There are three principal reasons why local authorities are investing in renewable energy technologies:

To develop a long term, sustainable source of revenue for public services

Local authorities are having to become less reliant on the central government Revenue Support Grant and other traditional sources of public sector income. At the same time, councils have experienced downward pressure on equity-based investment and commercial income due to factors such as stagnant and low interest rates and the impact on the local tax base due to the COVID-19 pandemic.

To reduce reliance on fossil-based energy to achieve Net Zero commitments

Over 75% of local authorities have made Climate Emergency declarations and are taking steps to move away from fossil fuels to achieve Net Zero targets. Renewable energy technologies provide one pathway to decarbonise property estates or utilise land as part of area-based carbon reduction.

To develop locally-owned renewable energy generation to the benefit of the local taxpayer and economy

Solar PV has seen a significant expansion through government-supported financial instruments and can now achieve rates of investment return without tariff support. This is because installation prices have dramatically reduced, and energy prices have increased. Local authorities can use local energy generation as a way to reduce the carbon footprint of their own business operations, create local value through new shared-ownership models with their communities and stimulate local supply markets.

The deployment of solar through local authority participation, whether as an investor or enabler, can form part of a successful strategy that satisfies these drivers.