A living lab for the sustainable energy transition ambition of the Algarve Region's S3

Summary of the case

The ‘Culatra 2030 - Sustainable Energy Community’ initiative is a demonstration project on the island of Culatra in Algarve, Portugal, covering multiple aspects of green transition. It implements the ambitions of the Smart Specialisation Strategy (S3) in Algarve, using a novel Entrepreneurial Discovery Process (EDP) to create a real-life laboratory for green transition, focusing on the specific needs of the island and capitalising on its assets.

The value of the Culatra 2030 initiative lies in its all-encompassing strategy covering multiple aspects of green transition, including social issues such as energy poverty. Rather than the development of new technology per se, the key perspective is the holistic model and demonstration character of the initiative. The central ambition of the initiative is to transform all structures on the island to become energy self-sufficient. A mix of new technologies is implemented to prepare the transition to clean energy and energy self-sufficiency. The community will produce energy exclusively from renewable sources, use electric mobility, decarbonise its fishing industry and acquire sustainable habits and living practices. It will also manage its own energy system, recycle water for self-consumption and retrieve value from its waste.

The key to its success is the active participation of the island’s whole community through a continuous EDP process. The initial Community Participatory Diagnosis was based on a fully inclusive participatory process, which brought together public entities, academia, companies and communities. Following the initial stage, a new governance system for participatory exploration of transition pathways was put in place. This participatory model is proving effective in improving decision-making, compared to the previous situation, which was characterised by several scattered and uncoordinated initiatives.

Culatra 2030 succeeds in tailoring new technological solutions for green transition to the specific needs of the island, as expressed by the islanders themselves. It is a truly bottom-up initiative, inspired by the S3 approach, which can be replicated in other communities.

Main ‘green’ topic area(s) covered: Energy transition, Circular Economy, Zero pollution, Sustainable smart mobility, Sustainable aquaculture, Ecosystems and biodiversity and more specifivcally Community-led holistic green transition initiative.

1. Territorial context and challenge faced

Culatra is a small island, located in a protected area, home to 1,000 permanent inhabitants living primarily from fishing activity. There are over 7,500 daily tourists in summer, providing a second source of revenue for the island’s population. As a small and relatively isolated community, Culatra faces specific challenges in terms of energy efficiency and self-sufficiency, water scarcity, waste management and localised pollution. Given that energy accounts for some 50% of household expenditure on the island, energy poverty is another important challenge.

2. Aims and ambition of the initiative

Consolidating the strategic sector of renewable energy is identified as a key priority within the Algarve Smart Specialisation Strategy (S3). In response, the Culatra 2030 Sustainable Energy Community initiative – ‘Culatra 2030’ - aims to address the island’s challenges through comprehensive green transition, creating at the same time a living pilot demonstration of its new green socio-economic model. The broad scope of Culatra 2030 impacts upon several of the region’s S3 domains. Beyond the benefits for Culatra, the initiative also aims to position the Algarve as a whole as a centre of excellence in renewable energy research and training, exploiting its distinctive resources in the decarbonisation of its economy.

Culatra 2030 seeks to demonstrate that, through systematic use of a broad Entrepreneurial Discovery Process (EDP) involving all local stakeholders, local energy communities can play a central role in the transition to a greener, more inclusive, democratic, transparent and participatory energy system.

3. Content and implementation of the initiative

A wide Entrepreneurial Discovery Process around the Community Participatory Diagnosis

Culatra 2030 was established in 2018, in the context of the EU initiative ‘Clean Energy for EU Islands’. Implementation began with a Community Participatory Diagnosis, a specific form of EDP adapted for the island from the region’s S3 partnership processes. Using this model, different pillars of energy transition were defined collectively by key stakeholder groups, comprising members from academia, companies, residents’ groups and administration. The Community Participatory Diagnosis was carried out in three distinct phases:

Phase1 - Views: understanding the actors and the territory as a social product;

Phase 2 - Horizons: dialogue and proposals for action;

Phase 3 - Negotiation and Action: seeking consensus for the development of the territory.

