As the year comes to a close and the winter cold creeps into our homes, many families are reluctant to turn up the heating due to the high cost of fossil fuels. Living in cold and damp conditions has terrible consequences for people’s health – both mental and physical – and pockets. According to research by the House of Commons Library, the cost of cold and damp homes is three times higher than the cost of upgrading a house to comfortable levels. 

Fortunately, energy communities are bringing hope to this situation by helping citizens access modern, energy efficient, and comfortable homes, while paying lower energy bills. Energy communities are citizen-controlled legal entities that allow citizens to work together to take control of their local renovations and renewable energy. As citizens directly own the district heating installations, they collectively decide on the price of heat, and how the revenues are used. This also allows them to become energy independent, create local jobs, and keep the benefits of the energy transition local. For all these reasons, community-led heating and cooling is a future-proof solution.

In the European Union, there are currently more than 650 district heating systems directly owned by citizens, with 1.9 million homes connected to fully democratic, not-for-profit heating systems. In Denmark alone, the vast majority of district heating systems are directly owned or controlled by local citizens. Similarly, the Netherlands has opened the door to democratic heating and cooling. 

Heating network copy
© Wattnu Energy Cooperative

Three ingredients for democratic heating and cooling

The success of these energy communities is built on good legislation, support from a trustworthy network, and sufficient funding. Replicating these conditions is key to creating fertile ground for the creation of new initiatives. 

Good legislation

If the law is not favourable, creating a community-led heating and cooling project becomes an uphill battle. The Netherlands is an excellent example of good legislation for democratic thermal energy. Their recently approved 'Heating Law' legally recognises citizens as market actors in the heat transition and commits to removing the barriers they face. Furthermore, Dutch municipalities will now need to directly involve energy communities in the planning of local energy projects, finally giving citizens a permanent seat at the table. 

At the EU level, legislation on energy communities obliges national governments to conduct national analyses of energy communities and remove the barriers they face. 

A network of experts

Citizens cannot be expected to understand all the technical details of a district heating system or a home renovation. Therefore, having a network of experts saves countless hours of work. Federations of energy communities, such as Energie Samen in the Netherlands or Desmi in Greece, offer their members knowledge sessions, supporting them through every step of the project. REScoop.eu also helps energy communities working on the topic build connections and share knowledge and experience through its working groups. As always, cooperation and solidarity yield far better results than going at it alone.

Sufficient funding

A district heating system can cost millions of euros. The three main sources of funding are public subsidies, bank loans and citizen contributions. In Denmark, energy communities looking to set up a district heating system can access the same public guarantee fund as municipalities (‘Kommunekredit’). The existence of a guarantee fund for citizen projects makes it easier to access loans, as private banks consider them a less risky investment. In turn, the remainder of the funds are usually gathered from the members of energy communities. In the Netherlands alone, energy communities have mobilised €185 million in citizen capital for renewable energy projects. 

Furthermore, EU funds can also be an excellent source of funding. At the EU level, the upcoming Citizen Energy Package, and the update of the Heating and Cooling Strategy – both expected in 2026 – will be key opportunities to make home renovations and thermal energy affordable, democratic, and future-proof.