Supporting New Community Energy Groups with Start-up Issues

This is a ’10 steps’ guide set up by CEL to help community energy groups quickly establish themselves such that they can accelerate the development of their projects. This guide aims to provide clear and simple information for newly emerging groups (and also more established groups who are continuing to grow and formalise) on topics like energy projects models, proper governance, how to constitute itself as an organisation, get funding, volunteer guidelines, communications, impact measure and more. You will also find here the steps involved in delivering a project, and guidance to assist groups to identify suitable technologies and progress projects.

Created by Angelica Santodomingo, Lorraine Haskell, Tim Minshall, Jenni Tyyska. Date: 4th June 2021

Community Energy Groups are formed by people coming together to create ground level solutions to tackle Climate Change, reduce energy inequalities, and reconnect people with how energy is consumed and generated.

They implement projects to reduce consumption of energy and reduce local carbon emissions by providing locally owned and governed sources of renewable energy, that generate funds for tackling fuel poverty and increasing energy efficiency.

Community energy groups in London currently own and operate 2 MW (latest data from CEL’s projects map 05/21) of solar PV situated on churches, social housing blocks and schools that have been financed through the purchase of shares by members of the community.

Other technologies such as micro anaerobic digestion have been installed to a lesser extent. Some groups are developing renewable heat solutions, for example CREW has installed air-source heat pumps in certain locations in London. Some community energy groups focus on promotion of energy efficiency and tackling fuel poverty by financing or facilitating retrofit or by delivering grant funded fuel poverty alleviation work.

Moreover, some community groups, like Brent Pure Energy, reinvest in their community, by facilitating and funding other carbon zero activities and social impact projects through a Community Energy Fund.

Find out more about the history of Community Energy Groups in the UK in Sustainable Overton website.

Creating a community energy group will allow you to:

  • Ownership and control of local generation assets and civic pride
  • Reduce carbon emissions and tackle the climate crisis
  • Be part of a growing movement that generates positive social impact
  • Give back to your community and support other local projects
  • Create jobs and business opportunities
  • Be part of change, of the future!

Find out more about the benefits of Community Energy groups  in Community Energy England website.

Is important to be clear about your aims. You could set a group to deliver one project, to address energy needs in one borough/community or looking to deliver and support different projects in London, like Repowering London. Clear goals will help you answer and guide your path through the next steps. More information on how to set this before the Start of Your Project in here.

Get Ready…

  • Familiarise yourself with what community energy is, including the workings and structures. Understand the time and effort required from team members.
  • Look for people vested in working for the community’s development or clean energy, and who are willing to give their time to the group.
    • They may have already come together over another community initiative like places of worship.
    • They could be part of an environmental group like Fossil Free campaigns, transition town groups, XR, etc!
    • For example, the founders of SE24 share a common interest in cycling and form part of the core of a Herne Hill cycling group which combines long-distance cycling challenges with charitable fund-raising for community-based causes.
    • They can be people with previous experience in community and/or energy projects. For example, the Schools’ Energy Co-op is run by Energy4all, the core team behind the successful Wey Valley Solar Schools Energy Cooperative.
    • Identify the skills set you need like energy sector knowledge, technical skills, legal knowledge, business skills, and project delivery skills.
    • Identify the roles you need in the group like chair, treasurer or secretary and assign them according your teammates’ skills and time commitment..
    • Seek to build an inclusive and diverse team that reflects the communities you want to serve.
  • Come along to the monthly Community Energy London meetings to meet other like-minded people, and to learn about what’s involved and if anything is going on in your area. Follow this link.
  • Community energy groups are formed to serve communities. Therefore it is key to research what are the energy needs of your community.
  • Engage with the community and identify relevant insights like:
    • Whats is the demographic composition? For this you could check for useful data like the Indices of Deprivation. You can find it in the London Datastore of the Mayor of London.
    • What are the current specific energy- related issues and where?
    • Are there other other groups working for cleaner energy?
    • Are there potential sites worth following up?
  • Identify if there are previous attempts or studies of the area’s potential for renewable energy projects. Check the GLA solar opportunity map to identify sites with solar potential.
  • Identify synergy/collaboration opportunities. Engage with other community organisations or local business to join forces and get more insights of the community’s needs and history.
  • Who the stakeholders are? (e.g. tenant management organisation, Tenants’ and residents’ associations, councils, and more.
  • Check in CEL map if there are other projects in the area or groups that can support you.
  • Check in CEL website if the Council has declared a climate emergency. Engage with local authorities to identify current policies, funds and potential support you can get.
  • For tips on community engagement, check MyCommunity’s blog.

