Overall assesment

The Estonian Government has transposed the CEC definition through an amendment to the Electricity Market Act. Specifically, the legislation refers to ‘energy community’ instead of citizen energy community. The REC definition has been transposed through a subsequent amendment to the Energy Management Act. The Electricity Market Act foresees a very open concept of forming energy communities, essentially allowing anyone to participate. Furthermore, any legal form that is capable of being used by an energy community is eligible to become one. There is little to no elaboration of the criteria contained in the Electricity Directive, notably effective control. Furthermore, the autonomy principle is absent from the REC definition. As it stands, the transposition provides little clarity and further elaboration is needed to operationalize the concept. Furthermore, no regulatory authority is appointed to oversee the registration of energy communities and compliance with the EU criteria. As such, there is a large risk of corporate capture and abuse of the concept.

Detailed assesment

Criteria of EU definition reflected in national definition

Energy Community:

  • Voluntary and open participation is covered
  • Effective control by micro- and small enterprises is not covered

Renewable Energy Community:

  • Effective control and geographic proximity covered
  • Autonomy is not covered

Level of detail in the elaboration of principles contained in EU criteria

  • Control – energy communities must be controlled by natural or legal persons. The explanatory section to the legislation states that only members who do not engage in large-scale business and for which energy is not the main area of economic activity should have decision-making power. However, there is nothing in the legislation that requires effective control to the extent that it complies with the CEC definition.
  • Members can leave an energy community with 6 months notice.
  • Energy companies (namely those whose commercial or professional activity relates to the renewable energy community) are not eligible to participate as a member or shareholder. Furthermore, participation among enterprises is limited to small and medium-sized enterprises.
  • Close proximity is not specified in the Energy Management Act for RECs.

Clearly defined purpose

Both definitions copy-paste of the EU definition.

ICA cooperative governance principles reflected

Voluntary and open participation only.

Legal entities allowed

Partnerships, limited partnerships, private limited company, public limited company, for-profit association or any other company that, in its main business, can define itself as an energy community. Any legal forms that exist under the Commercial Code or Non-Profit Association Act can be an energy community. Without a legal authority to oversee the creation and/or registration of energy communities, this presents a risk of abuse.

Citizen participation is ensured


Designated authority to oversee

The national regulatory authority has a duty to ensure that there are no barriers or restrictions on the development of energy communities, but there is no specific authority to monitor or ensure compliance around the definition.

Number of definitions


Coherency between both definitions