Greater Manchester has committed to achieving carbon neutrality by 2038. The region launched its Five-Year Environment Plan, which includes an accompanying carbon budget. To support this, Greater Manchester engaged Energy Systems Catapult to help achieve its vision of each of its districts transforming infrastructure, homes, and buildings to be part of a smarter local energy system. Recognising the need to translate the strategic vision to an implementable plan of action, Greater Manchester and the Catapult supported each district in the development of their Local Area Energy Plan (LAEP).

The LAEP included the transformation needed across each district, identifies the first steps to progress, and provides a robust plan to engage businesses and citizens. The technologies and future trends considered and assessed for meeting Greater Manchester’s carbon neutrality targets included: thermal insulation, heat pumps, district heating, electric resistive heating, hydrogen boilers, solar photovoltaics, wind turbines, electric vehicles, demand flexibility, and energy storage.

The Innovation

The Catapult developed the concept of Local Area Energy Planning (LAEP) as a mechanism of applying a whole system approach to the planning and design of Net Zero Local Energy Systems. Bury in the Greater Manchester region was one of the first places in the UK to pilot the LAEP integrated planning approach.

This was the first time that a region-wide approach was adopted for the LAEP process. This resulted in LAEPs being developed for the 10 boroughs of Greater Manchester.

The Challenge

It can be challenging for Local Authorities to scenario plan, due to evolving regulatory and policy changes that impact energy systems.

There is no single route to effective decarbonisation, but a variety of futures. Strategic planning must consider parallel activity across multiple channels to understand what will help Greater Manchester achieve their Net Zero goals in the most cost-effective, impactful way possible.

While the collaborative approach across the region provided economies of scale, opportunities to engage with multiple stakeholders, and a partnership approach to affecting change, the multi-region approach also presented challenges. The nuances and requirements of city authorities with varying levels of development added additional layers to the project scope. This was the first time Local Area Energy Planning had dealt with challenges such as aligning neighbouring areas.

The Solution 

Greater Manchester has a detailed pathway which will help the area work towards changing its energy infrastructure so it can meet its ambition of being carbon neutral by 2038.

Following approval at a meeting of the Greater Manchester Combined Authority on 30 September 2022, the city region is the first in the country to produce and adopt Local Area Energy Plans (LAEPs).

The plans, one for each of the 10 Greater Manchester districts as well as an overall one for the city region, detail the current position and a roadmap towards a decarbonised future.

They also identify key decisions that are needed to determine the longer-term decarbonisation pathway for the city region. For the near-term activity, the region will need to deliver the following measures over the next five years:

• 140,000 additional homes with fabric retrofit
• Nearly 2 GW of additional rooftop solar panels on homes
• 190,000 vehicles replaced by electric alternatives
• 8,000 additional homes connected to heat networks
• 116,000 additional heat pumps in homes

Similar levels of interventions in public, commercial and industrial buildings and fleets will also be needed, with public sector buildings making up over seven per cent of Greater Manchester’s non-domestic building stock. This will include the opportunity for over 2.5GW of non-domestic rooftop solar panels.

These figures will need to rise dramatically over the coming fifteen years, with around a million heat pumps in homes and a million electric vehicles needing charging by 2038, meaning work to enhance Greater Manchester’s local electricity network and to find options for flexibility on the grid.

With urgent action required across the region, in the near-term and through to 2030, to achieve the 2038 carbon neutrality target, a key focus of the LAEPs is to:

• Set out priority areas for different elements of the energy system in Greater Manchester, including insulation measures
• Identify areas where heat pumps and heat networks are cost effective to use. Action in these areas could transition the heating systems of around 120,000 homes, making them both less reliant on carbon and more affordable to heat.
• identify priority/opportunity areas for the introduction of other technologies at pace
• continue to build capability, capacity and understanding so further wide-scale transition can be delivered

The Impact

The GM Local Area Energy Plan provides a strong foundation setting out a set of suggested interventions for the energy infrastructure changes needed to enable the region to become carbon neutral by 2038.

The completion of the 10 Local Area Energy Plans has given Greater Manchester a basis to turn plans into action. The Combined Authority commissioned EY to deliver a Strategic Outline Business Case (SOBC), setting out the strategic case for change to enable the transition to net zero by 2038 across energy systems in GM, delivered in three phases,  across Five different areas ( as show in the picture below). The SOBC considers the scope and approach to delivery, which will be further developed in future outline business cases.

The LAEP analysis indicates that GM investment required to 2038 is £64.4bn.

Of this total figure, the required LAEP investment that is in the local public sector’s significant control or influence totals £12.5bn and this forms the scope of this Strategic Outline Business Case (‘SOBC’).

The public sector is likely to need to contribute up to £6.3bn of the £12.5bn in order to leverage in £6.2bn of private sector investment. This will also enable the delivery of projects that will, in some cases, act as pathfinders for the private sector for those projects outside of the public sector sphere of influence.

The SOBC identifies that, alongside significant funding commitments, an increase in capacity and capability across the GMCA and Local Authority teams will be needed to deliver the programme of work. Greater Manchester will need to create new ways of delivering net zero to match the scale of need at a city region level, its aspiration in doing this will see it act as a trailblazer in creating approaches and models that can be replicated elsewhere nationally.

Next Steps

Greater Manchester’s leadership on this agenda and by having an evidence-based plan has seen the region be successful in acquiring funds (in the form of capital grants), to support GM’s 2038 ambition and therefore progressing associated feasibility studies and projects across a range of net zero projects.

But like many areas funding to the level required is a challenge. The lack of scale and the piecemeal nature of grant funding programmes does not allow for a strategic, place-based approach to the delivery of the net zero ambition.

Based on the latest emissions data, GM is tracking above where it should be in terms of carbon emissions, and it is notable that the gap has been increasing year on year.

Achieving carbon neutrality by 2038 is therefore hugely ambitious and challenging and, if the current trend in GM is to be reversed, will require a significant scale up of activity, coupled with major local policy interventions, investment by government and industry and both technology and business innovation.

The work undertaken by GMCA in taking the LAEPs and moving them into Strategic Outline Business Cases is helping them to consider the various models that could be used to deliver net zero programmes and projects, ranging from autonomous District-led delivery through to a centralised function such as the project delivery unit. This recognises that there is no ‘one-size-fits-all’ approach.

The Combined Authority has a critical role to play in the coming years in coordinating different stakeholders within GM, and to provide a single point of contact for central government bodies, regulators, third-party delivery partners and investors.

GM is charging ahead with the required shift needed to a Net Zero future energy system, but it also understands the complexity of the future and the challenges it faces.