This is how we enable community energy at scale

On Thursday February 6th, evidence submitted by E.ON to the Energy Security and Net Zero Committee’s Unlocking Community Energy at Scale enquiry was published. 

Two of that committee’s three stated aims are to “Identify potential solutions to the financial and regulatory barriers facing community energy projects, including how to establish local supply,” and to “assess how reforms to the planning system, grid connections and the energy market could support the growth of community energy at scale.” 

In our evidence, we suggested that one of the most effective ways the Government could enable more community energy would be to reconsider some of the network costs that are applied to locally generated electricity, in no small part because this would allow and incentivise people around the country to establish Energy Sharing Communities. 

Community power through sharing

Energy Sharing Communities allow public buildings and businesses such as schools, hospitals, libraries, and supermarkets to install solar panels on unused roof space to help meet their energy needs while selling surplus to local consumers as a source of additional revenue. In our evidence to the committee, we estimated that around 40% of all monetary value from community scale generation is ‘lost’ to third parties via taxes, levies, and especially transmission and distribution costs, which is a major disincentive to get these kinds of communities running. 

In Spain, however, all network costs and levies for renewable energy were removed in 2019, allowing us to demonstrate the effectiveness of an Energy Sharing Community at work. In the town of Adeje, Tenerife, we installed a 100kWp solar system on the roof of the Escuela de Musica Theatre, earmarking 35kWp for the building and 65kWp for the local community, the rights to which were sold out within one week. 

After expanding to several other sites in Adeje in year one, the pilot has since provided power to hundreds of households, and will serve even more in year two. Rolled out to the whole of Spain, Energy Sharing Communities could generate 10gWp of clean, locally produced electricity by 2030 – enough to power roughly 7 million homes – and similar can be said for the UK. 

Bringing energy sharing to the UK

As shared with the committee through our submitted evidence: while large power stations can expect the electricity they generate to travel physically through both distribution and transmission networks in order to reach consumers, and should therefore pay towards using those networks, more decentralised energy sharing communities are likely to serve demand only in localised areas and not make use of these wider-reaching networks. 

Not only does this make it appropriate to spare small renewable generators the burden of transmission and distribution costs, but we think that doing so could usher in an energy sharing revolution and unlock massive potential for the UK. 

We’re not alone. According to the Council for the Preservation of Rural England: “All suitable roof space and car parks in the UK could generate a whopping 117GW,” which is considerably more than the Government’s total solar target of 70GW by 2035, and nationally representative polling we commissioned from YouGov has found that an astonishing 93% of people agree that “it would be a good idea to install solar panels on public buildings such as schools, hospitals, churches, and libraries to help power local communities” (compared to only 2% who disagree). 

This is why our evidence to the committee also signalled our intention to bring an energy sharing pilot to London in 2025, demonstrating that a simple rule change like the one in Spain could have a huge positive impact not just on community energy, but communities themselves. 

By giving British communities more control over the power they use, we can drive further progress towards net zero, maintain public support for the green transition, and make new energy work. 

To  find out more about Energy Sharing Communities, take a look at Connecting communities through energy sharing | E.ON News