The landscape of the British energy sector is undergoing a profound transformation, moving away from a centralized model dominated by large-scale power stations toward a more decentralized, localized, and democratic system. At the heart of this shift is community-owned renewable energy, a sector that has long been championed by local activists and environmentalists but is now being recognized as a critical pillar of the national infrastructure. According to the newly released Community Energy Scenarios report from National Grid Electricity Distribution, the potential for this sector is vast. The research suggests that across the operator’s specific regions—encompassing South and Mid Wales, the South West, and the Midlands of England—community-owned renewable energy capacity could soar to as much as 1.5GW by the year 2035. This ambitious figure represents a significant leap from current levels and underscores the pivotal role that local groups could play in achieving the United Kingdom’s broader net-zero ambitions.
The report provides a comprehensive look at the future of localized power, modeling three distinct potential pathways that reflect varying degrees of policy support, financial investment, and regulatory reform. These pathways—Steady Growth, Accelerated Uptake, and Transformational Change—offer a roadmap for how community energy might evolve over the next decade. Currently, the community-owned generation capacity within National Grid Electricity Distribution’s network stands at 265MW, with an additional 60MW already in various stages of development. While these figures are encouraging, they represent only a fraction of the total potential identified in the study. Under the Steady Growth scenario, which assumes a continuation of current trends and existing levels of support, capacity is projected to reach approximately 527MW by 2035. However, with more robust policy interventions and a concerted effort to remove systemic barriers, the report suggests that capacity could rise to 795MW under the Accelerated Uptake model, eventually hitting the 1.5GW mark in a Transformational Change scenario.
A central theme of the research is the concept of shared ownership, which the report identifies as a primary engine for growth. Shared ownership refers to an arrangement where commercial renewable energy developers offer a portion of a project’s equity to local community groups. This model allows communities to benefit directly from large-scale energy projects that might otherwise be entirely externally owned. The modelling suggests that shared ownership could be responsible for delivering up to 64% of all new community-owned capacity by 2035. The impact of this model depends heavily on the regulatory framework in place. For instance, the Accelerated Uptake scenario assumes a mandatory 5% offer of shared ownership for new projects. In contrast, the more ambitious Transformational Change scenario assumes a 20% mandatory requirement, coupled with extensive capacity-building support to help local organizations navigate the complexities of energy development.
The geographic scope of the report is particularly significant, covering a diverse range of landscapes and economic conditions across Wales and England. In the South West and the Midlands, as well as throughout Mid and South Wales, the potential for community energy is spread across various technologies, including rooftop and ground-mounted solar photovoltaics, onshore wind, and hydropower. Each of these technologies presents unique opportunities and challenges. Solar energy, particularly on rooftops, offers a way for urban and suburban communities to participate in the transition, while onshore wind and hydropower are often more suited to rural areas with specific geographical features. By diversifying the technological mix, the report suggests that communities can create a more resilient and balanced local energy portfolio.
However, reaching the 1.5GW target is not without its hurdles. The report identifies several major near-term constraints that could stifle growth if not addressed by industry leaders and policymakers. Chief among these is grid capacity. As more renewable projects seek to connect to the electricity network, the existing infrastructure is increasingly strained. National Grid Electricity Distribution is already working to address this, as evidenced by a broader commitment to invest £624 million into modernizing the electricity network to ensure it can handle the influx of green energy. Without significant investment in grid reinforcement and reforms to the connection process, many community projects may find themselves stuck in a long queue, unable to contribute to the national energy mix.
Beyond the technical challenges of the grid, the report highlights the need for better access to finance and specialized skills. Developing a renewable energy project is a complex undertaking that requires expertise in planning, engineering, law, and finance—skills that are not always readily available within small community groups. Furthermore, the lack of reliable revenue support has made it difficult for some organizations to secure the necessary upfront investment. To combat this, the study calls for clearer definitions of what constitutes community energy, alongside dedicated revenue support mechanisms and comprehensive capacity-building initiatives. These measures would provide local groups with the stability and knowledge required to take projects from the initial concept through to operation.
The social and economic value of community energy is already being felt across the regions covered by the report. Currently, there are approximately 170 community energy organizations operating within the network’s areas. These organizations are more than just energy producers; they are local employers and engines of social investment. In 2024 alone, these groups employed 304 people and reinvested more than £1.2 million back into their local communities. This reinvestment often takes the form of fuel poverty alleviation programs, local environmental projects, or grants for community facilities. Unlike large-scale commercial developments where profits are often distributed to distant shareholders, community energy ensures that the financial benefits of the energy transition remain within the local area, fostering a sense of ownership and public support for renewable infrastructure.
David Witherspoon, the Community Energy Manager at National Grid Electricity Distribution, emphasized the importance of this research in shaping the company’s future strategy. He noted that the report provides a much-needed understanding of the trajectory of community energy and the specific factors that can unlock its full potential. By identifying where opportunities exist and pinpointing the exact types of support that local groups require, the utility provider can better tailor its services to help these projects come to fruition. Witherspoon’s comments reflect a growing recognition within the utility sector that the transition to a net-zero economy must be inclusive and that local communities are essential partners in that journey.
The call for "connections reform" is a particularly urgent aspect of the study’s recommendations. Historically, the process for connecting new generation to the grid has been a "first-come, first-served" system, which has sometimes led to backlogs caused by projects that are not yet ready to build. Reforming this process to prioritize projects that are advanced in their development—including community-led initiatives—could significantly speed up the deployment of renewable capacity. Additionally, the report suggests that land access remains a critical issue. Finding suitable sites for ground-mounted solar or onshore wind requires navigating complex planning regulations and balancing the needs of local residents, agriculture, and biodiversity.
As the UK looks toward its 2035 and 2050 climate targets, the role of the distribution network becomes increasingly central. The shift toward electric vehicles and heat pumps is expected to double the demand for electricity on local networks. Meeting this demand solely through large-scale, centralized generation would require massive and expensive upgrades to the high-voltage transmission system. Community energy offers a more efficient alternative by generating power closer to where it is consumed, thereby reducing the burden on the wider grid and minimizing transmission losses.
The 1.5GW potential identified in the Transformational Change scenario represents a vision of a future where energy is not just something consumed by the public, but something produced and managed by them. This model of "energy democracy" has the potential to transform the relationship between citizens and their utility providers. By participating in shared ownership schemes or starting their own cooperatives, residents in the Midlands, the South West, and Wales can have a direct say in how their energy is produced and how the resulting profits are spent.
In conclusion, the Community Energy Scenarios report serves as both a roadmap and a call to action. It demonstrates that with the right combination of mandatory shared ownership, grid reform, and financial support, the community energy sector can grow from a niche interest into a major player in the UK’s energy landscape. While the challenges of grid capacity and financing are significant, the potential rewards—in terms of carbon reduction, local economic development, and community resilience—are even greater. As National Grid Electricity Distribution continues to modernize its network, the success of these 170 organizations and the hundreds more that could follow will be a vital measure of the country’s progress toward a sustainable and equitable energy future. The findings of the study suggest that the path to 1.5GW is achievable, provided that the barriers identified are met with decisive policy action and continued investment in local capacity.
