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Local authorities and energy supply

  • 4 August 2022
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Local authorities have launched their own energy companies in the past, some have failed and one or two have been successful. Would it be viable for an energy company to work alongside a local authority to bring down tariffs and any profits shared?

Councils could use profits to improve housing conditions e.g., insulation, solar panels etc.

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Best answer by Blastoise186 5 August 2022, 19:46

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A really interesting point to raise, @BrenJ.

 

I’ve forwarded this one to the team so will pop back when I hear more. In the meantime I wonder if fellow community members @Jeffus and @Blastoise186 might know more about these type of local authority partnerships.

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Thanks @Jess_OVO, it would be great to hear any thoughts and knowledge of such partnerships.

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Unfortunately, pretty much all of them are dead in the water right now. The last one standing Together Energy collapsed last year and the only remaining one beyond that is London Power, which doesn’t technically count because it’s used for a different purpose.

To date, they all seem to have been horribly mismanaged, terrible taxpayer value and completely exploded in the councils face. That’s not to say it’s impossible to do, just really hard!

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Hi @BrenJ that is a good question.

As @Blastoise186 says there isn't a particularly good track record for councils getting involved in energy.

In fact there isn't a particularly good track record in commercial activities of councils in general. 

There have been over 30 energy company failures in the recent mess generally so its easy to make mistakes. 

The risk to council tax is probably simply too high. It's hard to make money, scale sufficiently and needs cheap money to fund the business. There isn't a great deal of money to be made at the moment so sharing with a council would be tricky. Its energy producers and fossil fuel companies that are making huge profits at the moment. 

A better option perhaps would be for a council to own outright or a share of some wind turbines or solar panels or battery storage and use any profits from that. For example

https://www.hulldailymail.co.uk/news/hull-east-yorkshire-news/council-owned-wind-turbine-could-6014609

Any commercial activity does rely on really good and experienced staff in the Local Authority and protecting local  council tax payers as there is no appetite for central government bailouts. 

Then if a council owned a wind turbine etc they may be able to work with an energy company. In this case octopus own the wind turbines, but perhaps something similar where the council owned the turbine could be possible. 

https://octopus.energy/octopus-fan-club/#:~:text=Any%20electricity%20you%20use%20while,off%20every%20unit%20you%20use.

This sort of thing is a simple example of what we might see more of in the future, a local time of use tariff, you pay less if it is windy in your local area. 

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Hi @Blastoise186 and @Jeffus, really good insights, very helpful.

This is where I think there should be more involvement between energy suppliers and councils. Councils could facilitate wider access to suppliers in advancing new resources and technology.

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Hi @Blastoise186 and @Jeffus, really good insights, very helpful.

This is where I think there should be more involvement between energy suppliers and councils. Councils could facilitate wider access to suppliers in advancing new resources and technology.

No worries. Now that idea is probably more feasible than the other one. Not only does it prevent insert council name here getting egg on its face for yet another failed council run energy supplier, but it actually has useful mutual benefits for everyone.

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@BrenJ you may already have done this

You could ask your local MP and Council if there are any current or planned initiatives in your local area. There may be a local councilor with a specific remit for the environment/green energy/insulation etc. and a committee. Many councils have declared a climate emergency and have an associated strategy and plan. 

Be curious to know what is being done in your local area? 

 

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@Blastoise186 and @Jeffus 

Then there is always the controversial ‘Fracking’. Could shale gas sites become practical and safe in the UK? There are always going to be objections from local authorities and the ‘NIMBY’ brigade.

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