Sunak missed his chance to build local net zero expertise

The chancellor did not use his spring statement to help step up councils’ work in tackling climate change, writes Polly Billington, chief executive of the UK100 network of local leaders seeking to achieve net zero.

The backdrop against which Rishi Sunak delivered last month’s spring statement is dark and unenviable. Across Britain, residents are facing a cost of living crisis that threatens to spin out of control. Rising energy bills linked to the Russian invasion of Ukraine could push millions into poverty.

Under these circumstances, I agree with Upgrade Secretary Michael Gove who said that “the answer is not to be less green, it is to be greener”. The crisis has highlighted the need to wean ourselves off Russian oil and gas, boost our local supply of clean energy, and do all we can to increase energy efficiency. Net zero has never been more important.

Local leaders are the most trusted by the public to drive climate action. And a new report from PwC reveals they are also best placed to take net zero action that gives taxpayers the best value. Therefore, UK100 wanted to see the Chancellor take the opportunity to support ambitious local authorities desperate to do more, faster to achieve local net zero.

What we got was a mixed bag. The reduction in VAT on energy efficiency measures is welcome, alongside indications that the UK Infrastructure Bank (UKIB) will support renovation projects. However, the fuel tax cuts are a step back from net zero, and there was no mention of measures to boost public transport or sustainable alternatives.

But one of the most worrying omissions, by far, for local authorities was the lack of increased support for energy hubs.

Energy poles

Across England, there are currently five Local Energy Hubs which offer local authorities practical support in the development of clean energy projects. They grew out of a 2017 UK100 report proposing local clean energy partnerships.

Where there is little a local authority can do to achieve ambitious goals, the service provided by local energy hubs is invaluable.

Hosted by a leading local authority and working with local business partnerships and local leaders from across the region, the hubs are a one-stop-shop for expert support. They are a source of promoting best practices among councils, a place to build partnerships and a tool to support projects that can attract business investment.

They are designed to increase the number, scale and quality of energy projects carried out by local leaders across England. Each hub has a team of energy experts to support local energy projects throughout their development stages, from options assessment and feasibility, to business case preparation, from conception and planning to financing.

While some municipalities have significant energy and climate teams, this is not the case for all local authorities. Capacity varies greatly. Therefore, the expertise and internal resources provided by the hubs are invaluable.

In its first few years of operation alone, the major energy hub in the Greater South East has attracted more than £15million in investment for 55 projects in 35 local government and public sector partnerships. By 2020, it had already provided 1-2-1 development support to local authorities worth over £400m while saving around 82,000tCO2/year.

Solar farms, energy efficiency of public and domestic buildings, decarbonization of fleets, heating networks and smart grids are just some of the projects supported by the hub.

He has built a network of stakeholders across the innovation landscape, supply chains, public sector and community energy groups – the types of partners essential to advancing the energy transition and accelerating net zero progress.

An easy choice

Hubs have the potential to be a vital tool for implementing local action on net zero. And after the initial reference in the Net Zero strategy, confirmation that energy hubs will be transformed into net zero hubs promises an expanded role from April 1, their omission from the Spring Statement is no joke.

Especially since this expanded role is likely to be essential in navigating the relationship between local authorities and distribution network operators, the UK Infrastructure Bank and the Net Zero Forum in what is still an emerging Net Zero governance environment.

Hubs aim to provide local support. But with just five across England, they are geographically spread out. And with less than £5m a year to fund the five hubs, we believe they barely have enough funding to operate as is, let alone expand their scope to include all considerations net zero. While it is difficult to assess precisely how much funding is sufficient, a potential tripling of responsibilities suggests that increasing funding to over £20m per year would better equip new net zero hubs to achieve their potential.

And these responsibilities are very necessary. There is an opportunity to increase the ambition of the hubs, to complement them and to work towards the decarbonisation of all sectors of the economy, alongside the UKIB and its new mandate and the Local Net Zero Forum. But it needs a longer-term political and financial commitment.

After the Chancellor recently faced many tough decisions, I want to offer him an easy one: recognize the power of net zero local partnerships and act urgently to fund enough and secure the long-term future of energy hubs /net zero hubs.