The UK government and Great British Energy have launched a £30 million ‘People’s Power’ funding package to help local communities develop and own their own renewable energy projects. Launched on 17 September 2026, the initiative is designed to give neighbourhoods more control over their power supplies while supporting the national shift toward net zero.
The investment is the first instalment of a wider £1 billion commitment to community energy projects by 2030. The scheme aims to support more than 1,000 community-led developments across the country, ranging from rooftop solar panel installations to small-scale wind farms and river hydro schemes.
Energy Secretary Miatta Fahnbulleh, who is leading the Local Power Plan, confirmed that the funding is intended to remove the financial barriers that often prevent local groups from starting energy-generation projects. The initial £30 million package includes a £20 million Community Fund available for grant applications in England, Wales, and Northern Ireland, alongside a £5 million Partnerships Grant for local authorities in England working with community partners.
Grant eligibility and application details
The funding is open to a wide variety of organisations, including parish and town councils, faith groups, sports teams, and community interest companies. The government has structured the grants to support projects at different stages of their lifecycle:
- Feasibility studies: Groups can apply for up to £40,000 to investigate whether a project is technically and financially viable.
- Project development: Up to £100,000 is available for more advanced stages, such as securing planning permission or finalising technical designs.
A further £1.8 million has been allocated to Scotland through the Community and Renewable Energy Scheme (CARES), with approximately £2.9 million reserved for advisory and support services to help groups navigate the application process. The Great British Energy portal is now live for organisations to begin their applications.
VAT removal and the £1 billion goal
The launch of the People’s Power fund coincides with a significant pledge regarding household energy costs. Prime Minister Andy Burnham has confirmed that the government intends to remove VAT from household electricity bills starting in October 2026, a move aimed at providing immediate relief to consumers alongside the long-term benefits of community-owned power.
While the initial £30 million is described as a “downpayment,” the government expects the cumulative £1 billion investment by the end of the decade to significantly increase the amount of clean energy generated locally. By allowing communities to sell excess power back to the grid or use it to lower local running costs, officials believe the scheme will create a more resilient and decentralised energy network.
The Department for Energy Security and Net Zero (DESNZ) and Great British Energy will oversee the rollout of the funds, with the first wave of projects expected to receive approval later this year.
