Energy Communities
How to start and which steps to follow?
Identify the problem and the drivers for becoming a member of the energy community, or creating a new energy community. Find the people to start such an initiative together!
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1. Discovery/ Needs Assessment
“Well begun is half done” Aristotle said. Once there is the need to be part of an energy community or create one, a good practice would be to discover and assess the needs. This could be done by following the 5 Ws approach (Who, What, Where, When and Why) and trying to answer the following 5 questions. The questions will also help by guiding the next steps.
Who?
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Who will be part of this community or with whom I would like to initiate/co-create such a project? What are the profiles of the people, stakeholders and entities with whom we will build an energy community? It’s all about identifying key persons you want to work with and mapping the important stakeholders.
What?
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What are my needs? Should I Identify an energy community that already exists and become a member or create a new one? In the first case, it is easier to fulfill the need, by searching for an existing energy community and seeing in what ways you can contribute. There are some examples in the Inspiring first-hand experiences and Best Practices Aspect of this guide and the map from the Energy Community Platform. There is also a match making tool for energy communities, but also an Energy Communities Repository provided by the European Commission (although it is no longer being updated). In the second case of creating a new energy community, the following steps can provide a good starting point. Of course, joining an existing one is a great way to learn the ins and outs of establishing a new one in the future!
When?
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When should we create the energy community? As soon as possible, we are in the midst of the transition! Other than that, of course, this is a question to answer once the scope is defined and the initial resources and people have been gathered. Here it’s important to map out any interesting events that can be used to engage people and that will help create the necessary momentum. It’s also considering any calls for funding or your local authorities’ agenda in case that’s a partner you want to involve. As a general rule, it’s not a good idea to start projects in the summer months and in December.
Where?
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Where should the project be located? This is a question to answer again after defining the needs and the scope. A very important aspect is to consider the legal restrictions that come with the legal type of the energy community, but also restrictions that differ according to the legislation of each country. For example, the members of a community should all be residents of the region where the energy community will be registered, and the renewable energy project should be also located in this region. There are also technical barriers that could delay the development of the project, like for example the lack of an electricity grid in a specific area to electrify new renewable projects. In this case, a neighboring area could be a more suitable place. As a general rule, public buildings that are central to a community, (municipal building or a school) are good places to start. It is also important to consider other potential restrictions like buildings that are classified as cultural heritage and may not be able to accommodate solar panels or other energy infrastructure.
Why?
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Why should I create an energy community? Again, this is a question to answer based on the needs but also the activities that the community will have. The motivation behind the project is what will drive it forward and will help engage and recruit more members.
Understanding the benefits of creating and being a member of an energy community is crucial to proceed with its development. It is important to acknowledge that energy communities are one of the most important tools for providing power to the people and tools to contribute to energy equity, ensure reliable access and tackle energy poverty. This way the community can engage and participate actively in the energy transition through various activities like clean energy self-production projects, distribution and storage or energy efficiency services. The community can participate in all the phases of the project but most importantly have ownership of the project and make decisions. As a result, community members can acquire new skills, get empowered, and even new jobs.
2. Definition of the scope and mission
The scope of the energy community and the activities that will be implemented should be defined from the beginning. This exercise should be mostly based on the needs assessment. The clearest and most specific the scope is, the easier and more accurate the next steps will be. The scope could be defined, for example, based on the type of members that will participate in the energy community. Will it be only households and/or small businesses? Will the activities of the energy community create benefits only for the members of the community who have contributed financially, or will the community also support vulnerable households.
Additionally, another factor to consider is the mission and social objectives of the CRE which has implications for the financial aspect, namely on how to deal with or reinvest any surplus funds that can result from the activities of the energy community.
3. Preparation
After defining the scope and the needs, the next step would be to prepare for whatever is needed to create the energy community. Establishing a new energy community creates a lot of practical tasks that are related to bureaucracy as is a legal entity that should be registered to the national registry.
