“Across the country, communities and people of influence are asking: how do we get more community ownership of low carbon energy; how do we stimulate community involvement and how do we keep the value within the community? The answer is community energy.”
Ollie Pendered, Chief Executive, Community Energy Pathways
We at Community Energy Pathways (formerly Community Energy South) were recently invited to contribute to a call for evidence as part of a Parliamentary inquiry, launched by the Energy Security and Net Zero Committee. In all, 147 organisations responded to the call.
In this paper, Ollie Pendered summarises the response from Community Energy Pathways, formerly Community Energy South.
Creating a new local power plan under Great British Energy
We have been impressed by the reach of the Community Energy Fund (CEF), which has supported more than 70 projects across the south-east including a wide range of renewable energy projects and retrofit. Ideally, it should include traditional rooftop solar projects, which are often a gateway to community energy and the most straightforward schemes to develop. They enable groups to gain vital experience and pave the way to larger initiatives, as well as raising the profile of community energy.
We think more could be done to share experiences of previous CEF schemes – highlighting examples of positive partnerships with energy providers that have built the capacity of local groups, as well as learning from less successful collaborations.
Our experience in Hampshire has demonstrated the importance of local authority officers who understand and are actively engaged in community energy projects. This knowledge and support should be extended across departments such as planning and home ownership.
The work of funders such as Innovate UK and the Net Zero hubs (supported by the Community Energy Fund) is invaluable in growing capacity for community energy and helping to build momentum for the sector. Could infrastructure community benefit funds be better aligned with local community energy projects?
Could future funding be channelled through a requirement that some unspent Section 106 and Community Infrastructure Levy (CIL) contributions – amounting to £8bn according to the Home Builders Federation – go to community-owned energy projects if Councils are not meeting their green targets?
Encouraging shared ownership of large-scale renewable energy
We strongly recommend that DESNZ and GB Energy create a policy for shared ownership of large-scale renewable energy projects, to ensure support is leveraged by local communities. Renewable energy developers will become good neighbours if they work together and harness the power of local communities.
Making it easier for community energy suppliers to sell electricity locally
We would recommend creating local supply licences that are more suitable for smaller-scale energy generation than is possible under the current national regulations. The Local Electricity Bill, which we expect will be passed in 2025, will play a vital role in simplifying the licencing process. It will also help small-scale community electricity generators (with a capacity of less than 5MW) earn revenue though mechanisms such as an export guarantee and a supplier-services scheme.
We also encourage the use of standardised power purchase agreements (PPAs) – guidance for setting fair electricity prices and local procurement that links community energy projects with local institutions or businesses, as recommended by the Energy Saving Trust.
Bristol City Council’s ongoing difficulties in buying electricity generated from local community energy projects are a stark reminder of the need for reform to the legislation.
Strengthening support for community energy
Extending the Smart Export Guarantee (SEG – the successor to the feed-in tariff) for community energy providers would inspire more local projects. Furthermore, transmission network use of system (TNUoS) charges will not apply where energy is generated and consumed locally, while distribution use of system (DUoS – the cost of installing and maintaining electricity networks) would be minimal.
Offering guaranteed, fixed long-term rates for exported electricity over extended periods such as 20 years would provide long-term revenue certainty, as would raising “floor prices” for community energy exports. We think the government should consider raising capacity limits above 5MW and streamlining the SEG application process.
Requiring large energy companies to offer favourable SEG tariffs to community energy suppliers would help level the playing field of the energy market. And amending regulations could make it simpler for generators to sell directly to their local community, preferably at discounted rates.
Recognising the benefits of community energy in planning decisions
Evidence from Scotland and elsewhere points to community energy projects providing a wide range of benefits from creating jobs, investment opportunities and stimulating the economy to improved air quality and carbon reduction. They reduce reliance on centralized power systems and imported fossil fuels – simultaneously making local electricity supplies more secure and resilient and keeping profits within the community.
Community energy schemes can bring down bills for vulnerable customers and spearhead various energy-saving measures that address fuel poverty. By raising awareness of issues surrounding energy generation and supply, well-run community projects can serve as a platform for local ways of dealing with a changing climate.
This aligns with the government’s goal of engaging communities in sustainability, which is not a priority for commercial energy suppliers. Recognizing these benefits would align with the National Planning Policy Framework (NPPF), which supports the transition to a low-carbon future and promotes renewable energy developments.
Building support for community energy through Local Area Energy Plans (LAEPs)
We at Community Energy Pathways think the Government needs to work across departments to dovetail our community energy plans into their LAEPs and Neighbourhood Plans. The resulting Community-Led Energy Plans should form the backbone of a new approach for parishes and neighbourhoods and be deployed nationally. They are the next step in our energy evolution, building on the LAEPs delivered across England in 2018 and, more recently, Wales. Ideally, a national communication campaign would be developed to encourage communities to develop their own net zero plans.
Community energy groups should be included as stakeholders – and funded to contribute their valuable local knowledge into the first four or five stages of LAEPs. We are involved in a multi-partner project in Leicestershire, funded by Innovate UK, which is developing a LAEP for the whole county. At the same time, we are building the capacity of the community energy sector so it can be a professional partner in future projects arising from LAEPs.
Within the sector, community energy groups are working with neighbourhoods and villages to create decarbonisation plans such as CommuniHeat in Barcombe, East Sussex and the Broughton Village Decarbonisation Plan in Hampshire. These communities and many others are putting a flag in the ground and plans in place so that they can transition to low carbon energy – leaving no one behind.
The Energy Security Select Committee is meeting on 12th March – join them here.