During this dynamic process, possible transition pathways were discussed and agreed upon to create a shared vision for the future development of the Island – the ‘Culatra 2030 Clean Energy Transition Agenda’ (CETA). Based on this vision, proposals for actions were generated collectively. Opportunities for cooperation and financing were identified under the three main priority areas of Energy, Water and Waste. The EDP proved essential for defining priorities and generating ideas for actions with a high degree of commitment by all local actors. It also helped bring about important changes in mentality among islanders, boosting their confidence and sense of self-belief.

New governance model for participatory transition pathways

The Culatra 2030 initiative is firmly based on a ‘quadruple helix’ partnership model, bringing together the Regional Authority of Algarve, Local Authorities, the University of Algarve and various companies providing technology solutions, as well as citizens gathered under the Culatra Island Residents' Association. The University of Algarve is coordinating the initiative. Together they form the ‘Island Sustainability Committee’, overseeing the whole Culatra 2030 initiative. The committee has proved to be of considerable help in streamlining decision-making processes and ensuring feasibility of all projects from the outset. The new participative approach compares favourably to the past situation, where a multiplicity of bodies in the small territory were acting in an unconnected and uncoordinated way. The local partnership is now also seeking to involve the National Ministry of the Sea in the Island Sustainability Committee, in order to increase its power and influence at higher decisional levels.

Bundles of pilot experiments implemented in the Culatra living laboratory

The Island Sustainability Committee selected key instruments and tools for implementation under the three priority areas of the CETA, as follows:

Energy transition - the main focus of the initiative, with four lines of action:

1. Increasing power generation from renewable energy sources and storage capacity:

• establishing flexible instruments and grid support for management of the island’s integrated energy system;
• developing flexible demand response models for prosumers, associated with local decentralized renewable production;
• installing a set of renewable generation systems (predominantly photovoltaic), with the aim of reaching 100% of the consumption of electricity from Renewable Energy sources by 2030;

2. Increasing housing and building efficiency:

• interventions aimed at increasing energy efficiency and energy production capacity, water efficiency and at evaluating rainwater harvesting and grey water reuse potential;

3. Development of electric mobility and decarbonisation of maritime transport:

• electrification of transport on, to and from the island
• setting up of Smart Charging Systems for electric vehicles, combined with innovative vehicle-to-grid mechanisms and energy storage;

4. Creation of an energy community in charge of renewable energy production:

• establishment of an intelligent micro-grid, as well as reward/market/price/sharing mechanisms that motivate consumers to develop more sustainable practices.

Water supply and treatment:

• Desalination pilot plant;
• Application of new concepts for rational use of water.

Waste reduction, management and valorisation:

• Pilot station to recycle waste produced on the island;
• Development of new consumers habits and waste sorting solutions.

Taken together, these activities were considered by the partnership as the most appropriate for establishing Culatra as a real-life laboratory for green transition. They are now under different stages of implementation.

Constant efforts needed to combine appropriate funding sources

A major challenge faced by Culatra 2030 remains the acquisition and successful articulation of a variety of financing sources into an integrated initiative. Culatra 2030 has been funded so far from a scattered policy mix of local, regional, national and EU sources:

• Local level: ‘Fundo Culatra2030 - Environmental and social responsibility fund’. This is a grass-roots fund made up from a collection of micro funding sources from local associations and bodies. Local municipalities also provide small amounts for green projects;
• Regional level: ERDF and domestic regional funds, managed by the Algarve Regional Coordination and Development Commission (CCDR), supported a wide range of infrastructure investment in Culatra under previous generations of EU Cohesion Policy. However, the current Algarve regional OP – with its main emphasis on SMEs – is not well adapted to the needs of the initiative in terms of eligible target groups. Changes are expected in the 2021-2027 funding period, which should enable better alignment between regional funds and this kind of initiative;
• From national level: a Portuguese NGO supporting ‘Win-win strategies and small actions for big impacts on climate change’ funded the participatory diagnosis.
• The ‘Decarbonisation of Aquaculture Activity’ project, aimed at providing solar power generation sources and solar boats, is funded by the European Maritime and Fisheries Fund (EMFF), through Portugal’s ‘MAR2020’ EMFF OP.

