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Research
LOCAL AUTHORITIES AND LAEPS
Where are we now?
Of the respondents who took part in the survey, almost nine out of 10 (87%) expected to be involved in the creation of their local area energy plan (LAEP) and only 5% of those surveyed said they did not intend to start one. However, plans were not advanced: 40% said they had yet to start one, scoring it one on a scale of zero to five when asked how advanced was their local area energy plan. Another 27% scored their progress at two out of five.
LAEPs are spatial plans which are designed to enable authorities to tailor whole system energy transition strategies around local needs and priorities. They should help councils identify the potential locations for local renewables and other low-carbon technologies, including flexibility and smart energy systems.
According to Energy Systems Catapult data from November 2023, the number of councils that have created or committed to a LAEP had risen from 20 in the summer to 86 at that point.
Andrew Clark, business leader – place at Energy Systems Catapult, says: “There's been this massive uptake in the last year, and momentum is certainly building.”
Energy Systems Catapult has designed a local energy planning framework to consider the entire energy system across vectors (heat, electricity, transport), supply chains (from energy generation to how it reaches people’s homes) and systems (physical, digital, market and policy systems). Pilots conducted in Newcastle, Bridgend and Bury found that the decarbonisation of heat could be achieved for less than 15% above the cost of decarbonising electricity alone by adopting a "whole systems" approach.
In its report published in September 2023, Energy Systems Catapult stresses the need for all local authorities to benefit from a robust energy systems plan, and sets out five recommendations, including embedding LAEPs within the National Planning Policy Framework, as well as centralised funding for all areas to undertake a full LAEP, or as a minimum, the first three stages. Funding a LAEP across all authorities would cost in the region of £40 million, it estimates.
Clark says: “We've set out recommendations, including for government to endorse LAEP as a framework so that you can compare area against area. There is currently a patchwork of approaches to local energy planning across areas. So there are issues of data use, level of project information and scope, which make it difficult to compare like for like. If you have a standard approach across the country, you can compare areas, ensure plans that can lead quickly to action are produced and get a national picture.”
Clark points to the approach taken by the Welsh government, which is funding all 22 councils to draw up a LAEP including consultative support. “The LEAPS will be used as part of the evidence base to create a national energy plan. That’s something we're really looking forward to working on.
“From here, we’re turning plans in to action and getting spades into the ground by aggregating up the local plans into a tangible national approach that is fit for a net-zero future.”
Having a LAEP also helps set out the different options for decarbonisation and helps articulate what the opportunities might be for private investors to bring solutions to the table.
UK100’s chief executive Chris Hammond says it is important to have interoperability between councils for a number of reasons: it means there is less disruption if there are boundary changes, and it provides a clearer picture for private investors showing the scale of the opportunity across regions.
Overcoming barriers to developing LAEPs
Lack of funding, inadequate and incorrect data, and a lack of internal resources are the three reasons cited as barriers to delivering a LAEP. Nearly three quarter of respondents (73%) cited funding, followed by 62% blaming lack of data and 57% lack of internal resource as barriers to progress.
Few of those interviewed were against the principle of LAEPs, seeing clearly the benefits that it could bring. The sticking point with many was the sheer cost, cited by one as £100,000 per half a million population, and as much as £1 million for the equivalent in larger counties, and whether that could be justified. There were also the question of logistics – for example, in authorities with boroughs and county authorities, who should lead? There was also the consideration of whether in unitary authorities, for example like Reading, whether they should be joining up with neighbouring authorities to draw up a LAEP.
There is currently some confusion about what LAEPs are and questions about budgets are unanswered. There are widespread calls for government to pick up the tab for councils to do this piece of work, as is happening across Wales. Making a LAEP a statutory requirement was also an ask by some we interviewed.
UK100's Hammond says: “A lot of local authorities would like to do this piece of work, and I think your research shows that. But the costs are considerable. LAEPs are going to have national significance as we decarbonise the energy grid. So, again, expecting hard-pressed local authorities who are really struggling with resources to pick up yet another responsibility is probably why it's stalled. We need government financing to unlock it.”
Data and LAEPs
Energy Systems Catapult’s LAEP tool was praised by some as an aid to the process but others claimed it was ultimately too prescriptive and that some of the data required was not necessarily relevant to all councils.
The need for more data about energy use and stock condition, combined with visibility of network upgrades and capacity (the more granular on all these things the better) was a constant topic of conversation.
Steve Atkins, senior manager, stakeholder (Distribution), at SSEN comments: “In terms of energy usage information we are bound by the rules of GDPR, which means we aren’t meant to make the data so specific that you can identify the consumption by an individual household. We experience the same constraint in obtaining smart meter data from the DCC – the data has to be aggregated at a certain level so we can’t identify individual houses. Nevertheless we are investing in network monitoring to generate highly granular power-flow data that stakeholders can access. We recently published our Near Real-time Data Access Portal as part of our Open Data Portal, which will help enable new opportunities for low-carbon technology and flexibility."
