What Denmark’s wind experience reveals about community ownership, financial risk, and the terms of participation
By Hector Gonzalez
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A wind turbine tells us little about who benefits from the electricity it produces. Similar machinery can operate under very different arrangements. Income may go to a single owner, several investors, or a cooperative whose members each have an equal vote.
Those differences are difficult to see from the road. They matter to the people living nearby.
We can count turbines, measure their output and estimate the emissions they might displace. Understanding their place in a community requires other questions. Who receives the income? Who can challenge a decision? Whose land or livelihood is affected? And what happens when the project has a difficult year?
I am interested in what could change when people affected by an energy project also own part of it. Ownership could give them a continuing financial interest and authority over consequential decisions. It could also expose their savings to a business they have limited power to influence.
The question is what the arrangement actually gives people—and what it asks them to carry.
In 2023, I explored cooperative and shared-ownership possibilities while contributing to a six-author policy memo on accountability in Mexico’s green transition, prepared through Mexico Development Lab at UC Berkeley. I also assembled the memo and shared it with interested representatives of Mexico’s Secretariat of Foreign Affairs.
Denmark’s experience helped inform that exploration. Returning to the question now, I would judge ownership against a demanding alternative: enforceable benefits and meaningful participation that do not require people to risk their savings.
For Mexico, I would begin with onshore wind projects affecting local communities. Could collective ownership give people something valuable that they could not obtain as effectively through another arrangement?
That comparison matters. If the only alternative we imagine is a project that excludes people from its benefits and decisions, almost any ownership offer will look attractive. The more useful test is whether ownership improves on a credible agreement that already respects rights, distributes benefits and gives people practical ways to hold the project accountable.
What Denmark actually shows
Middelgrunden, the offshore wind farm near Copenhagen, offers a concrete starting point. Its twenty turbines have a combined capacity of 40 megawatts. It was developed through cooperation between a citizen partnership and Copenhagen’s municipal utility. Today, the citizen partnership owns ten turbines and HOFOR owns the other ten. Historical project account; current ownership description.
An offshore project beside Copenhagen cannot stand in for an onshore project affecting Mexican communities. A comparison would need to examine the particular land uses, livelihoods, rights and institutions involved. Offshore construction also raises different practical questions from turbines, access roads and transmission infrastructure placed across land that people use.
What makes Middelgrunden useful is the opportunity to examine specific arrangements. How did citizens finance their participation? How were financial interests separated from votes? What support made the organization possible? And what happened as its machinery aged?
Those questions can travel across borders more readily than a legal structure.
The citizen organization is commonly described as a cooperative, although its legal form is a Danish partnership, an I/S. Its portion was divided into 40,500 shares, originally priced at 4,250 Danish kroner each and payable upfront. Public funding also supported preliminary investigations, including analysis of the citizen-owned portion’s organization and economics. Household investment was therefore one component of a broader development arrangement. Project participants’ account, 2000.
Its published bylaws separate votes from financial interests: each member has one vote, while distributions follow shares held. They prohibit borrowing by the partnership but retain members’ personal and joint liability to its creditors. The prohibition should not be mistaken for limited liability or evidence that individual members never borrowed to purchase shares. Bylaws, amended March 2022, §§6, 13–16.
These details change the lesson. “Community ownership” can describe arrangements with quite different consequences. Equal voting does not necessarily mean equal income. A restriction on organizational borrowing does not eliminate every form of exposure. Public support for early development also reminds us to ask who pays for the work required before an investment becomes available.
Middelgrunden demonstrates that citizens and a utility can develop and operate a substantial wind project together. It does not isolate how much ownership itself contributed to public support, separately from engagement, public assistance and the surrounding financial and regulatory conditions.
The project also predates Denmark’s later national purchase-option scheme. That scheme required covered developers to offer at least 20 percent of a project to eligible local buyers. It had exceptions and was abolished in 2020, with transitional coverage for projects granted building permission before June 1 of that year. It should not be presented as a current universal mandate. Danish Energy Agency.
An opportunity to invest also did not ensure broad participation. A government review reported 335 purchasers across fifteen projects in an early 2009–11 evaluation cohort. Roughly one-third accounted for about 95 percent of purchase value. These were not Middelgrunden’s membership figures, and concentrated investment does not establish improper conduct. Government review, December 2018, pp. 50–51.
It does reveal a design problem: a formally available opportunity can produce a narrow distribution of investment. An open door does not tell us who has the money, time or confidence to walk through it. If the purpose is broad participation, the offer’s existence is only the beginning of the assessment.
