Energy Smart Places: Why the UK needs them and what’s holding them back

Row of traditional filament lightbulbs with one energy-saving lightbulb hanging lower.

Strathclyde's Dr Rebecca Ford & and Dr Euan Morris talk about Smart Local Energy Systems. Dr Ford is also Research Director of the UK’s Energy Revolution Research Consortium (EnergyREV)

Their blog draws on evidence presented at EnergyREV’s workshop “Why SLES?: The Value Case for Smart Local Energy Systems”, as well as EnergyREV’s “Insights and Impact” Summit, which outlines why the UK should be investing in creating energy smart places, and the barriers that need to be overcome to support widescale deployment. EnergyREV is a consortium of 60 researchers from 22 Universities led by Strathclyde who work together to tackle the challenges around smart local energy systems. It is one of the three key components of the UK Industrial Strategy Challenge Fund’s Prospering from the Energy Revolution (PFER) programme. From a system point of view SLES consist of a bundle of distributed energy assets, including small-scale battery storage, local embedded generation, and flexible loads, including electric vehicles, smart appliances, and low-carbon heating technologies such as heat pumps.

Users are also a critical part of SLES operation, and a SLES should be able to give people the advice and information they need to make informed decisions about how they interact with their energy system, without the user themselves needing a detailed knowledge of the operation of the SLES or its subsystems.

Energy smart

The UK’s energy system is changing, and within a decade will look substantially different. Greater levels of non-dispatchable renewable generation will see more variability in the supply side, while electrification of heating and transport will see demand almost doubling, adding to the large degree of constraints that already exist due to standard population growth and uptake of local renewable technologies. These changes will also create higher peaks in demand, which future energy systems need to manage to ensure efficient and cost-effective development.

Smart local energy systems have an important role to play in connecting the technical operation of the energy network with new energy and flexibility services, incorporating new advances in real-time sensors and machine learning. Having data and visibility at local level forms the basis for enhancing efficiency at a granular level, optimising consumption within a particular geographical domain, and helping reduce stress and operational costs on the wider network. Inefficiencies at the local level add up to impact the national scale, but energy smart places can join up supply and demand locally through new forms of data and business/market models to unlock flexibility and help local networks operate more efficiently and deliver positive impacts into the wider system.

Reduce bills

Providing flexibility services can also help reduce bills for those households participating (by up to 8%) and through the creation of a more flexible and efficient local system, can reduces bills for their community. Additionally, if a SLES involves energy efficiency measures, and/or PV installation, then this can reduce bills even more significantly (by up to 7% and 30% respectively). This is particularly important in the current energy crisis context, with dramatic increases in the number of homes in fuel poverty, and the market failing to provide affordable energy, even with government interventions.

Further value streams can be derived through sector coupling, delivering the least cost route to decarbonisation by maximising the utilization of local energy assets. For example, waste heat (e.g., from subway stations or data centres) can be taken from one site to be used as a heating at another site. As demonstrated in the GreenSCIES project implemented in the London Borough of Islington, co-generating heating with cooling in this manner can give a total energy ratio of 7, if local heat sources can be connected to local heat loads. This particularly significant as both heating and cooling represent a significant proportion of total energy demand.

In addition to the benefits from leveraging flexibility and maximising system efficiency, energy smart places implementing local energy approaches generate greater value (social, financial, and environmental) and return on investment, in particular to local economies, than approaches which take a place-agnostic, generalised view. The UK has a diverse range of local energy businesses, utilising technologies such as heat networks, microgrids, fuel cells, and energy markets, that currently met the needs of a diverse range of customers. Investment in local authorities to deliver local energy resources can delivery significant returns on investment.

Local approaches can also de-risk innovation by generation local buy-in, and enhance local social and economic development by growing local skills and supply chains to deliver and maintain new energy technologies. Some examples of this approach include Repowering London, who have worked with Kensington and Chelsea council to install community solar, while offering apprenticeships to young people, and B4Box in Greater Manchester, who work with ex-offenders providing multi-skill apprenticeships ending in employment with a housing developer.


Local actors, particularly the local authority, have key roles to play in developing energy smart places that integrate planning, operation, and maintenance of energy assets, support local business and supply chain development, and engage local communities. While energy powers are being devolved to local communities through their local authorities, those local authorities have themselves been hit by over a decade of austerity measures reducing their funding, and thus their ability to invest in local energy projects. This lack of funding and ability to deliver energy projects also means there is a lack of experience within local authorities in delivering SLES projects including across their finance and legal departments.

Businesses as well have seen their spending ability restricted, in large part due to the coronavirus pandemic, with many firms no longer employing energy managers who would have been responsible for implementing energy efficiency measures and low carbon technologies. FE colleges have also been hit by a reduced budget, which has impacted their ability to recruit instructors and to scale-up training approaches even when proven successful, this has had a knock-on effect on the availability of apprenticeships and skilled workers.

The right policy environment is critical to unleash the full potential of places, yet there has been a lack of vision, leadership, and coordinated action from the government and regulator. While successive governments have committed to decarbonisation goals with various targets set for between 2030 - 2050, and even some beyond, there has often been a lack of detail in these plans, including how they can be delivered locally.