Financial aspects of micro- and pico- community energy systems

This briefing reviews the financial aspects of micro- and pico- grid community energy systems. Most guidance has been developed for micro-grids, particularly those that operate commercially. However, micro- and pico- systems, given their smaller size (1 to 50kW), may depend on different funding mechanisms than larger projects. Apart from size, the resource and material requirements of a small community energy system may change them qualitatively. This briefing discusses some principles for the financial management of micro- and pico-electrical grids, and outlines steps for the development of a financial plan, drawing on previous experiences with micro-grids. It also provides a summary of the different types of costs that will need to be considered, a discussion of additional costs which may be particularly relevant in community energy systems (CES), and concludes with a discussion of the different ways in which cost-recovery could be considered.