Micro-generated renewable energy is a workable solution for people with low incomes and chronic ill health who face fuel poverty in this climate of rising energy costs.
A co-operative solution could easily be formed by communities to help share, or take advantage of, a regulatory subsidy that is paid for in the first instance for the generation of electricity; and a further fee can be paid per unit of excess electricity sent onto the National Grid.
But users do not have to sell any power to the grid. A better deal might be available, particularly where a local user wants cheap power.
There are at least two business models for communties to look at, which will help keep any surplus funds locally instead of in the pockets of institutional investors. Much depends upon the degree of risk that can be accepted.
A very low risk option would be to align a community co-operative with a not-for-profit social enterprise. Here, much of the possible revenue is surrendered to the social enterprise in exchange for acceptance of very low risk. For a 3.3kWh solar photovoltaic installation, about £100 could be returned to the community each year — with the householder receiving free daytime electricity.
In addition, a profit share would provide for a further £25 per property each year for community schemes for people with homes that are not suited for solar generation.
Within this model, the community has no financial outlay — it simply forms an association of people with households that have the potential for installation of renewable energy. The scheme would run for 25 years, after which the social enterprise surrenders the equipment for the payment of one pound. And after 25 years, solar cells are still estimated to output at about 80 percent of their initial efficiency.
For the more adventurous, an option with greater risk, but one I am actively exploring, is particularly applicable for owners of social housing. Within the City of Oxford — where I am a Labour/Co-op councillor — at least 2,000 council houses are suitable for the installation of solar panels — that’s about one out of every four tenancies.
Should I be able to persuade the council, a prudential loan could facilitate the City Works department to buy and install photovoltaic panels. Each householder could obtain free daytime electricity — the council could receive a net income of £1.8 million for 25 years — and the carbon emissions for Oxford could be significantly reduced.
Plus, a community fund managed within the aims of co-operative principles could share part of the rewards with those unable to accommodate micro-generation. With a surplus of about £900 per property each year, there could be a lot to share and a lot left to improve council services.
So, what’s stopping us? It is certainly not stopping Wrexham Council, which is well on the way with plans to fit out 3,000 properties. Wrexham has teamed up with the Sharp Corporation, which will pay twice the going rate for the feed-in tariff — which still provides it with cheap power. As a by-product this approach creates local, green jobs and stimulates British industry to innovate and meet demand for more efficient photovoltaic micro-generation.
• For further information, the Association for Public Sector Excellence has published a research paper entitled ‘The virtuous green circle’. For more see: www.apse.org.uk