One of the most common questions about Local Energy Communities (LEGs) is: "Is it financially worth it?" The answer is clear: Yes, in most cases! But how much can you really save?
In this comprehensive cost-benefit analysis, you'll learn how to calculate your personal savings, which factors affect profitability, and what you can expect financially from LEG membership.
Overview: Typical Savings Through LEGs
Average Savings
Based on current data from Swiss LEGs:
For Energy Consumers:
- Savings: 15-40% of energy costs
- Typically: 200-800 CHF per year
- Dependent on consumption and LEG model
For Energy Producers:
- Additional revenue: 500-2,000 CHF per year
- Higher compensation for excess energy
- Optimized use of own facilities
For Hybrid Participants (Producer + Consumer):
- Total savings: 700-2,800 CHF per year
- Reduced consumption costs
- Revenue from energy sales
Cost Structure: What Does an LEG Really Cost?
One-Time Costs
1. Membership Fee:
- Typically: 0-500 CHF (one-time)
- Often tiered by LEG size
- Sometimes free for certain models
2. Smart Meter Installation:
- 0-900 CHF (often covered by LEG)
- Required for precise billing
- Learn more about smart meters
3. Other One-Time Costs:
- Legal advice (optional): 200-500 CHF
- Technical advice (optional): 100-300 CHF
- Total one-time: 300-1,700 CHF
Ongoing Costs
Monthly Expenses:
| Cost Type | Typical Cost | Notes |
|---|---|---|
| Base Fee | 5-20 CHF/month | For LEG operation |
| Energy Price | 0.08-0.12 CHF/kWh | Local renewable energy |
| Grid Fees | 0.02-0.05 CHF/kWh | For grid use |
| Platform Fee | 0-5 CHF/month | Often included in base fee |
| Total (at 4,000 kWh/year) | 50-150 CHF/month | Varies by consumption |
Comparison: LEG vs. Utility Provider
Example Household (4,000 kWh/year, 4 people):
| Cost Type | Utility Provider | LEG | Savings |
|---|---|---|---|
| Energy Price (0.10 vs. 0.20 CHF/kWh) | 800 CHF | 400 CHF | 400 CHF |
| Base Fee (annual) | 240 CHF | 120 CHF | 120 CHF |
| Grid Fees | 200 CHF | 150 CHF | 50 CHF |
| Total annually | 1,240 CHF | 670 CHF | 570 CHF (46%) |
Factors Affecting Your Savings
1. Energy Consumption
Higher Consumption = Larger Absolute Savings
Example Calculations:
Low Consumption (2,000 kWh/year):
- Savings: 150-300 CHF/year
- ROI: 2-4 years
Medium Consumption (4,000 kWh/year):
- Savings: 400-800 CHF/year
- ROI: 1-2 years
High Consumption (6,000+ kWh/year):
- Savings: 600-1,200 CHF/year
- ROI: <1 year
2. Local Energy Prices
Differences Between Regions:
| Region | Electricity Price (Provider) | LEG Price | Potential Savings |
|---|---|---|---|
| Urban | 0.18-0.22 CHF/kWh | 0.10-0.12 CHF/kWh | 35-45% |
| Rural | 0.15-0.18 CHF/kWh | 0.09-0.11 CHF/kWh | 25-35% |
| Mountain Regions | 0.20-0.25 CHF/kWh | 0.11-0.13 CHF/kWh | 40-50% |
3. LEG Size and Efficiency
Larger LEGs = Cheaper Prices
- Small LEG (10-20 members): Often higher costs, less efficiency
- Medium LEG (20-50 members): Good balance, optimal prices
- Large LEG (50+ members): Best prices, highest efficiency
4. Own Production (Solar Panel)
With Own Solar Panel:
Additional Savings:
- Self-generated energy: 0.00 CHF/kWh (vs. 0.10-0.12 CHF/kWh grid electricity)
- Surplus sales: 0.08-0.12 CHF/kWh
- Additional savings: 500-1,500 CHF/year
Without Own Solar Panel:
- Still savings through cheaper LEG price
- Often 15-30% savings possible
5. Participation Duration
Long-Term Membership = Higher Total Savings
- 1 year: Savings 400-800 CHF (after payback)
- 5 years: Savings 2,000-4,000 CHF
- 10 years: Savings 4,000-8,000 CHF
Plus: Rising electricity prices increase savings long-term!
