How Collective Self-Consumption scheme is Driving Energy Providers to Reinvent Themselves
A key example of a driving force that has accelerated the adoption of renewable energy across Europe is the European Green Deal, introduced by the European Commission in 2019. This initiative is designed to make Europe the first climate-neutral continent by 2050, with a significant focus on renewable energy. Central to this is the Fit for 55 package, which aims to reduce greenhouse gas emissions by at least 55% by 2030. One of the package's main components is the revision of the Renewable Energy Directive (RED II), which raised the EU’s renewable energy target to at least 40% by 2030 (later increased to 42.5% in the revised directive in 2023.
The REPowerEU plan, introduced in response to the energy crisis following Russia's invasion of Ukraine, further pushed these targets to 45% by 2030, alongside efforts to expedite renewable energy projects and reduce dependency on fossil fuels.
These initiatives, coupled with binding national targets, have been key to fostering the growth of renewables such as wind, solar, and hydrogen across Europe.
France is a great example where this shift has particularly accelerated since the enactment of the 2015 Energy Transition for Green Growth Act and the subsequent Paris Agreement. The law aims to reduce the country's dependence on fossil fuels, increase the share of renewables in the energy mix, and improve energy efficiency.
Over the past years, France has seen a significant rise in installed renewable energy capacity, particularly in solar and wind power, with primary renewable energy production increasing by 75% since 2005. Public policies and financial incentives have played a crucial role in driving this transformation.
At the same time, technological advancements such as smart grids and energy storage systems are making it easier to integrate renewables into the energy system. These innovations are fueling the growth of clean energy both on a national and local scale. Notably, there has been a surge in local renewable energy production, which is accelerating decentralized energy generation. This shift is empowering a growing number of small producers, from individual households to local communities.
This trend has given rise to new models of individual and collective self-consumption that are reshaping the French energy landscape. These models of decentralized energy production are playing a vital role in advancing the energy transition at the local level, pushing traditional energy providers to rethink their strategies and adapt to a more distributed and sustainable future.
In this article, we will explore the development of auto-consumption using France as an example and how this trend is driving energy providers to reinvent their business models.
Collective self-consumption (CSC) has been developing over recent years.
The Collective Self-Consumption Scheme (or CSC scheme) is an innovative, localised energy model that allows multiple consumers to share electricity produced from renewable sources. It operates within a structure where producers and consumers form a single legal entity. This entity oversees electricity production and distribution among its members—ranging from individuals to businesses and municipalities. Central to this model is the role of the distribution network operator, who measures both consumer and producer energy consumption, calculates the share of electricity to allocate to each participant, and provides this data to energy suppliers to adjust billing accordingly.
The SCS potential is vast. Whether in industrial zones, isolated rural areas, metropolitan regions, residential buildings, or public facilities, SCS projects are thriving. In 2023 alone, the number of SCS initiatives in France doubled compared to 2022, with the capacity of new SCS scheme installations increasing by 34%.
This growth is fueled by SCS’s key advantage: access to local, clean, and affordable energy. Consumers benefit from reduced Tarif d’Utilisation des Réseaux Publics d’Electricité (TURPE) fees for self-produced energy, incentivizing homeowners and communities to adopt these projects and lower their electricity.
Businesses and municipalities, particularly those hit hard by recent spikes in energy prices, are embracing SCS as a “shield of economic and social resilience.” The 2023 Renewable Energy Acceleration Law further propelled this shift by simplifying the regulatory process for SCS projects, making it faster and clearer to implement new initiatives.
Additionally, this law allows communities to sign private contracts with producers beyond the 2 km distance limit, enabling them to source renewable energy from solar or wind farms located farther away.
Network operators are also advocating for ACC’s growth. With rising electricity demand putting pressure on energy grids, localized ACC projects help manage energy flow more.
Moreover, SCS offers a remarkable advantage in terms of energy efficiency. In traditional energy supply, France's energy mix achieves a yield of only 43% of primary energy consumed, whereas local renewable production through ACC approaches nearly 100%.
Through this model, SCS not only enhances energy sustainability but also strengthens local communities, making it a cornerstone of Europe’s transition toward a greener future.
Incentive Policies to Unlock the Economic Potential of Collective Self-Consumption
Despite its numerous advantages, Collective Self-Consumption (CSC) in France faces challenges, particularly around profitability. The energy produced through CSC is subject to multiple taxes and fees, including TURPE (the Tarif d’Utilisation des Réseaux Publics d’Électricité), CSPE, and VAT, which impact the economic appeal of these projects. Much like individual self-consumption, CSC benefits from the local distribution of energy between producers, such as photovoltaic farms, and local consumers. However, unlike individual self-consumption, CSC energy is subject to TURPE, even though the shorter distances involved in CSC significantly reduce the burden on the national grid. Although CSC enjoys a reduced TURPE rate compared to traditional energy supply, it remains a limiting factor when compared to the exemption offered to individual self-consumption.
