Imagine a future where energy isn’t just a cost on your bill, but a shared resource, produced locally under your neighborhood’s sun. A future where citizens, small businesses, and municipal governments collaborate to create a cleaner, cheaper, and more unified energy system. This future has a name: Renewable Energy Community (REC). RECs represent an epochal transformation in the way we produce and consume energy, a model that combines technological innovation with an ancient spirit of collaboration. They are emerging throughout Italy as a concrete response to the climate crisis and high energy bills, allowing anyone to become a protagonist in the energy transition.

A Renewable Energy Community is an association of different entities—such as private citizens, commercial businesses, and public bodies—that decide to join forces. The goal is to equip themselves with systems to generate, consume, and manage energy from clean sources, like photovoltaics. The energy produced is shared “virtually” among members, promoting local self-consumption and reducing dependence on the national power grid. This model not only cuts CO2 emissions but also generates economic and social benefits for the entire community.

What Are Renewable Energy Communities (RECs)

A Renewable Energy Community (REC) is a legal entity based on open and voluntary participation. Its members can be individuals, small and medium-sized enterprises (SMEs), territorial entities, or local authorities, including municipal governments. The primary purpose of an REC is not to generate financial profits, but to provide environmental, economic, and social benefits at a community level to its members or the local areas where it operates. In practice, multiple entities join together to build and manage one or more renewable source plants, sharing the energy produced. The most common technology is photovoltaics, due to its versatility and decreasing costs.

Italian legislation, implementing European directives, has created a precise regulatory framework for their establishment and operation. RECs can take various legal forms, such as associations, cooperatives, or consortiums, as long as they maintain their mutualistic and non-profit purpose. This model also allows those who do not own a suitable roof or space for a system to participate and benefit from shared clean energy, becoming a “consumer” within the community.

How an REC Works: The Sun as a Common Good

The operation of an REC is based on a principle as simple as it is revolutionary: virtual energy sharing. The energy produced by the community’s systems (for example, a photovoltaic system on the roof of a factory or a school) is first used by the producer itself (physical self-consumption). The excess energy is fed into the national power grid, which acts as a “carrier” to transport it virtually to other members of the community. These members then draw it from the grid when needed, just as they normally would.

The heart of the system is measurement. Special smart meters record, hour by hour, the energy fed into the grid by the REC’s systems and the energy drawn by its members. The Energy Services Manager (GSE) calculates the “shared” energy, which is the energy consumed by members at the same time it is produced by the community. It is precisely this shared energy that receives the main economic benefits, in the form of government incentives and savings on bill components. This creates a solidarity-based system that rewards efficiency and the balance between local production and consumption.

The Benefits: An Alliance Between Your Wallet and the Environment

Joining a Renewable Energy Community offers a series of concrete benefits that touch the economic, environmental, and social spheres. It is a win-win model for all participants, from simple consumers to energy producers, and for the territory itself. This synergy makes RECs a powerful tool for truly sustainable local development.

Economic Benefits

The most immediate benefit for members is economic savings. This is realized through several avenues: an incentive tariff paid by the GSE for shared energy, the reimbursement of certain tariff components, and, for producers, revenue from the sale of unconsumed energy. In addition, there are non-repayable grants, provided by the PNRR, which can cover up to 40% of the costs for building new systems in specific municipalities. The combination of these mechanisms not only lowers utility bills but can also generate a return on investment, turning an expense into a source of income. For a broader perspective on savings, it’s useful to consult the complete guide to energy savings.

Environmental Benefits

RECs are a pillar of the ecological transition. By promoting the production of energy from clean sources like the sun, they directly contribute to the reduction of greenhouse gas emissions and the phasing out of fossil fuels. Locally produced and consumed energy also reduces grid losses, which occur during the long-distance transmission of electricity. This distributed generation model increases the resilience of the electrical system and accelerates the achievement of decarbonization goals set at the national and European levels.

Social Benefits

Perhaps the most profound benefit of RECs is their ability to strengthen community bonds and promote inclusion. They become an effective tool to combat energy poverty, allowing even low-income families to access clean energy at reduced costs. The creation and management of an REC stimulate collaboration, active citizen participation, and the emergence of new skills and jobs at the local level. They also encourage the redevelopment of abandoned industrial areas or unused rooftops, generating shared value for the entire territory.

