An Alternative Approaching to Energy Market: Energy Cooperatives

Introduction

From the twentieth century, the rise in energy prices caused by declining energy sources and the idea of eliminating negative effects caused by energy use; has made it necessary to

  • investigate alternative energy sources
  • use renewable energy that do not harm the environment.

And this approach also paved the way for a new model, ”Energy Cooperatives’’.

Brief Summary of Cooperatives

Cooperative shall be defined as the cooperation and the economic activities based on collaboration. In hereby model, the members establish an independent organization which is governed by democratic rules in order to meet the common goal of economic, social and environmental needs.

Within the framework of cooperatives’ principles, it is essential for all individuals to enter this organization without any discrimination and each member has a vote in cooperative’s elections which is managed democratically by the partners participating in policy-making and decision-making. The decisions taken by the cooperative are decisions that are guided by specific principles and values ​​to meet the various needs and expectations of their members. Members participate equally in the ratio of own capital. The cooperative, which is an autonomous and independent organization, provides education and training services to its members and contributes to sustainable development of the society through its co-operative cooperation and policies approved by the partners.

The Importance of Cooperatives : Energy Market

The energy cooperatives, which have a character of a democratic organization in terms of institutional structure, is an important means to an end. Besides thanks to effect of increasing competition, there is also the ability to contribute positively to distribution of resources.

The cooperative’s structure can;

  • provide locally needed services
  • create employment
  • struggle against poverty
  • protection of the environment,

contribute to related investment.

Also, by doing all this, it provides a basis for rising of economy and sustainable development thus level of society and economy is advanced. If needed giving example, In Denmark, approximately 23% of wind energy capacity is owned by energy cooperatives, and roughly 150,000 families are members of wind energy cooperatives.

Energy cooperatives play an important role in

  • making long-term investments necessary for sustainable energy supply.
  • implementation of troublesome energy projects.
  • providing of energy supply

easing production and distribution of energy.

Because of high investment costs of and low energy prices in the market, the private sector investors avoid investing in energy market on the grounds that it is not profitable, thus supply problem can be overcome by means of energy cooperatives. Energy cooperatives can also be effective in solving problems through cooperation between local or other public institutions and organizations. Other benefits include accountability and rural diversity.

The Cooperatives in Turkish Legal System

Although the number of energy cooperatives is increased all over the world, In Turkey cooperative system is not progressed as much as excepted. However, as stated in the Cooperative Strategy and Action Plan 2012-2016 of the General Directorate of Cooperatives of the Ministry of Customs and Trade, established of energy cooperatives are desired in our country and it is stated that the studies have started. However, on developed the system, the importance of the support mechanism, which is important and essential for sustainable energy supply, is a matter of particular concern. In Denmark, for example, energy co-operative is encouraged through different support mechanisms including;

  • direct public or local authority support
  • financial support,
  • bank credit,

tax-free investment opportunities.

Conclusion

The legal infrastructure for energy cooperatives in our country should be clearly and immediately regulated and individuals should be encouraged to establish an energy cooperative through strong support mechanisms.

De Lege Ferenda!