One participant questioned the underlying premise of the LAEPs, saying: “How can you plan net zero? We know what the constraints in our area are at the moment but do we build a plan based on that scenario or do we trust that the connections queue is going to get sorted and the planning system streamlined? Because those are two very different scenarios.”
The difficulty faced by many authorities currently in getting the connections necessary to progress net-zero ambitions raised concerns widely that strategies in a LAEP would remain unfilled.
There was also a question as to whether LAEPs should be one-off documents or part of a more cyclical process. Greater Manchester Combined Authority, which has been a trailblazer on LAEPs, is planning to update its strategy at least every five years, as more data becomes available, says Mark Atherton, its director of environment.
Lack of resource and need for networks’ help
Lack of internal skills and resource was never far away in any conversation. As one officer put it, “We have lots of data – knowing how to interpret it is the problem.” Where councils can find the budgets to recruit, they struggle to find people with the necessary skills.
This is where energy networks can help, say those interviewed for this research. There was agreement amongst interviewees that seconding staff from energy networks, particularly DNOs, into councils would be hugely beneficial.
One said: “You can give us all the data in the world but it’s no good without the insight. Training to go alongside that data would certainly help to a certain point but we still have to free up the people to do that. What we really need is staff from networks seconded to us, to allow us to make sense of the data and to tell us what is possible.”
LAEPS and RESPs
Questions were asked about where LAEPs would ultimately fit within national net-zero strategies but also within the work of the regional energy strategic planners (RESPs), recently announced by Ofgem.
The role of the Regional Energy Strategic Planner (RESP) is to provide a formal framework for local authorities to engage with and influence energy infrastructure planning.
Part of the function of the RESP will be to provide proportionate support to local authorities in the form of tools and advice. This, alongside a coordinated approach to regional planning, is intended to help each region meet net-zero targets. Whether to dedicate funding for local authorities to accelerate decarbonisation efforts is a decision for Government.
The RESPs will be responsible for developing a regional whole-system strategic plan which will inform infrastructure investment planning, and also the setting of the RIIO-ED3 price control. In developing a strategic plan, Ofgem says it expects the RESPs to develop a regional view using a wide range of inputs, including LAEPs.
There was general desire for requirements set out in LAEPs to be strongly reflected in the investment priorities and funding agreed between the regulator and networks. At the moment, local authorities say that is not the case. The regulator points out that in the RIIO-ED2 price control process, companies were required to engage with regional stakeholders on their plans and demonstrate how local ambitions (eg LAEPs) had informed their plans. In companies’ distribution system operation (DSO) strategies, they also set out plans for engaging with local authorities on an ongoing basis.
Some of participants thought that RESPs could be a game changer in terms of linking funding and requirements of local authorities with funding and investment from networks. Others had not heard of the RESPs, while others doubted they would be able to effect an influence soon enough, given they can only be created once the future system operator (FSO - since renamed the National Energy System Operator) has been set up.
A spokesperson from Ofgem says: “Embedding regional context in planning is essential in empowering local communities to meet net-zero targets and ensure network investment is delivered when and where it is needed. Local area energy plans (LAEPs) help bring a place-based approach to planning, while the introduction of the new Regional Energy System Planning (RESP) roles will end the patchwork approach to energy planning by defining tailored regional strategies.
“We met with Metro Mayors from across England earlier this month (December 2023) to begin shaping these roles so they can expedite planning and cut through red tape, help to create green jobs, and speed up the building of vital energy infrastructure.
“We’re working hard to create a modern energy system by ending unacceptable delays to renewable power and halving the time to build new transmission networks. The creation of the FSO will provide a once in a generation opportunity to design an energy system that works for everyone.”
SSEN is broadly supportive of this new role, says Atkins: “The detailed design is still to be completed so SSEN is engaging with Ofgem to ensure the good work already being done at a local authority level on DFES and LAEPS is core to the new process and we’re engaging with the ESO to validate our suggested approach.
“We will be joining Energy Systems Catapult in their calls to mandate LAEPs, and provide necessary funding to create them, so as to ensure that the necessary bottom-up components are in place to feed into the top down framework which will be established.”
Ofgem says that through the RIIO- ED2 price control, DNOs are expected to work collaboratively with and support the development of local authority and devolved government plans for decarbonisation. Cross-sector, regional engagement is designed to ensure transparent processes are adhered to in identifying and assessing options to resolve network needs. However, the DNOs cannot directly fund local authorities to undertake local area energy planning.
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