Denmark also uses arrangements requiring no equity purchase: compensation for property-value losses, qualifying property buyout options, annual neighbor bonuses and municipal green funds. Eligibility and terms vary. Its experience gives us several arrangements to compare, rather than one model to copy. Danish Energy Agency’s current overview.
Following the money
Consider a simplified hypothetical project company receiving 100 pesos from electricity sales. Suppose operating costs, taxes, debt payments and required reserves leave 20 pesos lawfully available for distribution. If those funds are distributed proportionally among ordinary shareholders, a community organization holding 10 percent would receive two pesos.
The distinction is easy to miss. A 10 percent ownership interest does not necessarily mean receiving 10 percent of electricity sales. The claim sits within an arrangement that determines which obligations are paid first and what can be distributed afterward.
This example illustrates cash allocation. It is not a forecast or an accounting income statement. Actual distributions depend on financing agreements, share rights, legal obligations and decisions about retaining funds.
There is then another decision: what does the community organization do with its two pesos?
It might retain money for future expenses, fund collective purposes or pay members under its applicable rules. A payment to a collective owner is not automatically household income. Even an organization with healthy receipts may need to pay for administration, advice or reserves before deciding what its members or the wider community receive.
The distribution rule therefore belongs inside the proposal. Would benefits follow the amount invested, membership, exposure to project impacts, or some combination? Would people who cannot invest receive anything? These choices determine whom the arrangement serves.
The downside needs to be followed with the same care. If production falls or repairs become expensive, distributions can disappear. A household that borrowed to buy its interest may still owe its lender. Even where liability is limited, people can lose their investment; separate loans and guarantees require their own scrutiny.
Middelgrunden makes operating risk tangible. Its citizen partnership reported accounting losses of approximately 496,000 Danish kroner in 2025 and 831,000 in 2024. Management identified low turbine availability and substantial repair costs. The report also explained that age and wear prevented machinery insurance from providing damage coverage. These results do not establish members’ lifetime returns. They show why maintenance, insurance limitations and eventual dismantling belong inside the investment proposition from the beginning. 2025 annual report.
For Mexico, affordability would require more than inexpensive share denominations. A small investment can still be unaffordable to a household that needs the money for food, housing or an emergency. We would need to ask what people give up to participate and whether they could withstand a prolonged period without distributions.
Land contributed to an arrangement also has a cost, even when little cash changes hands. Replacing a predictable land-use payment with a claim on future distributions changes the risks borne by the rights-holder. The promised return should be compared with the income or use being surrendered.
Grants or subsidized collective equity could reduce these barriers. Someone would still have to finance them. Public support has an opportunity cost, so the comparison should ask what the same resources could achieve elsewhere. Would an equity subsidy build a valuable collective asset, or would a funded benefit agreement deliver broader and more dependable gains?
Ownership is not authority
A cooperative can elect its leadership democratically while holding a minority interest with little influence over the project. The internal vote chooses who represents members. The agreement with the other owners determines what those representatives can actually do.
Imagine members carefully selecting a representative, only to discover that the representative can attend meetings but cannot obtain useful financial information or influence the decisions that most affect distributions. The internal process may be democratic while the project relationship remains weak.
A board seat could provide access to decisions. Certain matters might require the collective owner’s agreement: asset sales, additional borrowing or transactions with affiliated companies. Financial information and independent scrutiny could help members understand how value moves through the business.
But “access to information” also needs practical meaning. When is it supplied? In what language and format? Who can explain it? What happens if information is incomplete or arrives after a consequential decision has already been made?
These would be negotiated powers, not benefits we should assume follow automatically from a shareholding. Their usefulness would depend on the financing structure, applicable law and remedies people could realistically use. A right that costs more to enforce than its holders can afford may offer little protection.
A share certificate is a little like a promise to receive part of a harvest. Its value depends on what is deducted before the harvest is divided and who can influence how it is managed. Receiving a portion tells us little unless we can also understand the expenses, decisions and risks behind it.
The metaphor has a boundary: rights over the land exist independently of that promise. Accepting a financial interest should not blur who holds those rights or who can authorize their use.
Mexico’s institutional constraints
A community stake would need to fit Mexico’s electricity framework. The current law permits state, private and specified mixed-development routes within binding planning rules. Its national state-participation requirement and the project-level requirement for the mixed-investment scheme are distinct. Neither establishes a general entitlement to community ownership. Legal note 1.
That means the ownership idea needs a concrete project route before its financial and governance promises can be assessed. Who would hold the permit? Who would sell the electricity? What would the collective organization own, and through which agreements would it receive income or exercise authority?
