Community energy is a broad term referring to the development of locally owned renewable energy, energy efficiency or demand reduction projects.
These projects can be wholly owned and managed by the communities where the projects are situated, or developed in partnership with public sector or commercial bodies.
Development of community energy has a number of advantages:
Successful community energy projects are often created with specific goals in mind but can arise from opportunities created by external partners or developers. The benefits can be managed in a way that maximises the goals or ambitions of the group.
Community groups can draw on a wide range of support: from advice on setting up groups and the associated legal structure, to feasibility studies and ultimately financing and construction of projects. Advice is often available for on-going management of a project, from technical support to managing the financial benefits so they can used to support a wide range of non-energy related goals.
The Ofgem Energy Industry Voluntary Redress Scheme is playing a significant role in supporting community energy projects across the UK through its Just Transition Fund.
£3.5m from the fund has been granted to nineteen organisations across England, Scotland and Wales, to support the development of community renewable energy that benefits vulnerable residents by reducing energy bills and promoting carbon reduction initiatives.
The fund aims to build the capacity of the community energy sector and demonstrate how a just transition to net zero can benefit everyone.
Find out more about the types of projects Redress has helped fund and how your community project can apply for support here.
Supporting community and public sector organisations in Wales to reduce energy use, generate locally owned renewable energy and cut carbon emissions.
We're a partner in the Local Energy Scotland consortium that manages the Scottish Government's Community and Renewables Energy Scheme.
Community energy is all about a group of people coming together, taking action and using local resources to reduce, manage or generate…
Last updated: 3 July 2025
