It is a time of great change and uncertainty for community energy projects in the UK with the implications of Brexit and the recent changes to feed-in-tariffs (FITs). The result of Brexit could be very different depending on whether we end up inside or outside of the single market, but legislation is unlikely to change significantly as most of it is driven by the UK anyway.
Over the last few months feed-in-tariffs (FITs) have dropped and at the moment there is a huge rush to get projects approved before various deadlines coming up this autumn. There is also now a quarterly cap on FITs, so when a quota has been reached project are being pushed over into the next quarter which is making planning and management of projects very difficult. So, many community energy projects are struggling to find ways to give a sensible rate of return to their investors.
But on a more positive note there is an expectation that, though the next 2-3 years may be difficult for community energy projects, the ethos is strong and the concept of community energy has caught the imagination of a significant group of enthusiasts who are determined to make these projects happen. So while there is no consistent approach, there are a lot of people thinking and exploring new ideas. Popular ideas around at the moment are things like: direct supply of energy to consumers (rather than feeding into the grid), the possibilities opening up from energy storage, and buying up existing energy installations and turning them into community projects. All these possibilities are credible and will contribute over the next few years to make community energy a successful force in the market.
While energy storage options are not generally cost-effective yet, there are a few pilot community projects around including storage and the technology is developing quickly, so it is likely that community energy projects in the future may be able to make their proposition more valuable by offering energy at times of the day when other sources are less available. And with effective storage will also come the opportunity to look at direct supply initiatives. With the export tariff so low there are new options arising in supplying energy direct to households or businesses. Possibilities are being considered such as providing power supply points for electric vehicles directly from community-owned power plants. Opportunities like this and many more will open up as storage options get more cost effective.
So there is lots of positivity in the sector and plenty of opportunities coming up for innovators and enthusiasts.
[With thanks to Emma Bridge of Community Energy England]