Mexican cooperative law recognizes one member–one vote and permits limited liability. It also distinguishes cooperative types, membership functions and surplus-allocation rules. Registering a cooperative would not, by itself, establish that the intended investment structure works. Legal note 2.
The appropriate organization should follow from what people intend to do and what the law permits. Calling something a cooperative cannot resolve the relationship among membership, work, investment and distributions.
Nor would holding shares automatically reduce members’ electricity bills or improve reliability. Financial ownership, electricity supply and the physical operation of the system require separate arrangements. A proposal should explain each promised benefit through the mechanism that would actually produce it.
The people involved must also be distinguished. Residents, land-rights holders, investors and Indigenous peoples may overlap, but they are not interchangeable. Mexico’s Agrarian Law distinguishes common-use ejido land from individual parcels and assigns different decision-making powers. A new investment organization cannot simply replace the relevant landholding authority. Legal note 3.
The word “community” can conceal these differences. An organization open to investors might exclude affected residents who lack money. An agreement with landholders might leave other residents without benefits. A majority inside one organization cannot be assumed to speak for every constituency affected by the project.
Consultation and consent require particular care. The Constitution recognizes Indigenous consultation concerning measures with significant effects, aimed at obtaining consent or reaching agreement, and addresses fair and equitable benefits. Those rights do not depend on purchasing shares. Legal note 4.
Consent can also be a substantive requirement. In a 2018 judgment concerning a wind project affecting the Zapotec community of Juchitán, the Supreme Court’s First Chamber applied consent reasoning to the large-scale project and concluded that consent had been obtained. That decision cannot determine the requirements for every future development. It does prevent us from treating consent as merely aspirational in all circumstances. Legal note 5.
Ownership must also be distinguished from addressing harm. Mexico’s 2026 social-impact rules prioritize avoidance, followed by mitigation, remediation and compensation for residual impacts. They also address shared benefits and monitoring. An equity offer cannot be treated as proof that these responsibilities have been discharged. Legal note 6.
For a particular proposal, these overlapping requirements would need specific assessment. An investor vote cannot substitute for the relevant rights-holders’ process, and an expected dividend cannot answer every objection to a project’s impacts.
The strongest objection
People should not have to become investors to secure fair treatment from a project affecting their lives.
If households take concentrated financial risk while developers retain management authority and lenders have priority over cash, a participatory label could conceal a poor bargain.
That concern becomes sharper when exposure accumulates. A household might depend on the same area for its livelihood, experience the project’s impacts and invest its savings in the project company. A difficult outcome could then affect several parts of its security at once. The fact that an investment is local does not necessarily make it a prudent place for household savings.
Subsidizing the investment would not automatically resolve the governance problem either. A collective organization could be dominated by residents with more time, education or connections. Representatives expecting project income might become reluctant to acknowledge harms or challenge management.
Dissenters could face pressure from neighbors who regard opposition as a threat to future distributions. Someone questioning the project might be treated as jeopardizing a collective asset, even when the concern deserves an answer. A serious proposal needs room for disagreement throughout the project’s life, including disagreement from people who never invest.
The institutional weakness that makes ownership attractive could also undermine ownership itself. If people struggle to enforce land agreements or obtain reliable information, becoming shareholders does not automatically make courts accessible, accounts intelligible or managers responsive. Changing the legal relationship may create new rights while leaving the practical obstacles to using them intact.
Some desired powers might also be secured without equity. An agreement could provide information rights, representation, monitoring or specified approval powers. Their enforceability would still need examination. Ownership cannot claim every possible improvement in participation as its exclusive contribution.
The financial alternatives deserve equal seriousness. A share of gross revenue could provide payments without household investment, while retaining exposure to production, price and nonpayment risk. Fixed or indexed land payments could offer more predictable contractual income to rights-holders, although they would not necessarily reach affected residents without land. A community fund could serve a broader population, but its allocation could also be captured.
None of these arrangements escapes the need for governance. Each has to answer who qualifies, who decides, who monitors and what happens when a commitment is not fulfilled.
A fair comparison would give the alternatives credible funding and enforcement arrangements too. Otherwise, ownership wins because we have designed the competing options badly.
When ownership earns its place
After those objections, why consider ownership at all?
Because people may want to build and govern a collective asset, rather than remain only recipients of payments determined through another organization’s business. A continuing ownership interest could combine a claim on distributable income and asset value with useful authority over decisions.
That combination could matter. It might allow people to participate in future gains as well as present benefits, and to exercise powers attached to the interest. Whether those advantages justify the costs depends on the actual terms. They should not be inferred from the word “owner.”
