Energy and Climate ChangeWritten evidence submitted by Cornwall Council

1. What contribution could medium-sized energy projects (5–50MW) make to the UK’s climate change, energy security and energy affordability objectives?

All renewable energy development contributes towards the above objectives.

It is worth bearing in mind that community owned schemes—which are likely to be below 10MW are effective in getting communities together to help understand the reasons for renewable energy (climate change) and helps gain public understanding regarding the issues involved as well as aiding opportunities for local generation projects.

2. What different models of ownership exist for medium-sized energy projects and how prevalent are they in the UK?

We are aware of the co-operatively owned wind turbines at Westmill, Cumbria and Cornwall Council has developed its own 5MW solar farm.

Wind farms are often highly controversial and we feel there is a need for communities to be more involved by establishing co-operatives or similar schemes to that provide local benefit. This should help gain public acceptance.

3. What types of financing model are most suitable for small- and medium- scale projects? Do these differ from the financing models used for larger-scale projects?

We are concerned about the impact that Contracts for Difference (CFD) might make on community scale projects and question whether the threshold for this should be above 7–10MW (below which an enhanced feed-in tariff could operate) to give greater certainty regarding the returns on community scale projects.

4. Why are community-owned energy projects more prevalent in countries like Germany and Denmark than they are in the UK?

The UK competitive market seems to have made it much harder to invest in measures that need significant upfront investment (eg district heat mains) where the payback may be longer; part of the reason may be due to the fragmentation of energy delivery, ie different competing energy supply companes, gas companies and network providers, making it hard to develop a joined up approach, and there is too much fear about the ability to remain competitive over the longer term—partly due to uncertainty about market regulation and future support for various technologies.

We are also feel that good PR is essential to ensure public acceptance and in this respect we are often fighting against mis-information provided in the press.

5. Is there any evidence that medium-scale energy projects are more likely to be accepted by local communities?

The key to acceptance is local ownership, however even then, the prospect of a wind turbine can still polarise a community. At present, despite the huge opportunity to generate local income, community scale energy projects are not getting established in any number and communities are not functioning in the way it has been hoped for under the Localism Act. For example, some neighbourhood plans are proposing policies that are in favour of renewable energy, with consultations having been carried out, however it is very likely that when proposals are put forward they will still generate vociferous opposition.

We suggest the ability to buy into schemes could make a considerable difference to public acceptability, but it would help if guidance were developed to help provide models for communities to adopt and the concept needs to be promoted effectively.

6. What appetite is there for community-owned medium-scale energy projects in the UK? `

There is enthusiastic interest from some communities, however some have become worn down by the scale of effort and skills required and the challenge of keeping public opinion on-side.

7. What appetite is there among private sector organisations in the UK to invest in their own medium-scale energy projects?

There is quite a lot of interest from farmers and landowners who are interested in the financial returns

8. What appetite is there among UK local authorities to invest in their own medium-scale energy projects?

We feel local authorities could play a huge role in getting renewable energy established. For example, in Cornwall, we have carried out resource assessments for wind, PV, biomass, hydro etc. Hence there is a glaring opportunity for councils to set up arms length development companies that could develop sites, set them up as co-operatives so wealthier individuals could invest, and use some of the council’s return to invest in measures to reduce fuel poverty. Alternatively, this could also provide an income for councils to help support service delivery and further investment strategies. We feel this model would be most effective at gaining public acceptance and most trusted, however, at present most councils have not recognised the scale of opportunity and may be put off by perceived risks and public opinion.

9. What are the barriers to medium-scale energy projects in the UK?

Opposition due to the following:

A significant proportion of the public don’t see the need to tackle climate change, many have been misled by the “sceptics” writing in the press and think there is still significant scientific uncertainty regarding the link between man’s activities and climate change. It is imperative that clarity is given regarding the scientific consensus and the consequences of not taking action. We consider that government leadership has been lacking in this regard—despite all the disruption and costs associated with the increasing incidences of extreme weather events (flooding etc) and the increasing link to climate change.

For those that do accept that the planet is warming, many don’t appreciate the scale of effort that is needed to address the issue or think there’s no point because of what India or China is doing.

Many see effort to tackle climate change as being too expensive rather than seeing the economic opportunities—again much of this is down to misleading articles in newspapers.

Some members of the community may be in favour in principle, but if a development is proposed near their home, become concerned about potential impacts and house prices, noise, views, etc.

There can be resentment from individuals regarding national companies or even local farmers making money from something that they themselves have to look at.

Mis-information regarding the contribution that renewable energy can make—eg wind being too intermittent, inefficient, expensive, etc.

10. How effective are current Government policies in encouraging local and medium-sized energy projects? Could they be improved in any way?

National planning policies are supportive, however the scale of opportunities need to be promoted to town and parish councils with an expectation that they develop pro-active approaches for their areas.

We suggest that the government could do more to promote the benefits of community owned renewable energy and provide more guidance as to how to set up schemes. The government could also encourage local authorities to lead on such schemes.

Electricity distribution network operators need to be mandated to upgrade the grid infrastructure where necessary to accommodate renewable energy generation. At present, there are areas where the grid is at capacity and the current position is that any upgrading that is necessary has to be paid for by the first renewable energy development that puts the grid over capacity. Any subsequent development can then take advantage of the upgrade that was paid for by the previous developer. This situation is unfair and creating log-jams. If the network operator was mandated to investigate renewable energy likely to occur without grid constraints and then upgrade the grid accordingly, the cost could be spread across several developments. Alternatively, OFGEM and DECC could work with local authorities to identify strategic needs and provide investment.

April 2013