eco cities energy
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Local Environmental Taxation Incentives and/or Subsidies?
Eco Cities Conference - OF4
Chris Cook
Nantes 27th September 2013
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“21st Century problems cannot be solved with 20th Century solutions”
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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 – Natural Grid
Financial Resilience – Open Capital
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Resource Resilience – Natural Grid
Since 1980 Denmark's GDP rose 78%
Energy use has been stable
Carbon fuel use has declined
How did Denmark achieve this?
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Resource Resilience - Natural Grid
Least Energy 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
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Emerging Outcomes of Natural Grid policy
- decentralisation
- skills base of knowledge and knowhow: eg Vestas is the biggest global wind turbine manufacturer......in a country of 6m people
- trend to energy security and energy independence
- not forgetting........reduction in carbon use
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Financial Resilience – Open Capital
Prepay – credit returnable in payment for value
Protocols – Contrats de Société/social agreements
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Prepay
Tax
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Tax Prepay
Tax Prepay – credit returnable in payment of taxes
Tax Return – 'stock' part of tally stick returned to Treasury
Rate of Return - rate over time at which stock is returnable for cancellation
eg Prepay £8 for £10 tax - £2 profit 25% pa rate of return
- not fixed - depends on existence & quantity of flow
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Capital Partnership
Custodian(Community)Custodian(Community)
InvestorInvestor
UserUser
Prepay%
ManagerManager
Value
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Capital Partnership
An agreement or Protocol: not an Organisation
A consensually negotiated framework agreement for self organisation to an agreed common purpose
Does not own anything; employ anyone; borrow anything; or contract with anyone
A Co-operative of Co-operatives or Partnership of Partnerships
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Energy Partnership
Custodian(Community)Custodian(Community)
InvestorInvestor
ConsumerConsumer
Prepay %
%
ManagerManager
Payment
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Energy Prepay – the Value Proposition
Community
- sells energy forward and locks in price
- interest-free loan until prepay unit returned vs supply
Consumer
- prepays for energy and locks in price
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Energy Prepay – the Value Proposition
Investor
- direct 'inflation hedge' investment in energy
- 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
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Energy Partnership - Outcomes
Contrat de Société - relationship-based not transaction-based; costs transformed to revenue/production shares
Neutrality – removes ego and politics
Collaborative - stakeholder interests aligned
Sustainable - shared interest in minimising cost over time
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Nantes Green Deal – How it Works
Investor pays €1k for Units in Nantes Energy Pool
- 20 x 1 Mwh prepay Units @ €50 each; or perhaps
- 2000 x 10 Kwh prepay Units @ 50c each
Nantes Energy Pool 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 in €
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Nantes Green Deal
CustodianNantes Energy Pool
CustodianNantes Energy PoolInvestors
Consumers
Manager
€ EnergyLoan Buy units @
market price
€
Prepay
Prepay
Units
€
€
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Nantes Green Deal - Outcomes
Cost-effective - interest-free return in energy to investor out-competes conventional € debt funding
Incentives – consumers must save energy to save €
Subsidies – energy dividend of energy prepay units replaces € subsidies
Natural Grid - energy independence & resilience
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21st Century problems cannot be solved with 20th century solutions.........
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…....21st century solutions pre-date modern finance