The Regulatory Framework in Italy: The Path to Self-Consumption

Italy has built a solid regulatory framework to support the development of Renewable Energy Communities, transposing European directives and defining clear rules for accessing incentives. The two pillars of this architecture are Legislative Decree 199/2021 (known as the RED II Decree) and the subsequent MASE Decree 414/2023 (also called the REC Decree), which came into force in January 2024. These measures define who can create an REC, which systems are eligible, and how the incentive mechanisms work.

Another key document is the Integrated Text on Widespread Self-Consumption (TIAD), drafted by ARERA, the Regulatory Authority for Energy, Networks and Environment. The TIAD governs the technical and regulatory aspects of energy sharing, while the Energy Services Manager (GSE) plays the central role of managing applications, disbursing incentives, and verifying compliance with the rules. Recent regulatory updates in 2025 have further expanded opportunities, for example, by extending PNRR grants to municipalities with populations up to 50,000. To learn more, a specific guide on self-consumption and energy communities is available.

Success Stories: The RECs Lighting Up Italy

From the Alps to Sicily, Energy Communities are already demonstrating their potential. One of the first and most well-known examples is the REC of Magliano Alpi in the province of Cuneo, established in 2020. The initiative, started by the municipality, involves public buildings like the town hall and schools, as well as families and craft businesses, sharing energy from two photovoltaic systems. This pilot project, carried out in collaboration with the Polytechnic University of Turin, has paved the way for many other similar experiences.

Another significant case is that of Ferla, in the province of Syracuse, a small village that created the “Common Light” REC. Here, the model stipulates that the economic incentives generated are reinvested to expand the community’s production capacity, creating a virtuous cycle of sustainability and local development. There are also specific examples for productive sectors, such as the first agricultural energy community established in Ragusa, where four farms share energy for their operations. These and many other cases demonstrate the flexibility and adaptability of the REC model to different territorial and social contexts in Italy.

RECs and Mediterranean Culture: A Return to Our Roots

The idea of sharing resources for the common good is not new, especially in Mediterranean culture. For centuries, the peoples around this sea have shared ovens, mills, and water sources, creating a social fabric based on cooperation and the collective management of essential goods. Renewable Energy Communities, in a sense, represent a modern take on this tradition of sharing. The sun, a central element of the Mediterranean landscape and life, now becomes the source of a new resource to be managed in common: clean energy.

This approach combines innovation and tradition. The innovation lies in photovoltaic technology, smart grids, and virtual energy management models. The tradition lies in the collaborative spirit, in the idea that joining forces brings greater benefits than acting alone. RECs thus become the new energy “piazzas”—meeting and exchange places that not only produce clean kilowatt-hours but also strengthen the identity and cohesion of local communities, promoting a more equitable and territorially rooted development model.

How to Create a Renewable Energy Community

Establishing an REC is a structured process that requires planning and collaboration. The first step is to gather a group of interested founding members, who can be citizens, businesses, or local entities located within the same geographical area served by a single primary substation. Next, it is necessary to define the community’s objectives and choose the most suitable legal form, such as an unincorporated association or a cooperative, whose primary purpose is not profit.

The next phase is technical and design-oriented: you need to identify available surfaces for installing the systems, such as the roofs of public buildings or industrial warehouses, and size the required power based on the members’ consumption. Once the articles of association and bylaws are drafted, the REC must be officially registered with the GSE to access incentives. It is a process that requires technical, legal, and administrative expertise, but it opens the door to a new way of experiencing energy. For those considering a system, consulting the complete guide to residential photovoltaics can be helpful.

Conclusions

Renewable Energy Communities are not just a technological response to the energy and environmental challenges of our time. They represent a true cultural and social shift, a bridge between innovation and tradition that puts people and the territory at the center. They offer a concrete path to reduce bill costs, combat climate change, and strengthen the social fabric of our cities and towns. Thanks to an increasingly favorable regulatory framework and concrete incentives, 2025 is shaping up to be a crucial year for their widespread diffusion in Italy. Creating or joining an REC means becoming a protagonist in this quiet revolution, transforming the sun from a mere spectator in our lives into a shared engine for a more sustainable, equitable, and prosperous future for all.

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