In some countries across Europe, incentive policies have successfully stimulated the growth of energy communities. In Italy and Portugal, for instance, public initiatives favor CSC over individual self-consumption, making it more financially viable. According to a study conducted by researchers, energy communities in these countries enjoy better financial conditions due to public incentives like direct subsidies, tax reductions, and favorable feed-in tariffs. These policies increase consumer participation and improve the economic feasibility of CSC projects.
Several solutions could be explored in countries that are not taking enough advantage of the CSC scheme. One possibility is to follow the same approach taken with individual self-consumption by reducing or eliminating public transmission system active tariffs for CSC. Another option is the introduction of a surplus energy buyback model, with varying valuation levels depending on the self-consumption rate. Finally, offering specific premiums for CSC could incentivize consumers to embrace local energy sourcing.
By establishing the right legal framework and adopting such policies, countries could unlock the full potential of CSC, making it a pivotal player in the country's energy transition.
What Does the Future Hold for Energy Providers?
Collective Self-Consumption (CSC) is transforming the French energy landscape, much like other green innovations such as individual self-consumption, heat pumps, electric vehicles, and thermodynamic water heaters. However, CSC comes with a distinct challenge: the energy supplier must differentiate between energy consumed from the collective production and that sourced from the broader grid, ensuring accurate billing for the customer.
Beyond this technical challenge, energy suppliers now face a strategic decision: should they remain traditional retailers, purchasing energy from markets and reselling it to customers, or embrace the role of the agents of change, guiding their clients through the energy transition? As consumers become increasingly aware of the environmental and financial stakes, they evolve from passive buyers to active participants. This shift opens up new opportunities, with customers seeking guidance from innovative players, rather than their conventional suppliers.
New actors in the energy market are emerging, often building on their core business to include energy provision. For instance, companies like AIRA, known for manufacturing heat pumps, are now offering energy services to provide a comprehensive solution for their clients. This trend highlights the need for traditional suppliers to rethink their strategy.
Nevertheless, traditional energy suppliers still hold a critical advantage: their established customer relationships. To capitalize on this, they must go beyond conventional models and anticipate evolving customer needs, particularly driven by these new energy uses. There are three critical areas where suppliers can offer their expertise:
- Optimizing consumption patterns: Helping consumers align their energy usage with ACC production periods to maximize efficiency.
- Curve-based billing: Offering precise pricing based on consumption patterns, and creating short-term promotional offers to incentivize use.
- Load shedding management: A strategy that combines the above, allowing for better energy distribution and usage optimization during peak times.
By stepping up to meet these needs, energy suppliers can secure their role in the evolving market and maintain their crucial relationship with customers, all while supporting the broader transition to renewable energy.
Energy Providers face Urgent Need to Modernize Their IT Plaform to Keep Up with New Demands.
It is indisputable that the energy ERP or Customer Information Systems currently used by energy providers were never designed for the scale of disruption now unfolding. While most systems can manage the separation of self-produced and grid-supplied energy flows, along with the administration of new taxes, few are equipped to handle the profound transformations on the horizon.
The emerging demands place far greater pressure on information systems than they were ever designed to handle. Previously, energy data was collected sporadically, and billing was done in batches. Now, systems must process massive data inputs and deliver real-time responsiveness, which is not only required by new energy use cases but expected by more engaged, informed consumers.
Moreover, these systems must be flexible to co-exist in the ecosystem of partner solutions, to integrate easily with third-party platforms that manage specific functionalities, such as load shedding or vehicle-to-grid (V2G) technology for electric vehicles. Unfortunately, traditional systems are ill-equipped to support such advancements and cannot address the new cybersecurity challenges that these innovations bring.
For energy providers, upgrading their IT infrastructure is no longer optional—it’s critical to staying competitive in a rapidly evolving market.
How Can triPica Support Energy Providers in Their Modernization?
Designed as a cloud-native, real-time, open, and multi-industry platform, triPica is perfectly suited to meet the demands of the energy transition. It was built from the ground up to support emerging use cases and already does—such as managing energy injections from electric vehicle batteries and compensating customers for their participation in this activity.
With a robust technology foundation and a flexible, generic data model, triPica was designed to adapt to the services it bills for, making it fundamentally different from market solutions built for a single need and later forced to evolve. This adaptability gives triPica and the Energy Retailers who use it a distinct advantage. Combined with its scalability and resilience, triPica is the most sustainable solution for facing a future where tomorrow’s energy uses are still unknown—regardless of the size or ambitions of the energy provider.
