Local Area Energy Planning was pioneered by Energy Systems Catapult to help inform and support local authorities, distribution network operators, business and communities to plan for a cost-effective low carbon transition to achieve Net Zero.

LAEP: Supporting clean growth and low carbon transition was developed as part of the UK’s largest smart, consumer-focused project aimed at overcoming the barriers to the decarbonisation of residential heat – the Smart Systems and Heat (SSH) programme.

Local Area Energy Planning is a means of exploring a range of different future local energy scenarios to achieve deep decarbonisation at least cost while promoting clean growth. Prior to the publication of this report, there had been little planning for decarbonisation of local energy infrastructure, yet a major overhaul that extends into people’s homes will be necessary to meet climate change targets.

This process enables stakeholders, led by local government, to interrogate different energy futures for an area and to develop the most promising, cost-effective options for decarbonisation. For network operators, it provides a foundation for justifying and planning network upgrades. Local Area Energy Planning develops a shared vision as a basis for targeting investment, encouraging innovation, securing value for money and gaining public understanding and support.

Key points

Local Area Energy Planning: Supporting clean growth and low carbon transition is aimed at government, decision-makers and related stakeholders. LAEP can address some of the key challenges of UK climate and energy policy to help deliver the UK’s clean growth opportunity, including:

• A clear pathway to meeting ambitious national decarbonisation objectives, based on locally specific, viable and cost-effective plans
• A focus on Whole Systems and multi-vector planning that should realise system-wide efficiencies and secure value for money, whilst limiting increases in consumer bills
• A credible Local Area Energy Plan that establishes a basis for assessing or contesting energy developments in local spatial planning applications
• A framework for targeting investment and funded programmes directed at fuel poverty and improving building energy performance
• A way of providing evidence to target investment in network infrastructure upgrades, meeting an efficiency requirement of Ofgem’s network price-setting process that provides the capital for network investment
• The potential to use Local Area Energy Planning as a basis for accountability, governance and performance management in this space and to coordinate with other local planning (e.g. transport and infrastructure)
• A compelling and locally specific narrative for meaningful engagement with local citizens and businesses in the national effort to decarbonise, adding a democratic element to the significant changes ahead
• A framework for local areas to achieve local decarbonisation ambitions and assessing and setting local carbon emissions reduction targets
• The provision of a clear plan to drive local clean growth and job creation and to provide confidence to invest in new energy products, services and infrastructure.

Recommendations

An evolutionary approach to Local Area Energy Planning is recommended, with the initial emphasis on encouragement, facilitation and supporting funding. If the case is then compelling, moving to an obligatory approach in the mid-2020s should be
considered.

• Recommendation 1. Integrate Local Area Energy Planning as part of the Local Plan process, encouraging a Whole Systems approach to meeting the challenge of climate change, fuel poverty and cost effectively transitioning local energy systems.
• Recommendation 2. Central government to support and co-fund local areas to undertake Local Area Energy Planning to help understand options and plan to decarbonise local energy systems. Considering the role of local government and other local bodies such as the recently established local energy hubs in facilitating this.
• Recommendation 3. Due to their fundamental role in the energy system, energy network companies should actively participate in Local Area Energy Planning, working with local areas, as part of their obligation to take a Whole Systems approach under the RIIO-2 framework.
• Recommendation 4. Utilise Local Area Energy Planning to target investment in housing retrofit programmes and heat network development, to ensure cost effective decarbonisation of the whole energy system.
• Recommendation 5. Build up a knowledge base of insights from Local Area Energy Planning, so that local characteristics and options for decarbonisation can inform national energy strategy.
• Recommendation 6. To rationalise current practices, support and publish data gathering standards and requirements for organisations (e.g. local government and energy network operators) responsible for the collation and spatial representation of energy use, assets and infrastructure.