DECC lifts ban on councils selling green energy

The UK government will from next week allow local authorities to sell energy that they produce back to the grid, ending a ban that has been in place for a quarter of a century.

The Department of Energy and Climate Change (DECC) confirmed today that the ban, which was originally imposed in 1976, would be repealed on August 18.

Energy and Climate Change Secretary, Chris Huhne, who first announced that he would lift the ban last month, said that the change would free up councils to accelerate the roll out of community-scale renewable energy projects.

"For too long, Whitehall's dogmatic reliance on 'big' energy has stood in the way of the vast potential role of local authorities in the UK’s green energy revolution," he said in a visit to Woking Council. "Forward thinking local authorities such as Woking in Surrey have been quietly getting on with it, but against the odds, their efforts frustrated by the law."

The lifting of the ban allows councils to sell surplus energy generated by their onsite electricity projects back to the grid, providing them with an additional source of revenue.

Soon after the announcement, councils began explaining how they might benefit from the reversal in policy. Derby is due to complete a hydroelectric plant at Longbridge with a peak power output of 230Kw by the end of next year and also wants to install photovoltaic panels on two council buildings.

Meanwhile, Hampshire already has three energy from waste plants in place that process unrecyclable waste and generate enough energy each year to power 50,000 homes.

"Having the ability to sell our own generated electricity - instead of through an energy supply company - would really help us to invest in cleaner and more efficient generation technologies," said Councillor Mel Kendal, Hampshire County Council's Executive Member for Environment. "The benefits for Hampshire include ensuring energy security and reducing our vulnerability to future price increases."

The move is the latest step in the government's plan to promote greater uptake of small and community-scale renewable energy projects. However, it also comes at a time when many within the UK's renewable energy industry are frustrated at changes to planning rules that should make it easier for councils to overturn applications for mid-scale wind farms and other renewable energy projects.

A series of industry insiders told the Sunday Times' yesterday that the government had effectively "sanctioned nimbyism" by telling councils that it would roll back central government targets and allow them to have a greater say in planning decisions.

The CBI has also issued a major report today warning that the government's failure to provide greater detail on its proposed low carbon energy policies is blocking billions of pounds of renewable energy investment.

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