SMART METERING The Shifting of Power to Prosumers: Bioenergy Communities – A European Perspective By Adam Ajzensztejn, IDC Energy Insights Briefly put: A shift of power is taking place, a transition from large centralized power plants with extensive transmission and distribution networks to small community-led renewable distributed generation projects, often heavily reliant on locally produced bioenergy. Some consumers have grown tired of the old energy model and have taken matters into their own hands to deal with the issues close to their heart. To this aim, a new wave of prosumer — the community prosumer — has sprung into action, using good old-fashioned community spirit to capitalize on local renewable energy resources, subsidies, and a free market. These communities include villages, towns, and even islands, where inhabitants have mobilized, invested, and changed their energy model as well as their entire economic and social future, providing the catalyst for sustainable development. The community-led prosumer scheme shakes the old energy model. These communities do tick many of the boxes for a sustainable energy future. However, whilst today they may not stack up economically without the aid of subsidies and grants, it is just a matter of time before they do. When they do, the emphasis will shift to utilities that will need to cope technically and financially, carving out a niche under the new energy reality or at minimum requiring them to redefine their role. community cohesion and generates a powerful self-perpetuating momentum for change. Whilst each community and each individual has their own motivation for wanting to change their energy model, common drivers are: security of supply, environmental stewardship and climate change, volatile energy prices, lack of trust and economic development. Regulatory and Policy Framework The EU’s Renewable Energy Directive sets a mandatory target for 20% of the total EU energy consumption to be generated from renewable energy sources by 2020. Bioenergy (energy derived from living or recently living biological sources) is a renewable energy source, and member states view it as a vital component of their future renewable energy mix, with it expected to account for over half of EU renewable output in 2020. The new climate and energy package presented in January 2014 sets out proposals for greenhouse gas reductions between 2020 and 2030. This proposes a binding Europe-wide 27% renewable energy target. In terms of biomass, the new package notes that “An improved biomass policy will also be necessary to maximize the resource efficient use of biomass in order to deliver robust and verifiable greenhouse gas savings”. Following the establishment of the 2020 targets, some concerns over the sustainable merits of bioenergy production have been raised, particularly regarding agrofuels. This has led to biofuels being withdrawn from the 2030 proposals. Conversely, biomass when sourced from waste, agricultural and forestry residue and fed into a cogeneration plant to generate electricity and heat is considered a far more sustainable approach to tackling climate change. Many governments worldwide have established incentives to encourage the uptake of renewable energy technologies. A widely adopted approach involves the use of policy mechanisms, such as Feed in Tariffs (FITs). Private and public loans have also been made available to contribute to covering the costs of renewable projects. The combination of the words producer and consumer, prosumers, once represented a small group of individuals driven by strong ideals of energy security and environmentalism. It has since expanded and now incorporates hundreds of community-led schemes worldwide, often based on similar ideals to the early visionaries but with the prospects of it being a savvy investment providing profit and local development. The involvement of an entire community not only leverages economies of scale for financing and implementing technological solutions but also leads to improved social 66 METERING INTERNATIONAL ISSUE - 2 | 2014