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Background Information

The Implementation of energy communities is in its inception in Sweden. Although variants of energy communities have been present for an extensive time, there are no current examples of energy communities adhering to the definitions of citizen energy communities (CEC) or renewable energy communities (REC) as specified in EUs Electricity Market Directive (IEMD) (2019/944)
EU directive 2019/944. EU directive on common rules for the internal market for electricity. https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32019L0944&from=EN.
and Renewable Energy Directive (REDII) (2018/2001).
EU directive 2018/2001. Renewable Energy Directive (RED II). https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32018L2001&from=EN.
A considerable amount of juridical and practical issues are yet to be addressed before energy communities can be implemented on a greater scale. 
There is no existing database of active energy communities in Sweden today and no umbrella organisation currently exists. A study performed in 2017, utilising the Swedish Energy Agency’s database “Cesar”, covering registered organisations in the Swedish electricity certificate system, identified 140 active energy community initiatives and around 20 that had been discontinued.
Magnusson, D. and Palm, J. (2019) ‘Come together—the development of Swedish Energy Communities’, Sustainability, 11(4), p. 1056. doi:10.3390/su11041056.
The mapping indicated that the most common forms of initiatives in Sweden were wind power cooperatives, eco-villages, and communities based on small-scale heating systems or solar power. The energy communities are generally organised as incorporated associations, non-profit organisations (samfällighet), and tenant-owned apartments associations (bostadsrättsföreningar).
Magnusson, D. and Palm, J. (2019) ‘Come together—the development of Swedish Energy Communities’, Sustainability, 11(4), p. 1056. doi:10.3390/su11041056.
Almost all active energy communities in Sweden today are locally delimited communities that produce renewable energy for their members (Magnusson & Palm, 2019).       
The implementation of energy communities in Sweden is regulated by the national government and EU bodies (Swedish Energy Agency, 2022).
The Swedish Energy Agency (2022). Policy and Legislation. Available at: https://www.energimyndigheten.se/en/about-us/policy-and-legislation/
The Swedish Energy Agency is the government agency responsible for promoting energy-efficient measures and investments in renewable energy technologies. Furthermore, the Swedish Energy Market Inspectorate (Energimarknadsinspektionen) supervises the Swedish energy market actor’s compliance with laws and regulations at national and EU level. Other important actors are the state-owned enterprise Svenska Kraftnät, responsible for monitoring and developing the national transmission grid, and Distribution System Operators (DSOs), responsible for the distribution grids in specified areas around the country. The market for the distribution of electricity in Sweden is formed as monopolies with approximately 170 companies having area licenses, known as network concession (Swedish Energy Market Inspectorate 2022).
The Swedish Energy Market Inspectorate (2022). Electricity. https://ei.se/ei-in-english/electricity
In addition, municipalities generally play an important role as owners of DSOs and housing companies and as actors within development projects aiming at implementing energy communities or other energy-related solutions.
See examples one and three.
The Swedish energy market has been deregulated since 1996 and is part of the EU’s common electricity market. The market for sale of electricity is competitive, and customers have around 120 suppliers to choose from. The three main companies in the Swedish electricity market have more than 800,000 customers while the smallest have less than 1000 customers. The companies are privately owned, cooperative economic associations or owned by municipalities (Swedish Energy Market Inspectorate 2021).
The Swedish Energy Market Inspectorate (2021). About the electricity market.https://ei.se/ei-in-english/electricity/the-electricity-market

Models for Energy Communities & National Legal Framework

As noted, energy communities have not yet been implemented in Sweden according to the definitions of CEC and REC. There are, however, existing models for energy communities sharing the same characteristics as CECs. The most common models for energy communities in Sweden today are wind power cooperatives, solar power communities, eco-villages, and small-scale heating cooperatives (Magnusson & Palm, 2019).
Magnusson, D. and Palm, J. (2019) ‘Come together—the development of Swedish Energy Communities’, Sustainability, 11(4), p. 1056. doi:10.3390/su11041056
Wind power cooperatives have become increasingly popular in Sweden during the last 20 years. The cooperatives are predominately structured as incorporated associations where members buy shares in a wind turbine to produce energy, thereby bearing the investment cost together. Studies on wind power cooperatives in Sweden have identified around 80 active cooperatives. Most wind power cooperatives have 200–300 members, while the largest cooperatives have up to 4000 members (Horn, 2019).
Horn, V. (2019) Wind power shares and wind shares, el.se. Available at: https://el.se/vindkraftsandelar (Accessed: 23 May 2023).

