If you have even the slightest doubt that Indigenous clean energy has arrived as a major force for rapid decarbonization, it isn’t too late to catch up on the recording of Vancity Community Investment Bank’s Feb 3rd webinar: Building Partnerships for Indigenous Clean Energy.
Throughout this conversation, I and the more than 200 others who joined, were reminded of how powerfully Indigenous clean energy investment has evolved and matured. It was so exciting to hear first-hand how dozens of projects across Canada are succeeding with the right combination of Indigenous leadership, local participation, community benefits, and fair and equitable partnerships.
The discussion moderated by Clint Davis, CEO of Nunasi Corporation, with Terri Lynn Morrison of Indigenous Clean Energy, Matt Jamieson of the Six Nations of the Grand River Development Corporation, and Steve Parsons of the Eskasoni First Nation Corporate Division pointed to the rapid transition taking shape as communities take control of their clean energy future. With 197 medium- to large-scale projects at different stages of planning or construction, Indigenous communities are poised to receive a combined $295 million per year in financial returns, said Morrison, a Mi’gmaq from Listuguj, Quebec.
The session left me with five takeaways for our work at VCIB and really for anyone looking to work with Indigenous communities on clean energy.
1. It’s All About the Relationship
All three panelists stressed that a successful Indigenous clean energy project depends on social acceptance and an authentic working relationship based on trust.
In any negotiation, a community has to sort out whether a new contact is interested in a quick transaction or a solid working relationship. “I’ll know in the first three minutes of conversation with a potential partner whether it will work or not,” Parsons said.
The panelists shared that company representatives have freely disclosed to them that they’re only calling because a government official had told them to. So here’s a pro tip: Treating Indigenous partnerships as a box to be checked is not the way to build trust with the community.
2. The Land is the Asset that Matters Most
This reality can be lost on partners who come from outside the Indigenous sphere: A project literally can’t get on the ground without land, and that means landholders must be at the centre of every decision.
“Let’s all remember that we have the biggest asset,” Morrison said. “With Indigenous involvement in a meaningful way, we’ll have the opportunity for some amazing projects.”
3. Respecting Community Values
Projects built on that land must be grounded in the social, political, and ecological relationships to which Indigenous leaders and developers are held accountable, Morrison explained.
When Listuguj and two other communities developed a 150-megawatt wind farm, with Morrison as project director, they recognized the need to go above and beyond a standard government-mandated environmental assessment. This meant addressing community concerns about potential impacts on hunting grounds, migratory routes, and medicinal plants.
“Indigenous communities are drawn to a cleaner economy because it’s so in line with our vision of a circular economy, only taking what we need, and sustaining for the next seven generations,” she said. “It’s great that we’re building a project that will represent a significant amount of money coming back into the community. But at the end of the day, it’s about the territory and the impact on the land.”
4. An Emphasis on Community Benefits
An Indigenous clean energy project serves multiple bottom lines. It has to supply reliable electricity and make money. It must also deliver training, jobs, and revenue to the community.
“The people are what makes the community,” Jamieson said. So “we expect the partner to show up” with a willingness to help that community build capacity and learn more about the business.
In the early stages of a partnership, “we want to work with companies who come early and often, who recognize that we don’t know their industry,” he added. “What we don’t look for is companies that come to us and need us more than we need them,” in what he called a “joint venture façade”.
5. Project Finance: From Debt to 51% Ownership
One of the most tangible takeaways from the webinar was that 51/49 is the new math of Indigenous clean energy partnerships.
“Our joint venture strategy is not complicated,” Parsons said. “The projects are all 51%/49%,” with the community holding majority ownership. “We don’t run the company. That’s why we take on a partner. But we always protect the interests of Eskasoni first and foremost.”
“At the end of the day the controlling interest of our band comes first,” Jamieson agreed. “If you don’t have that, you can’t control the project” in the community’s interest.
Building up equity, rather than relying on debt financing, has always been a challenge for Indigenous business development. Jamieson cited VCIB and the Canada Infrastructure Bank as institutions that have delivered innovative financing solutions to give Indigenous development corporations the edge they need.
This one-hour webinar just gave a glimpse at the economic and business development powerhouse that is making the energy transition a reality for Indigenous communities. Stay tuned for the next post in VCIB’s series on Indigenous clean energy where we’ll explore how industry players can better engage community to support Indigenous development, and the journey from being a clean energy participant to being a clean energy developer.
Eager to learn more about the role that values-based partnerships and cross-sector collaboration can play in helping communities overcome challenges, build capacity, and reap the benefits of the clean energy transition? Watch and listen to the full conversation in the video found below.