Financing Grassroots Innovation Diffusion Pathways : The Case of UK Community Energy

Exploring how finance can better support Grassroots Innovations (GIs), community-led solutions for net-zero transitions, we examine finance’s role in the case of UK community energy (CE) across three ‘diffusion pathways’: niche replication (growth in the numbers of projects), individual scaling (growth in organisational scale) and collective diffusion (confederation of GIs). We examine each through a nationwide survey, interviews and four case studies. We find that while finance supports replication of small-scale CE projects, the incompatibility between GIs and the wider finance meta-regime inhibits individual scaling. The UK CE sector has responded with collective diffusion, via business group intermediaries, attracting greater, but still limited, sums of finance. Consequently, for GIs to diffuse effectively they must be supported to translate across both sectoral regimes (e.g. energy) and broader meta-regimes (e.g. finance). This paper contributes to theory on the role of finance in sociotechnical transitions and the role of intermediaries in GIs diffusion