Powering the future

Fulfilling the binding commitment that the UK has made to deliver significant increases in low and zero carbon energy generation requires more of us to become energy generators as well as consumers. As regeneration takes place through new offices, showrooms, leisure centres and rental properties being built, there are opportunities to create new, sustainable communities, which can deliver benefits to local entrepreneurs as well as local people through increased investment in energy generation.

In fact, the long term financial savings can be just as substantial as the environmental benefits community energy schemes provide. Property developers need to consider energy as part of any area or development.  They must be able to identify energy opportunities and develop or commission projects. This requires a certain level of understanding of the energy project development process in order to ask the right questions, understand recommendations and choose the optimum solution.

Decentralised energy is becoming a key area of focus in energy generation and carbon emissions. Developers, landowners and building operators face enormous challenges in delivering low carbon, affordable rental properties, offices and other commercial properties; particularly with many companies becoming liable for emissions under the Carbon Reduction Commitment Energy Efficiency Scheme.

Rather than seeing it as a financial cost, many are recognising that investing in energy projects will open up valuable revenue streams, enhancing the value of their assets and providing a tenant incentive in the form of lower energy bills and reduced liabilities. The Green Deal introduced in the recent Energy Bill will add to the financial incentives for action. In short, decentralised energy projects can make businesses money and offer a cheaper and simpler way of meeting ever more stringent building regulation requirements. Schemes don’t have to be large or complex. Even small projects can generate a good income and grow over a sustained period of time.

Knowledge, advice and guidance for developers, councils and public organisations comes in the form of a guide. The Community Energy: planning, development and delivery guide. It has been written to provide a straightforward step-by-step approach to the challenge of creating a successful and efficient energy scheme.

The Community Energy guide is the ‘how to manual’ for project developers interested in generating their own energy, creating a revenue stream and slashing bills in the process. It will convert ambition into action, and help take-up the challenge of local energy generation. The guide shows how local communities, planning authorities, landowners and private developers can work together to ensure that they achieve positive and financially attractive solutions on energy demand reduction and low carbon energy.

Developers who want to increase their energy opportunities will make savings from an office block with 20 businesses operating more efficiently, while landlords will benefit if the 30 people renting their homes save energy together. When every house relies on its own heating system, the community’s collective carbon footprint depends on individuals and their singular inefficiencies, while generating electricity at a distant power station leads to transmission losses in bringing it to our homes. By contrast, a local central source providing heat or power to a number of the buildings in the immediate area, such as schools or offices, can offer a range of benefits, including improved efficiency, lower fuel costs, cheaper bills and a significantly lower carbon footprint for all involved.

The guide steers project developers through the process of creating a successful community energy scheme, allowing them to play a full role in the current energy revolution taking root across the country.  It focuses first on how to identify and maximise energy opportunities on the stages of development – rather than specific technological options – to make sure, whichever opportunity is pursued, it delivers optimum benefit. The guide is designed to assist potential energy project developers to translate these energy opportunities into financially viable and deliverable low-carbon projects; while understanding the stages of developing an energy project and who is involved along the way.

Furthermore, it helps identify the most appropriate and best fit business and financial models for their scheme while taking into account the creation or influencing of energy maps for use as a resource to inform projects, masterplans or development plans. In essence, it is about moving the whole industry forward through effective partnerships and innovation.

It also shows how community scale energy generation can aid compliance with planning and building regulations, a likely area of concern for property developers. It guides project developers through a ten stage process which takes a strategic and long-term perspective on energy provision for planning the installation of new schemes, as well as how to make choices when existing energy systems approach the end of their lives. It also looks at how to set out objectives for the project from the outset, which can help secure the support of other stakeholders in defining the ultimate outline of the project.

For example, there are four basic business models within the context of decentralised energy projects: private energy service companies; public energy service companies; hybrid public/private partnerships and stakeholder-owned special purpose vehicles. The guide further considers sources of finance, the roles required to deliver and operate a low-carbon energy project and the proportion of private and public sector involvement.

Reducing the impact of climate change in our towns and cities is one of the greatest challenges society faces today. Creating a low carbon economy and shifting away from a reliance on fossil fuels will be monumental tasks, but they are within our grasp. Property developers, local authorities and local communities themselves are at the cutting edge of this challenge because they have responsibility for a whole raft of decisions that are vital to our collective future.

There are now unprecedented opportunities for each to become project developers and to share from the financial benefits of energy generation.