"The vast bulk of our new renewable energy system is already beginning to be built in regional Australia," Community Power Agency director Jarra Hicks said on Thursday.
"Everyday communities are poised and motivated to participate - but without proper planning, they will miss out on the benefits of this boom."
Dr Hicks gave federal parliament an "F" for an energy committee report that last week rejected the Australian Local Power Agency Bill introduced by independent MP for Indi Helen Haines.
The bill had aimed to establish 50 hubs across regional Australia to support communities to develop their own renewable energy projects, through grants of up to $500,000 a year for five years and access to loans.
The committee said the creation of another new bureaucratic agency, with all the costs and administration that entails, would not benefit Australians.
The Australian Renewable Energy Agency (ARENA) and Clean Energy Finance Corporation (CEFC) are appropriate agencies to give support to renewable energy projects, the committee said after a year-long inquiry.
But Dr Haines and Zali Steggall said the committee heard strong evidence that current grant programs offered through federal agencies like ARENA don't meet the needs of community energy groups.
It also heard evidence that the programs are aimed primarily at large-scale developers, they said.
The responses to the inquiry included several grassroots campaigns that attracted more than a thousand emails in support of the bill, which the committee chaired by the LNP's Ted O'Brien did not treat as individual submissions.
Victoria's two-year community power hub pilot scheme in Ballarat, Bendigo and the Latrobe Valley found the idea delivered "significant value", equating to $22 for $1 of government funding.
A solar array powered a health centre, solar streetlights linked a sport and recreation reserve to the nearby town, and the installation of solar panels on social housing cut the power bills of low-income residents.
One project harnessed solar and batteries to service a small off-grid community that had previously relied on diesel generators.
"We're calling on all regional candidates for the federal election who want to build prosperity and resilience in the regions to back community power hubs - it's a vote winner," Dr Hicks said.
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