The Government announced their first Community Energy Strategy today, paving the way for more control over energy bills and helping to transform the energy system.

These plans mean that the Government will broaden the support available for community energy projects, in which people are able to come together to reduce energy usage or purchase and generate their own energy.

These plans include:

  • £1 million Big Energy Saving Network funding to support the work of volunteers helping consumers to reduce their energy
  • £10 million Urban Community Energy Fund to kick-start the community energy generation projects in England, to complement the existing £15 million Rural Community Energy Fund
  • A community energy saving competition, offering £100,000 to communities to develop innovative ways of saving energy and money
  • The formation of a dedicated Community Energy Unit within the Department of Energy and Climate Change (DECC)
  • A 'one-stop shop' of information resources for people with interest in developing community energy project

Under the new plans, community groups are able to apply for up to £20,000 to undertake feasibility work and apply for loans of up to £130,000 to help complete projects.

Energy and Climate Change Secretary Ed Davey said:

"We're at the turning point in developing true community energy.
"The cost of energy is now a major consideration for household budgets, and I want to encourage groups of people across the country to participate in a community energy movement and take real control of their energy bills.
"Community led action, such as collective switching, gives people the power to bring down bills and encourage competition within the energy market."

Energy and Climate Change Minister, Greg Barker said:

"The Community Energy Strategy marks a change in the way we approach powering our homes and businesses - bringing communities together and helping them save money – and make money too.
"The Coalition is determined to unleash this potential, assist communities to achieve their ambitions and drive forward the decentralised energy revolution. We want to help more consumers of energy to become producers of energy and in doing so help to break the grip of the dominant big energy companies."

Since 2008, around 5,000 community groups have participated in energy projects in the UK. For example, the Ashton Hayes Going Carbon Neutral project, running in Cheshire, has saved local households an average of £300 a year through encouragement of changing their behaviour and installing simple energy efficiency measures.

Looking forward, the generation of electricity by communities is likely to put pressure of energy suppliers to lower prices, cutting carbon emissions, creating warmer homes and diversifying the UK's energy mix. Estimates suggest that generation schemes involving the communities, such as installing a solar panel on a social housing building, could supply enough electricity to power 1 million homes by 2020.

Community shared ownership schemes with renewable developers will be an important part of the future, ensuring that local people are able to reap the benefits of energy developments in their area.

The Government's vision is that all communities that wish to take on an energy project should be able to do so. The Community Energy Strategy sets out how they are taking measures to remove the barriers faced by communities that wish to take action and to create opportunities for more people to get involved.