Additionally, to develop the project not only money but also time is needed. That’s why it is very important to create a support system that has the knowledge, the expertise and the willingness to contribute to the effort needed. Examples of this support system are lawyers who know the legislation, local actors like municipalities or resident’s associations who can provide info or potential financial support, organizations that work with energy communities and can provide possible training to you and the members of the community and, of course, the local people with whom you could potentially collaborate.
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Once you have the support system, you have to gather all the information about what is needed to create the application for establishing an energy community. In this case, you could search for a possible training that exists like in the Energy Community Repository, rely on people from the support system or contact other existing energy communities. It is necessary and empowering to find the right people to start this initiative, it can be a small group that can drive the initiative (offering time and effort to make all the preparations) and then recruit help and expertise along the way as needed.
Of course, an important aspect to consider is the technical. What will be the technology needed, the size of it, how many households will be supported? And also the financial aspect. This is a challenging part, as unfortunately there are not sufficient governmental support schemes to cover the cost of the investment. So in most cases, the members of the community have to pay that cost. However, renewable energy is an investment that will “pay back” in time and in most cases offers much better interest rates than, for example, having savings in the bank. It’s important to have someone who can clearly demonstrate the business case for creating community energy and to communicate that effectively because many members will base their decisions on that.
Keep in mind that there will be barriers and obstacles, but being proactive, finding solutions quickly and surrounding yourself with the right people will get you through it! Some of the most common barriers could be restrictions from legislation, the lack of electricity grid, financial inadequacy or demotivated people. More information on the barriers and obstacles can be found in the report of the European Commission: Barriers and Action Drivers for the Development of Energy Communities & their Activities.
More detailed information on the preparation step can be found in sections 3.1 and 3.2 of this Guide.
4. Co-creation
The most important part of energy communities are its members and the participatory process to co-create the project and have an active role in the whole process (from design to implementation and management). Make sure people have a say in the location, are aware of the steps, and even join in the installation day. Small activities like creating art or something that brings meaning to the project are a great way to create (psychological) ownership of the process (some research says it’s essential for project success in the long run).
Besides the support system mentioned in the previous step, there should be a development team to run the initial processes, and also gather the members of the community. Once the initial group of members is formed, there should be a meeting to define the way that the community will operate, draft the official documents, make decisions about the legal entity, the energy project and the activities, the financial and the cooperative system. At this phase, it will be also useful to design a communications strategy plan. And of course, decide the name of the energy community and create a brand or simple logo that will generate identification!
More detailed information on the co-creation step and what the development group should do can be found in section 3.3 of this Guide.
5. Launch
Reaching this step means that all the steps above went well and you are ready to create an energy community! First, the application should be submitted to the responsible authority so the association is legally formed. Once this is done and finally the energy community is legally formed, find the time to celebrate with the members, and the development team and maybe organize an event also inviting the support system to inform and reflect on what has been done so far.
And of course, spread the message to the public. It is time to develop the communication strategy designed in the previous step!
More detailed information on the launch phase can be found in section 3.4 of this Guide.
6. Implementation
Once the energy community is launched, the next step is to develop what is needed for the activities that are about to take place. For the majority of the energy community the main activity is the production of energy for covering the energy demand of the members of the community. In this case there should be an installation of a renewable system to produce the electricity. There are different technologies that can be used, while the most common are solar panels.
However, electricity production is not the only option, yet the most popular. Energy communities (wherever it is possible from the legislation) can also operate as suppliers of electricity, can invest on distribution systems, energy storage or energy efficiency. More information on these activities, the existing technological options for electricity production and how to choose one, can be found in the technical aspect.
7. Network Development
While preparing what is needed for the launch and implementation of the energy community, iit is important to spread the message and become members of coalitions wherever they exist, so that the movement of energy communities becomes bigger and stronger. This way there will be bilateral support from which all members can benefit. Building a network can help not only the promotion of self-production projects but also have a more solid impact on campaigning, advocacy and public consultations. And of course, there can be a lot of knowledge to exchange
The biggest network that exists at the European level is RESCOOP, but also there can be smaller networks at the country level. For example, in Greece in late 2023 a coalition was created called “Desmi Energiakon Kinotiton” with a distinctive legal entity.