Unlocking the potential of local green power

This summer saw the end of a law banning councils from selling renewable electricity. Now councils across Britain will be allowed to sell renewable electricity to the grid and should assume their rightful place leading a local power revolution.
At present only 0.01 per cent of electricity in England is generated by local authority-owned renewables, despite the scope that exists to install projects on their land and buildings. In Germany the equivalent figure is 100 times higher.
In one of the first energy policy actions of the coalition government, a ban on local authorities selling renewable electricity ended on 18 August. This will open new sources of income including the full benefit of the Feed in Tariff, which incentivises renewable electricity. It could mean up to £100 million a year in income for local authorities across England and Wales.

Role of local authorities
Chris Huhne, the Energy and Climate Change Secretary, said: “For too long, Whitehall’s dogmatic reliance on ‘big’ energy has stood in the way of the vast potential role of local authorities in the UK’s green energy revolution.
“Forward thinking local authorities such as Woking in Surrey have been quietly getting on with it, but against the odds, their efforts frustrated by the law.
“I’ve taken the early step of overturning the ban on local authorities selling renewable electricity to the grid. I’ve written to all councils urging them to take advantage and lead a local energy revolution.
“This is a vital step to making community renewable projects commercially viable, to bring in long-term income to benefit local areas, and to secure local acceptance for low carbon energy projects.”
Previously, local authorities were able to put any renewable electricity they generate to local use, and to benefit from the associated feed in tariff for projects smaller than 5MW. But they were restricted from selling any excess renewable electricity into the grid (other than that generated from combined heat and power), and also from benefitting from the additional export component of the feed in tariff.

Overcoming restrictions
The restriction was a 1989 amendment to the Local Government (Miscellaneous Provisions) Act 1976. It was put in place at the time of electricity privatisation to ensure the transfer of the electricity industry to the private sector. However, given the acute need to shift the UK’s power sector to low carbon, and the potential contribution that small scale renewables can make it was seen that this no longer made sense.
Woking Borough Council is at the forefront of local authorities already investing in clean energy projects, and will be able to benefit from the change in the law. Through Thameswey Limited, a company wholly owned by the local authority, green electricity is generated across the Borough and provided to local customers by way of private wires.     
Ray Morgan, Woking Borough Council’s chief executive, said: “The Council welcomes the announcement by the Energy Secretary, and the commitment shown by the coalition government, to enable local authorities to provide and support low or zero carbon energy production.
“Woking has made strenuous efforts over the years to produce energy locally and hopes that this strong signal from the government will be supported by the regulator, Ofgem, to remove other barriers which frustrate the delivery of local energy solutions.”       

Other steps being taken to support local green power include:
•    The government is committed to encouraging community-owned renewable energy schemes where local people benefit from the power produced. It is actively working  on proposals to allow communities that host renewable energy projects to keep the   additional business rates they generate.  
•    DECC will launch an online portal in the autumn, Community Energy Online, to support the development and deployment of low carbon community- scale energy infrastructure.
Strong support
Friends of the Earth’s executive director Andy Atkins said: “This is great news – at long last councils will be able to earn money by selling green electricity generated from small-scale renewable projects to the grid.
“It is a real incentive for them to bring in new clean energy schemes that will benefit everyone in the area, including poorer communities.
“With budget cuts looming, the cash raised will be more welcome than ever, and should be used for schemes like making homes energy efficient, which will slash energy bills, tackle fuel poverty and create jobs.”
Gary Porter, Chairman of the LGA Environment Board, said: “It is good news that the government is acting quickly to lift the ban on councils selling renewable energy.

“There is a lot of enthusiasm in town halls to develop green energy to cut the power they use and save money. Fully realising the benefits of green power will take time and investment, but this has the potential to cut energy bills, reduce emissions and raise millions of pounds in much-needed income to maintain services and keep council tax down in these tough financial times.
“Councils have lots of buildings, from offices and leisure centres to houses and flats, depots and community centres that could be transformed into local green power stations.”

For more information
Web: www.decc.gov.uk