Bright sparks

That's the vision behind energy communities, and it's already becoming a reality across Europe.

From taking back control of our energy consumption to bringing neighbours closer, the benefits of energy communities are numerous, though so are the challenges. 

In this post, we'll take a look at some of how these grassroots initiatives are reshaping the energy landscape in their regions — and how you could start to put their learnings into practice. 

An energy community is a collective of citizens, local authorities, businesses or any combination of stakeholders who get together to produce, consume and manage energy, typically from renewable sources like solar panels or wind turbines. 

When it works well, it's a win-win situation: Local communities become more sustainable and resilient while taking control of their energy future.

Energy communities have multiple benefits for society and the environment. As well as reducing the greenhouse gases (GHGs) that cause climate change, they can create and sustain ‘green’ jobs locally. This frees communities from dependence on fossil fuels and, therefore, makes them more future-proof and resilient. 

These projects can also attract investment, bringing prosperity and enabling the funding of environmental projects with local impact. Last but not least, collaboration and mutual benefit can also strengthen communities. 

All this is highly attractive for regions working toward achieving the goals of the Paris Agreement and the Sustainable Development Goals (SDGs), especially 7 (affordable and clean energy), 11 (sustainable cities and communities) and 12 (responsible consumption and production).  

While the arguments are compelling, energy communities are some way from becoming a reality for many regions. Regulatory complexity, financial hurdles, and the need for strong community engagement are all obstacles that many encounter along the way. 

Among other challenges, energy communities may struggle to get off the ground due to: 

Financing: High upfront costs, financing difficulties and uncertainty around revenue streams are all stumbling blocks.  

Policy: Complex regulatory frameworks, permitting and zoning issues and legal restrictions present significant red tape that’s beyond the abilities of many citizens to deal with. 

Technology: Limited access to advanced technologies, technical integration and interoperability issues, and systems maintenance and reliability are all hurdles for the inexperienced.  

Social factors: Community acceptance and engagement is not a given with these projects, so there’s a lot of work to do. Resistance to change, lack of trust or cooperation and aversion to risk can also hold things back.  

Environmental factors: It isn’t always easy to find a suitable site for large-scale solar panels or wind turbines that’s close enough to end-users but doesn’t negatively impact the local environment or residents’ wellbeing. 

These issues are compounded by a widespread lack of awareness and understanding of the benefits of renewable energy, insufficient training and expertise and misinformation and misconceptions that muddy the waters. 

If you can overcome those challenges (more on this later), however, the potential rewards are immense: cleaner energy, stronger local economies and more resilient communities.

Fortunately, examples exist in the form of pioneering regions across Europe. Let’s take a look at some of them next.  

These three European regions are leading the way when it comes to establishing successful energy communities.

Speaking at the MAIA project energy policy event in 2024, João Dinis from Cascais Ambiente shared the region’s ambitious plan to slash carbon emissions. This includes offering free public transport to reduce vehicle emissions and empowering residents to become energy producers through community solar projects. 

Several solar installations are already operational locally, supported by local NGOs and EU grants, demonstrating the possibility of leveraging external resources for sustainability projects.

Education and community engagement are central to Cascais's strategy. As João emphasized, "Understanding the financial aspects, like cost assessments and return on investments, is key to keeping the community engaged and supportive." This approach ensures that residents are not just beneficiaries but active participants in the town's energy transition.

Knowing that knowledge-sharing and collaboration are key, Cascais is also participating in six EU projects to share best practices. Working with other regions or municipalities like this can help to amplify the impact and accelerate progress towards sustainability goals.

 the picturesque Åland Islands of Finland, Green Party representative Pia Widén explains how the region’s decentralized system of small municipalities creates unique challenges and opportunities. While individual municipalities’ autonomy over clean energy installations means they can act independently, it can also lead to competition and delays.  

Despite these challenges, Pia highlights the significant economic opportunities that sustainable energy communities offer for the region. She suggests a potential community ownership model inspired by Alaska, where residents can become owners and receive dividends from energy projects. This also offers the potential to explore other technologies like hydrogen gas. 

Finally, Pia stresses the need for swift action to capitalize on financial benefits, emphasizing the potential for individual income of around €2000 annually from renting water areas, and up to €60 million per municipality per year. These figures emphasize the potential for economic resilience and a fairer transition through renewable energy communities. 

Over in Austria, they're taking the "community" in energy communities very seriously. Crucially, explains Tara Esterl from the Austrian Institute of Technology, Austria’s national energy strategy mandates collaboration between energy communities and incumbent Distribution System Operators (DSOs). This framework ensures transparent rules for allocating returns from energy projects, fostering both community participation and a sense of ownership.

What really stands out is Austria’s focus on inclusivity, however. These aren't just feel-good projects; they're actively working to benefit vulnerable households and tackle energy poverty. As Tara emphasized, "It's crucial that energy communities are seen as friendly, supportive groups that benefit everyone in the community."

This approach seems to be yielding positive results, with local residents increasingly recognising the role of energy communities in advancing sustainability goals while improving energy security and affordability. 

These examples offer important learnings for anyone looking to follow in their footsteps and overcome the many challenges. Let's take a look at how to do that next.

Among other measures, the regional representatives recommend tackling the challenges through a mix of:  

Financial support: This might include incentives, subsidies, community funding models and cooperatives.

Simplified regulatory processes. Supportive policy changes, legal assistance and resources are also needed to help navigate compliance requirements. 

Facilitating technology transfer and partnerships. Other things that can help are developing standardized protocols for integration and training local technicians in maintenance. 

Community engagement and educational campaigns. These should feature promotion of success stories and role models, trust-building activities, offering incentives for participation, training and certification courses and countering misconceptions. 

Comprehensive social and environmental impact assessments. These need to be carried out pre-deployment to minimise harm to biodiversity and ensure projects align with local needs, values and priorities.

Collaborative governance structures. These must promote transparency, inclusivity and accountability to build trust and foster cooperation.

As we look to the future, it's clear that energy communities have the power to transform not just how we produce and consume energy but how we come together as neighbors and citizens. 

Whether it's through solar panels in Portugal, wind farms in Finland, or inclusive energy policies in Austria, communities across Europe are proving that when it comes to sustainable energy, the future is local, collaborative and bright.

So, the next time you flip on a light switch or charge your phone, take a moment to imagine what it would be like if that energy was generated in your community, by your community and for your community.

With energy communities on the rise, that future might be closer than you think.

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