Speaking up for community energy ⚡️
Thank you Sir David - it's a pleasure to be under your Chairmanship - and thank you to the Hon Member for Bath for securing this important debate on an issue that could fundamentally change not just the electricity market but also people's ability to access cheap, sustainable, locally produced, energy across the UK.
I was very pleased to support my Hon friend, the MP for Waveney, in his efforts to enact the Local Electricity Bill in the last session.
To my inexperienced eye, the Bill appeared to be a win-win - driving the creation of new local electricity markets, lowering prices for consumers, and creating a path for households and businesses to access more sustainable and renewable energy.
In a 2014 DECC report into Community Renewable Energy Generation it was suggested that 3,000 megawatts of generating capacity could be in place by 2020. Instead production stands at just 278 megawatts. The scale of the opportunity here is vast.
We only need to look at Germany to see the prize on offer. There, over 1,000 local, community-based, supply companies are in operation, producing renewable energy. There, four large utilities only control 40% of the market.
Unleashing community energy would enable local economic resilience in communities across the country. By bypassing large utilities, it would allow them to keep significant additional value within their own economies. Unleashing community energy would create more skilled local jobs, more viable local businesses, and stronger local economies.
I would argue that these necessary reforms aren't just about enabling people to enjoy cheaper electricity bills - they will also benefit local economies, and help us get to net zero too. These reforms are levelling up in action.
Last year I was pleased to visit Hobkin Ground Farm in the Lickle Valley. Megan and Mark want to run a low impact, sustainable farm and leave as little mark on the environment as possible. In pursuit of this, they installed a hydro generator, powering their own farm and largely removing themselves from the grid. They could go further, but the cost of connection are prohibitive.
Nearby to them there is a project in Broughton-in-Furness, which aims to bring together local residents in a co-operative to buy renewable electricity from the hydro plant at Logan Gill, allowing them to benefit from cleaner, cheaper energy. Potentially 400 customers could benefit from this, saving almost 20% off their energy bills.
The model is great and I'd like to praise local residents (including Jennifer Sanderson and Rob Dunphy), Cumbria Action for Sustainability, and Ellergreen Hydro for working together to deliver it.
However, for this project to succeed it is reliant on the benevolence of Octopus Energy – a nationally licensed and huge utility company.
By enabling a Right to Local Supply, that ceases to be a problem. Reforming the market rules so that local and regional sized renewable energy generators could sell their electricity directly to local customers would mean that my constituents in Broughton would no longer be reliant on having to choose from a large national one only.
If we can achieve that then the effect will be to take community energy schemes, like this one, from being a smattering across the country to thousands. They are currently only generating around 0.5% of the UK’s electricity, but they could scale up to generate significantly more than that. A few small changes could allow a thousand flowers to bloom.
But this will only happen if local community owned interests are given a route to market. I very much hope that my Hon friend the Minister sees the opportunity in enabling community energy as a tool to levelling up our local communities and look forward to hearing her response.
Thank you Sir David.
