A Transaction Cost Approach to the Role of Cooperatives in Energy Transition

A Transaction Cost Approach to the Role of Cooperatives in Energy Transition

Purpose - This paper investigates how community-based approaches to renewable energy help in to substitute renewables for fossil fuels in Europe in the context of transaction costs. Design/Methodology/Approach - This paper uses qualitative research methods, which feature online interviews focusing on 14 REScoop.eu member cooperatives and organizations, four non-REScoop.eu organizations, and a complementary online survey of 32 respondent REScoop.eu member cooperatives. Findings - The paper finds that (a) cooperative legal form is not seen to generate the perceived advantages to cooperatives in renewable energy proliferation, or (b) in addressing associated land use issues; further (c), there a perception that renewable energy cooperatives directly help in renewable energy proliferation by localizing energy production and stimulating the local economy (d) by making renewables more acceptable at the local level, and (e) by building trust-based relationships within these communities. It is also perceived that (f) such cooperatives are hampered by the general lack of corresponding professional and technical expertise, volunteer work, and the democratic decision-making process. Research Implications - The major implication is that localization is key for renewable energy cooperatives to be significant drivers of renewable energy in Europe. The paper contributes insights on cooperative organization form itself, and by addressing how transaction costs help in renewable energy proliferation.