Local conditions associated with local energy system projects

Theodoros Arvanitopoulos and Charlie Wilson

May 2021

Local energy system (LES) projects seek system solutions to decarbonising, balancing, and coordinating across supply, storage, and demand resources. The search is on for replicable business models and scalable technological configurations. But local energy by definition is also rooted in specific contexts and conditions. Which of these conditions enable LES projects to flourish? 

Using a unique dataset of 146 LES projects begun in the UK from 2010-2020, we have applied spatial econometric methods to test relationships with a wide variety of local conditions. We have identifed specific energy, institutional, social and economic conditions that are significantly associated with LES projects historically and have confirmed the robustness of these associations. 

We have found that distributed power generation, low-carbon infrastructure (including electric vehicle charging), firm activity in the tech sector, local authority energy and climate strategies, and active energy efficiency markets are enablers of LES projects involving multiple actors, sectors, and skill sets. These conditions describe a clear policy agenda for stimulating and supporting emerging local energy markets.