More financial support is needed to bolster the installation of medium-sized renewable energy generating systems, according to the Energy and Climate Change Committee (ECCC).

The ECCC’s Local Energy report states that medium-scale energy projects have the potential to provide a significant proportion of the UK’s energy capacity but at the moment government risks failing to capitilise on their potential due to a lack of support.

Speaking on behalf of the committee, Alan Whitehead MP said that schools, business and local authorities should all be encouraged to generate their own electricity locally. He explained: “Businesses can reduce their energy overheads, locals can potentially benefit from cheaper electricity or heat, and councils can use projects to tackle fuel poverty, cut costs and reduce carbon emissions.”

The committee acknowledged that medium-scale projects face a number of barriers including securing funding and Power Purchase Agreements (PPA), connecting to the grid and, sometimes, overcoming public opposition. In addition, often the planning process can be costly and time-consuming with the risk of losing substantial capital if planning permission is refused.

Whitehead continued: “Medium-scale power plants could also help to boost energy security. Local heating schemes in particular could be helpful in balancing out peaks and troughs in electricity supply and demand by storing energy as hot water when there is a surplus of electricity being generated. If small-scale power plants fail it would cause less of an impact than if a large power plant fails.”

The report calls on the government to introduce a support mechanism alongside a ‘comprehensive package of measures’ designed to address finance, planning, grid access and advice to address the current support gap.

The ECCC suggests that the Green Investment Bank could play a fundamental role to the sector by offering seed funding and project development funding.

Reacting to the report, Professor Roger Kemp from the Institution of Engineering and Technology, echoed the committee: “Energy is used to deliver heat, light and transport and the point at which these come together to enable efficiency of the whole energy system is at the community and individual level.  In terms of sustainability, the ability of a community to manage its own energy supply and demand locally is a largely untapped resource. Taking a joined up local approach to energy could make better use of “waste” heat and reduce losses in the power system.”

Whitehead added: “We support the government’s ambition to return decision-making powers to local authorities, but carbon reduction is a national priority. Although it is unlikely that local energy projects will eliminate the need for larger, centralised power stations completely, with some government support they could provide a significant proportion of the UK's energy capacity while reducing carbon emissions and increasing efficiency.”