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Energy communities are groups of people that come together to collectively generate, store, and manage energy. Often, they are formed with the aim of increasing access to renewable energy sources such as solar panels, wind turbines, and biogas generators, lowering energy costs, and finally reducing a neighbourhood’s impact on the environment. By pooling their resources, knowledge, and experience, energy communities create more sustainable and resilient energy systems than would be possible at the individual level. They may also invest in energy storage technologies such as batteries, which allow them to capture excess energy and use it later when demand is higher. By doing so, energy communities reduce their reliance on traditional energy sources and lower their carbon footprint.

Here are five reasons why energy communities allow people to take back control of their energy sources and become independent energy providers and consumers.

1. Energy communities decrease energy costs

In an energy market dominated by large-scale players, energy communities building on renewable energy sources have a great potential to significantly reduce the members’ energy bills. Building on the collective rather than the individual, the prices for both, energy production and purchase are lower. Some energy communities produce and sell to customers at wholesale prices. For example, Helsingin Energia, an energy community in Helsinki, Finland, offers electricity tariffs up to 25% cheaper than traditional local energy providers. That’s as if you would get electricity but without paying VAT.

2. Energy communities allow members to have a say in how their energy is produced and distributed

With the gas and electricity shortage expected for winter 2022/2023, an increasing amount of people have become aware of the fact, that they do not really have a say about their electricity. Indeed, many have experienced a maximum of dependency. This is less true for people engaged in energy communities. As members they can actively participate in decision-making processes – the very basis for ‘controlling’ or ‘being in power’ of their own energy usage. To pick yet another example from outside the TANDEMs project, the Samso Energy Academy in Denmark empowers community members to own and operate wind turbines, solar panels, and district heating systems. Have a look at their website; they have an inspiring collection of talks on sustainable energy and energy communities!

3. Energy communities encourage the use of renewable energy sources such as solar, wind, and hydropower

It is untrue to assume that we will have to wait for years until we have something to gain from cutting CO2 emissions. As a matter of fact, every reduction of the reliance on non-renewable sources for energy production that contributes to a cleaner planet today gives a little more autonomy for other decisions that will be pressing in the upcoming years. Surely, power to the people might be a quite general claim at this stake. It is not said that the newly evolved scope for action plays out in your energy community. To those arguing reducing here is nonsense while Asian countries increase air pollution: Do you really believe atmosphere, air, and pollution stop at the border?

4. Energy communities encourage energy efficiency by providing members with advice and support to reduce their energy consumption

Knowledge is power and luckily there are many advisors and organisations, which navigate citizens through setting up energy communities. For instance, French Energies POSIT’IF offers free energy audits to its community members and provides personalised recommendations on how to reduce energy usage. Other projects, such as Newcomer – Exploring New Energy Communities, assess the regulatory, institutional, and social conditions to facilitate learnings on a meta, or more precisely, supra-local level.

5. Energy Communities create jobs

We’ve started with economy. We end with economy. Hovering over the EU Centres for Development of Vocational Training map of occupation needs in Europe, you’ll quickly find out that the only country in Europe where mining personnel is still hired is Bulgaria. For Czechia and the Northwest region, a 2021 published study of the European Greens (that are obviously not the representatives of coal mining industries) expect 10,000 jobs in the mining sector to be soon replaced by more than 20,000 jobs in renewable energy. The reason: decentral energy harvesting. Indeed, energy communities provide job opportunities for residents in various areas such as installation, maintenance, and customer service.

Overall, energy communities empower citizens by giving them control over their energy usage. It seems almost ridiculous to assume, they have the potential to empower people. Instead, they do so on an everyday basis already. Energy communities create jobs and decrease the cost of energy. They allow for a minimum scope of action and open windows of opportunity to fight climate change. Finally, they give communities a voice and reduce dependency. The latter is the very essence of empowerment.

Image by Cornell Frühauf from Pixabay

What are Energy Communities?

Energy communities are groups of individuals or organizations that come together and jointly develop, manage, or own energy projects in their community. Actually, the European Union provides two definitions of energy communities: „Citizen Energy Communities“ and „Renewable Energy Communities.“ Both definitions put an emphasis on participation and effective control by citizens, local authorities, and smaller businesses. Large-scale energy providers and industries are not included in these definitions. In energy communities, members pool their financial resources to invest in renewable energy projects such as solar or wind power. Energy produced by these projects is sold back to the grid, and profits are returned to the members. An already existing example of this, which is also a TANDEMS pilot project, is in Otterbeek, Mechelen (Belgium). It is an energy community set up in a social housing area by Klimaan.

The Problem of Deviating Legal Frameworks

Energy communities’ participation in the clean energy transition requires a supportive legal framework, which should be designed, considering the criteria of simple and clear administrative procedures, non-discrimination of actors, legal certainty and predictability of the framework, the stability of remuneration, and financing possibilities. Within the European Union, the regulatory framework and support for energy communities depend on individual country policies. In some countries, policies provide little or no support, while in others, policies are more supportive, providing some significant financial incentives. To better grasp the diversity of the policy frameworks enabling energy communities in Europe, it is recommendable to have a look at the RESCoop Transposition Tracker. It is easily accessible through a color-coded map and provides detailed information about each member state. Finally, it shows that there is a lack of uniformity or standardization in the legal framework surrounding energy communities in Europe.

Let‘s pin that down. For instance, in Germany, renewable energy cooperatives and citizen energy partnerships are widely used, with the strong backing of the Renewable Energy Act, which provides incentives such as feed-in tariffs and priority access to the grid for renewable energy producers. In contrast, in Italy, although there is a policy for Energy Communities, it’s not as supportive in terms of the incentives it provides. Similarly, in Portugal, there is no specific law for Energy Communities, and therefore, Energy Communities are not recognized legally. To this end, the deviations in the legal framework across EU Member states pose a challenge for cross-country collaboration in general, but also for the TANDEMS project.

Possible Solutions to Deviations in Legal Framework

Deviating legal frameworks have been identified as a major obstacle for the realization of renewable energy projects in energy communities. Common legal standards might boost the development of energy communities. At the same time, they might reduce flexibility to react on local specificities, landscapes and community structures. A top-down, one-size-fits-all approach is likely to fail.

To overcome deviations in the legal framework, EU member states should thus develop a regulatory framework that encourages the development of local energy communities. This action may be led by the European Commission or Parliament – what is important though, is to ensure all relevant stakeholders (that are citizens not industries) have a say. The aim of such a framework should be to remove existing barriers and provide supportive measures that incentivize the development of energy communities. It should encourage cross-border cooperation and incentivize participation in the clean energy transition.