Lottery funding worth millions to power community energy projects across Scotland
Community groups across Scotland are to receive further help to cut their energy bills and reduce carbon emissions, thanks to a £10 million investment over five years from the largest community funder in the UK.
The National Lottery Community Fund investment will help to fund the installation of renewable technologies like heat pumps and solar panels, as well as energy efficiency measures through the Scottish Government’s Community and Renewable Energy Scheme (CARES) Community Buildings Fund.
CARES provides advice and funding to communities looking to develop renewable energy, heat decarbonisation and energy efficiency projects. It is administered by Local Energy Scotland on behalf of the Scottish Government.
The investment was announced by Energy Minister Stephen Gethins during a visit to Shetland, where he saw how CARES funding helped Scalloway Youth and Community Project install a heat pump, solar panels and a battery.
The Minister said: “Scotland’s communities are at the heart of our transition to more affordable energy, and this £10 million investment over five years from The National Lottery Community Fund will help even more of them benefit from it.
“By supporting the installation of renewable technologies and energy efficiency measures, we can cut costs for organisations serving some of our most vulnerable people, reduce emissions from community buildings, and strengthen local supply chains.
“CARES has already delivered over £83 million to communities across Scotland, supporting more than 1,200 projects and 75MW of renewable energy capacity.
“This new funding will enable more communities to build on that progress in the places that matter to them, and I would encourage any organisations who have not already applied to speak with Local Energy Scotland to see what help they may be eligible for.”
Kate Still, Chair or The National Lottery Community Fund Scotland, said: “We’re delighted to have established this partnership with the Scottish Government and Local Energy Scotland.
“Supporting communities to be environmentally sustainable is one of our key missions at The National Lottery Community Fund. That’s why we are investing £10 million in the CARES Community Buildings Fund. It significantly increases CARES funding while keeping access to support and funding straightforward for community groups.
“Community buildings are often at the heart of local communities across Scotland, bringing people together to connect and support one another.
“Thanks to National Lottery players, this funding will help organisations invest in renewable and carbon-saving technologies, making these valued local spaces greener, more sustainable and more resilient.
“We know communities want to play a leading role in responding to climate change, and this investment will enable organisations of all sizes to take meaningful action while creating lasting benefits for both people and the environment.”
Laura McGadie, Operations Director at the Energy Saving Trust, said: ““We’re incredibly proud of everything CARES has achieved so far in supporting communities across Scotland.
This funding from The National Lottery Community Fund will help us build on that success, enabling us to reach even more communities and support them on their journey towards a more sustainable future.”
New proposals for onshore renewable energy developments
Communities across Scotland could see more money invested in their area as a result of onshore renewable energy developments – under new proposals published yesterday.
The proposed updates to existing community benefit guidance for onshore energy developments would recommend that local groups should receive yearly payments of £6,000 per Megawatt (MW) of onshore wind capacity – up from £5,000 per MW – for the lifetime of a project.
‘Community benefits’ are voluntary contributions provided by energy developers to local communities. Around £30 million in benefits was provided to groups across Scotland last year, supporting projects that matter most to local communities.
The proposals also include:
a new specific recommended range of £700-£1000 per MW per year for solar projects;
a new recommended level of at least £150 per MW per year for battery energy storage projects;
the pilot of a Community Benefit Peer Forum, run by Local Energy Scotland, so communities can work together, share learning and build expertise;
and improved guidance to support communities to maximise the long-term value of community benefit funds.
Energy Secretary Gillian Martin said: “For more than 10 years, Scotland has led the way in establishing the provision of community benefits as a common and expected practice across our renewables sector.
“This has led to communities and energy developers working together to deliver tangible and long-lasting legacy benefits for local areas – along with the wider benefits of local jobs, supply chain businesses and growing local economies.
“The updated proposals outlined today seek to strike a balanced approach to future fund levels which continue to serve communities well while reflecting the market challenges for developers over recent years.
“We will continue to engage with communities and the energy sector to help refine these proposals ahead of developing our final updated Good Practice Principles later this year.”
Stephen McCarron, Chief Operating Officer at the 9 Community Councils Group, said: “The 9CC Group warmly welcome the significant updates to the Good Practice Principles and are delighted that it adopts our key asks for communities to be at the heart of the decision making regarding the funding and delivery support for local and strategic priorities.
“It’s an excellent document; comprehensive and clear on best practice while striking fair balance on the interests of developers and communities.
“A partnership approach is critical to creating a lasting legacy for our communities and whilst we will continue to promote a collaborative and wider approach in terms of communities working together, we are pleased that there is a clear distinction between those who make local decisions on funding and those who administer the fund, that avoids the risk of self interest undermining the greater good for the wider community.”
Over £5.5 million for local renewable energy projects
An Island solar farm, community ice rink and a small community wind farm are among almost 50 projects to benefit from more than £5.5 million funding.
Supported through a combination of Scottish Government and Great British Energy funding, the Community and Renewable Energy Scheme’s (CARES) Community Energy Generation Growth Fund will enable 46 community groups to install local renewable energy schemes such as wind turbines and solar panels, to meet local needs.
Energy Secretary Gillian Martin confirmed the 2025 allocations for the Fund whilst at a visit to an Edinburgh Solar Co-op site in southwest Edinburgh, during Scotland’s Climate Week.
The community-run group have been offered more than £480,000 funding to install further solar panels on schools, community centres and leisure facilities across the city generating free electricity for the buildings and a fixed return on investments for local supporters.
Among the projects awarded funding are:
Edinburgh Community Solar Co-op receives £484,500 for Edinburgh Solar Co-op phase 3
Arran Community Renewable’s work on building community-owned Glenkiln Solar Farm
Eigg Electric to support their work towards decarbonising the island by 2030
Huntly Development Trust’s project to generate up to 20MW of potential wind, solar and green hydrogen
It brings the total number of funding offers through the Fund up to 69 since it first launched last year, supporting 57 different community energy projects.
Cabinet Secretary for Climate Action and Energy Gillian Martin said: “Scotland is fast becoming a global renewable energy powerhouse, and it is vital that communities share in the benefits from this transition.
“This funding, for stand-alone generation projects, responds to the needs of local groups and has the potential to lever in significant funds for communities by providing the ability to earn money from their projects by, for example, selling the excess energy generated back to the grid. It will also play a key role delivering a just transition to net zero, whilst supporting a greener, fairer future for Scots.
“To further ensure communities see the benefits of the renewable energy transition, we know more can be done. That is why we are calling on the UK Government to go further by mandating offers of shared ownership and to introduce a mandatory community benefits scheme for mature onshore technologies.
“We will continue to work with our partners to grow the community energy sector and, crucially, ensure that the delivery of renewable energy comes with benefits for people in Scotland, as well as supporting progress towards net zero.”
UK Government Minister for Energy Michael Shanks said: “Great British Energy is empowering communities across Scotland to take a stake in their own energy, whether it be investing in solar projects on the Isle of Arran or community wind farms in Aberdeenshire.
“This is our clean energy superpower mission in action – putting communities in the driving seat of energy generation and making sure working people and businesses profit.”
Local Energy Scotland Manager Chris Morris, said: “Congratulations to the community groups and charities who’ve worked hard to develop these inspiring projects and proposals. We’re looking forward to working with them and to see the lasting impact they’ll make, locally and across the country.
“This funding marks a step forward for community-led renewable energy in Scotland. Through CARES, we’re enabling local groups to turn ambition into action, developing energy projects that not only reduce carbon emissions but also directly benefit communities with long term social and economic value.”
