Psychological Dilemmas of Community Companies

As well as a Prospector, I’m also a Director of Talybont-on-Usk Energy. We’re a community company with our own 36kW hydro electric turbine which has been running since 2006. We sell the electricity it generates via Good Energy and this provides us with an income of around £25k-£30k which we strive to spend on energy saving and sustainable living projects for the benefit of our small, rural community in the Brecon Beacons.

This has been my first experience of being involved with a community, rather than a commercial, company. It’s very rewarding and enormous fun. At the same time, it creates dilemmas and tensions which are intriguing from a psychological perspective. And these appear to be common in other community companies. For example:-

1. All the Talybont Energy Directors are volunteers - there is no financial remuneration for any of the work done. This is obviously different from my own company, The Prospectory, where we charge for the work we do. But, once my food and housing needs are covered, I find any surplus income is only motivating to me if I can translate it into something else which I value or enjoy. I am lucky, especially as most Prospectory projects are interesting and enjoyable activities in their own right. Similarly, “working” for Talybont Energy on innovative projects which we have dreamed up is both valuable and enjoyable in its own right. It would feel very odd to get paid for it and, once there was any financial remuneration, one might be forced to measure its value in a different way.

2. However, if any of the Talybont Energy Directors were paid or we employed someone in the community whom we paid, then the dynamic instantly changes. Similarly, we are often approached by academic researchers wishing to study us or wishing to do some community research for us. Again the dynamic becomes awkward. The academics are financially rewarded to study us doing work for which we are not paid or, in some cases, they are bidding to carry out research projects in our community which we currently do for free. Arguably, nothing changes for us (we weren’t being financially rewarded anyway) and yet something subtle but powerful certainly changes.

3. Employing people poses other problems too. Deploying our Talybont income on sustainable projects in the community requires ideas, money to fund the projects and energy and time to set them up and run them. At the moment, we have no shortage of ideas and the income to realise a reasonable proportion of them. What we lack is enough energy and time to run all the projects we’d like. One solution, which some communities adopt, is to use their income to employ someone full or part time to run the projects. But people cost money and suddenly a significant proportion of a £25,000/year income disappears as salary. So, you now have the manpower to enable you to do a lot more but, ironically much less money to do it with! What happens? Well, you find that you now need to use the person you have employed to attract more money (in the form of grants or consultancy) in order to still afford to do the projects you had in mind. But now the manhours (which you were paying for to run your projects) are being used up attracting more money to compensate for the project money which has been redeployed on a salary! Hmmmm…
It might sound funny but we have watched this play out in other community groups. They seem to end up in a cycle of employing more people and attracting more money but spending less and less on making actual projects happen!

4. So, Talybont Energy is now exploring an alternative route – offering some proportion of our income as community grants which anyone in the community can bid for to fund a sustainable project they wish to run (as volunteers). But we have to ensure that the projects are all for community (not individual household or business) benefit. And, that creates yet another dilemma – what does “community benefit” actually mean? Almost every project we can think of benefits one segment of the community rather than another. We wonder if this is why so many rundown village halls have been transformed by community companies into all singing all dancing eco centres offering every modern facility imaginable – it’s probably because, in many cases, they are the only asset which is 100% community owned!