Europe currently stands at a crossroads. It must address several imperatives: ensuring energy independence, security, and access to affordable, clean renewable energy. Europe’s last energy crisis exposed the continent's profound vulnerability caused by over-reliance on imported fossil fuels. This issue has only been further compounded by entering into new deals for imported fossil gas from unreliable and increasingly belligerent global partners acting in bad faith.  

Even the Draghi report admits that as long as imported gas remains a significant element of the EU’s energy mix, it will be impossible for citizens and consumers to comprehend the full benefits of renewable production. It is clear that to break free, Europe needs to move towards an energy system driven by domestic renewable energy production, and local community ownership is essential to achieving this objective.  

As part of its strategy to chart a new course, the European Commission is developing the Citizens Energy Package (CEP) as part of its broader Clean Industrial Deal (CID) and Affordable Energy Action Plan. While the CEP may not garner as much attention as other related initiatives, citizens and local communities are indeed watching: we expect something bold and ambitious.  

The case for local ownership of renewables  

Energy communities – networks of citizens, SMEs, and local authorities – are not merely a niche social experiment. They are essential strategic partners in securing a clean, affordable energy supply. A CE Delft study projected that, by 2050, 45% of renewable energy production could be owned by EU citizens, with 83% of European households actively participating in the energy system through demand response or storage. 

Numerous energy crises have already proven the benefits of this model. While market prices skyrocketed during the latest crisis, community-led initiatives across multiple countries were able to cap prices or keep them significantly below market rates as they supplied members through their own local production. Furthermore, research in France and Germany indicates that locally controlled renewable projects deliver 2 to 8 times more return to the local economy than projects built by external developers. This shows how energy communities can contribute to regional development.  

But it doesn’t stop there. In a recent survey undertaken by the ESPON-TANDEM project, 40% of the communities indicated that they intended to tackle issues around social inclusiveness, such as energy poverty. Furthermore, there are more and more studies showing that local ownership of renewable energy projects can contribute to public acceptance of such initiatives, as well as alleviate issues with the grid. 

Where the Citizens Energy Package comes in 

While the benefits of local community ownership of renewable energy resources are evident, many citizens around Europe still experience significant challenges trying to set up a community project. Issues range from lack of resources and capacity to regulatory and administrative barriers; reticence from grid operators and other market actors; and lack of legal clarity that can also contribute to corporate capture. While Member States were required by the Clean Energy for All Europeans package to put in place enabling frameworks to promote the development of energy communities by the middle of 2021, many have not complied. 

This is where the CEP comes into play. The CEP has the potential to reinforce the EU’s existing policies on supporting the build-out of an energy community movement. The CEP can provide a strategy for how the European Commission, national authorities, investors, regulators and grid operators can work together to support energy communities and turn the vision expressed in the original Clean Energy for All Europeans package into reality.  

The CEP should create an Energy Communities Action Plan that proposes and delivers on a distinct set of actions and measures to ensure Europe’s citizens can reach their potential in taking ownership in the transition to clean, locally produced renewable energy. At the forefront of delivery, the Commission should ensure that the CEP assists with the implementation of EU rules designed to create the conditions that enable energy communities to grow and thrive. 

This action plan needs to be supported by three guiding pillars. The first is setting an EU-level policy objective; a medium- to long-term guiding post that reflects the EU’s ambition to empower energy communities in the energy transition. An assessment of potential coordinated by the Commission, in cooperation with the Member States, should be in support of this target. 

Second, the Commission needs to produce distinct guidance for Member States on how to build out enabling frameworks for energy communities. This guidance should help Member States set their own benchmarks for assessing potential, identifying barriers, and adopting definitions and simple yet clear registration procedures so that energy communities can be acknowledged. It also needs to assist Member States in designing support mechanisms and renewables support schemes, integrating energy communities into local, regional and national energy planning, developing and supporting secondary structures of energy communities (federations and coalitions), supporting community initiatives that work on energy poverty, and collaborating with municipalities using public procurement procedures.  

Third, the Commission should take a focused approach to addressing non-compliance, not just through its enforcement powers, but also by providing transparency and facilitating dialogue. The Commission can play a unique role in this regard by creating a platform between national governments, energy communities and other national actors, such as investors and system operators, to foster a common understanding of issues and opportunities for collaboration.  

And it shouldn’t stop there…  

The Commission already took some preliminary steps towards supporting energy communities in its recently adopted Grids Package. In its guidance on grid connections, the Commission took a significant first step to move away from ‘first come, first served’ grid connection procedures, which discriminate against energy communities. In particular, the guidance invites Member States to consider replacing ‘first come, first served’ rules with priority schemes in areas with long waiting times for grid connections, including projects that deliver social value or can provide flexibility to the grid.  

However, the Commission needs to go further. Priority access to the grid is critical for communities to be able to supply themselves with their own locally owned, affordable renewable energy. Ultimately, EU legislation must be put in place to ensure a level playing field by requiring regulators and system operators to prioritise grid access for energy communities and locally driven projects that provide social value or grid flexibility. 

As the Commission reflects on a post-2030 legislative framework for the energy sector, priority grid access must be on the menu along with several other important issues, including strengthening and alignment of the EU definitions on energy communities and providing a level playing field for energy communities in energy sector regulation.  

The transition to a renewables-based system will only be sustainable if it is democratically controlled and publicly accepted. By prioritising local ownership, the EU can replace expensive fossil fuel subsidies with locally owned resources that provide secure, stable, and predictable energy prices. The Citizens Energy Package is the moment for the EU to prove that its “just transition” is more than a slogan – it is a commitment to putting energy back in the hands of its citizens. 


Cover: Envato