The local power plan is a welcome boost to the support available for locally driven, low-carbon energy projects. We’re looking forward to working with Great British Energy and their regional teams to help ensure these initiatives deliver maximum benefits for communities. Read more from our Policy Analyst, Guy Clark, below. 

Much-needed support for community energy – though many details remain to be finalised. 

The Government has announced the Local Power Plan, backed by up to £1bn of funding from Great British Energy between now until 2028/29. This funding will support the delivery of locally-owned, low-carbon community energy schemes of various forms. The ESA wholeheartedly supports the government’s vision for community energy. Large-scale infrastructure updates are essential, but community energy projects can tackle the climate crisis and the cost-of-living crisis in ways that are far more tangible and immediate. In handing power back to ordinary people, they advance the energy transition by ensuring its benefits are widely felt and understood. The ESA looks forward to helping policymakers put further detail on the initial plan announced today.

 

The Headlines

1. Direct funding and finance. The Great British Energy Community Fund (for community energy groups) and The Partnership Fund (for local authorities in partnership with such groups) will be set up to administer grant funding. GBE will also provide loans for construction and operation costs and direct investment in viable schemes.

 

2. Capacity building. GBE acknowledges that skills and knowledge gaps can prevent communities getting through the complex process of setting up energy schemes. It therefore aims to provide expert personnel to assist potential schemes, create a Community Energy In A Box toolkit of standardised guidance documents, and build partnerships with developers, DNOs and NESO to facilitate the smooth construction and integration of new community projects. 

 

3. Crowding in wider investment by developing the sector as a whole. The plan sensibly focuses on creating the conditions for successful community energy projects far beyond the scope of its initial investment. It will seek out best practices in the sector and use them to develop innovative financial products and business models. These can then be used as templates for future projects, increasing investor confidence and growing the sector. One part of this will be the Local Energy Platform, an “end-to-end business solution” for local energy projects, though this is still in development. GBE will also build models for Smart Local Energy Systems where multiple technology types – such as solar and smart storage batteries – can work together to deliver local benefits.

 

Meanwhile, DESNZ will be providing the fourth type of support included in the plan:

 

4. Policy & regulatory reform. DESNZ will collect evidence on how community energy projects are presently disadvantaged by current market arrangements and seek to remove barriers to participation. This includes recent work on Balancing Settlement Code modifications, developing PPA arrangements for community energy schemes and public buildings, improving incentives for suppliers to work with such schemes and exploring tailored ways to speed up the grid connection process for them.

 

The News for Energy Storage

The Plan as a whole is somewhat light on detail. Much evidence remains to be gathered, and specific grant mechanisms remain to be published, meaning implementation may be some time coming. Energy storage is no different.

 

A call for evidence is coming in 2026 to assess the role of community batteries in the energy transition, and the ESA will be working closely with policymakers to make sure their transformative impact is fully realised. Further down the line, a consultation is also proposed on how best to implement Smart Local Energy Systems once GBE’s pilot schemes have been reviewed.

 

The Plan, however, does explicitly aim to boost the rollout of community battery schemes and enable their participation in flexibility markets, alongside the provision of bill savings. DESNZ’s championing of Balancing Settlement Code modification P441, on the Creation of Complex Site classes, will certainly help advance that aim.

 

The Plan also highlights the success of early community battery schemes. Project Girona, Northern Ireland’s first smart grid with combined solar panels and smart batteries, saved users on average £450 per household on annual energy bills and a combined total 40 tonnes of CO2 a year. A community battery project at Odet Court, Cardiff, generated over £600 annual savings per flat and saw a 60-70% reduction in grid energy use. 

 

Across the board, from domestic usage to utility scale developments, the same principle holds true: integrating generation and storage is the way to reap the maximum benefits of the energy transition. Replicating this approach in the locally-owned energy sector is great news for communities and the climate.

11th February 2026