imon and Sarah are part of a working group co-ordinated by Carbon Leapfrog which is assisting community energy project, MOZES, to challenge the UK Government’s policy on state aid and community energy projects. Here, they outline the impact of the policy and compare to elsewhere within continental Europe where the legislation has been more liberally interpreted.
EC leaders have committed to transforming Europe into an energy-efficient, low carbon economy, with ambitious targets for reducing greenhouse gas emissions and increasing each economy’s reliance in renewable energy by 2050.
In the UK, the current coalition Government has committed “encouraging community-owned renewable energy schemes where local people benefit from the power produced”. The Government has often stressed its importance if the UK is to reach its own carbon reduction targets. However, the UK Government’s policy on state aid and its application to community energy projects has left some organisations out of pocket, and unable to use the proceeds from renewable energy generation to benefit the community.
The experience of one community energy project MOZES, which working in a deprived residential area of Nottingham in the midlands of England, illustrates how community groups have been caught out by the UK Government’s change in state aid policy. In comparison with other member states, which have arguably been more lenient in their interpretations of the prohibition on state aid, the UK Government seems to have taken a rather hard line.
BWB, the UK’s leading legal advisers to not for profit organisations and businesses with social purposes, has been working with MOZES, Carbon Leapfrog and others to negotiate the UK’s policy, and continues to campaign on MOZES’ behalf.
Importance of community renewables
Community-owned renewables provide a dual benefit. They contribute directly to achieving the UK’s target of 15% of energy consumption from renewable sources by 2020 and help to foster public support for renewable energy generation. When payment of Feed-in Tariffs (FITs) by licensed electricity suppliers to generators of small-scale low carbon electricity was introduced, it was presented as a key policy tool for delivering growth in this sector. Three years later, despite cross-party support, a combination of UK Government and European Commission policy decisions have undermined the scheme’s potential for growth in the community renewables sector.
