Overview
Energy communities are one of the key elements for achieving the EU’s energy transition: by 2050, half of Europe’s citizens could be producing up to half of the EU’s renewable energy.1
Recognizing the important role of local actors in the energy transition process – citizens in particular – the EU’s Clean Energy Package since 2019 includes provisions to help local communities take ownership of the energy transition through the concept of energy communities.
According to the EU laws, energy communities can take any form of legal entity, for instance, that of an association, a cooperative, a partnership, a non-profit organization, or a limited liability company. It makes it easier for its citizens, together with other market players, to team up and jointly invest in energy assets. This, in turn, helps contribute to a more decarbonized and flexible energy system, as the energy communities can act as one entity and access all suitable energy markets on a level playing field with other market actors.
Benefits
Energy communities offer a means to re-structure our energy systems by harnessing energy, allowing citizens to participate actively in the energy transition, and providing direct potential benefits to citizens such as increasing energy efficiency, lowering their electricity bills, reducing carbon emissions, as well as supporting the local economy and creating local job opportunities.
At one glance, energy communities…
A legal entity that is based on voluntary and open participation, effectively controlled by shareholders or members who are natural persons, local authorities, including municipalities, or small enterprises, and micro-enterprises.
A legal entity that, in accordance with the applicable national law, is based on open and voluntary participation, autonomous, effectively controlled by shareholders or members that are located in the proximity of the renewable energy projects that are owned and developed by that legal entity; the shareholders or members of which are natural persons, SMEs or local authorities, including municipalities.
The primary purpose of a CEC is to provide environmental, economic or social community benefits for its members or the local areas where it operates rather than financial profits.
The primary purpose of a REC is to provide environmental, economic or social community benefits for its shareholders or members or for the local areas where it operates, rather than financial profits.
A CEC can be engaged in electricity generation, distribution and supply, consumption, aggregation, storage or energy efficiency services, generation of renewable electricity, charging services for electric vehicles or provide other energy services to its shareholders or members.
A REC can engage in activities based on renewable energy sources, including generation, energy efficiency, supply, aggregation, mobility, energy sharing, self-consumption, and district heating & cooling.