Other programmes contributed with technical rather than financial support:

• The EU programme, ‘Clean Energy for EU Islands’;
• The SMILO, Small Island Organization - a cooperation programme to support sustainable management on small islands.

Monitoring plans

Plans are underway to create an online monitoring platform, managed by the University of Algarve, to collect and display data from the photovoltaic generation plants of the island. The platform will also present real-time information about the energy imports and exports to and from the national power grid, with a view to calculating trends in emission reductions.

Combination of technology and human contributions as success factor

While embarking on its initiative, the Culatra community has taken up lessons from successful cases of energy transition in other islands – for example, in Norway and Denmark. The lessons, which inspired Culatra most, were those showing that success depends on specific virtuous configurations of technologies, humans, organisations and space in their specific contexts, beyond the energy issues they are actually seeking to address.

Important lessons learnt from Culatra’s experience so far are that:

• It is essential to include the community’s perspective in order to truly understand actual needs;
• Broad citizen participation and strong cooperation between citizens, authorities, researchers and companies provide the most realistic basis for green transformation. The broad and thorough EDP carried out has been a key ingredient of success;
• A wide combination of all potential technology pathways, whether they concern batteries, electric vehicles, retrofitting of homes, or heat pumps etc. need to be carefully aligned to achieve a reliable, community-owned, decarbonised energy system.

Appropriate regulations and funding are needed to complete this demonstration case

The success of Culatra 2030 still depends on new regulatory developments and incentives for the creation of energy communities, yet to be put in place. Further adaptation of urban administrative procedures on the island and better availability of funding sources are also needed for test beds, to ensure optimum adaptation of new technologies to Culatra’s specific needs.

4. Achievements

While the implementation of the full range of solutions for Culatra 2030 Clean Energy Transition Agenda is still underway, several remarkable achievements are already visible.

An important step is being taken to decarbonise fishing - the main economic activity of the islanders - in the transition from combustion engine powered to electric-solar boats, thereby reducing pollution and the emission of greenhouse gases. This will allow the award of the ‘zero carbon fishing products’ label, raising the value of seafood from Culatra, contributing in turn to the environmental sustainability of the Ria Formosa Natural Park and enhancing sustainable tourism. Decarbonisation of the island’s main economic activity in this way responds directly to the twin ambitions of the Algarve S3 to both support economic development and improve the environmental sustainability of the territory.

Beyond the anticipated environmental and economic benefits of the initiative as a whole, Culatra is also implementing a new participative economic model, in which the distributions of costs of and incomes resulting from renewable energy generation are co-decided with the citizens. The new model is expected to demonstrate that energy communities can play a relevant role in the generation of electricity in a decentralized way. Energy poverty on the island should become a thing of the past.

The initiative has already attracted the interest of Portugal’s main energy operator for the National grid. Discussions are underway regarding a possible major investment by this operator to help accelerate the system conversion.

5. Replicability

The Culatra 2030 initiative is conceived as a living lab for energy transition in Algarve, through which the island will become the first Portuguese community that is fully sustainable in terms of energy production, distribution and consumption. Culatra 2030 will not only produce new tools to generate and manage green energy. It will also make recommendations on the legal and regulatory framework to create better market opportunities for increasing the share of renewables in the energy mix, as well as for larger-scale replication of different solutions. The Algarve Regional Energy and Environment Agency will facilitate dissemination to other isolated territories in the region.

Replicability to other islands of the EU is strongly embedded in the initiative through Culatra’s membership of the EU pilot project 'Clean Energy for EU Islands'. Under this EU pilot, islands - as micro versions of larger territories - are seen as appropriate sites for validating and spreading new concepts, processes and technologies, serving as showcases at international level.

"The university could not do this alone without bringing companies, community and local administration all together, to make the green transition a reality for everybody."

André Pacheco, Coordinator of Culatra 2030 at University of Algarve

Click to see the illustration of Culatra 2030 initiative (Source: University of Algarve)

The university could not do this alone without bringing companies, community and local administration all together, to make the green transition a reality for everybody.’