Price support allows communities to raise low-cost citizen finance for renewable energy projects

Community energy groups can raise citizen finance for renewable energy projects at lower interest rates than from commercial lenders, but they often depend on price guarantee schemes. Policies providing price stability and business model innovations are needed to realize the sector's potential contribution to the zero-carbon energy transition. Messages for Policy Schemes like the Feed-in Tariff provide price stability, thus de-risking community energy projects for citizen investors and allowing smaller projects to be funded by low-cost citizen finance. Without some price support, only a minority of current community renewables business models are likely to still be viable. Projects with an on-site customer for their power - typically solar rooftop photovoltaics on buildings with high daytime energy demand - are the ones that perform best without price support revenues. Growth of the sector could be supported by encouraging, or even mandating, public-sector bodies to purchase community-generated energy on long-term contracts. Alternatively, a floor price for exported electricity, or support for smaller projects in the UK power auctions scheme (Contracts for Difference), could provide price stability for community energy.