Friday, 26 September 2014

Community Energy? Communist Energy? Does DECC know the difference?

The UK Secretary of State for Energy and Climate Change, the Rt Hon Edward Davey MP (Lib Dem), spoke words of encouragement to local authorities and community energy groups on 4th September 2014. The largest part of his short speech was a catalogue of ‘pioneering examples’ for community energy, each of which had found a different way to achieve collective ownership of energy production resources. He went on to say that his department DECC was about to release £10M through an Urban Community Energy Fund, which again encourages community ownership of renewable generation plant. He closed with a ‘clear and unambiguous message that people can come together… and can take control.’
Collective ownership of the means of energy production has a distinguished history: it was proposed by Vladmir Lenin, enforced by Josef Stalin and implemented through the National Coal Board and the CEGB. Some readers may be concerned about the direction that Mr Davey’s thoughts appear to be taking.
But more seriously, I think that Mr Davey’s advisors at DECC have failed to explain to him that communal engagement in local energy does not by any means require communal ownership. For people to benefit from distributed renewable generation and energy storage there does need to be communal engagement: people need to belong to communities of interest in which energy can be bought and sold, so that they can get a decent return on costly energy plant. 
But local energy markets can be realised without any communal ownership of the energy resources. For comparison, think how ridiculous it would be if eBay or Gumtree insisted on taking ownership of all the goods that were sold through them: hardly anybody would trade through them, because hardly anybody trusts big enterprises to act in the little man’s interests. It’s the same with energy: I’m not going to support any council that wants to spend my money on a community energy project, because I’d rather keep control of my own energy generation. 
The marvellous scalability of distributed generation and storage equipment means that there’s simply no need for large-scale communally-owned installations. So please, Mr Davey, give some support to community of interest, to communal engagement, but not to communal ownership.

PS Curiously, Mr Davey (a graduate in economics, who therefore ought to have known better) also remarked ‘The last thing I want to see is significant negative impacts on consumer bills’. If he only supports communally owned energy systems, I fear that he will not be disappointed.’

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