Integrated local energy systems (Energy islands)

Proposals will develop and demonstrate solutions which analyse and combine, in a well delimited system, all the energy vectors that are present and interconnect them, where appropriate, to optimise their joint operation that is demonstrated by an increased share of renewables in and higher energy efficiency of the local energy system.

Proposals should present a preliminary analysis of the local case as part of the content of the proposal and propose to develop solutions and tools for the optimisation of the local energy network, that also have a high replication potential across Europe.

Local consumers, small to medium industrial production facilities and/or commercial buildings should be involved in the projects from the start, preferably by creating energy renewable energy communities[[‘renewable energy community’ as defined in DIRECTIVE (EU) 2018/2001 on the promotion of the use of energy from renewable sources.]].

TRL will range between 5 and 8 (see part G of the General Annexes). Proposals will indicate the estimated levels of TRL at the beginning and at the end of the project.

Proposals will include a task on the analysis and communication of obstacles to innovation and foresee the coordination on policy relevant issues (e.g. regulatory framework, business models, data management, consumer engagement) with similar EU-funded projects through the BRIDGE initiative and, if relevant to the project, the Clean Energy for EU Islands initiative[[https://ec.europa.eu/energy/en/topics/energy-strategy-and-energy-union/clean-energy-eu-islands]]. An indicative budget share of at least 2% of the EU contribution is recommended for the research work associated with these issues and an additional 2% of the EU contribution for the coordination effort.

The Commission considers that proposals requesting a contribution from the EU of between EUR 5 to 6 million would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.

The fast growth of energy production from renewable energy sources offers new and economically attractive opportunities for decarbonising local energy systems (e.g. isolated villages, small cities, urban districts, rural areas with weak or non-existing grid connections). It is also a technological and financial challenge for the electricity network to integrate more renewables, but it is also an opportunity to optimise the electricity system operation in synergy with other energy carriers/vectors to increase the hosting capacity for renewables, not just for electricity but also for heating/cooling, transport and/or industry in a sector coupling approach. Novel approaches to optimize network architecture, planning and development based on the opportunities offered by integrated local energy systems and enabled by digitalisation and power electronics can contribute to addressing the challenge, as can storage of electricity in all energy vectors (e.g. electricity, heating, cooling, water, wastes, etc.), including possibilities offered by batteries and electric vehicles.

Integrated local energy systems can be used to create economically attractive conditions to boost local energy sources and activate local demand-response. Innovative approaches, for example based on Renewable Energy Communities, in line with the recently adopted Renewable Energy Directive (EU) 2018/2001 can result in attractive business cases for local investments in smart integrated energy systems with weakly or non-existing grid connections. At the same time, decarbonisation can go hand-in-hand with the improvement of local air quality and citizens’ engagement.

The supported projects are expected to contribute to all the following impacts:

• validate solutions for decarbonisation of the local energy system while ensuring a positive impact on the wider energy infrastructure, on the local economy and local social aspects, and local air quality;
• enhance the involvement of local energy consumers and producers, preferably by creating energy communities in the development and the operation of local energy systems and test new business models;
• validate approaches, strategies and tools to safely and securely operate an integrated local energy system across energy vectors (electricity, heating, cooling, water, wastes, etc.) so that it is able to integrate higher shares of renewables (than it would in case of separate operation of infrastructures);
• benchmark technical solutions and business models that can be replicated in many local regions and that are acceptable by local citizens.

Proposals are invited to include ad-hoc indicators to measure the progress against specific objectives of their choice that could be used to assess the progress during the project life. Indicators are expected to have clear and measurable targets.