The Community Energy State of the Sector 2025 report, published by Community Energy England, Scotland and Wales, has highlighted the vital role that co-operatives continue to play in delivering community energy. Out of 614 organisations delivering community energy schemes in 2024, the year for which data was analysed, 62 were co-ops.
The report shows that community organisations overall generated more renewable electricity than ever during 2024, producing 575 GWh, the equivalent of powering over 212,000 homes. This helped to increase the UK community renewable energy capacity to 411MW composed of 266 MW of solar PV, 132 MW of wind and 13 MW of hydro. During the year, renewables generated over half of the UK’s electricity for the first time, a new record.
The report confirms that the community energy sector continues to expand, providing significant benefits. In 2024, it saved over 120,000 tonnes of carbon, engaged over 61,000 people, and raised £24m for new projects. Significantly, this created 88 jobs and boosted local economies to the tune of over £20m. In the same year, the UK Community Energy Fund (CEF) was open but very few projects benefiting from CEF funding were installed during the year. The publication hopes “that subsequent reports will show that ‘the biggest expansion of support for community energy in history’ which the government has promised will result in the sector returning to doubling in size every year, which is necessary to achieve the government’s ambitious targets”.
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Co-operatives have a proud history of developing, funding and building community energy schemes. One of the first in the UK was Westmill Solar in Oxfordshire, which has been generating electricity since 2012. The installation, comprising over 20,000 polycrystalline PV panels, generates around 5GWhr per year, enough to power 1,500 homes. It was the UK’s first and, at the time, the world’s largest co-operatively operated, community-owned solar park. As the report highlights, since then, a plethora of community energy schemes have been installed by co-operatives across Europe and beyond in all the major renewables, actively supported and promoted by REScoop.eu, the European Federation of Energy Communities, a network composed of 2,500 energy co-operatives engaging more than 2 million citizens in climate action.
Co-ops are also leading the way with innovative community energy projects, which not only tackle the climate crisis but also address related issues around biodiversity. In the Dutch municipality of Olst-Wijhe the community has developed an energy and nature park at Noordmanshoek. Here, a group of neighbours in co-operation with Natuur en Milieu Overijssel, Wageningen University, and a local energy co-operative called ‘Goed Veur Mekare’ have developed a plan for the 6.5-hectare site incorporating a 7.5 GWh solar array which now supplies electricity to 2,200 homes.
However, the panels only cover just over half the site, leaving space for nature, rewilding, agroforestry, hiking and cycling trails and a small number of eco-homes, all of which are being developed as part of the energy and nature park.
The report shows that 151 organisations and co-operatives – more than ever before – are engaging with energy efficiency to reduce bills for consumers and businesses in combination with energy advice and tackling fuel poverty. Co-ops have again led the way with projects such as EcoVision, formerly known as Energy Communities Tipperary Cooperative, which was established in 2015 by four local communities to carry out energy efficiency projects for old homes and community buildings in County Tipperary, Ireland. Since then, they have upgraded more than 900 houses and 50 community and commercial buildings, saving over 10 GWh of energy, the equivalent of the average annual electricity consumption of more than 2,300 Irish households.
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Like the UK, funding for community renewable energy schemes in Europe remains fragile, with fears that the Social Climate Fund, a key source of finance, will be reduced or cut this year. Following a one-year postponement of the Emissions Trading System 2 (the EU’s new carbon pricing system), 43 organisations and coalitions, including REScoop.eu, Climate Action Network Europe and Greenpeace, wrote an open letter to Wopke Hoekstra (European Commissioner for Climate, Net Zero and Clean Growth) and Dan Jørgensen, (European Commissioner for Energy and Housing), criticising the delay and the potential implications for the Social Climate Fund. The letter stated: “Delaying the introduction of ETS2 will postpone critical climate action and raise prices in 2028, while costing member states €50bn in lost auction revenues. This creates uncertainty as to whether the Social Climate Fund will be affected/cut.”
The report makes 10 key recommendations to unlock the potential of the community energy sector for tackling two major challenges – enabling new organisations to develop and putting in place the right policies to enable growth. In relation to funding, it recommends increasing support and access to finance through GB Energy or the UK government securing loans that communities can borrow to take up a shared ownership stake.
Despite fears about funding, the report predicts that with the right financial backing, the community energy sector will continue to both grow and diversify this year. New energy co-operatives across Europe continue to be formed, using citizen-led action to set up community energy schemes. Galvanising local communities to tackle climate change, they are helping to create much-needed jobs benefiting both local economies and the environment. The report concludes: “Looking to the future, the sector has a healthy pipeline of new projects, services, investment, innovation and startup organisations, but even more could be unlocked if a range of barriers causing projects to stall were removed.”
Local energy co-operatives have a critical role to play in driving forward the transition to renewables both nationally and internationally by enabling citizens to invest in and co-own wind, solar, and bioenergy assets.
By taking action to tackle the climate crisis, co-operatives have powered local economic and social development and significantly strengthened public support for the transition to a clean, green energy future.
