Energy secretary Chris Huhne has told councils across Britain that they will be able to sell renewable electricity to the grid from next week.
Only 0.01% of electricity in England is currently generated by local authority-owned renewables, despite the scope that exists to install projects on their land and buildings. In Germany, the equivalent figure is 100 times higher.
At present, local authorities are able to put any renewable electricity they generate to local use, and to benefit from the associated feed in tariff for projects smaller than 5MW.But they are restricted from selling any excess renewable electricity into the grid by a 1989 amendment to the Local Government Act 1976, which was put in place at the time of electricity privatisation to ensure the transfer of the electricity industry to the private sector.
But that ban will end on 18 August, which the government claims could mean up to £200m a year in income for local authorities across England and Wales.
Mr Huhne said: “For too long, Whitehall’s dogmatic reliance on ‘big’ energy has stood in the way of the vast potential role of local authorities in the UK’s green energy revolution.
“Forward thinking local authorities have been quietly getting on with it, but against the odds, their efforts frustrated by the law. I’ve taken the early step of overturning the ban on local authorities selling renewable electricity to the grid.I’ve today written to all councils urging them to take advantage and lead a local energy revolution.
“This is a vital step to making community renewable projects commercially viable, to bring in long-term income to benefit local areas, and to secure local acceptance for low carbon energy projects.”