Charities and community groups have a key role to play in fighting climate change and fuel poverty. This could be through improving the energy efficiency of buildings, providing energy advice or starting a locally based renewable energy initiative.

But all are likely to need money. This page explores some of the grants and funding schemes specifically aimed at communities along with a specific section for funding energy efficiency improvements in community buildings.

Grants, including those administered by CSE
Crowdfunding
Raising shares
Institutional investments such as bonds and loans
Funding energy efficiency improvements in community buildings

Grants for community energy projects

The grant world is constantly changing. Grant programmes come in many forms including:

• Ongoing national grant programmes – like the many programmes from the National Lottery Community Fund.
• Short term one-off programmes.
• Funds for specific demographics (e.g. young people).
• Funds for specific types of organisation (e.g. faith-based organisations).
• Funds for specific activities (e.g. community energy projects).
• Location specific grants, for example UK Community Foundations, grants from local councils (like Community Infrastructure Levy funds), and through local members of the National Association for Voluntary and Community Action.

National Community Energy Fund

A £10m national Community Energy Fund was announced in 2023, building on the old Urban and Rural Community Energy Funds and managed through five regional net zero hubs in the South West, North East and Yorkshire, Greater South East, North West and Midlands.

Finding grant funding

There are various funding search websites and databases including:

• CSE’s funding spreadsheet (we update this every 6 months).
• 360 GrantNav: This search website allows you to search, explore and download grants data published by UK funders. You can use this website to search for information on who funds groups that are similar to your own.
• Charity Excellence Framework: Sign up for free and search for trusts and foundations who are funding similar work.
• Grant Finder: funding database for registered customers. They also post highlights that anyone can view.
• Grants Online: free-to-use funding database.

Grants administered by CSE

CSE has deep roots in the community energy sector, which is why we are asked to administer grant schemes on behalf of many funders. These include:

Rural communities energy support network
Bristol City Leap community energy fund
SGN safe and warm scheme
Energy affordability fund
Thrive Renewables community benefit programme
SSEN enabling works fund
Power partners

Tips on making grant applications

Making a grant application can be a big undertaking. Luckily, there’s a wealth of guidance and resources online to support you with making your application.

At CSE, we have a lot of experience writing successful grant applications and have put together a helpful checklist to support communities with grant applications.

But we’re not the only ones with experience. We recommend the following:

• Charity Aid Foundation’s guide to writing a great grant application.
• Groundwork’s tips on applying for a community project grant.
• NVCO’s application guide.

Crowdfunding

For some ideas, particularly where other sources of funding or finance are not viable, crowdfunding is well worth exploring. It’s a great way to enable people to invest in something they believe in. It can also help to raise money which would put you in a position to secure other funding in future.

Crowdfunding is quite literally the process of getting funds from a crowd – via an online platform. Funders can come from anywhere in the world and they can be an individual, organisation or business.

In return for their contribution, you might offer donors:

• Nothing tangible (except of course that feel-good glow).
• Non-financial rewards such as merchandise or free entry to an event.
• A financial return.

Platforms can be broadly categorised into equity-based and loan-based (which are both FCA-regulated), and reward-based and donation-based. Crowd funding usually involves a one-off transaction, so there’s minimal administration involved.

You can use crowdfunding to raise very small or pretty large amounts — from small campaigns like Keep Streets Live which raised just over £3k, to ambitious projects like Solar Schools, which raised more than £700k. If you have a strong network of supporters and you’re prepared to put some time and effort into promoting the opportunity it can be a game changer.

There are lots of websites that make crowdfunding simple including: Crowdfunder UK, Fundsurfer and GoFundMe.

Running a crowdfunding campaign

Here are some tips from Nesta for running a crowdfunding campaign.

And here are some successful examples of crowdfunder campaigns for community initiatives:

• Possible’s Solar Schools: asked parents and the local community to donate money towards solar installations on their local school.
• Bristol Energy Coop’s Hydro Feasibility study crowdfund: asked residents to donate money to raise funds to cover scoping and feasibility studies to explore a potential site for a community owned hydro-electricity project.

