3.5.1.1 The CIC in community energy schemes

In the last 20 years, the UK has sought to promote the development of community and locally driven renewable energy initiatives as part of a national strategy, which aims to increase the production and the wider use of renewable energy in the country.1 The national strategy promoting renewable energy use and production was primarily the result of the country’s obligation as a Member State of the EU to achieve a certain target, i.e. 15%, in energy consumption from renewable sources by 2020.2 It was also the country’s objective to safeguard the abundance of its national energy resources and to protect the environment through the reduction of carbon emissions by 57% by 2030.3 All it was done simultaneously with promoting policies that could encourage community active engagement and the collective change of behaviour towards energy production and consumption.4

To that end, the UK favoured a policy concerning community driven renewable energy generation. Such a policy encouraged the development of a wide range of community and locally driven activities undertaken by community-based organisations.5 As such, the UK Government established national measures and subsidies, which facilitated community energy schemes.6 Among the measures introduced by the UK Government in 2010 is the feed-in-tariff (hereafter ‘FIT’) measure. The FIT promotes the generation of low-carbon electricity from a range of small-scale initiatives, such as community and individual renewable energy installations. The FIT is also a measure designed to reward and promote the generation of low carbon electricity from different small-scale initiatives.

In the scope of the FIT, individuals, households, communities and small businesses are encouraged to adopt, invest and participate in small-scale renewable energy generating projects, e.g. small-scale solar photovoltaic installations. As part of the FIT regime, the so called ‘export tariff’ allows individuals, communities and small businesses to trade the electricity produced by them through renewable energy means back to certain FIT accredited energy suppliers.7 Accordingly, eligible and certified small-scale installations are allowed to receive payments for the electricity produced which is exported-traded to the FIT accredited energy suppliers.8

The FIT regime determines the involvement of certain types of community organisations in the development of eligible small-scale energy installations for the production of renewable energy. These are small businesses and community organisations, in particular: (i) CICs; (ii) charities; (iii) subsidiaries wholly owned by charities; (iv) community benefit societies hereafter (BenComs); and (v) cooperative societies, defined in the FIT policy framework as ‘any of the following which has 50 or fewer employees’.9

The scholarship notes that the types of community energy schemes in the UK vary. They comprise a variety of community activities and community actors. In an empirical study on community energy projects, Seyfang et al. demonstrate that the broad spectrum of community energy actors in the UK engaged predominantly in renewable energy production and renewable energy conservation (storage) activities.10 The CICs are among them. According to Seyfang et al., renewable energy production and renewable energy conservation activities are either managed and/or owned by such community actors, such as the CIC.11 Walker notes, in this respect, the phenomenon of community ownership of community energy schemes in the UK.12 He discusses the advantages of ownership for communities owning and running such community energy schemes. According to him, community energy schemes can be used as incentives to encourage community engagement pursuant to the policy ambitions of the UK Government.13 The most significant advantage of community owned energy schemes acknowledged in the studies of Seyfang et al. and Walker include the generation of local income for the community, which allows the local community’s regeneration.14 According to Walker, community-owned means of production could generate income locally, through: (i) ‘returns on investment’; (ii) ‘the sale of generated energy in the form of electricity or heat’; or (iii) ‘the creation of employment’.15

Another second advantage of community owned energy schemes is the possibility of achieving lower energy costs for the community users. As such, the cost in the use of energy for the community is reduced. Thirdly, community owned energy schemes allow for the maintenance of community approval and legitimacy. Accordingly, community energy activities are subject to the community’s acceptance and legitimacy. Finally, the maintenance of local control over the community energy scheme safeguards the community’s control over the pace of development and operation of this scheme. Seyfang et al. also demonstrate the predominant economic, social, environmental, political and infrastructural incentives (Figure 3.2) of participants in community energy schemes.16 Such incentives are characterised by a tendency to ‘save money on energy bills’, ‘generate income for community’, ‘reduce carbon dioxide emissions’, increase ‘community well-being and health’, ‘promote community empowerment; and ‘improve energy independence’.17

In their empirical study, Seyfang et al. also found that among the community energy schemes in the UK, which undertake activities of renewable energy production, a majority of 71% among 190 examined community energy schemes, enable the installation of solar photovoltaic renewable technologies (Figure 3.2).18 The biggest part of these schemes is the development of solar panel farm projects. A solar panel farm is defined as:

Accordingly, scholarship notes the current and rapid increase of solar farms in the UK.20 However, such statements are unreliable in that there is no formal registration facility to quantify the existing solar farms developed in the UK as there is no official registry to demonstrate data regarding the development of existing solar farms in the UK. However, aggregate data regarding the increase of solar photovoltaic installations on the basis of total energy capacity in the UK are publicly available in the monthly Solar Photovoltaics Deployment Report produced by the UK Department of Energy and Climate Change.21 The data demonstrate a significant increase of solar photovoltaic installations of high and/or low power capacity in the last seven years 2010 – 2017 in the UK.22