SUN is building and operating wind and solar power plants in Northern Hessen, afterwards it transfers its shares to local citizen energy cooperatives.
In 2011, six North Hessian public municipal utilities are equal partners of SUN Nordhessen. This structure enables interested municipal utilities within SUN to collaborate in commercially separate project consortia. This creates opportunities for low-risk participation in local projects, especially in renewable energies and in particular wind energy. Wind energy plays a big role in the region. Projects such as SUN enable municipalities to actively participate in projects. Members are the utilities from Bad Sooden-Allendorf, Eschwege, Homberg (Efze), Kassel, Witzenhausen and Wolfhagen.
For each project it is specifically decided whether a municipality wants to participate. The aim is to jointly finance projects (classic financing with regional banks) and thus to keep risk and financing costs as less as possible.
The transfer of shares (up to 74.9 per cent) to municipal energy cooperatives is an integral part of the SUN Code. This will bring additional private funds into the projects and also enable citizens to participate in the energy transition.
In this way, a large part of the asset value flows into the region and forms the basis for financing the next project. Thus, each share paves the way for further investment.
The project volume varies from project to project. The same is the sum needed for external financing. The projects will be developed on the basis of a mixture of debt financing on a project basis and own funds from the orgnaistion (via shareholders).
The wind farm "Söhrewald / Niestetal" (as an example) was implemented by Städtische Werke AG in Kassel with a total investment of EUR 37.5 million.
Furthermore, the shareholders of Windpark Söhrewald / Niestetal GmbH & Co. KG share the capital provided for the investment in the wind farm.
Evidence of success
The plants in "Söhrewald" produce 48 GWh of electricity per year and supply 15,000 households. The project saves 37,200 tons of CO2 per year.
A continuous public relation with the local stakeholders and multipliers and the development of a regional energy transition concept underlined the claim of SUN to operate as a local framer. The conservative earning calculation of SUN and its partners in contrast to private project development could fulfil the expectation of the participating model.
The model of SUN claims some resources, manpower and financial resources. Because of this, SUN is not able to offer the best leases for land usage always. To compete with other players, SUN must convince the land owner with the locality of their business model.
Potential for learning or transfer
This opportunity to participate is a basis for acceptance in the region of Northern Hessen. The built wind power engines show an investment amount of 190 Mio. Euro over the last five years and contribute 270 Mio. kWh to cover the power demand of the region.
Thus, SUN bundles forces and know-how and minimizes risks. Every SUN partner can decide for itself and for every project how they want to extend their participation in project implementation and location. This organizational innovation enables flexible acquisition of locations as well as freedom of decision.
Characteristically for this participating model are the low minimum holdings, that offer monetary participation in the energy transition to a lot of people. Since 2011 six citizen energy cooperatives with more than 3.000 members are established in the region with SUN.
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