15. 10. 2024
Electricity sharing is essentially an accounting process. This means that if you become a member of an energy community, your energy provider will reduce your bill based on the value of the shared electricity. However, the amount of shared electricity consumed by individual community members may vary. This is because it depends on the method of allocation or sharing used.
People who decide to form an energy community can invest in shared electricity generation facilities (such as photovoltaic or wind power plants) or offer surplus electricity from their own sources (typically rooftop solar panels) for collective consumption (sharing). The more self-generated electricity community members consume, the less they need to buy from an energy provider, leading to greater savings. If community members consume electricity at the time it’s being produced (known as the simultaneity of production and consumption), they also reduce the strain on the local distribution network.
* (This situation is very typical for Czechia, but it may differ for other countries depending on their legislation regarding community energy.)
The practical setup for electricity sharing and allocation plays a crucial role in the return on investment for energy projects. The goal of a community is to consume as much of its own electricity as possible, which is directly influenced by the chosen method of electricity sharing. There are three basic methods: static, dynamic, and hybrid (also known as combined).
With the static method, electricity is allocated in a single round, based on pre-agreed percentages. If a participant does not consume their share of electricity during a given 15-minute interval, it cannot be reallocated to another community member or active customer.
The main advantage of the static method is its predictability, thanks to the predetermined shares of electricity. However, a significant drawback is that the static allocation does not optimize the use of electricity within the community. Any unused electricity is sold back to the grid. Additionally, this method does not incentivize members to align production and consumption times.
The dynamic method also involves a single round of allocation, but unlike the static method, it takes into account the real-time electricity consumption of each participant. The member who consumes the most electricity during the 15-minute interval receives the largest share of the shared electricity.
This method allows for greater utilization of electricity within the community, potentially up to the level of real-time consumption. It also strongly encourages aligning production and consumption. However, it may disproportionately benefit members with higher electricity consumption, putting those who are trying to reduce their usage at a disadvantage.
The hybrid (or combined) method uses two rounds of allocation. In the first round, electricity is allocated statically, according to predetermined percentages. However, if a participant does not consume their share during the 15-minute interval, the remaining electricity is then dynamically redistributed among other participants based on their real-time consumption.
This method combines the advantages of both the static and dynamic methods, while minimizing their drawbacks. From the community’s perspective, it can be considered the fairest option, as each member first receives their agreed-upon share, and any surplus electricity is distributed according to actual consumption.
Below, you can see a model example of how electricity is distributed within an energy community. For better readability, the infographic can be opened in a new browser window by right-clicking on it.
EU member states employ various methods of electricity sharing. For example, France, Brussels, and Austria allow for the use of a hybrid allocation model. In contrast, other countries, such as Greece and Poland, use net-metering, which enables users to "withdraw" the energy they produce from the grid at a later time. Net-metering acts as a virtual battery, similar to services offered by some energy providers in Czechia. However, the issue with net-metering is that it provides no incentive to align production and consumption times, primarily encouraging maximum production, which can place excessive strain on the distribution network.
An interesting variation is found in Italy, where net-metering is supplemented by a feed-in tariff (guaranteed purchase price for renewable electricity) and discounts on distribution fees. This combination strengthens the alignment of local electricity production and consumption. However, this model is not particularly popular among Italian energy communities, as it is complex and administratively burdensome.
Other unique electricity allocation methods also exist, such as multi-round static models or different approaches to distributing electricity on weekdays, weekends, or during various seasons. France, for instance, allows communities to customize their own allocation key.
This article draws primarily from the study conducted by the Frank Bold expert group: Legal Framework for Community Energy in the European Union: Seven Recommendations for the Czech Republic. Reprinted with permission from the authors.
Anna Michalčáková
+420 605 038 162
anna.michalcakova@uken.cz
