Community Energy Federation of Ireland

On 7th March 2025, CEFOI submitted two recommendations to the Government’s Consultation on Community Benefit Funds under the Renewable Electricity Support Scheme – 1) to clarify that 100% community owned energy projects are not required to establish Community Benefit Funds 2) Facilitate the investment of Community Benefit Funds into 100% Community Owned Energy, in an equitable way.

Community Energy Federation Ireland (CEFOI) is group of communities and people advocating to remove barriers and improve supports for 100% community owned energy projects – including community owned renewable energy generation, storage and distribution.  Many members of this group have extensive experience attempting to establish community owned renewable energy generation projects over 50kw, and have faced many barriers, with only one such project (Templederry Wind Farm) being successful so far.  

Recommendation 1: Clarify that 100% community owned energy projects are not required to establish Community Benefit Funds

Relevant to question 25 of the consultation document

This consultation relates to Community Benefit Funds which are required for projects which are in the Renewable Electricity Support Scheme (RESS) scheme. No 100% community owned project has been successful in completing the seven milestones set out in the RESS scheme due to grid connection delays.  Recently the SRESS scheme has been introduced for 100% community owned energy projects, so going forward, such projects will be under SRESS and not RESS.

If Community Benefit Funds are only required for RESS projects, this would imply that 100% community owned energy projects are not required to establish a Community Benefit Fund.  

However this sentence of the consultation document could indicate otherwise:

“For the purposes of the RESS 5 T&Cs, it is proposed that the changes introduced in the RESS 4 Terms and Conditions, including the requirement for all projects which produce electricity, regardless of whether they remain in the RESS, to maintain a CBF for the relevant support period, usually 15 years, will be maintained.”

The above sentence is ambiguous.  It could be interpreted that projects which were in the RESS and then leave the RESS must establish Community Benefits Funds.  However, it could also be interpreted that all electricity generation projects, including community owned projects (which are in SRESS not RESS, or which are not in any such scheme) will also be required to establish Community Benefit Funds.

CEFOI is calling for the documentation to make very clear that 100% Community owned energy projects will not be required to establish Community Benefit Funds.

Rationale:

• Administering a Community Benefit Fund is a work intensive and costly exercise.  100% Community owned energy projects already face many administrative and cost barriers, and this would add a further barrier.
• Unlike private developer led projects, 100% Community owned energy projects are set up by definition to benefit the community.  Therefore, while the CBF mechanism is needed to ensure that communities benefit from private developer-led projects, it is not needed in the case of 100% community owned projects.
• 100% community owned energy projects must, by definition, follow the definition of “Renewable Energy Community” (REC) and be run by an entity:
  • (a) which, in accordance with the applicable national law, is based on open and voluntary participation, is autonomous, and is effectively controlled by shareholders or members that are located in the proximity of the renewable energy projects that are owned and developed by that legal entity;
  • (b) the shareholders or members of which are natural persons, SMEs or local authorities, including municipalities;
  • (c) the primary purpose of which is to provide environmental, economic or social community benefits for its shareholders or members or for the local areas where it operates, rather than financial profits.
• Therefore community owned energy projects re-invest any surpluses in expanding community owned energy, and in related social and environmental objectives.  Such projects are open to all local community members to join, and should be subject to one-member-one-vote governance rather than acting in the interest of financial investors. Therefore there is no need for such projects to establish separate Community Benefit Funds.

Recommendation 2: Facilitate the investment of Community Benefit Funds into 100% Community Owned Energy, in a way which supports equity

Relevant to question 24 of the consultation document

The consultation documents discuss the potential for funding from Community Benefit Funds to be directed into “Energy Transition” .  The existing CBF hand book includes “Goal 7 – Affordable and Clean Energy: Funds could support energy efficiency projects or initiatives that encourage and deliver renewable electricity generation projects. Giving local communities the ability to buy into the process themselves can be an important step in the development of sustainable energy communities.” and “It is recommended that extra weighting should be given to proposals that have energy efficiency, sustainable energy and climate action initiatives”.

We recommend strengthening these provisions by providing a framework and more detailed guidance for how communities can invest proceeds of Community Benefit Funds from private developers, into their own community owned energy projects.  Such investments should not be simply a share in the private developer led project which is inseparable from that project, but rather they should be investments in community owned energy projects which the community can continue to own and operate independently, even if the developer-led project was to close or change ownership in future.

The framework and guidance should specify how Community Benefit Fund finance could be combined with other financing sources, to establish 100% community owned energy projects.  Finance from the Community Benefit Fund to 100% community owned energy projects could include both grant finance and low interest loan finance.  In the case of grant finance, it could be structured in a way that subsidises membership of local people in community energy projects, so that such membership is accessible to people of all income levels in the community. 

Conclusion

We call on the Government to consider these two recommendations to ensure that the Community Benefit Fund supports and does not hinder the development of 100% community owned energy.