Another common model of energy communities in Sweden is eco-villages. Eco-villages are generally rural communities focusing on social, ecological, and economicsustainability and self-sufficiency. Eco-villages in Sweden differ significantly in theirsolutions to produce and share energy. While most eco-villages focus on energyefficiency and decreased consumption in various ways, a few have developedinnovative ways of producing energy for heating and electricity. The eco-villages are exclusively based on cooperation and social inclusion and vary in size from a few up to around 50 households per village (Magnusson, 2018).
Magnusson, D. (2018) ‘Going back to the roots: The fourth generation of Swedish eco-villages’, ScottishGeographical Journal, 134(3–4), pp. 122–140. doi:10.1080/14702541.2018.1465199. 
A further increasingly popular model of energy communities in Sweden is solar power cooperatives. Interview data and previous studies indicate that one of the most common forms of solar cooperatives in Sweden is tenant-owned apartments associations (bostadsrättsföreningar), which are investing in solar panels on their apartment buildings for their internal consumption (KTH n.d). The recently declining cost of solar PV panels together with rapidly increasing electricity prices are stated as two central factors for the growing interest in this solution. Another present form of solar cooperatives in Sweden is cooperatives organised as incorporated organisations, consisting of members buying shares in a solar power plant to produce renewable energy.
Finally, a fourth present model of energy communities in Sweden is small-scale heating systems, often located in rural villages and communities. These communities generally operate common small-scale heating systems for residents in villages, to produce and distribute hot water. These initiatives by communities are often based on the resident’s financial incentives, but they also strengthen the community’s local connection.          
The legislative framework, encompassing the energy system in Sweden, is regulated by EU directives and national laws. The main EU directives regulating energy communities are the Electricity Market Directive (EMD) and Renewable Energy Directive (RED) (Swedish Energy Agency 2022).
The Swedish Energy Agency (2022). Policy and Legislation. Available at: https://www.energimyndigheten.se/en/about-us/policy-and-legislation/
The EU directives define the criteria for CECs and RECs to be recognised as legal entities in EU member states. The Swedish Energy Market Inspectorate is responsible for the implementation of these directives in Sweden. As previously stated, the concepts of CECs or RECs have not yet been implemented in the Swedish legislature. Our combined data indicates, however, that the concept of energy communities will be implemented in some form in the near future.
The most significant national legislative framework, regulating the energy market and implementation of energy communities, is the Electricity Act (1997:857). The Electricity act was implemented in 1997 to regulate the generation, conversion, transmission, trading, distribution, and use of energy in Sweden. Within the framework, electrical installations are classified according to their degree of hazard in power installations and low-voltage systems and their environmental impact. The Energy Market Inspectorate is responsible for supervising that all actors in the energy market are complying with the regulations within the act.
Another legislation framework that is affecting the preconditions to implement energy communities in Sweden is the regulation on exemption from net concession (IKN-förordningen) (2007:215). As stipulated by the Electricity Act, DSOs operate the regional and local distribution grids as monopolies in designated areas around the country. To do so, they are required to have an area license, known as network concession. The regulation on exemption from the requirement for concession, however, allows certain networks to be developed without concession. To be granted exemption from the concession, the network must be internal within an easily defined area and may not be too large (e.g., an internal network in a residential building or a factory). The regulation does not permit exemption from concession for the development of networks sharing electricity between buildings, which affects the conditions to implement energy communities in Sweden of several buildings that can produce and share electricity in a common network. A few pilot projects, however, have been permitted to develop a common energy system for residential areas to investigate the potential effects and challenges related to the development of energy communities.
See example 1.
The most central sustainability-related legislative framework, which is also i regulating the energy system, is The Swedish Environmental Code (Miljöbalken). The environmental code was implemented in 2000 and constitutes a legislative framework to promote sustainable development at all levels and sectors of Swedish society. The framework stipulates that all actors in the energy market actively should strive to limit their energy consumption and primarily use renewable energy sources (Ds 2000:61).
Ds 2000:61. The Swedish Environmental Code. https://www.government.se/legal-documents/2000/08/ds-200061/
Furthermore, the development and maintenance of power grids need to consider and limit their effect on the environment and nature. The supervision of the Environmental code is guided by Sweden’s overarching environmental goals and energy policy goals. Sweden’s energy policy goals are that the country’s energy system should be exclusively based on renewable sources by 2040 and that energy production should be 50% more effective by 2030 (Swedish Government n.d).
The Swedish Government (n.d). Energy Policy Objectives. https://www.regeringen.se/regeringens-politik/energi/mal-och-visioner-for-energi/