Set Up…

  • Evaluate and decide how the group will constitute itself as an organisation. Typically, your group would have to take a legal form and incorporate to be able to access funding, obtain permits and establish certain partnerships.
  • Source: Table from page 16 of Simply Legal  from Co-op UK.
  • Analyse what are the differences between the legal forms in terms of how revenue is distributed, the registration and annual costs, the governance structure, rules about social/environmental objectives and privacy issues.
    • There are restrictions from  the FCA to register new energy co-ops. If you wish to review this topic, contact us.
  • Check Co-op UK’s Simple Legal guide for more information.
  • Source: based on table from page 34 of Simple Legal from Co-op UK.
  • During this process, you could ask for advice from CEL or other community energy groups. For example, Ovesco helped SE24 to set-up their group.
  • Furthermore, you could get free or paid support for this process. In slide 11 there is a list of some of the organizations that facilitates this in London.
  • Choose a name for your group, that is recognized in your community. Check in Companies House’s searcher if another company has registered your name. Specifically, you can check in the FCA’s searcher if there is another society registered by that name.
  • Develop a Business Plan (Template) for your organization that includes your vision, mision, strategies, indicators, market analysis, organisational structure, processes map, financial planning and community engagement plan. You can find more business tools in Power to Change’s website.
  • Proceed to register your group, if that is what you decided.
    • For registering as a society under the Co-operative and Community Benefit Societies Act 2014,  the quickest and easiest way to submit a form to the FCA (Financial Conduct Authority) is through the Mutuals Society Portal.They aim to process it within 15 working days.

Establish how your group will work by defining the governance structure and rules.

Structure:

  • The Board: is the main governing body with ultimate responsibility for the organization. The board will guide and monitor the achievement of the groups energy goals. A Chair and Secretary should be appointed.
  • It should be elected by members of the society (or group, if you are unregistered) (e.g. SE24, SEC).
  • Management and governance: Running a community energy group requires the drive and leadership of an individual or small group of people to succeed. You could appoint Executive Directors that share the leadership (e.g. CEL), a CEO to lead the group (e.g. SELCE) or an organization to be in charge of management and operations (e.g. SEC appointed Energy4all).
  • Other roles: you can appoint a Treasurer (e.g. PUNL) to oversee the finance of the group and project coordinators for the specific development of energy projects.
  • Be aware that more than one role can be assigned to person, especially if you are a small group. Be flexible and open to adapt according to the developments and needs of your group.

Rules:

  • Define the rules, articles or governing document that will guide the governance and describe how the organisation will operate. You will need to submit them when registering the society or company.
    • For societies: to reduce registration cost and time, is recommended to use standardised governing documents which have been previously approved by the registrar. These must be presented through a sponsoring body but can sometimes be too restrictive.
  • These will include:
    • Objectives of the group,
    • Role, powers and rules about members, the board of directors and the manager.
    • Rules about the general decision-making meetings
    • Rules about capital management.Rules about dissolution of the society/company.
  • You can check the rules of other groups like Schools Energy Co-op (Co-op) or Crew Energy (Bencom).
  • For good governance practices, check the CARES Toolkit from Local Energy Scotland. If you are registered as a society, use the Governance Code of Coop UK as a guide.

Annual General Meeting:

  • This is required for societies and the details should be specified in the rules.

…and Go!

  • Set up a bank account to receive the funding you get.
  • You will need accountancy or finance skills in your team or outsource it to develop and implement your funding strategy.

Funding is important to support the group operations and the projects set-up and delivery. As a community group you can get funding from:

Grants:

Investment:

  • Your group can raise capital in different ways, depending on how it is incorporated.
  • Community share offers are unique to co-operative and community benefit societies. It is a good option for capital funding, when you have support from the community and other individuals.
    • Already 13 Community Energy London member groups have used community shares to fund project delivery. For more information you can check out the Community Share handbook from Co-op UK.
    • Remember to create a mechanism for new investors to register their interest in order to prepare for a future share offers (e.g. Lambeth Community Solar, Aldgate solar power).
  • You can also start a equity-backed crowdfunding campaign. There are organizations in London that can help you set up your crowdfunding projects like Crowdfunder.

Donations: you can fundraise donations from organizations and individuals.

