Economic benefits
Economic benefits
Local value instead of money flowing out
An energy community creates economic benefits on several levels at the same time: for households, for local businesses, for the municipality and for the wider local economy. Instead of everyone separately paying their bill to a distant utility company, the community builds shared energy assets - mainly solar, later storage and smart control - and keeps a much larger share of the value locally.
Every euro that stays in the town as part of a local value cycle strengthens its long-term resilience and development.
Every forint that would normally flow out of the town through the electricity bill becomes part of a local value cycle: it helps pay off community-owned investments, finances maintenance and upgrades, and supports new projects that again reduce costs or improve services.
Households: lower bills and more predictability
For households, the most direct economic advantage is lower and more predictable energy bills. When a family covers a growing share of its annual consumption with locally produced solar power at a community tariff, it buys less electricity at full retail price and becomes less exposed to external price spikes.
In practice this means two things:
- the average yearly bill goes down
- the remaining bill becomes much more stable
Community calculations in Kistelek, for example, show that a typical household with an annual consumption in the range of 3,000-4,500 kWh can expect savings on the order of 50-60,000 HUF per year compared to their previous bills. Instead of being at the mercy of rapidly changing market prices, families pay a tariff that is anchored in the long-term costs of the community’s own installations. This reduces financial stress and makes household budgeting easier; the freed-up money can be spent on other local goods, services or home improvements.
Local businesses: competitiveness and risk reduction
Local businesses gain in a slightly different way, but with equally important consequences. Energy-intensive small and medium-sized enterprises often struggle with volatile energy costs, which can quickly erode already tight margins. By participating in an energy community, they can source part of their electricity from locally owned solar at conditions that are more stable and, over the medium term, more favourable than purely market-based procurement.
Key benefits for companies include:
- reduced exposure to sudden price jumps
- safer long-term planning
- potential to optimise load and reduce peak demand charges
The community model often allows for smarter load management - for example by shifting certain processes to times of high local production or by smoothing peaks. This combination of lower average cost and reduced risk strengthens the competitiveness of local firms and makes them more resilient in crises.
Municipal budgets and strategic flexibility
For the municipality, the economic benefits are closely linked to budget stability and strategic flexibility. Public buildings - schools, kindergartens, cultural centres, administrative offices - represent a significant share of a town’s total energy demand. When these buildings are at least partly supplied by the community’s own renewable generation, the local budget becomes less sensitive to external price fluctuations.
Stable, predictable energy costs free up room in the local budget for social services, development projects and long-term investments.
On top of this, the municipality often acts as a co-owner of the installations and a key decision-maker in the community, so part of the surplus can be reinvested in public purposes: further energy projects, building renovations, public space improvements or social support schemes for vulnerable residents.
Wider local economy and skills
Beyond individual savings and municipal budgets, an energy community also stimulates the broader local economy. The design, installation and maintenance of solar panels, meters, IT systems and, later, storage and charging infrastructure generate demand for skilled work. Wherever possible, these contracts can be awarded to local or regional companies, supporting jobs and building a local ecosystem of installers, engineers and service providers.
Over time, the town accumulates practical knowledge and experience in:
- energy management
- project development
- digital tools and data
This “learning by doing” reduces dependency on outside consultants and strengthens the community’s bargaining position in negotiations with banks, suppliers or higher-level authorities.
Funding mix, reserves and governance
The way the community handles external funding is another important economic factor. Well-prepared projects are able to combine local capital with targeted support from national or EU programmes. External funds are not used to replace local involvement, but to amplify it: they help build more capacity, more quickly, while ownership, control and long-term benefits remain anchored in the community.
Risk reduction is itself a form of economic benefit. A consciously designed reserve component - a small share of each kilowatt-hour set aside in a reserve fund - creates a buffer that can absorb unexpected shocks without sudden tariff increases.
A clear reserve strategy and transparent governance send a strong signal of professionalism to lenders and external partners.
Because decisions in the community are typically taken on a “one member = one vote” basis, the way money is used is decided in a transparent, democratic framework. This shared responsibility creates strong incentives to keep the project financially healthy and reinforces trust - an economic asset in its own right.
Altogether, the economic benefits extend far beyond the headline figure of “cheaper electricity”: they include more stable household budgets, stronger local businesses, safer municipal finances, local jobs and skills, better access to funding and a robust mechanism for managing risk.