Legal and Practical Barriers

There are several legal and practical barriers impeding the implementation of energy communities in Sweden. Data from interviews and previous studies emphasise the regulation on the requirement of network concession as a major legal barrier. Further stated hindering factors are the DSO’s monopolistic position on the distribution market, various actors’ economic and technical constraints, a generally low level of public knowledge, and a political and judicial ambiguity related to the definition of energy communities.
Several interviewees emphasise the regulation on network concession and exemption from concession as a barrier, hindering further models for energy communities to be implemented in Sweden. Because it is generally prohibited to develop networks that connect several buildings in residential areas, many of the potential positive financial and environmental effects of energy communities are limited. However, due to the implementation of the EU Clean Energy Package, EMD and REDII, and a recently stronger public interest in finding new energy-efficient solutions, interviewees expect that the national legislation will soon be adapted, to enable energy communities to produce, share and store energy. Furthermore, as noted previously, there are currently pilot projects that have been permitted to share and store energy within a community, indicating an increasing interest in these solutions among Swedish authorities.
Example 1 and 2.
Interviewees also describe the DSOs as potential keepers of the services needed to implement energy communities at a larger scale. Although some DSOs currently are invested in projects to implement energy communities, interviewees representing projects express a general lack of interest from the DSOs to engage in projects aiming at developing energy communities. One potential reason for this,as expressed by interviewees, is that DSOs might consider the emergence of energy communities as future competitors that potentially could threaten their position in the distribution market in a longer perspective.
Moreover, several interviewees have pointed out current economic and technological constraints as hindering factors. Developing, installing, and maintaining solutions needed to produce, store, and share energy is a major investment for individual members in smaller communities, thus composing an important barrier for citizens. A few interviewees also express uncertainty about whether the net cost of producing energy within an energy community would be reduced after the investment compared to the regular energy price. Further, Sweden has come from a long period of relatively low electricity prices and has a stable national grid, hence making the economic and other forms of incentives relatively weak to invest in alternative solutions, such as energy communities. However, with electricity prices currently increasing and the investment costs for various modules to produce renewable energy decreasing, a few interviewees consider that there will be a shift toward more locally produced and shared energy in the future, creating better conditions for the implementation of energy communities.
The generally low public knowledge regarding energy consumption and unawareness of solutions to lower costs is furthermore described as a barrier by interviewees. Due to historically low energy prices, the relatively robust energy system, and the stable energy supply in Sweden, interviewees underline that the public has not generally engaged in acquiring energy-related knowledge. Due to rapidly increasing energy prices, however, the public debate on the national energy supply has intensified, leading to increased public interest and knowledge.  Civilians are currently becoming increasingly aware of their energy consumption and showing a greater interest in alternative solutions to decrease their electricity costs, which potentially will lead to better conditions for implementing energy communities in the future.    
Lastly, several interviewees describe a general political and juridical ambiguity concerning the definition of energy communities nationally and in EU legislation which impedes public debate and juridical implementation. Multiple interviewees state that a higher degree of clarity regarding the definition of energy communities is needed to generate public interest and to create better conditions for the implementation of energy communities on a greater scale. Thus, several interviewees are sceptical of implementing the two definitions of energy communities from the EU directives.     

Drivers and Benefits

Our combined data indicate that there are several drivers and benefits to implementing energy communities in Sweden on a greater scale. The main drivers, emphasised by interviewees, are mainly based on economical and sustainable incentives while multiple benefits for society, the energy market, and citizens are stated, such as financial gains, more renewable energy available, an increased sense of agency for the consumer, and increased knowledge.   
The majority of interviewees agree that citizens and organisations engaging in energy community initiatives in Sweden, to varying degrees, are driven by economic incitements. As energy prices have risen rapidly in Sweden and Europe, citizens and organisations are exploring new solutions to lower their energy costs, consequently showing interest in alternative energy investments, such as energy communities. Actors in Sweden have mainly shown interest in engaging in energy communities producing renewable energy for electricity and heating, as a complement to power from the national grid.
Second, there is a consensus among interviewees, and previous studies show, that the desire to live sustainably and exclusively consume renewable energy is an important driver of why citizens and organisations engage in energy community initiatives in Sweden. Several interviewees that are engaged in energy communities emphasise sustainability as the far most important driver and the importance to produce and consume renewable energy as part of a sustainable lifestyle, thereby potentially affecting others toward a green transition.
The combined empirical data depicts several benefits of energy communities, both for the Swedish Energy system as a whole and for the individual communities and their members. One of the main potential benefits for actors engaging in energy communities is financial gains. Through participation in energy communities, members expect to reduce their costs for heating and electricity. Interviewees emphasise that the financial gains have been particularly relevant during the last year due to the energy crisis and consequently rapidly increasing energy prices. One interviewee notes that the financial gain of energy communities for consumers could be particularly evident for larger communities organised as incorporated associates, where larger groups of members together can bear the investment costs. On a systemic level, several interviewees note that larger communities also could have major effects on politics and the future energy market by organising themselves. One potential effect, discussed by one interviewee, is that larger communities that organise themselves potentially could force DSOs to develop by demanding new services to facilitate the operations of energy communities.
Another important potential benefit of energy communities, described by interviewees, is an increased sense of ownership and agency among consumers engaged in energy communities regarding their energy consumption. Joining energy communities may potentially increase members’ energy-related knowledge and their awareness of themselves as actors within the Swedish energy system. An increased level of public knowledge and awareness within the system may in turn lead to more effective energy consumption from a systemic perspective and additionally lead to decreased costs and environmental impact for the consumers.
Furthermore, several interviewees state that the development of energy communities with the possibility to produce and store energy will lead to a more locally stable energy supply in remote communities in Sweden. The implementation of energy communities that can produce and store energy locally could be particularly relevant in the future, and a solution, for remote communities in northern Sweden, often experiencing power shortages. Additionally, interviewees point out that implementing energy communities on a greater scale will lead to a higher degree of renewable energy in the Swedish energy system and would also lead to more flexibility within the system by adding local energy sources that could complement the main grid.

