Policy

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Shared Community Ownership

of Renewable Energy systems

All about shared community ownership under the Community Energy Strategy's voluntary protocol

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Key asks:

  1. Make it easier for renewable energy projects to secure planning permission where a community has been offered an opportunity to invest.
  2. Make it easier to secure Financial Conduct Authority (FCA) accreditation for shared ownership arrangements.
  3. Make it easier and cheaper for developers and communities to secure bank finance for shared ownership schemes.
  4. Enable the Green Investment Bank to provide low cost finance to community energy groups.
  5. Require Distribution Network Operators to offer separate connection facilities, when called on to do so.
  6. Resource a body to:
  • Implement a partner-finding platform
  • Develop peer mentoring programmes
  • Develop template contracts

Policy improvements proposed by the Taskforce

The report of the Taskforce identified several areas where policy needs to be enhanced to make the share ownership agenda effective. Extracts are shown below and the key 'asks' on the right.

Planning, consenting and local government

Increased probability of planning consent is a major value driver for the shared ownership approach. The planning system does not currently establish a strong enough link between local community support and planning consent. This link needs to be made clearer and supported further, with weight accorded in law.

Grid connection

Community projects are disadvantaged in the way in which grid capacity is currently allocated.

Local Authorities

Local Authorities can play a vital role in facilitating the deployment of renewable energy, community and shared ownership. Central central government should support this more actively.

Finance and incentives

There is currently limited experience of bank and investor funding of shared ownership renewable energy schemes. Banks and other financiers need to become more flexible in their approach to the financing of shared ownership schemes - both for communities and the commercial developers involved in a project. To enable this, Government must stabilise the current policy environment for renewables and put an end to its negative politicisation of renewable energy development.

Tax incentives

There is also a need to ensure that the tax incentives available for investment in community schemes are available to individuals investing in shared ownership schemes such as EIS eligibility.

Support mechanisms

The Feed-in Tariff may be extended to cater for community renewables projects up to a capacity of 10MW.

There will be a need for greater clarity as to the type(s) and level of support available to both community groups and commercial developers when applying for support as part of a shared ownership arrangement.

Ofgem’s registration procedures may inhibit the registration of shared ownership projects, particularly those with split ownership.

The administrative burden

Any additional administrative costs will need to be minimised and offset within the wider project costs if we are to realise a significant increase in the shared ownership of renewable energy infrastructure.