UPDATE: EU negotiators reached agreement Monday evening (12 November) on a legal framework for “citizen energy communities” in a deal solar PV manufacturers hailed as a victory for small-scale renewable energy production.
The deal on energy communities was reached during negotiations on the reform of the EU’s electricity market directive, said Florent Marcellesi, a Spanish lawmaker from the Green party who was in the European Parliament’s delegation at the talks.
“Member states shall treat citizen energy communities in a proportionate manner and guarantee the right to energy sharing,” Marcellesi told EURACTIV in emailed comments after the talks, which took place behind closed doors at the European Parliament in Strasbourg.
There are currently around 3,000 energy communities across Europe, according to REScoop.eu, the European federation for renewable energy cooperatives.
The European Commission estimates that by 2030, more than 50 GW of wind and more than 50 GW of solar could be owned by energy communities, representing 17% and 21% of installed capacity, respectively.
Key elements of the deal includes the possibility for energy communities – located in the same building or neighbourhood – to own, rent or purchase their own electricity distribution network, according to people familiar with the matter. Network charges will by default not apply when electricity is consumed on location, for example in the same building or complex.
Network ownership will be subject to approval from national authorities, however. This was a concession made to member states which have a monopoly in the management of distribution networks, like Enedis in France.
But when network charges do apply, they will have to be defined according to a transparent cost-benefit analysis, performed under regulatory supervision and taking into account the positive effect of distributed generation, said people involved in the talks.
Citizens in control
Perhaps more importantly, the very concept of local energy communities was renamed ‘Citizen Energy Communities’, in a move aimed at reinforcing their principle of autonomy.
“We are now talking about citizen energy communities, and the name goes far beyond the semantic. It designates an entity that is autonomous, local and managed by real people and legal entity,” Marcellesi told EURACTIV.
However, virtual exchanges of electricity along greater distances – so-called ‘virtual net metering’ – was voted down, in what appears like a concession to Germany, which insists that all energy producers big or small pay a contribution for using the electricity grid.
Aurélie Beauvais, Policy Director of SolarPower Europe, hailed the agreement, saying it “will support the uptake of renewable energy communities, which is so important to make the energy transition a reality.”
Provisions on electricity sharing “will reinforce Europe’s leadership and innovation in decentralised energies,” Beauvais told EURACTIV in emailed comments, warning however that critical talks were still lying ahead to wrap up the reform of the electricity market.
“It is critical that we now get the right electricity market design for small-scale solar, active consumers, and storage – only then will energy communities, SME’s and rural areas be able to fully take part in the energy transition,” she said.
Legal clarity sought on governance
Some crucial legal detail still need to be ironed out, however.
According to Marcellesi, the deal on energy communities means only natural persons (i.e.: individuals) can be among the shareholders and have decision-making powers in the governance structure of citizen energy communities.
“This is a real change of paradigm,” Marcellesi said, explaining that private companies with a local stake can still join a community but without a role in the governance structure. “This is important to ensure real citizen ownership and avoid abuse of the status by large companies.”
But it is still unclear whether the formulation on “natural persons” will be retained in the final text of the electricity market directive, said REScoop.eu, the European federation of cooperatives.
Local authorities, for instance, have strong expectations regarding their representation in the governance structure of local energy communities, REScoop.eu explained, saying this is a point that will need to be clarified in further negotiation rounds.
2030 targets cleared
Still, the mood in Strasbourg was upbeat. The deal on energy communities came just hours before the European Parliament rubber-stamped three pieces of EU legislation – on renewables, efficiency and governance – on which agreement had been reached earlier in June.
The vote formally writes into EU law a legally-binding renewable energy target of at least 32% and an energy efficiency target of at least 32.5%, both of which are to be attained by 2030.
Solar energy made simple
With the new renewable energy directive in place, households now have a right enshrined in EU law to produce electricity using solar panels, sell any excess production to the grid and get a market price for it, said BEUC, the EU consumer organisation.
The new law includes the creation of contact points to advise and support people interested in installing solar panels on administrative and permitting procedures, BEUC said. And it will also prevent EU countries from applying prohibitive charges such as Spain’s infamous “Sun tax”.
“Solar energy should be within everybody’s reach,” said Monique Goyens, director general of BEUC, adding the new law provides more certainty for “people who have been on the fence and who previously hesitated about investing in solar panels.”
Green MEP Florent Marcellesi was equally pleased with the Parliament vote. “On the day where the Parliament formally approves the Renewable Energy Sources directive, we successfully built a second leg for citizen energy to stand, grow and run,” Marcellesi said.
“More than ever we need to encourage these local initiatives, a key element to promote citizens empowerment of the energy transition,” the Spanish MEP added.