Monday, January 16, 2012

Community energy schemes receive funding but mixed messages from Government

Action for Sustainable Living in Manchester is one of the winning community groups.

The first 82 local energy projects run by communities throughout England have won funding from the Government's £10m Local Energy Assessment Fund (LEAF).

But at the same time, many community-led solar PV projects are still waiting to hear if they will receive enhanced support from feed-in-tariffs.

LEAF is managed by a consortium of community networks administered by the Energy Saving Trust.

The money given is intended to be used for understanding energy efficiency and renewable energy generation issues at a local level and to help communities to prepare for new opportunities in sustainable energy and climate change arising from the Green Deal, Renewable Heat Incentive and feed-in-tariffs.

There was a high volume of applications for the first round of awards. The second round is open until 20 January and the website above contains full details of how to apply.

Many of the winners are part of the Energyshare network.

£50,000 is the average size of the award for each successful bid, but it depends on the proposals put forward. Any work needs to be completed by end of March 2012.

Peter Lipman, Chair of Communities and Climate Action Alliance said: “Hundreds of communities responded fantastically to the opportunity afforded by LEAF with imaginative and innovative schemes. It’s wonderful to see that many of them will be funded and so will have a chance to show just what those communities can deliver.”

Feed-in-tariffs confusion

Government support for communities wanting to engage with the low carbon agenda has come under renewed criticised lately over the removal of their ability to claim high returning feed-in-tariffs for solar electricity.

"Why on earth have [the Government] not excluded housing associations, schools, council and other community projects from the damaging proposal to give multibuilding projects ever lower financial support?" asked Lord Judd during last Thursday's Lords debate on the Government's green record.

Lord Marland, speaking for the Government in reply, gave no sign that it would give way on the matter and revise its position on the tariffs.

On Friday, the judges at the Court of Appeals postponed their decision on the Government’s appeal against the High Court’s recent finding that its cuts to the photovoltaic feed-in tariff (FIT) rates were unlawful. A decision is expected later this week.

The Renewable Energy Association’s Gaynor Hartnell commented that no one has liked how the government has carried out the FIT review process, and that the judges should "ensure that the Government thinks twice about acting in such a cavalier manner again".

However, she added that "the majority of our members want to draw a line under this affair, look forwards, and get on with installing systems at the new tariff rates".

The Department of Energy and Climate Change has issued a statement saying that once the court arrives at a decision "we will consider our options and make an announcement on the way forward to provide clarity to consumers and industry".

Amongst the clarity required by communities is whether a much lower tariff will now be applied to schemes where an organisation receives payments from multiple installations on different sites, as happens in some cases (the proposed cut is of 80%), or, whether genuine community renewable energy projects will be given special levels of support in recognition of their enhanced efficiency and the spin-off benefits.

The benefits of community energy

These benefits include social cohesion, reduced crime, a better local environment and spreading awareness of renewable energy and energy efficiency, all aims of the LEAF scheme.

Many projects have been cancelled or put on hold as a result of the confusion over FITs.

The situation means that the community-scale schemes that are now proceeding are more likely to be privately owned.

E.ON is one utility giant that is pushing into this market. Its Sustainable Energy division specialises in district-level or 'distributed' energy, employs 500 people with a turnover of £100m, and is rapidly expanding.

The UK situation is in stark contrast to that in Germany, where most of its $100 billion of private investment in renewable energy is not owned by companies but by communities and individuals; a total of 51% according to Paul Gipe.

40% of this 51% of renewable energy generation is owned by individuals, and 11% is owned by farmers. Just 13% is owned by power utilities. The rest is owned by a combination of developers (14%), investment funds (11%), industrial ownership (9%), and “others” (1%).

"German farmers, community leaders and entrepreneurs are not only democratising electricity generation and renewable heat, but are also setting their sights on an equally ambitious prize, the transmission system itself," comments Gipe, an advocate of community wind power since the 1970s.

Though Britain has a long and proud history of community and co-operative ownership, it is perhaps hard for us to imagine how, if this pattern were to be repeated here, it would affect our attitude towards energy supply.

Communities everywhere clearly want to have more engagement with renewable energy, but for decades the Renewables Obligation financing system has unfortunately inhibited this natural inclination and meant that there is only a handful of community-owned windfarms.

One example of such a community is Sustainable Wallingford, established in 2003 by residents of this Oxfordshire town, and which is one of the LEAF winners announced today, for a project to use thermal imaging to show where energy is leaking from homes, and provide advice on energy efficiency and solar power.

The Government continues to send out mixed messages on community energy, but the message from LEAF is that communities do want to be empowered.

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