I would begin with the protections and obligations already owed to affected people. The additional ownership offer should then be compared with a funded alternative requiring no investment, with both examined under difficult operating conditions.
Who absorbs a construction failure? What happens if electricity cannot be sold as expected? Could new shares dilute the collective interest? Could additional borrowing restrict distributions or influence? How are major repairs and dismantling financed?
Exit deserves particular attention. An interest can have value on paper while being difficult to sell. If a household needs money urgently, is there a realistic buyer, a funded redemption mechanism, or only a theoretical right to leave? The answer matters when comparing an illiquid investment with a more dependable payment arrangement.
Independent advice would need to continue beyond the signing ceremony. The documents may be clear on the day they are signed while circumstances change around them. New financing, repairs, ownership transfers and disputes could all require members to make decisions long after the original advisers have departed.
Accessible accounts, translation and support for participation would therefore need a budget over the project’s life. Funding that advice should preserve the organization’s ability to question the developer. Otherwise, the party being scrutinized may also control whether scrutiny is possible.
Even a carefully designed arrangement would have costs. Negotiation, administration and financing conditions could make a project more expensive or slower to deliver. Those costs may be justified, but they need to be counted. Any claim that ownership reduces conflict or financing costs would require evidence, rather than being entered as an assumed saving.
Its contribution to the energy transition also needs precision. Transferring an interest in an operating wind farm changes who receives benefits; the transfer itself adds no electricity. A claim about additional clean generation or lower emissions requires a further explanation of what ownership enables and how the electricity system responds.
An arrangement could still have distributional or governance value without producing additional electricity. Being clear about that value makes the argument easier to assess.
I have not established that a particular Mexican community would prefer such an arrangement, that an appropriate project could finance it, or that it would outperform the alternatives. Those uncertainties belong inside the argument.
They leave me with a conditional position. Shared ownership merits consideration where it gives people a collective asset and useful authority without making their security depend on financial exposure they cannot bear. If a benefit agreement offers comparable influence and more dependable gains at lower cost, I would favor that arrangement. If the project’s harms or rights implications are unacceptable, a more attractive investment offer does not resolve them.
Denmark helps make these choices visible. Its experience includes citizen ownership, concentrated investment under a later purchase scheme, and benefits requiring no equity purchase. Each arrangement answers a different question about who contributes, who benefits and who carries risk.
For Mexico, I would judge shared ownership by the position people can actually hold over time: whether they can question the accounts, influence consequential decisions and withstand a difficult year while preserving the rights of those who never invest.
Contribution and context
This essay develops a question I explored as one of six contributors to Improving Accountability in Mexico’s Green Transition. My contribution included substantive content, exploration of cooperative and shared-ownership possibilities, assembly of the memo and sharing it with interested SRE representatives. The original memo credits all coauthors. This essay presents my subsequent analysis and does not imply their or any institution’s endorsement.
Read the original policy memo · Mexico Development Lab project
Legal source notes
Legal texts checked October 27, 2026. These notes identify provisions supporting the distinctions above; they do not establish the feasibility of a particular project.
1. Electricity-sector framework. The March 2025 Electricity Sector Law, article 12, establishes binding planning and the national requirement for at least 54 percent state participation in annual energy injected into the grid. Article 36 identifies state, private and mixed-development routes. Article 40 separately requires at least 54 percent direct or indirect participation by the state public enterprise in the specified mixed-investment scheme.
2. Cooperative structure. The General Law of Cooperative Societies, articles 11 and 14, addresses voting and liability regimes. Articles 21–28 distinguish cooperative types and their functions and surplus rules. The appropriate vehicle for a proposed collective investment remains unresolved.
3. Land authority. The Agrarian Law, particularly articles 23, 45 and 79, distinguishes authority over common-use land and individual parcels. Any contribution or use of land would require assessment of the applicable rights and procedures.
4. Indigenous rights. Constitution, article 2(A)(XIII), addresses consultation concerning legislative or administrative measures with significant effects, consent or agreement, and fair and equitable benefits under applicable law.
5. Consent judgment. Amparo en revisión 600/2018, decided November 21, 2018, particularly paragraphs 140–149 and 302–303. The Court’s reasoning and conclusion concern that case; application to a future proposal requires separate assessment.
6. Social-impact responsibilities. SENER’s February 2026 administrative provisions, particularly articles 28–34, address the impact hierarchy, social-management plans, shared benefits, budgets and monitoring. Their existence does not demonstrate consistent enforcement.
