Leading Lights: how local politics took control of clean energy

Unique economic stars have aligned, leaving councils free to go solar.

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Local authorities can make most solar projects pay today without central government support. That’s the key message from our new report, Leading Lights. Unique tools and powers, combined with rapid solar cost reductions, have freed local leaders all over the UK to act on clean energy, breaking loose from Westminster’s frustrating stop-start pace. This marks a political and technology investment watershed. From "subsidy-free" solar farms to net-zero carbon homes, the practical case studies in our report demonstrate it is councils who are delivering the breakthough policies and projects today. When it comes to solar, councils have arrived. And they can think big. 

They need to; analysis by C40 Cities shows to deliver on the Paris Agreement goals, every city across the UK should be powered by at least 90 per cent renewable energy by 2030, making investment a necessity now. And who could not be alarmed by the plummeting national investment in renewables last year – the biggest drop in the world - under the UK’s weakened and  disappointing national policies? Councils take solar seriously; our analysis shows 85 per cent already own solar panels, nearly a third have integrated solar into their environmental strategies and the top ten local authority investors have collectively invested £80m in solar. Furthermore, solar unites; local people across the political spectrum want to see more renewable energy investment, so this is a great area for forging ambitious council programmes with stable, cross-party support. 

If there is one area where we would urge all local authorities to rapidly follow our Leading Lights, it is on new build policies. There is understandable disorientation, following a confusing whirl of reviews, Ministerial Statements and the scrapping of the Zero Carbon Homes agenda, as to where local authorities really stand on their powers to set higher new build standards today. Lord Bourne confirmed in the Lords last year that local authorities are free to set higher new build standards. Naturally our report features leading light councils doing just that. The experience in Scotland where their government introduced higher new build standards in 2015, proves that this has no impact on build rates. And UK national standards are now lagging so far behind London and Scottish standards even mainstream house builders have joined calls to raise standards without delay.

An impressive beacon for where we need to get to on new homes is the 91 eco-home development enabled by Plymouth City Council, which required homes to meet net zero energy carbon emissions. For a great example of evolving new build policy look to Milton Keynes Council. Not only do their revised plans, which they hope to introduce later this year, increase expectations to a 20 per cent contribution from onsite renewables, they also require onsite energy storage to be considered. 

This brings us on to the "smart energy" neighbourhoods we will all need in future, as already realised in the stunning Trent Basin scheme in Nottingham, supported by the City Council, which integrates neighbourhood-scale storage, smart homes and a solar farm. Going forwards we need to see join-up between top-down and bottom-up approaches to delivering a smart energy system. Why shouldn’t local authorities be able to participate in the new "smart" markets needed to defer network investment, enabling them to monetise local demand reduction projects and smart developments offering smart services? Join-up here could save the whole system and consumers a fortune. 

Local authorities today are under tremendous pressure to secure new and sustainable sources of revenue to fund essential services. The exceptional popularity of solar, and its low risk, make solar farms a prime candidate for investment by councils, including in partnership with local people. Our report features the first UK subsidy-free solar farm (with battery storage), which is about to be opened by West Sussex County Council. No sooner had we published Leading Lights, than Leicester City Council agreed a £16m investment in a solar farm and industrial units, that will generate nearly £1m of revenue for frontline council services every year. Expect more to follow. 

The Chapel Farm case study, developed by Public Power Solutions for Swindon Council, demonstrates the huge appetite in local communities to partner with councils to fund major investments. Chapel Farm was the first to offer a renewable energy bond in a tax free Innovative Finance ISA, attracting over half a million pounds of investment from local people in less than a week. Going forwards there is clearly tremendous scope for councils to partner directly with local people and community energy groups to invest in ambitious projects that help to meet shared local objectives, including for fuel poverty and air quality.  

Our analysis also shows that by making use of zero interest Salix Finance (which has recently included solar), and by using an efficient tendering processes, local authorities can also deliver rooftop solar schemes with good paybacks across schools and council rooftops. Portsmouth City Council provides a great example of a competitive tendering process that has enabled the council to deliver nearly 5MW of rooftop power across almost 300 sites, with more rolling out. Not surprisingly, other councils are making use of this scheme. That includes West Sussex County Council, who have secured £3m of capital funding to finance solar across 50 schools, with costs recovered in 12 years. 

It’s not all good news. We found many social housing retrofits had collapsed all over the country, where the economics remains difficult and where we continue to press government for support, including for better local authority control over ECO funds to target deep intervention on fuel poor homes. But even here innovative models are emerging, such as the Solarplicity social housing model, which can install solar and even battery storage at no cost to the household, as part of an energy supply package that instantly shaves hundred of pounds off bills. 

The UK government’s treatment of rooftop solar for self-supply under business rates remains perverse in a world that urgently needs to encourage low-carbon investment. We continue to campaign to level the playing field and recommend councils make full use of their powers to correct this, by granting rate relief on rooftop solar at least to state schools and to community energy groups. 

All of the case studies in our report have been carefully chosen because they illuminate what is possible here and now. It is action that matters and it is action we are keen to support. Our research is enriched by expert independent modelling of typical council schemes, which is summarised on our website alongside the report. If councils approach schemes in the canniest way, paybacks for many solar projects are comfortably within ten years. We also invite councils serious about solar and energy storage to join our Leading Lights Local Authority Network, which shares best practices and offers additional support. 

The stars have aligned, making possible a new era of local, clean power innovation. It is time for our industry to work closely with local councils and local people to deliver the local, smart energy infrastructure society needs, and to ensure communities’ everywhere benefit from a solid stake in our clean energy future. 

Leonie Greene is director of advocacy and new markets at Solar Trade Association.