Studies on community energy have generated many useful insights concerning its potentials and challenges in facilitating energy transitions. However, this line of inquiry tends to overlook the crucial significance of site-specific contexts, concerns, and needs beyond the energy system and often generalizes these under a “civil society” umbrella. To study community energy on its own terms, this paper proposes a more grounded approach based on the relational place-making framework. It draws upon the case of the Taihsi Green Energy and Health Community Initiative in Taiwan to investigate how the emergence, development, and framing of this initiative are entangled with geo-historically produced concerns about the village’s socio-economic marginalization and suffering from petrochemical pollution. The findings suggest that community energy in this context was a proactive continuation of place-based activism for environmental justice; its value to this damaged community lied in its potential to create self-reliant socio-material relations alternative to those relied on the patronage of petrochemical interests. However, this justice-oriented aspiration tended to be discounted in national-level energy transitions agenda, revealing a tension between citizen-oriented and community-based energy projects. The paper argues that a relational place-based analysis is crucial in recognizing the grounded meanings and values of a community energy initiative, which can address the decontextualizing tendency in many community energy studies to better help policymakers and advocates enhance energy justice in disadvantaged communities.