Self-consumption refers to the aim of producing energy that will be used by the owners of an installation and/or by dwellings and other energy users in the immediate vicinity.
The European Renewable Energy Directive defines two categories of self-consumption:
- renewables self-consumers refers to final customers who generate renewable electricity for their own consumption and may store or sell any excess. For non-household self-consumers, these activities must not be their primary business or professional focus.
- jointly acting renewables self-consumers are groups of at least two individuals who cooperate to generate renewable electricity and are located in the same building or multi-apartment block.
As legislation on self-consumption varies across Member States, ECs have developed diverse business models that are to either category, within relevant to national or local contexts. The Inspiring Practice of Repowering London demonstrates the range of actors that may need to be involved to manage both technical and legal aspects of establishing an EC for self-consumption.
Models for ECs and self-consumption
For ECs to facilitate self-consumption, one option is to install small solar PV systems on the roofs of individual houses, matching the size to the family’s energy needs (as in the Inspiring Practices of ECoOB below). More often, ECs will look for an appropriate location to install a larger PV project (e.g. on the roof of an apartment block or school or in a field) or a wind turbine (in rural areas). In parallel, they will develop a base of members (i.e. consumers) in the area whose energy needs (some or all) can be met through the production (i.e. seeking to match demand and supply).
In the activities described above, ECs effectively take on the role of investing and installing renewable energy on behalf of their members and/or other beneficiaries. Typically, the EC handles technical, operational and administrative tasks. Enhanced energy security at the local level is a key benefit of these approaches. By guaranteeing sufficient production for self-consumption by its members, the EC reduces their risk of exposure to volatile prices on the electricity market. In fact, many EC members have been well protected from price fluctuations linked to the ongoing energy crisis.
If the installation generates more energy than members need, the EC typically has the right to sell the excess into the grid and retain any revenues realised. In some cases, ECs have chosen to provide part of the produced electricity for free to energy-poor households. The latest revisions for the Electricity Market Design include new provisions defining the activity of energy sharing.
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