Core Principles
- Absence of Subsidy: operates independently of government financial aid.
- Fair Exchange of Value: members contribute to and benefit equitably.
- Retention of Assets: asset holders maintain ownership; the cooperative facilitates access.
- Mutual Transactions: conducted exclusively among members in a closed-loop system.
- Non-exclusive Membership: open and equal terms for all members.
- Governance Mediated: governed by agreed-upon rules, allowing flexible management.
Operational Structure of the Thin Layer Cooperative
- Legal Form: Structured as a Cooperative Society under the 2014 Act with limited liability, regulated by the Financial Conduct Authority.
- Membership Composition: includes private companies and public bodies — local authorities, heat service providers, property owners, data centre owners, and renewable energy operators.
- Types of Members:
- Contributors: Provide resources or services.
- Users: Utilise services or resources.
- Investors: Offer financial backing.
- Experts: Provide specialised knowledge.
- Financial Structure:
- Share Capital: Members contribute up to £100k; local authorities may exceed this limit.
- Interest Return: Tied to the cooperative’s profitability.
- Dividends: Based on transaction-related activities.
Application in a Heat Reuse Scenario
The cooperative provides coordination and a robust collaborative governance structure enabling asset sharing and the connection of heat sources, such as data centres, to heat consumers and/or intermediary transformers.
The cooperative acts as a best efforts heat network in this context, reducing risks from fluctuating supply and demand by utilising existing grids as a fallback.
In this scenario transformers add value by aggregating and upgrading heat from various sources.
As a practical example in Blackpool, without the cooperative, multiple complex contracts would be required between heat generators and heat consumers (see below). Each of the heat generators would need to agree separate contracts with each type of customer (every arrow in the digram represents a potential contract), and we've only shown a few of the potential options that might be needed to create a distributed local energy system.
By implementing the thin layer approach, each stakeholder becomes a cooperative member and benefits from streamlined collaboration and is enabled to access the energy sources through simple member agreements.
This approach has been successfully deployed by CNI in Tameside, Sussex and Manchester as well as Blackpool.