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This study followed an integrated approach to foster the development of a local Energy Community (ECs) in Vega de Valcarce, a rural town in Spain. ECs are entities that encompass collective actions of citizens and other actors towards the open, democratic governance of (renewable) energy sources; ECs can take various organizational and legal forms. To provide socially accepted, technically optimal and feasible options for the implementation of the EC at Vega de Valcarce, we apply a participatory Multi-Criteria Analysis supported by the results of a mixed-integer linear programming for energy system optimization. We provide insights into the objectives of local stakeholders and their preferences, technical scenarios for viable EC options, and feasible governance models for ECs under current Spanish law. We summarize the encountered challenges implementing an EC and conclude with recommendations to overcome these in the Spanish context. While contributing to the understanding of the roll-out of ECs in Spain and Europe, our research also provides an approach to connect rural development with the energy transition.