Determinants of energy cooperatives’ development in rural areas—evidence from Poland

Abstract

The strategies, plans and legislation on energy market development and decarbonization in the European Union (EU) developed in recent years, such as the directives implementing the package “Clean energy for all Europeans”, aim at promoting not only renewable energy sources, but also new institutions that involve the development of local energy markets and a greater role for citizens in managing their own energy generation. At the same time, Poland remains the economy most dependent on coal and one of the largest air polluters in the EU. In order to minimize this problem and to meet the direction of energy development in the EU, Poland decided to establish, among other things, an energy cooperative. It is intended to fill the gap in the development of the civil dimension of energy on a local scale and at the same time improve efficiency in the use of the potential of renewable energy sources in rural areas. The authors of the paper seek to verify the extent to which this new institution, which is part of the idea of a local energy community, one of the driving forces for the implementation of the objectives and directions of development of “clean energy” set by the EU, has a chance to develop. The research took into account the characteristics of energy producers and consumers in rural areas, economic preferences provided for by law, relating to the functioning of an energy cooperative and the existing alternative solutions dedicated to prosumers. A dedicated mathematical model in the mixed integer programming technology was used to optimize the functioning of an energy cooperative, and more than 5000 simulations were carried out, with a typical optimization task performed as part of the research with about 50,000 variables. The conclusions and simulations make it possible to confirm the thesis that profitable energy cooperatives can be established in rural areas, with the objective of minimizing the sum of energy purchases from the distribution network and losses on the energy deposit (virtual network storage) (the energy deposit (or network deposit) should be understood as energy introduced to the grid during generation surpluses for its subsequent consumption, taking into account the discount factor).