Give Tanks for Community

Slowing the advancement of climate change and protecting fossil fuel reliant jobs could be considered mutually exclusive aims, but one cooperative is determined to take on both issues, writes Ellie Cooper in this week’s Spotlight on Social Enterprise.

The Earthworker Cooperative has set out to create dignified green jobs and accessible energy-saving technology through community-led economic development.

Secretary of Earthworker, Dan Musil, said the intention is to act as an umbrella organisation for an ecosystem of localised cooperatives in areas where industry has traditionally relied on coal.

“Our mission is to set up a whole network of worker and community owned social enterprises focussed on sustainability-based industries, and located in areas of real economic need, particularly fossil fuel dependent regions,” Musil said.

“For a long time we’ve known we need to move away from fossil fuels but governments have been very slow in actually laying out the ways we can practically do that while also looking after the communities that depend on coal for their livelihood.

“We think there’s definitely a major gap in providing actual green employment, sustainable employment, in coal regions.”

He said that cooperatives are the answer, not only because governments and big business have been reluctant to act, but because of the advantages of community-led intervention.

“The cooperative model, we think, is a really important alternative as well to large multinational owned businesses that don’t provide their workers, or the communities in which they operate, much say, if any, in how the business runs and how its profits are distributed,” he said.

“The cooperative model is a really important one for empowering workers and communities to take a bit more control of their economic affairs, and around the world the cooperative model has been proven as a really resilient one through times of economic crisis.”

Earthworker’s first progeny is the Eureka’s Future Workers Cooperative that will manufacture solar hot water tanks.

The first factory is in Dandenong, Victoria, with the aim of eventually leapfrogging to nearby Morwell, in the heart of the state’s coal-burning Latrobe Valley.

“We know people can’t wait for us to get down there [Morwell]. The community really wants to see new job opportunities, especially for young people,” Musil said.

“It’s quite a disadvantaged area since the privatisation of the power industry, and, in many ways, people can see the writing on the wall.

“There’s a couple of very old coal power stations here that, regardless of what government policy is, are not going to be around forever, so people can see a real need for alternative industries and livelihood opportunities.

“The community is desperate for any jobs and Earthworker is one many people are particularly excited about because of the sustainability side of things, and also because the ownership structure is a more democratic and inclusive and empowering business model than the kind of power industry we see at the moment.”

The solar hot water systems built in the worker-owned Dandenong factory will also be used to provide disadvantaged communities with access to energy-saving technology.

Earthworker has partnered with community housing organisations in their Give Tanks campaign to ensure renewable energy is socially equitable.

“[We’re] making sure it’s not just the rich who can afford to access renewable energy technology, but those who are most vulnerable in the community also can benefit from the transition we have to make to a greener economy,” Musil said.

“We’re inviting people to contribute to the instillation of locally made solar hot water systems into low income housing, and that, in a neat way, [addresses] three things.

“When people make a donation they’re firstly supporting the installation of solar hot water systems, so it’s going to help with reducing our carbon emissions, secondly, those systems are going into low-income households, so we’re supporting vulnerable households deal with the financial stress of power bills, and, thirdly, we’re supporting local manufacturing the more systems we get to install.”

This month the first solar hot water system was installed in the house of an Aboriginal elder in northern Melbourne through a partnership with Aboriginal Housing Victoria, an organisation that provides housing to 4,000 indigenous tenants.

In the future, Musil hopes to provide employment opportunities in the cooperatives for Aboriginal Housing tenants.

Earthworker has also partnered with Common Equity Housing NSW, an organisation that uses a cooperative model where the tenants run housing, as well as the Father Bob Maguire Foundation, and will supply solar hot water systems to both.

Musil said these collaborations are “absolutely vital”, and Earthworker has even bridged the divide between trade unions and environmental groups to create relationships with both.

“It goes to the deeper mission of Earthworker, which, in some ways, has come out of efforts to build partnerships and alliances across traditional divides, in the context of climate change and transition in Latrobe Valley,” he said.

“The Earthworker project has really been an effort to… break down this old distinction between jobs versus the environment.

“Partnerships with trade unions have, from the beginning, been very key to the Earthworker project and remain very important, as well as partnerships with sustainability and environment focussed organisations.”

Still in the early stages of its long-term vision, Earthworker was initially funded through donations and membership contributions.

“We have almost 1,000 members across the country who have purchased shares in the co-op and who make contributions, either of their time or financial contributions,” Musil said.

“Now for this first cooperative project, the Eureka’s Future Workers Cooperative, we raised capital through a community and member based investment program where members of the cooperative could loan money to Earthworker to set-up this first factory.

“We raised over $500,000 last year in that community capital raising effort, which was pretty amazing. It demonstrated how much hope in the project people have and how much support it’s got across the board for people who really believe in the vision.”

As the cooperatives develop, Musil said that the revenue the factories generate will be used to grow the ecosystem.

“The vision is that as we set up this first worker cooperative it will divert a portion of its surplus back to Earthworker to repay that initial capital and, over time, will also be able to contribute surplus towards seeding the next cooperative and so on, so that before too long there’s a network of independent but cooperating and mutually sustaining enterprises,” he said.

Despite the advantages of the model, Musil said that Australian cooperatives lack the recognition that their overseas counterparts enjoy, which presents a challenge in raising capital outside the member pool.

“This is something the Business Council of Cooperatives and Mutuals is doing really good work around, [but] we’ve found that in Australia there’s not a great awareness about the cooperative business model,” he said.

“Sometimes when talking to funding bodies, including government and others, there’s been some confusion around that.

“The cooperative business models have been really successful in other parts of the world and really widespread, but in Australia there’s not a great history or tradition of worker owned cooperatives.”

However, he also said that cooperatives in many parts of the world have faced the issue of raising capital because of their grassroots structure.

“The nature of the cooperative structure means that once they’re up and running they’re wonderfully democratic and they distribute wealth quite evenly, they’re quite resilient and stable, they’re less likely to be involved in really speculative business activity,” he said.

“But because, unlike traditional business where one big investor can come in and own the show, cooperatives typically have a bit more difficulty raising capital.”

Another challenge that Earthworker faces is overcoming the decline of manufacturing.

“The manufacturing industry, because of free trade in Australia, is really struggling, so in a way we’ve picked a very difficult industry to start in,” Musil said.

“But that’s also why we chose it, because it’s really important that Australia keeps making things here, and that Australian’s are employed in dignified workplaces that make the goods we need to work our way out of climate change.

“There’s innovative things Earthworker is doing in its business model to try to make manufacturing a more viable activity here in Australia.

“Through partnerships with social organisations like trade unions.. workers can choose to take a locally made solar hot water system as part of their negotiated wage increase, or in lieu of their wage increase.”

But Musil said that perhaps the greatest challenge is responding to the magnitude of climate change.

“Another challenge is building to scale quickly enough to feel like we’re going to make a difference on the climate change issue,” he said.

“Part of the mission is to be able to roll out renewable energy technology quickly everywhere, but the clock is ticking, so that remains at the forefront of our minds as well.”

However, he remains positive about Earthworker taking the lead on the issue.

“Earthworker has come into fruition because we felt there was a real need to do this, Earthworker is really trying to be a practical example of how we can start,” Musil said.

“That’s what we’re setting out to achieve, to take action where governments are not, and where large business is not, to really try to build solutions where we really need them and where other people aren’t.”