Community energy must be rejuvenated, report says

The think tank points out that community energy groups have struggled to make effective business cases due to changes in Government strategy.

In 2014, the Government anticipated that 1m homes would be powered by community energy schemes by 2020.

However, in 2018, there were only 67,000 homes benefiting from such schemes.

The report was released at the same time as a new manifesto was launched by multiple organisations to promote community energy development.

What is community energy?

Community energy projects involve a group of people joining together to own, manage and generate energy while also reducing the local carbon footprint.

In terms of energy generation, it means communities jointly owning renewable energy sources such as solar panels and wind farms.

While a strategy was launched with much fanfare in 2014, shifts in government policy on subsidies and tariffs have resulted in community energy projects stalling.

31% less generation capacity was installed or acquired by community groups in 2017 than in 2016, and at least 66 projects are known to have failed or stalled in 2017.

In the new report, "Community energy 2.0: The future role of local energy ownership in the UK", Green Alliance highlight the advancements made in renewable energy which have reduced costs and improved processes.

They suggest four opportunities for the Government to support community energy ownership, starting with the opening of new routes to sell to local energy markets.

In addition, they point out that community energy projects bring other important benefits such as carbon reduction, local economic growth and social benefits which should be recognised.

Finally, they suggest that more trials should be undertaken with community groups and that different forms of community ownership should be explored.

Manifesto for community energy

The "manifesto for community energy" signed by 20 organisations reiterates the conclusions made by Green Alliance, one of its signatories.

However, it represents a coordinated approach on behalf of the community energy sector to demand government puts local renewable schemes at the heart of policy.

In response to the manifesto, the Government pointed out that £15m of funding has been made available for feasibility studies amongst other steps to support small-scale low carbon energy generation.

They will respond fully to the report from Green Alliance in due course.

Future of renewables up for grabs

The cost of renewable energy in comparison to fossil fuels has reduced in recent years, yet the policy confusion has limited investment by the private sector.

It also means that community-based projects are having to prove their business cases more comprehensively, no doubt putting off some organisations who don't feel they have the relevant skills or support.

The scrapping of the solar feed-in tariff from April 2019 will leave some households essentially giving free energy back to the National Grid for an unspecified period of time.

While a consultation is underway to introduce a Smart Export Guarantee (SEG) to replace it, there is no definite date on when this might be introduced - if at all.

Small-scale energy generation offers an alternative to energy markets dominated by the "big six" and challenger providers.

Some of these challenger providers, however, are wholly based on renewable energy themselves, with Bulb hoping to pass the 1m customer mark in 2019.

Even so, as far back as 2016, energy providers were arguing that government policy was driving investment away from the sector.

Until a more coherent strategy on renewable energy generation and ownership is established by the Government, uncertainty around small-scale community energy projects will likely remain.