The Structural Problem with the Current Model

European households are, for the most part, energy consumers in the purest sense – entirely dependent on whatever their supplier chooses to offer, at whatever price market conditions and commercial incentives dictate. The relationship is transactional, the information asymmetrical, and the leverage sits entirely with the supplier.

The complexity of the market did not allow for a more prosumer focused system and because prices, while variable, remained within a range that households could absorb -  this arrangement has historically been tolerable. That assumption no longer holds. On the one hand we are seeing more consumer level products for single family homes like on-roof solar and battery storage (although this still leaves renters behind). And on the other hand energy prices across European markets have risen sharply, and the standard variable contracts now available to consumers, particularly from smaller, less capitalised suppliers, reflect the full weight of that market risk being passed downstream.

The problem is structural rather than cyclical. When energy is priced at the margin, and the marginal unit is set by the most expensive source on the grid, the price signal bears little relationship to the actual cost of generation for much of the capacity in the system. Renewables, once built, are extraordinarily cheap to operate. But under the current merit order system, they are sold at prices determined by gas.

For founders thinking about where durable opportunities exist in European energy, this structural tension is the starting point.

The Community Solar Model as a Response

What RemoteSolar is building is, in essence, a mechanism for households to exit this dynamic, partially and practically, rather than theoretically.

The model works as follows. We identify solar parks, either existing assets looking for a more stable revenue base, or new developments being planned, and we enable groups of households to collectively pay for a portion of that capacity. In return, whatever power that capacity generates flows to those households at a locked-in price, insulated from spot market movements for the duration of the rental period. Typically ten to fifteen years.

A solar park takes roughly a decade to repay its capital costs, and the developers building those assets require a reasonable and predictable return on that investment. If a sufficiently large group of households – we find that one to two thousand is a meaningful threshold – commits to underwriting that return, the park owner has what they need, and the households secure something of genuine value: price certainty for the majority of their consumption over a multi-year horizon.

In practice, this means that households can lock in somewhere between fifty and eighty percent of their annual electricity consumption at a fixed cost. The remainder is sourced dynamically, but the exposure is manageable precisely because the base load is already covered. When we model this against what households would otherwise pay on standard variable contracts (including the ground charges and headline rates that suppliers use to present an attractive advertised price before adjusting terms after the introductory period) the difference is material.

The Role of Batteries and Community Sharing

The model becomes considerably more interesting when batteries enter the equation. We are at a point in battery economics that mirrors what happened to solar panel costs over the previous decade. Prices are falling faster than consensus forecasts anticipated, and the implications for energy storage at a community scale are significant.

As battery capacity is added to the system, either at the park level or within individual households, it becomes possible to shift generation across time. Overnight wind, which is frequently abundant and cheap, can be captured and discharged during peak demand periods. The east-west orientation of panels, increasingly favoured by park developers, smooths the generation curve across the day rather than concentrating it at midday. Taken together, these developments reduce the effective cost per kilowatt hour for households in the system and extend the proportion of consumption that can be covered by locked-in supply.

There is also a community dimension that we find particularly compelling. Within the RemoteSolar platform, households can pool their excess generation with others in the network; friends, family members, local organisations, at a fixed transfer price. If one household is away and generating surplus, that surplus is automatically redirected to others who need it. The economics of this arrangement are straightforward, but the social architecture it creates is genuinely novel. Energy sharing at a household level, outside the traditional supplier relationship, has been discussed in European policy circles for some time. The regulatory groundwork in Germany, where we are based, is now sufficiently advanced for it to be operationally viable.