Detailed Cost Breakdown
Scenario 1: Consumer Without Solar Panel
Assumptions:
- Consumption: 4,000 kWh/year
- Current electricity price: 0.20 CHF/kWh
- LEG price: 0.10 CHF/kWh
- One-time costs: 500 CHF
Cost Breakdown:
| Year | Utility Provider | LEG | Savings | Cumulative Savings |
|---|---|---|---|---|
| 0 (One-time costs) | 0 | -500 | -500 | -500 |
| 1 | 800 | 470 | 330 | -170 |
| 2 | 800 | 470 | 330 | 160 |
| 3 | 800 | 470 | 330 | 490 |
| 5 | 800 | 470 | 330 | 1,150 |
| 10 | 800 | 470 | 330 | 2,800 |
ROI: 1.5 years
10-Year Savings: 2,800 CHF
Scenario 2: Prosumer with Solar Panel (5 kWp)
Assumptions:
- Consumption: 4,000 kWh/year
- Production: 5,000 kWh/year
- Surplus: 1,000 kWh/year
- Surplus compensation: 0.10 CHF/kWh
- LEG price consumption: 0.10 CHF/kWh
Cost Breakdown:
| Year | Utility Provider | LEG | Savings | Additional Revenue |
|---|---|---|---|---|
| 0 | 0 | -500 | -500 | 0 |
| 1 | 0 (self-consumption) | -100 | 100 | 100 (surplus) |
| 2 | 0 | -100 | 100 | 100 |
| 5 | 0 | -100 | 100 | 500 |
| 10 | 0 | -100 | 100 | 1,000 |
Plus: Self-generated energy saves additional 400-600 CHF/year!
Scenario 3: High Consumer (8,000 kWh/year)
Assumptions:
- Consumption: 8,000 kWh/year
- Current electricity price: 0.22 CHF/kWh
- LEG price: 0.11 CHF/kWh
Annual Savings:
- Utility provider: 1,760 CHF/year
- LEG: 880 CHF/year
- Savings: 880 CHF/year (50%)
ROI: <1 year (at 500 CHF one-time costs)
Hidden Savings and Benefits
1. Reduced Grid Fees
Benefit:
- Local distribution reduces grid use
- Lower transmission losses
- Savings: 50-100 CHF/year
2. Price Stability
Benefit:
- LEG prices are more stable than market prices
- Protection from price fluctuations
- Long-term planning capability
3. Tax Advantages
Possible Benefits:
- Investment deductions for solar panels
- Reduced tax rates (for cooperatives)
- Tax depreciation
Important: Consult a tax advisor for your situation.