Raising shares

Raising shares from your community is a tried and tested way to secure long-term investments. It is particularly appropriate for large infrastructure developments that require high capital costs (fixed, one-time expenses) and which will produce an income stream, such as sales of electricity, once up and running.

Such projects require a strong business plan that can demonstrate that there’ll be sufficient income to cover interest on the investments, and eventually pay back the capital investment. Depending on the legal model, you may also wish, or be obliged, to pay into a community benefit fund. The interest rate on shares can vary depending on the health of the business, and depending on your constitution, may be capped.

There are administrative costs associated with handling shares, so a minimum investment of £100 to £250 is recommended, with a caveat that people only invest an amount they can afford to lose. You should not seek investment from financially vulnerable people. Businesses and organisations can also invest in shares.

Cooperative UK has a useful resource on community shares, including their Community Shares Handbook.

Share-raising platforms

Share-raising platforms connect projects to investors to help raise shares and manage them on an ongoing basis. Examples include Ethex and Abundance.

Community shares can help to secure further investment, particularly for larger projects. Raising community shares is valued by institutional investors as it demonstrates community support and provides some financial security.

Institutional investment

Institutional investment can take the form of bonds, loans, or equity from institutions. Before you can access sources of finance like these, you’ll generally have to be able to show that you have an ‘investment ready’ project or initiative. That means you have done all the at-risk development work to set up something which is now expected to be able to generate sufficient income to pay back what you borrow over time.

Some examples of institutional investors are Power to Change and Social and Sustainable Capital.

Bonds

A shorter-term community investment opportunity is a bond – these are fixed-term investments at a set interest rate and have the advantage that they can be part of a (tax-free) ISA savings account. Businesses and organisations can invest in bonds.

Platforms like Ethex and Abundance can also be used to raise bonds.

Loans

Ethical and charitable banks and loan providers are experienced at lending to community businesses and organisations, for projects that have environmental or social impact. Some will also provide low-interest loans. Some key examples are Charity Bank, Triodos and Big Issue Invest:

Funding energy improvements in community buildings

Making energy efficiency improvements to your community building will reduce its carbon emissions and energy costs.

Some improvements may be low or zero cost, but for larger and more costly improvements you’ll need a budget. This section covers funding options for specific community buildings: Village halls, Schools and Churches.

Explore your options for making your community building more energy efficient and create an action plan with our free Energy improvements in community buildings resource.

Village halls

Start by contacting your local council to see if they offer grant funding for your proposed measures. If your area has a Local Action Group or a Rural Community Council, they may also have a small grants scheme.

A loan could be an attractive option for improving your building’s heating or lighting efficiency, where the payback times are relatively short. Loan funding will most likely require a robust business plan as well as a legally recognised body to manage to project and be held accountable should anything go wrong.

The following offer loans for projects that have environmental or social impact:

• Charity Bank
• Triodos
• Big Issue Invest

In addition to those listed above, the Rural Community Buildings Loan Fund provides loans of up to £20,000 to fill temporary gaps in funding, either for specific projects or for urgent work connected with a building. It’s managed by Action with Communities in Rural England who also run a nationwide advice and information service for the volunteers who manage village halls. With a network advisor in every English county, they can support with funding applications and more. Find your ACRE advisor here.

If there’s a landfill site within ten miles of your community building, then you could be eligible for the Landfill Communities Fund.

Schools

If there’s school budget allocated for building improvements or maintenance costs you could make a strong case for money to be allocated to making energy efficiency improvements.

The Public Sector Decarbonisation Scheme from the central government provides grants for public sector bodies to fund heat decarbonisation and energy efficiency measures. The scheme is delivered by Salix Funding, guidance and application forms are available on their website.

Schools may also be able to raise a significant proportion of the money needed to install improvements through fundraising activities and donations from the school community.

Churches

Several funds are targeted specifically at churches and faith groups. Here are some examples:

• The Benefact Trust (formerly Allchurches Trust) offers financial support to Anglican churches, churches of other denominations, and the wider Christian community.
• The National Churches Trust aims to protect and support the built heritage of churches, chapels and meeting houses throughout the UK.
• The National Lottery Heritage Fund funds a range of projects which connect communities to the country’s built heritage.