Legal and regulatory challenges to the development of renewable energy communities

Abstract

The Renewable Energy Directive defines Renewable Energy Communities (REC) as legal entities with open and voluntary participation, controlled by shareholders or members near renewable energy projects. REC aims to provide environmental, economic, or social benefits to shareholders and local areas, focusing on activities like generation, consumption, aggregation, energy supply, and sharing. The study examines REC practice in Germany and Sweden, focusing on local production and customer engagement. The paper analyzes the legal framework, challenges, and potential improvements. The lack of a legal definition of Renewable Energy Certificates (REC) in Germany and Sweden hinders nationwide development and challenges the Renewable Energy Act of 2021. Germany's lack of a legal framework for self-consumption and energy sharing hinders renewable energy distribution. The government may redesign energy market structures before addressing regulatory frameworks. Germany's shift towards market systems has negatively impacted the energy market and transition process. The Swedish legal framework lacks legislation for regulating ECs, and proposed law is insufficient. Adopting the Community Energy Plan would benefit national legal frameworks for ECs, but an ambiguous definition makes it difficult to identify ECs for policy measures. In addition, understanding sociotechnical imaginaries can help formulate more effective energy policies and technologies by considering social values, beliefs, and aspirations influencing energy transitions.