Examples of Real-life Communities

In the following examples of energy community initiatives in Sweden are presented:
  • Example 1, Tamarinden, is an innovative project aiming at developing an energy community within a new residential area that will be able to produce, store and share energy. 
  • Example 2, ElectriCITY – Hammarby Sjöstad 2.0, is a citizen-driven innovation platform that is developing an energy community in the district of Hammarby Sjöstad in Stockholm.
  • Example 3, SIMRIS, was a project conducted in southern Sweden to demonstrate that a village can be 100% self-sufficient in energy from renewable sources.  
The project Tamarinden aims at developing a new energy-efficient residential area in the Swedish city of Örebro. The construction of ten residential buildings, that will contain 800 apartments in the area, started in autumn 2022. The municipality of Örebro leads the project together with the construction companies and building operators ÖBO, Friendly Building, Magnolia, Serneke, and Tornet to create conditions for the community to be able to reduce, produce, store, and share energy in a local energy system. The overarching goal is to contribute to more locally produced renewable energy, cut power peaks, relieve the national grid, increase flexibility, and save substantial amounts of energy. Tamarinden is a pilot project within the research project “Systemic change through locally shared energy”, which is financed by The Swedish Energy Agency and RISE. The initiative is a four-year project with the purpose to investigate energy communities from a broad interdisciplinary perspective and its ability to renew the Swedish energy system, to be able to meet the energy needs of the future while protecting the climate and the environment. The goal is to make the pilots scalable as national role models for the energy transition in other municipalities and housing companies that today are looking for new solutions to contribute to achieving climate goals (Municipality of Örebro, 2023).
The municipality of Örebro (2023). About Tamarinden. https://extra.orebro.se/byggorebro/tamarinden.4.4ffbbf5616ac98ac8f49fb.html
ElectriCITY is a citizen-driven innovation platform that was formed in 2014 and operates from the district of Hammarby Sjöstad in Stockholm. All of ElectriCITY’s operations are run under the project name Hammarby Sjöstad 2.0. The platform has more than50 public and private partners and its overarching aim is to transform the Paris climate agreement into smart and local energy and environmental measures. The goal is to make the district climate neutral by 2030. One of ElectriCITY’s current projects is to establish an energy community in Hammarby Sjöstad. In the project, which started in 2022, actors will together develop a local energy community to produce solar electricity and have a microgrid with load-balancing functions and batteries that can support the local supply of electricity. ElectriCITY will also support housing associations in the district with energy-saving measures to reduce their energy needs. The goal is to create a sustainable cycle of energy, where the district's residents become so-called "prosumers" of electricity by consuming self-produced energy to some extent (Hammarby Sjöstad 2.0, n.d).
In 2017¬–2019, the demonstration project SIMRIS developed a 100% self-sufficient energy system run on renewable energy, in the rural village of Simris, in southern Sweden. The project was conducted by the DSO E.ON together with several other project partners. The project’s overarching goals were to prove that an entire village, of about 150 households, could run on 100 per cent renewable energy, to find measures to increase the utilisation of renewable energy sources and to develop business models for energy communities. In the system, a pre-existing wind turbine and solar power plant were connected to a smart control system, two large batteries, and a biofuel-run backup power generator. The smart control system together with the batteries were able to isolate the village from the main electricity grid every fifth week. The system also monitored whether the local power generation was aligned with consumer energy needs. The Surplus of renewable energy was stored in the large flow battery, which was used when the system was disconnected from the national grid. Further, heat pumps, PVs, and batteries owned by Simris residents were used to add flexibility to the system. The surplus energy produced beyond the consumer’s needs was sold to E.ON. SIMRIS was one of six demonstrators in Europe in the Interflex project that was co-founded by the European Union’s Horizon 2020 research and innovation program (E.ON, 2022) (InterFlex, n.d).
InterFlex (n.d) THE SWEDISH DEMONSTRATOR – SIMRIS. Available at: https://interflex-h2020.com/interflex/project-demonstrators/sweden-simris/?cn-reloaded=1