Can local energy planning help solve ‘double challenge’ of net zero and levelling up?

An opinion piece by Cissie Liu, senior regulation analyst at SSE Plc and Mike Davis, chartered engineer and a senior consultant at E4tech; both members of the Commission’s Young Professionals Panel (YPP).

Background

The Commission’s YPP has committed to explore decarbonisation and levelling up as our two key themes for 2021, as both have a strong bearing on young peoples’ futures. This past April, the YPP engaged on local area energy planning (LAEP) as the topic for our net zero round table. A LAEP approach, as recommended by The Centre for Sustainable Energy (CSE) and Energy System Catapult (ESC), has the potential to contribute the UK’s carbon emission reduction targets, and also to support levelling up through the creation of local, high-skilled jobs.

Why local area energy planning?

The YPP considers local area energy planning to be a relevant and timely topic. Many local authorities have decarbonisation targets for 2030, but few have delivery plans. The decarbonisation challenge also presents a skills gap, including locally-sourced skills such as installers of low-carbon equipment, much of which will need to be filled by training young people.

Locally led energy planning may also present some interesting parallels with some of the NIC’s thinking in other areas. For example, the Commission has consistently called for long-term devolved funding to cities to develop local transportation schemes, stating that “the most appropriate infrastructure measures will vary according to the characteristics and strategic needs of different places”, and that these would in turn provide ‘levelling up’ benefits. Similarly, local area energy planning could also be considered to meet the challenges of decarbonising heat, as the strategies to do so in an area will depend closely on local circumstances such as building stock characteristics; the potential for load aggregation for district heating networks; and the proximity to relevant energy hubs or ‘clusters’.

What is local area energy planning?

Energy Systems Catapult has developed and piloted a method for local area energy planning in which local authorities convene and lead a group of relevant local stakeholders (e.g., DNOs, large local energy consumers etc.) to interrogate the energy needs of a local area and develop a strategic plan for energy projects to follow and coordinate against. Further details on benefits of LAEP and results from pilot schemes can be found on the ESC website.

The Scottish Government has developed a similar initiative, the Local Heat and Energy Efficiency Strategies (LHEES), which aims to establish local authority area-wide plans and priorities for systematically improving the energy efficiency of buildings and decarbonising heat.

Process

The YPP identified relevant organisations across our networks, as well as contacting subject matter experts. We aimed to strike the right balance between direct involvement of young professionals and subject matter experts.

In preparation for the roundtable, we reviewed some interesting case studies where local area energy planning is currently being implemented. An example of this is the RESOP project, where SSEN Distribution has partnered with Dundee Local Authority to enable the local authority to better understand what infrastructure is needed to support low carbon technologies, such as EVs and decarbonised heat.

Guy Newey from Energy Systems Catapult gave an introductory presentation to provide us with background and progress on ESC’s development of LAEP. The session was divided into break-out groups with lively discussions bringing to light questions we YPP members had not previously considered.

Key takeaways and next steps

The feedback we gathered from the round table falls into three broad themes:

YPP finding 1: There are several links between local energy planning, levelling up and decarbonisation

These include programmes for local skills development to facilitate low-carbon solutions, tackling local environmental issues such as air quality, and helping to address social issues such as fuel poverty.
Like it or not, there will be decisions made at a local level that affect decarbonisation so it makes sense to try and integrate this into a process and structure such as an LAEP, hopefully leading to better energy systems for the UK as a whole.
Effective solutions for local areas can be found by taking advantage of the local area assets e.g., local renewable resources or building stock. These are often fragmented or small in scale and are therefore best explored by a locally led planning approach.

YPP finding 2: There is a need for more clarity in the purpose, ownership, and consistency of LAEPs/LHEEs

One of greatest barriers is lack of backing from central government for sub-national activity as a driver or enabler of decarbonisation. Participants pointed to hints in the Energy White Paper but little more. The governance structure for LAEP is also unclear – are LAEPs/LHEES truly ‘locally led’ or are they led at a higher level (e.g., national level) with information that is gathered locally?
We should be cautious about producing a planning process to solve all the world’s problems, so while LAEP can provide levelling up benefits, it might be challenging (and perhaps best not to) integrate them into one holistic policy strategy.
It will be important to design methodologies that are usable, understandable, standardised and flexible; ensuring a central data set and standardised process to undertake stakeholder engagement.

YPP finding 3: There is a distinct lack of capability to develop LAEPs/LHEES from local authorities

There is no resource to develop LAEPs (in England and Wales), therefore limited desire and perceived lack of immediate need to make this change towards more locally led approaches. Some local authorities do not have the resource to support LAEPS, nor capacity to share expertise.
There is an issue with brain drain by hiring consultants. There is also a clear capacity and knowledge gap between creating plans and implementing them, especially when the consultants who lead plans move onto new projects.
There is more opportunity to unlock co-benefits by leading at local level, but policy and the market does not currently support these co-benefits.

A big thanks to our participants for their time and input. We’re looking forward to future engagement on this relevant policy area. In terms of next steps, the YPP is working on how to progress this policy area and make it more accessible to a wider audience.

The views expressed reflect those of the authors rather than the Commission.