Sustainable energy for businesses and communities

Energy regulator Ofgem’s recent update means that from 1 October the energy price cap will be set at an annual level of £1,923 for a dual fuel household paying by direct debit based on typical consumption, reflecting recent falls in wholesale energy prices.

While the price cap has dropped from last winter’s peak, it remains well above the pre-2021 average and many people will still find such high bills difficult to pay, says Ofgem. Gas remains a significant component of the energy price and increased use of costly imported liquified natural gas means that electricity prices are unlikely to return to historic levels any time soon.

Like households, businesses would be sensible to keep on reviewing their energy use, both for heating and process heat but also their electrical usage. Rooftop solar is one means available to all businesses, small and large to lower those bills, as well as to reduce their carbon footprint. Climate Change continues apace, whatever the state of the economy, yet investment remains a challenge for companies in these times of economic hardship.

Community funded energy is one alternative for funding, construction and energy supply for smaller businesses that can pay for energy supply but struggle to pay for the up-front investment required to build large-scale solar assets.

Community Energy England represents over 90 organisations creating distributed generation for communities, social organisations and businesses. Most are businesses funded by private individuals that operate on a for-profit basis but distribute their profits for community benefit after covering operational and funding costs.

Within Kent, there are two such organisations, Orchard Community Energy and Kent Community Energy that own and build community funded large-scale and rooftop solar, both for community benefit and for businesses. The former works within the Swale and Medway area; the latter throughout the rest of Kent.

Orchard Community Energy owns a 5MW solar array near Sittingbourne and also owns a 158kW rooftop solar system that it installed for a local business, The Cook Classic Kitchen in 2021. Orchard procured and installed the rooftop system and sells to its client on a long-term power purchase agreement. Negotiation was done on a very transparent basis as Orchard is a community organisation, dedicated to ethical and client-beneficial activity.

Installation was performed by highly qualified sub-contractors under the project management of Orchard. Cook did not have to involve itself in technical specification or technology selection. The new asset will provide economic benefits for more than 20 years. Orchard manages operations and maintenance through sub-contractors. Cook did not have to invest any up-front capital.

The plant was installed before the recent price rise and Cook has therefore benefited from lower priced energy and price stability. Beyond that however, the installation has burnished Cook’s carbon credentials and brings a material contribution to their brand values and CSR agenda.

Both Orchard and Kent Community Energy are alternatives in the Kent area for SMEs seeking to install rooftop solar but lacking either the financial resources or the technical expertise to do so. Both are Community Benefit Societies that dedicate all profits to sustainable causes and are committed to ethical sourcing of equipment and transactional standards.

To proceed, the client’s roof needs to be in good condition and the installation needs to be permitted in any lease documentation. Businesses in Swale and Medway and throughout Kent would do well to consider these options as one way of reducing their carbon footprint and fixing much of their electrical energy costs without having to pay for it upfront or the need to become solar experts.

This is a guest blog which contains the views of the author and does not necessarily represent the views of the IoD. 

About the author

Michael Bax

IoD Kent, Sustainability and Innovation Ambassador

Michael Bax is the Ambassador for Sustainability and Innovation for IoD Kent. He also works with the IoD National Sustainability Special Interest Group. He has had a long career in international renewables power development, acquiring and managing large-scale renewable assets in the USA, Caribbean and Latin America. He currently is also a Director of Kent Community Energy and Trustee of the CT5 Forum, a Kent-based local government forum. He runs an advisory business providing financial advisory and consultancy services to renewable and sustainable businesses both in the UK and overseas.

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