Understanding The Impacts Of Community Renewable Energy Projects Using A System Dynamics Modelling Approach: The Case Of Aotearoa New Zealand

Local actors, such as cities and communities, are looking to play a role in reducing their carbon footprint and help meet global climate change targets. The number of community energy projects has grown significantly in the northern hemisphere since the turn of the century, and several countries and regions are looking to support the growth of their community energy sector. These projects often have a wide range of impacts, other than reducing carbon emissions, such as local economic development, energy sector, low-cost energy access, building community capacity to develop sustainable energy initiatives, improved resilience to adverse weather conditions and an increase acceptance of sustainable energy. With this range of potential impacts, however, there is no indication as to what impacts these projects must be achieving in a country or region’s energy system. Furthermore, there is a lack of tools that can predict the impacts derived from community energy projects, and support measures that can enhance positive impacts and mitigate negative ones. New methods of impact forecasting that can both capture the range of impacts leading from community energy projects are needed to help adequately understand the impacts of community energy projects and assist policy makers when shaping energy systems. This research fills this gap by (1) building an impact framework for community renewable energy projects, and (2) using system dynamics modelling to forecast the impacts of a community energy projects. The case study of Aotearoa New Zealand was used for the development of a national impact framework for the community renewable energy sector. Several projects are showcased, identifying the range of motivations for starting community energy projects and the unique environments within which these projects are started. Key impact areas for community energy, and respective indicators that can describe these impacts, were identified. A community energy project developed by Energise Ōtaki, in partnership with the Kāpiti Coast District Council, was used to develop two system dynamics models to assess the viability of the tool in forecasting impacts from community energy systems. The first model developed was based on the project, and showed that an increase in the feed-in-tariff to market rates led to a sharp rise in the impact of all the key variables analysed. This model also explored the potential effect of increased energy literacy in the community through the establishment of the community energy project. The second model developed was a community energy programme model that explored finance options for Energise Ōtaki to add an additional project, based on revenues from the current project. The scenarios run using this second model showed that using 80% of the revenue of the current project, and investing in another project after 10 years, was the most suitable option over the period analysed. The research showed system dynamics is a useful tool in forecasting impacts of community renewable energy projects, identifying suitable support measures, and building a portfolio of community energy projects. Lack of data at the community level is a challenge when developing a model, and the results could be greater enhanced by qualitative methods such as case studies or storytelling.