What is stopping Canada from unlocking the potential of renewable energy cooperatives? Critical insights from co-op leaders

Abstract

Background

The development of renewable energy cooperatives (RECs) in Canada is inhibited by regulatory and financial challenges that limit their ability to contribute to the country’s renewable energy transition. Despite the growing importance of community-based energy resources, current policies favour large-scale, investor-owned utilities, creating barriers for smaller, community-driven projects like RECs. While existing research has examined these challenges through policy analysis, case studies, and market data, few studies have directly incorporated the perspectives of REC leaders themselves. This study aims to address this gap by analyzing the barriers confronting Canadian renewable energy cooperatives through the lived experiences of REC leaders. It further proposes actionable solutions informed by the insights of these leaders. Using a mixed-methods approach, this research combines in-depth interviews with 15 REC leaders across five provinces and Likert scale analysis.

Results

Thematic analysis revealed that regulatory complexities, such as restrictions on virtual net metering (VNM) and limited access to financial mechanisms, inflate costs, delay timelines, and restrict market access for RECs. Participants proposed policy-oriented solutions, including adopting VNM, government-backed loan guarantees, direct loans, long-term financial incentives, and expanding community financing tools like bonds.

Conclusion

This study integrates REC leaders’ perspectives into actionable recommendations, emphasizing the need for targeted reforms to align provincial policies with REC needs. Addressing these challenges can enhance REC scalability, reduce policy uncertainty, and support Canada’s net-zero goals through community-driven renewable energy initiatives.