The idea of AIRE goes back to 2007 when a large-scale wind project was being proposed in our backyard. Our observations and research on the conflict that ensued led us to the interesting concept of community-owned renewable energy, which seemed to theoretically resolve most of the complaints this proposed project generated. In other words, projects could be developed on a smaller scale and they could prioritize local procedural input, ownership, benefit and control. It was also clear at that time that there were powerful interests determined to defeat even modest efforts to expand renewables by steering the public narrative. See this Owen-Boyer University of Tenn. paper here for more on this.
At that same time, Appalachian State University’s (ASU) Appropriate Technology program was gaining in stature in our region and nationally. Tax credits for renewable energy projects and North Carolina’s renewable energy portfolio standard were also new and exciting. Interest in renewables and calls for local wind and solar were commonplace and growing. Yet, no wind or solar was being developed, with the exception of a student-led and funded initiative at ASU called the Renewable Energy Initiative or REI for short. Students proposed and held a campus wide referendum to impose a mandatory fee each semester to support campus renewable energy development. Students have since contributed hundreds of thousands of dollars to the initiative. Their most visible project to date is a 100kW wind turbine, which until the large corporate wind projects in coastal North Carolina were recently installed, was the state’s largest wind project. (Note: There is prior history here, where in the late 1970s and early 1980s, NASA/DOE build the largest windmill in the world at that time on Howard’s Knob, above Boone. The research project completed, the structure was disassembled in the mid-eighties.) See this research by Jeff Boyer and Steve Owen for more detail.
We used this history and moment of conflict and reflection as an opportunity to ask why there was so little renewable energy in a place where it seemed both practical and generally supported, and attempted to answer our question with research, experiments and reflection. We reasoned that if renewables couldn’t be developed in a place like this, those barriers needed exposure and understanding. And so the journey began.
Our first prototype project was Boone Community Solar, LLC where five individuals invested in a 2.5kW system in downtown Boone atop a private office building that housed AIRE’s office.
Jeff Deal receiving shipment of solar panels for
AIRE’s first prototype project in 2009.
Since its inception AIRE has worked to identify barriers, but of major importance, we’ve focused on solutions, benefits, and best practices for making community-owned renewable energy commonplace. One of our guiding principles has always been “what can we do now…what does the system allow us to do now, while we work to change the system for the better?”
The Mental Insight Foundation provided us with early financial support. Its board was concerned about the “climate problem” and saw us located in a region of the country dominated by coal (both mountaintop removal mining and burning coal by big investor-owned utilities in the Southeast U.S.). By mid 2008, we had formally established AIRE with a fiscal sponsor (Inquiring Systems Inc.), and had begun to hone in on community-owned renewable energy. Seeing the high upfront cost of renewable energy as barrier, particularly for nonprofit and all tax exempt entities, AIRE began to research and develop methods of affordably financing renewable energy.
The allure of a 30% federal investment tax credit and a state credit of 35% seemed to be the answer, if only we could learn its many complexities and how to scale it to the much smaller community projects. We turned to the “flip” model, which was pioneered in Minnesota as a means to allow farmers to own multimillion dollar wind turbines. John Deere Corporation was the initial tax-equity investor, meaning they covered the upfront cost of the systems and then used tax write-offs to make a return on their investment, at which point ownership of the turbines were conveyed to local farmers.
In 2011, the Kendeda Fund, a private foundation known for its support of transformative work in sustainability, awarded AIRE a significant multi-year grant. Mary Reynolds Babcock Foundation, Z. Smith Reynolds Foundation, and a few others have also provided financial support.
AIRE’s stated goal was to become a self-sustaining organization, by serving as a wayfinder and consultant for those wanting to pioneer community-based renewable energy. Our plan was to move beyond dependency on grants as a means of financial sustenance and, instead, operate as a mission-driven social enterprise that used project developer fees as a sustaining revenue source to support our work across Appalachia, the southeast, and beyond. We have fulfilled the commitment, having not written a grant in several years. During that period we relied on fees, thrift, and to a greater extent our volunteerism and sacrifice.
As we (un)settle into 2018 and sense the “hour glass” running low, however, we see new threats, and their attendant opportunities, that casts our work in hyper-relevant new cross-sector collaborations, and cause us to reevaluate our funding model. We now believe that foundations and charitable donors are going to need to play a bigger role in this defensive time for all renewables especially community-scale renewables. For AIRE this means a hybrid of earned income from projects and consulting, and partial grant support from foundations.
But there’s another reason we’re rethinking a reliance solely on project fees and that is simply put, some worthy but small projects cannot support such overhead. Those projects need to be overhead free. We’ve seen the solar project development supply chain attempting to maximize profit and internalize the value of the tax credits at every step, the net effect being to inflate project cost.
AIRE is scrappy, resourceful and thoroughly mission-driven. The funders we’ve mentioned have been absolutely indispensable both for their financial support, brilliant insights and criticism. The folks that have done projects with our help are truly heroic because they have backed up their values with action and their wallets– to put solar in their communities. We have benefited from hundreds of hours of in-kind legal support, graduate interns and peers who care about sustainability. Our founders, Steve Owen and Jeff Deal have remained committed to AIRE and its mission through thick and thin. When the mission requires, and to this day, they always resort to volunteerism and servant leadership over careerism.
Where do we go from here? We are crystal clear that widespread adoption of rooftop and community-scale/owned solar is central to the future. Furthermore, we’re sure the need for transition is now. Microgrids, storage, electric vehicles, and other technologies are no doubt part of that future too.
There seems to be a lot of hope invested in the magic of “models” these days and we’ve certainly been a part of that. In fact, in our early years, we believed that the problem at the intersection of finance and policy could be solved with a model. We now think in terms of “modalities” (i.e. many ways) and not models (i.e. a rigid way) for reasons too many to mention here. We once won an award from The Solar Foundation for “our” model. We’ve done some good with that model but frankly it has limits, as do all models. Maybe not always, but models tend to be proprietary, guarded by non-disclosure agreements and usually the brainchild of a “professional” looking to profit. We have great respect for TSF but we never displayed our award because we felt like there was–and still is– a lot of work left to do.
We also know that the path forward isn’t just technology. We have to ask what kind of communities and economy do we want, and what kind of institutions do we need to create the conditions for realizing them? Our work, research and experiences tell us that there is need and opportunity to merge the social and the technical in ways that shift local financial resources in ways that promote livelihoods and community wealth. We also see market forces favoring renewables and the need to preserve important public institutions with solar lending a hand.