29 July 2010: UK localism

On 6 July, UK Local Government Secretary Eric Pickles scrapped Regional Strategies. This came soon after the demise of the Regional Development Agencies. The coalition says that it is committed to giving more power to local government and, as if to prove that abolishing the regional tier will not mean greater centralisation, the next day Energy Secretary Chris Huhne announced that local government will be allowed to sell renewable electricity to households. They have not been allowed to do this since 1976, so the coalition is correcting a mistake of a previous Labour government (which, to be fair, Labour also promised to do had it won). The coalition also promises to correct a previous Tory mistake, by returning revenue from business rates to local government.

The urgent need to invest in low-carbon energy services is widely recognised. Yet, many people fear that localism will delay the move to clean energy. Whatever their political hue, local councils often reject wind farm applications after pressure from NIMBYs. Allowing local government to sell electricity from local wind farms gives them a strong incentive, and would also be beneficial to local residents. About a third of Americans get energy from municipal or co-operative energy companies and the tariff is about 20% lower than for private ones.

In the past, UK local government has played a leading role in energy supply. As Huhne says, the dynamic Liberal mayor of Birmingham, Joseph Chamberlain, oversaw the development of the city’s gas infrastructure. (At the time Chamberlain’s approach was often called municipal socialism, but Huhne prefers to call it municipal liberalism!)  However, UK local government’s contribution to reducing carbon emissions has so far been limited. A handful of local authorities have supported voluntary actions of residents, by providing advice, grants or loans. For example, Kirklees devised innovative schemes to lend money to residents for domestic renewables and provide free home energy audits. Some authorities have been active on low-carbon energy: Woking installed combined heat and power and renewables on its own buildings; Aberdeen and Southampton have promoted district heating.

These are relatively small and isolated successes. The large metropolitan areas have not yet delivered on this. They are held back by three factors, namely lack of:

  • Money.
  • Ways to co-ordinate with neighbouring authorities.
  • National leadership.

Birmingham has ambitious plans to improve the energy efficiency of its social housing stock – the largest in Europe – but the price tag runs into tens of millions of pounds. Greater Manchester knows that renovating buildings would deliver gains in employment, economic activity and energy efficiency. However, how will the ten local authorities come together to deliver the changes? Sheffield cannot expand its district heating network because it cannot guarantee that homes will connect to the network if it is built. In comparison, the expansion of Copenhagen’s district heating system was made economically possible by the national Heat Law, which requires home owners to connect to the local district heating networks, creating a captive market for the hot water. Now citizens in Denmark ask for the district heat networks to be extended to their communities, so they too can enjoy the cheaper prices. 

The coalition needs to address all three obstacles to effective local action. It must provide access to money, and the promised Green Investment Bank has potential, as long as it has enough funding and is not just yet another institution. Conservative and Liberal Democrat councils must work with neighbouring authorities (as indeed must Labour ones). And the national government must show greater leadership – not just rhetoric, but firm and effective policies that deliver policies and, where necessary, require local government, communities and individuals to do certain things for the greater good.


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