. The network’s joint interdisciplinary research covers sustainable growth and best practice, reform of EU policies and the EU budget, capital markets and the regulation of the financial sector, and governance and macroeconomic policy in the European Monetary Union.
The network was founded in spring 2017 by the ifo Institute, along with eight renowned European research institutes. A further five associate partners* were added to the network in January 2019.
The foundation of EconPol Europe was made possible by an initiative of the German Federal Ministry of Finance (BMF) to intensify and deepen cross-border research and cooperation in Europe. The ifo Institute was commissioned by the BMF to set up this independent network, providing evidence-based policy advice to inform the economic and fiscal policy debate in Europe.