3. Introduction - Resilience
Resilience - the enduring power of a body or bodies for
transformation, renewal and recovery through the flux of
interactions and flow of events
Resource Resilience â Natural Grid
Financial Resilience â Open Capital
4. Resource Resilience â Natural Grid
Since 1980 Denmark's GDP rose 78%
Energy use has been stable
Carbon fuel use has declined
How did Denmark achieve this?
5. Resource Resilience - Natural Grid
Least Carbon Fuel Cost principle
- not 'least Danish Krone cost' (or least $, ⏠or £ cost)
- minimum carbon fuel input for a given output of
electricity, heat or power
- investment in renewables, heat, transport, energy
efficiency
6. Emerging Outcomes of Natural Grid policy
- decentralisation
- knowledge & knowhow base: Vestas the biggest
global wind turbine company in country of 6m people
- trend to energy security and energy independence
- not forgetting........reduction in carbon use
7. Linlithgow Natural Grid (LNG)
Aim: enable Linlithgow to be independent in energy
Means: application of least carbon fuel cost principle
Enlisted Mainstreaming Innovation for academic input
CARES funded study carried out by Dr Mohammed
Imbabi of Aberdeen University
Objective 1 â map energy use in Linlithgow Cross
Objective 2 â identify & prioritise viable least carbon
fuel cost interventions leading to energy descent
Q. How can we fund Linlithgow Natural Grid?
8.
9.
10. Systemic Funding Problem
Denmark's fiscally robust local government guaranteed
Co-op renewable finance & fund heat infrastructure
UK renewables â kill Big 6 profitable production
UK energy savings â kill Big 6 customer consumption
If Big 6 won't & local government can't, how can
renewables &energy savings be funded?
11. Financial Resilience â Open Capital
Prepay â credit returnable in payment for value
Capital Partnership â production sharing agreement
13. Tax Prepay
Tax Prepay â credit returnable in payment of taxes
Tax Return â 'stock' part of tally stick returned to Treasury
Rate of Return - rate over time at which stock is returnable
for cancellation
eg Prepay ÂŁ8 for ÂŁ10 tax - ÂŁ2 profit 25% pa rate of return
- not fixed - depends on existence & quantity of flow
15. Energy Partnership - Outcomes
Social Contract - relationship-based not transaction-based;
costs transformed to revenue shares
Neutrality â removes ego and politics
Collaborative - stakeholder interests aligned
Sustainable - all have interest in minimising cost over time
16. Energy Prepay â the Value Proposition
Community
- sells value of future energy production or savings
- interest-free energy loan until credit cancelled by
return vs supply or repurchase from energy savings
Consumer
- prepays for energy and locks in price
17. Energy Prepay â the Value Proposition
Investor
- energy loan investment directly âPeer to Assetâ
- Consumers buy credits from Investors at best price
below physical energy price & return against supply
Manager
- shares in gross revenues or production
- interests aligned with Investor
- no 'Principal/Agency' problem
18. Comparison of Western Isle community income
3 x 3 Mw Wind Turbines
Community Owned Farm
ÂŁ110k pa/Mw community
profit
ÂŁ ÂŁ330k pa per turbine
ÂŁ1m pa to Community
Adjacent Private Wind Farm
â ÂŁ6k pa /Mw community
benefit
= ÂŁ18k pa per turbine
= ÂŁ54k pa to Community
19. Mega Watts
Whoever owns renewable energy sells at wholesale bid
price (4p/Kwh) & buys back at retail price (13p/Kwh)
Private wire or local use wherever possible
20. Negawatts
Energy savings made by consumers at retail price
Well to Wheel savings: litre of diesel fuel saved might save
3 litres of crude oil
Conventional funding (Green Deal) has two problems
- compound interest on bank ÂŁ loans
- even if ÂŁ is saved, no guarantee energy will be saved
21. Linlithgow Energy Pool
Investor pay ÂŁ1k for credits in Linlithgow Energy Pool
- 20 x 1Mwh prepay Units @ ÂŁ50 each
- 2000 x 10 Kwh prepay Units @ 50p each
Fund invests at community level through energy loans
eg community CHP/co-generation
Loan repaid via energy bills through buying prepay
energy units at market price
Interest-free loan â return to investor in energy
Unless consumers save energy they will not save ÂŁ
22. Linlithgow Energy Pool
Custodian
Energy Pool
Custodian
Energy PoolInvestors
Consumers
Manager
ÂŁ Energy
Loan
Buy units
at market price
ÂŁ
Prepay
Prepay
Units
ÂŁ
ÂŁ