  • For this you can set up a link in your website, as Power Up North London. In their case it is supported by Paypal.
  • If you are a charity, you can add the Gift Aid scheme, like Habitats and Heritage.
  • Another option is to start a crowdfunding campaign supported by donations or rewards, like the Masbro Centre did to install 64 solar panels.

Awards:

You can apply to different awards that sometimes will give you funds for your operation and also increase the goodwill of the group. Check out the Community Energy London funding page for open award applications.

Traditional finance:

Companies and societies can obtain a loan, overdraft or revolving credit facility with an institutional investor or bank. For example, School Energy Co-op has a loan  from  Big  Society  Capital, distributed by Pure Leapfrog.

  • You can issue debt securities to raise money. Investors will purchase these and the society will promise to pay the amount borrowed at a future date with interest.
  • If the organization is a charity, then it must ensure that repayment terms are compliant with charity law requirements.
  • Identify your stakeholders: local partners (such as schools, libraries, industrial units, businesses, social housing, hospitals, city farms, churches), investors, beneficiaries, Community Champions, local authorities, grant funders, corporates partners, delivery partners, academic institutions.
  • Discover and reach out to other local groups like parents initiatives or tenant management groups. Find goals in common and join forces.
  • You can check on our Community Energy London map your local council information and more. Particularly important if the council has declared a climate emergency, check this on our website.
  • Also identify city and national community groups or coalitions you can be a member of like Community Energy London and Community Energy England. This will allow to get support from experts, join forces to work for policy changes and access funds.
  • If you are not part of Community Energy London, please join us!
  • Define what communication channels to use for your different stakeholders. Make sure you are enabling inclusion and diversity.
  • Develop and keep on maintaining these relationships and your communications channels. Working with and for the community is key for a community energy group.
  • Furthermore, review project ideas and identify new potential projects or services. Like 1-1 sessions with people from the community, Home visits or energy audits.
    • For example, Crew Energy and SELCE run Energy Cafes, or energy advice sessions in their local community to help reduce energy usage and bills,  supporting those at risk of fuel poverty.
  • Look for new ways to partner up with other community energy groups in London. Join forces to provide training, develop projects or host events.
  • Another way to engage and to increase impact, used by our groups is to have a volunteering programme. Like Energy Garden, whose volunteers can lead the creation and management of a new energy garden, engage others to join or participate in the activities of an existing one.
  • For this you should set a list of rules and procedures to manage volunteers involvement. Check out the example of PUNL’s code of practice, policy, application form and expenses policy for volunteers.
  • Develop a Brand strategy: This could include a Logotype, Color scheme, and Tagline.
  • Build your website: when publishing news and reports include date of publication or/and last update.
  • Build a social media plan and profiles on platforms like twitter, facebook or instagram.
    • Most of community energy groups in London have twitter accounts.
    • For tips on developing a social media plan, check Semble’s tips.
  • Use tools to increase efficiency like a monthly content planner (template) of posts for social media. You can also use platforms to schedule posts like Hootsuite or Facebook Business. For more information check the Digital Toolkit of Local Trust.
  • Most of the groups have newsletters sent to people who subscribe to their mailing list on their website. For example, Crew Energy uses Mailchimp for this. To gather information from others you should take into account GDPR rules.
  • You can also create a forum or use a digital tool to enable constant communication with your stakeholders or a specific group. For example, Crew Energy communicates through online channels such as Slack and Zoom with their volunteers.
  • Remember to:
    • Document your wins and share them e.g. awards, new projects, closer of an offering.
    • Congratulate your stakeholders on their achievements and share them in your social media.
    • Share your main measurements like kWh generated or CO2 saved. Be accurate and honest with this
  • There are also apps (e.g. https://nextdoor.co.uk/) that you can use to engage with your local community.
  • Use events as other communication channels with the community like periodical meetings, masterclasses or leading local events.
  • You can organise other activities, different from meetings to enable interaction with the community. For example, LEAP Micro AD engage with londoners through their volunteer program in their urban garden and with businesses through their Corporate Social Responsibility opportunities.
  • Identify physical and digital spaces where to host these events and activities.
    • Find a place where you can hold regular internal and external meetings.
    • For online engagements, choose proper tools like Zoom, Slack or Hopin.
  • Participate in other community or climate change events to increase your engagement with other organisations. For example, participate in the London Climate Action Week and the Community Energy Fortnight (an annual CEE event which happens in June).
  • Contractors and Suppliers page