Campaign reply - Urgent action needed on community energy

Thank you for contacting my office. I very much appreciate you getting in touch about community energy.

There is no doubt that communities are key to decarbonising the UK economy, and I am glad that the Government is supportive of community energy.

Ofgem has existing flexibility to award supply licences that are restricted to specified geographies and/or specified types of premises. Furthermore, following a consultation process, since February this year, Ofgem is welcoming applications from community-interest groups, co-operative societies and community-benefit societies to the industry voluntary redress scheme. This is enabling groups to apply for funds to deliver energy-related projects that support energy consumers in vulnerable situations, support decarbonisation and will benefit people in England, Scotland and Wales.

To support community energy projects, the Government has funded the Rural Community Energy Fund. This £10 million funding scheme was delivered through the Local Energy Hubs which support rural communities in England to develop renewable energy projects, which provide economic and social benefits to the community. Since its launch in 2019, the fund received 1,668 enquiries, 203 applications and awarded millions of pounds worth of grants to projects focusing on a variety of technologies, including solar, wind, low-carbon heating and electric vehicle charging. I understand your frustrations that this Fund closed in April this year. While I am unaware of plans to extend this scheme, I will pass on your comments to my colleagues in the Department for Business, Energy & Industrial Strategy.

The Government has also introduced other UK-wide growth funding schemes, such as the Community Renewal Fund and the Towns Fund, through which it is enabling local areas to tackle net zero goals in ways that best suit their needs. In addition, I know the Government encourages community energy groups to work closely with their local authority to support the development of community energy projects within these schemes and plans to reintroduce the Community Energy Contact Group to strengthen engagement with the sector.

While I am unaware of any plans to establish a new National Community Energy Fund, you may welcome that the Government continues to work with Community Energy England to share best practice within the sector, so less experienced communities can learn from those already operating. Nevertheless, I would be happy to raise this issue with the my colleagues in the Department for Business, Energy and Industrial Strategy should you wish.

The Energy White Paper, published in December 2020, also committed government to review the overall retail market regulatory framework and, through this review, the Government will assess what changes may be needed to allow for new supply propositions to come forward. I understand the Government will engage with community stakeholders as part of the review and I will follow any developments closely.

Once again, thank you for taking the time to write. If you require any further assistance, then please do not hesitate to get in touch.