Bridging the gap between theory and practice in local energy sharing - energy communities in Croatia

The European directives focus on unlocking the potential of final customers in the clean energy transition. With the recent trend of rising electricity and petrol prices, coupled with reduced investment costs in low-carbon technologies, the installation of photovoltaic solar panels for end customers has become more profitable compared to previous years, leading to a shorter payback period. Additionally, to enhance citizen engagement in the integration of renewable energy sources, various forms of local energy-sharing models are discussed in the literature. This paper elaborates on the regulatory framework and policies at the European level concerning renewable energy communities, citizen energy communities, and collective self-consumption, with a particular focus on Croatia’s perspective. It highlights the steps needed to accelerate the realization of energy communities in practice. Under current Croatian regulations, the profit from selling surplus community energy to the supplier cannot be directly remunerated to community members. The results indicate that community members could achieve 20% lower electricity costs annually if the surplus energy were directly remunerated. To avoid losing potential profits from excess energy, the paper models an investment in a community-owned battery storage system, aiming to increase community self-consumption and minimize the amount of energy sold to suppliers. It is shown that with a static sharing scheme, individual community members’ costs can decrease by 11% to 16%, and by up to 20% with a dynamic scheme compared to cases where profit from excess energy cannot be directly remunerated to community members.