4. Property Value Increase
Benefit:
- LEG participation can increase property value
- Sustainability becomes increasingly important
- Future buyers value energy savings
Cost Calculator: Calculate Your Savings
Simple Calculation
Formula:
Annual Savings = (Consumption in kWh × Price Difference) - LEG Base Fee Example: (4,000 kWh × 0.10 CHF/kWh) - 120 CHF = 400 CHF/year
Detailed Calculation
Step 1: Determine Current Costs
- Annual consumption in kWh: _____
- Current electricity price (CHF/kWh): _____
- Base fee current provider (CHF/year): _____
- Current Total Costs: _____ CHF/year
Step 2: Calculate LEG Costs
- LEG energy price (CHF/kWh): _____ (typically 0.08-0.12)
- LEG base fee (CHF/year): _____ (typically 60-240)
- Grid fees (CHF/kWh): _____ (typically 0.02-0.05)
- LEG Total Costs: _____ CHF/year
Step 3: Calculate Savings
- Savings per year: _____ CHF
- One-time costs: _____ CHF
- ROI (in years): _____ years
ROI Calculation (Return on Investment)
Simple ROI Formula
ROI = One-Time Costs ÷ Annual Savings Example: ROI = 500 CHF ÷ 400 CHF/year = 1.25 years
Considering Various Factors
Extended ROI Calculation:
| Factor | Impact on ROI |
|---|---|
| Higher one-time costs | Longer ROI |
| Larger savings | Shorter ROI |
| Rising electricity prices | Shorter ROI |
| Additional revenue (producer) | Shorter ROI |
Comparison with Other Investments
LEG vs. Other Investments
LEG Membership:
- ROI: 1-3 years
- Risk: Low
- Liquidity: High (often monthly cancellable)
- Sustainability: Very high
Solar Panel (without LEG):
- ROI: 8-15 years
- Risk: Medium
- Liquidity: Low
- Sustainability: High
Stock Fund (Average):
- ROI: 7-10% p.a. (uncertain)
- Risk: Medium-High
- Liquidity: High
- Sustainability: Variable
LEG + Solar Panel:
- ROI: 5-8 years (combined)
- Risk: Low
- Liquidity: Medium
- Sustainability: Very high
- Best Combination!
Frequently Asked Questions (FAQ)
How much can I really save?
Typical savings:
- Consumers: 200-800 CHF/year
- Producers: 500-2,000 CHF/year additionally
- Hybrid: 700-2,800 CHF/year
How quickly do one-time costs pay off?
Usually 1-2 years:
- Low consumption: 2-3 years
- Medium consumption: 1-2 years
- High consumption: <1 year
Is an LEG worth it even without a solar panel?
Yes, absolutely:
- Savings of 15-40% possible
- Cheaper energy prices
- Transparent billing
- Community engagement
What happens if electricity prices drop?
LEG prices are often more stable:
- Long-term contracts protect
- Local production more independent
- Usually still cheaper than provider
Can I claim my savings on taxes?
Depends on situation:
- Consult a tax advisor
- Investment deductions possible
- Revenue from energy sales may be taxable
What does it cost to exit an LEG?
Usually no or low costs:
- Notice periods: 1-3 months
- Often no exit fee
- Smart meter stays (can be removed)
Next Steps: Calculate Your Savings
1. Analyze consumption:
- Review your recent electricity bills
- Determine annual consumption in kWh
- Note current costs
2. Check LEG options:
- Find LEGs in your area
- Compare prices and models
- Check availability
3. Perform calculation:
- Use the formulas above
- Or use Upgrid calculator
- Consider all factors
4. Make decision:
- Compare options
- Review long-term benefits
- Join an LEG!
Professional Support
Upgrid Helps with Calculation
Upgrid offers:
- Cost calculator for your situation
- Comparison of different LEG options
- Advice on savings potential
- Support in decision-making
Financial Advice
For complex situations:
- Consult financial advisor
- Tax advisor for tax aspects
- Energy advisor for optimal solution
Conclusion
LEG membership is financially very attractive in most cases:
Typical Results:
- ✅ Savings of 15-40% of energy costs
- ✅ ROI of 1-3 years
- ✅ Long-term financial benefits
- ✅ Plus: Sustainability and community!
The numbers speak for themselves – an LEG is worth it financially and ecologically!
Related Articles:
- What is an LEG? Complete Guide 2025
- Subsidies and Grants for LEG in Switzerland 2025
- LEG Financing Models: From Crowdfunding to Bank Loans
- Energy Pricing in LEG: Transparent Billing Explained
About Upgrid: Upgrid helps you find the economically best LEG option for your situation. Visit Upgrid.ch for a free consultation.