The Rural Community Energy Fund (RCEF) is specifically targeted at helping rural communities access the money needed to carry out feasibility studies into renewable energy projects, and fund the costs associated with applying for planning permission.

The funding can be used to support renewable and low carbon technologies including wind, solar, biomass, heat pumps, anaerobic digestion, gas Combined Heat and Power and hydro.

Energy and Climate Change Minister Greg Barker said: “This investment will help kick start hundreds of clean green energy projects in rural areas across England. This new fund will give aspiring communities access to the cash they need to make this happen.

“Not only can local generation bring people together, boost local economies and drive forward green growth, it can help save money on energy bills too.”

The RCEF consists of a grant of up to £20,000 for feasibility studies and once these studies have been successfully completed, communities can apply for a loan worth up to about £130,000 to help with project costs, such as seeking planning permission and relevant environmental permits.

The loan is repayable to Government once projects have received the necessary private sector funding required to get them up and running.

DECC says the investment is intended to build on the success of the Local Energy Assessment Fund (LEAF) launched in December 2011, which helped drive forward 236 community energy generation and management projects across England.

Earlier this month, the Government also announced that planning guidelines would give local communities earlier and better involvement in the siting of onshore wind farms.

However, this funding follows yesterday’s announcement from the Government that just four customers had signed up to its flagship energy retrofit scheme, the Green Deal.

Conor McGlone

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie