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Investing in a Renewable Future – Renewable Energy Communities, Consumer (Co-) Ownership and Energy Sharing in the Clean Energy Package.

Written by Jens Lowitzsch.
The article was published in European Energy & Climate Journal, 9, 2020.


Consumer (co-)ownership in renewable energy (RE) is one essential cornerstone to the overall success of Energy Transition. When consumers acquire ownership in RE they can become prosumers generating a part of the energy they consume such reducing their overall expenditure for energy while at the same time having a second source of income from the sale of excess production. In June 2018, the European Union agreed on a corresponding legal framework as part of a recast of the Renewable Energy Directive (RED II) which entered into force in December 2018:

– Consumers, as prosumers, will have the right to consume, store or sell RE generated on their premises, (i) individually, that is, households and non-energy small and medium sized enterprises (SMEs) and collectively, for example in tenant electricity projects (Art. 21 RED II), or (ii) as part of Renewable Energy Communities (RECs) organised as independent legal entities (Art. 22 RED II).

– Transposing the RED II into national Law until June 2021 Member States – amongst others – have to adopt an enabling framework for prosumership and in particular for RECs. Defining citizen’s rights and duties the directive links prosumership to such different topics as fighting energy poverty, increasing acceptance, fostering local development and incentivising demand-flexibility.

The RED II is part of the Clean Energy Package of the European Union3 and its rules are embedded in those of the 2019 Internal Electricity Market Directive (IEMD) and Regulation (IEMR).4 The transposition of these comprehensive rules – in particular those on energy communities – requires developing, implementing and rolling out business models that broaden the capital participation of consumers in all 28 Member States. The challenge is to include municipalities and/or commercial investors like SMEs and advance to economies of scale while retaining the benefits of individual consumer participation.

This article gives an overview of the most important new rules on (Renewable) Energy Communities in the context of the RED II and the IEMD/R. Against the background of the relevance for financing RE prevalent business models for RE-investments across the EU are looked upon to analyse how they fit the new framework.5 A specific focus lies on “energy/electricity sharing” within RECs and the underlying (digital) technologies.
It also presents a financing concept for consumer (co-)ownership compatible with the requirements for (Renewable) Energy Communities, that is, the Consumer Stock Ownership Plan (CSOP).

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