Energy communities – new legal form of organization for everyone who produces, consumes, stores energy together

Citizens, local public authorities and businesses will be able to associate more easily to jointly produce, consume, store and manage energy, including energy from renewable sources. Government has approved the draft law developed by the Ministry of Energy, which introduces a dedicated legal form for energy communities.

Renewable energy communities and citizen energy communities are already provided for in the legislation of the Republic of Moldova, but until now they have not benefited from their own legal form. The six pilot communities developed with the support of UNDP Moldova in Logănești, Cociulia, Pleșeni, Bașcalia, Chișinău municipality, and Codru town were established using existing legal forms, such as limited liability companies and public associations. The experience of these projects has demonstrated that the available forms do not fully address the specific nature of energy communities and do not allow all the principles on which they are based to be fully implemented.

In this context, the draft law introduces a dedicated legal form that will allow energy communities to be established and operate within a framework adapted to their specific nature.

“Energy communities give people the opportunity to become active participants in the energy system. Through a clear legal form, citizens, local authorities, and entrepreneurs will be able to associate, produce energy, use it more efficiently, and jointly develop projects that bring benefits to the community. If several households want to pool their efforts and purchase a battery, store energy, or if a local public authority, together with the school, kindergarten, and local medical center, wants to create such an energy community, we are now providing the framework to make these initiatives possible,” Energy Minister Dorin Junghietu said.

The new legal framework proposes the creation of a special and optional legal form, in the form of a non-profit and non-political association with legal personality. This will provide the legal basis for establishing a community, which may subsequently apply to the National Agency for Energy Regulation for recognition as a renewable energy community or a citizen energy community, in accordance with the law.

The new legal form will allow different types of members to associate, ranging from individuals, local public administration authorities, and municipal enterprises to small and medium-sized enterprises, homeowners’ associations, public institutions, and other eligible entities. Participation will be voluntary and open, while decisions will be made according to the principle of “one member – one vote,” ensuring that members exercise effective control over the community’s activities.

The draft law facilitates the transfer for use of immovable property and energy infrastructure owned by local public authorities to the community in which the authority is a member. CNED will develop and publish a model founding document/statute, which will be made available to all interested parties in order to facilitate the registration process and reduce the related legal costs.

Communities will be able to develop joint projects for producing and using energy, including energy from renewable sources, as well as for storing and managing it. The main purpose will be to create economic, social, or environmental benefits for their members and for the community in which they operate, rather than distributing profits among members.

The draft law does not restrict members’ ability to use other legal forms provided for by sector-specific legislation. At the same time, the creation of the new legal form does not entail the introduction of additional fees or taxes and will not generate expenditures from the state budget. Communities will be able to obtain funding from membership fees, income from their own activities, donations, grants, and other sources provided for by law.

Establishing a clear legal framework will allow the experience of pilot projects to be expanded and new local energy initiatives to be developed. Energy communities can contribute to increasing decentralized renewable energy generation, reducing energy costs, and strengthening community resilience.