CrowdThermal Conference on Icelandic Case Study
The CROWDTHERMAL project aims at empowering the European public to participate directly in developing geothermal projects with the help of alternative financing schemes and social engagement tools.
On the 14th of September 2022, the Icelandic CROWDTHERMAL partners Eimur and GEORG hosted a conference in Húsavík, Iceland.
The conference touched upon the topics relevant to the CROWDTHERMAL Icelandic case study, where rural innovation is an essential element in addition to the core social and financial elements that have been developed in the CROWDTHERMAL project. Icelandic speakers and international guests helped us shed the light on the interplay between geothermal energy development, rural innovation, community engagement, and crowdfunding.
Topics of the Conference
The conference consists of two sessions:
Social Session – Moderated by Amel Barich, GEORG Geothermal Research Cluster. The session includes the following topics:
- Social Acceptance and SLO in Geothermal Energy
Jan Hildebrand, IZES Environmental Psychology & Amel Barich, GEORG Geothermal Research Cluster
- Stakeholder Engagement during the Development of Theistareykir Geothermal Power Plant
Sigurður Óli Gudmundsson, Landsvirkjun National Power Company of Iceland
- CROWDTHERMAL Icelandic Case Study
Ottó Elíasson, Eimur cluster, utilising geothermal resources and fostering innovation in Northern Iceland
Financial Session – Moderated by Ronald Kleveraan, Chairman of Crowdfundinghub. This session is composed of topics including:
- The Role of the National Energy Fund in Geothermal Development
Ragnar Ásmundsson, Orkustofnun National Energy Authority
- Investor´s perspective: The Importance of ESG
Marta Hermannsdóttir, Eyrir Venture Management
- Crowdfunding in geothermal energy
Ronald Kleveraan, CrowdfundingHub
- Do crowdfunded cookies taste different?
Arnar Sigurðsson, East of Moon
How Can Alternative Financing Schemes Help with the Development of Geothermal Projects?
Nowadays, public and private investors and fund managers are paying more attention to sustainability factors in investment projects. Environmental, social and governance (ESG) factors are becoming more widely accepted as a tool for measuring projects’ sustainability and how projects’ operations will affect the environment and the society.
Investors view the crowdfunding factor as a positive sign for the project – if a project was crowdfunded, it usually implies an interest and confidence in the project, as well as a potential customer base. At the same time, crowdfunding empowers people to support projects that actively look for solutions to build a more sustainable society, instead of making economic profits while damaging the environment. A crowdfunded project will also become more appealing to public and private funds, who invest at a later stage of the company’s development.
Crowdfunding can be a great enabler for the energy transition process, during which we still see lots of challenges today. Construction of new wind energy farms and drilling of geothermal energy wells are projects of, unfortunately, higher risk as compared to traditional energy projects. An active participation from citizens in geothermal projects via the means of crowdfunding can be a booster for the pre-financing stage of the project, at the same time, local community’s participation will help to align local challenges and keep the economic profits within the community.
An active community campaign can actually make a difference. For instance, in the city of Nijmegen, the Netherlands, the local Municipality helped the local community to promote the energy transition project by organizing campaign activities, starting the initiative and financing the construction of local wind energy farm. Together, 1,076 local investors participated in the project and collected 2 million euros of equity funding.
The Chairmand of CrowdfundingHub, Mr. Ronald Kleverlaan, shared with us his understanding of the potential of crowdfunding in geothermal energy projects and other sustainable, community-owned initiatives, through a presentation entitled “Crowdfunding for Geothermal Energy – Alternative finance and new business models for active citizen participation to (co-)finance development of sustainable and smart cities“.
Crowdfunding can help with the initiation process of your project, it can also help entrepreneurs to collect an initial amount that is convincing enough for the initiative to tap into national and/or European funds later. Another example of crowdfunding is in the city of Herenboeren, the Netherlands. Two hundred local inhabitants invested 2,000 euros each to purchase their own farm, so that they can employ local farmers to produce local food from their own land.
Crowdfunding can start small, but once investors are focused on crowdfunding’s financing ability, it will also be able to finance large projects. Zeewolde Wind Farm is a 320 Mega Watt onshore wind power generation plant under construction in the Flevoland province of the Netherlands. The 100% citizen-owned project has successfully collected 500 million euros through investment crowdfunding.