A drive by the London Mayor’s office to generate more power from the city’s small electricity providers looks likely to create a spike in investment in combined heat and power technology in the UK capital.
The Mayor, Boris Johnson, has taken the next step to becoming London’s smallest electricity supplier, allowing him to buy power from small generators at a better rate and sell it on to other public bodies, boosting the low carbon economy, and helping to secure London’s future energy supply.
Improving the viability of local energy projects is expected to help unlock more than £300m worth of investment for 22 new heat and power projects already in the pipeline. In the longer term, it could help generate over £8bn of investment and around 850 jobs a year until 2025.
The move is in line with the mayor’s target to produce 25 per cent of London’s energy from local sources by 2025.
London will be the first public authority in the country to receive a brand new type of ‘junior’ electricity licence, and the Mayor expects to be buying and selling power by early 2015. The ground-breaking move will permit him to offer the capital’s small electricity producers up to 30 per cent more for their excess energy than existing suppliers do, which he will then sell on to TfL, the Met and others at cost price.
Twelve boroughs and waste authorities already have schemes which could benefit. Together they are capable of generating around 76 MW of electricity – that’s equivalent to the power used by about 76,000 homes.
These types of schemes primarily heat local buildings through the electricity generating process. For example, Islington’s Bunhill Heat and Power project uses a gas engine as well as heat from the tube to warm hundreds of homes and local swimming baths. Westminster’s Pimlico District Heating Undertaking heats thousands of homes, commercial premises and three schools through two gas engines.
Boris Johnson, said: “Nurturing a new crop of small, low carbon energy producers across the capital is the key to a more secure, cost-effective and sustainable energy supply for us all. Investing in locally sourced power will help keep Londoners’ fuel bills down and drive innovation, jobs and growth in this city’s burgeoning low carbon sector.”