The Local Energy Revolution

Published date22 January 2021
Subject MatterEnergy and Natural Resources, Energy Law, Oil, Gas & Electricity
Law FirmAnderson Strathern LLP
AuthorMr Martin Whiteford

For a period this year, all of our lives became smaller.

As the pandemic developed, we quickly realised that when our systems are under stress we rely on those in closest proximity. When national institutions falter, geography matters. Our communities mattered.

Localism as a force of innovation

In 2020 we saw localism emerge as a force of innovation in the low carbon sector. Community groups, local authorities, housing associations and innovative private sector companies are collaborating to take control of local energy generation and supply, matching local energy supply and demand using digital technology.

The problems in our electricity system are well-known. Capacity on the grid is constrained by the cost and difficulty of reinforcing a UK-wide network designed to transport power from a handful of large power stations to our homes and businesses. Grid connection costs for new generation projects can be prohibitive, particularly for island and rural communities.

The national grid will continue to provide the spine of our energy supply network but there is an opportunity for local energy systems to better serve local needs and local stakeholders while addressing existing system constraints.

Communities as catalysts for change

Towns, cities, neighbourhoods and regions can own and operate their own energy resources. We need to encourage development of urban microgrids that use digital technology to balance supply and demand. Trading of electricity between producers and users should become the norm. You and your neighbours can become "prosumers" selling excess power to each other through Peer-to-Peer trading. This democratisation of power will be an important part of the transition to a low carbon energy system.

Locally owned and controlled power supply isn't new. Germany has a long history of municipally owned companies operating city-wide or regional gas and electricity systems. The National Grid was only completed in the 1930s.

The Scottish Government has recently consulted on its forthcoming Local Energy Systems policy and the Local Energy Systems Scottish Industry Network (LESSIN) has recently launched to support the growing local energy ecosystem.

Scotland has already delivered a number of smart local energy systems including the Levenmouth Community Energy Project and the Orkney Surf 'n' Turf project (both of which integrated the use of hydrogen). Anderson Strathern has recently advised on the Cloud Zuos project in Huntly and the ReFLEX Orkney...

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