Local government is playing the lead role in developing some of these schemes, particularly heat networks. Part of that role includes taking primary responsibility for stakeholder engagement and coordination, ensuring the best possible outcome for all parties. But the challenge goes beyond simply finding the best methods to engage stakeholders, or the resources to actually engage them. There is also a fundamental ethical challenge.
A local authority developing a local energy project needs to ask how they view the people they hope to supply with energy. For most private sector energy suppliers the answer is simple; they are simply customers. But for a local authority the answer is more complicated. Their potential energy customers are also their actual citizens, voters to whom they made electoral promises, and people to whom they have a duty of care. Whilst there may be overlaps between the notion of citizen and customer, there’s no escaping the fact that they are not the same thing.
Whilst a private company might take the approach of seeking to engage stakeholders to achieve a particular pre-determined goal, the perspective is different for a local authority. The needs of the local population should be the starting point and guiding principle of their engagement, and these go beyond the need for a project to generate a financial return.
Clean energy infrastructure projects will be pursued, or abandoned, for a variety of reasons. However, we know that one of the most significant motivating factors will be the desire to make money. It is clear that the ultimate beneficiaries of projects should be local citizens who get a clean, secure and affordable source of energy, but the debate over the extent to which they benefit, when, and how remains.
Time and again we see local energy projects that have stalled and failed because of poor early engagement. This leads to unnecessary project costs piling up, where the technical and financial investigations hit bumps and roadblocks because there was nowhere near enough consideration of whether this is actually a project that stakeholders want. And ironically, of course, it is those stakeholders who ultimately foot the bill.
One of the most effective ways to engage effectively is through early and open collaboration. In local energy projects this means making fewer assumptions about the likely outcomes of the process, working with citizens to understand their objectives, and genuinely taking them on board.
Take for example the ultimately successful construction of the Bunhill heat network in Islington. The project team had a problem working out how to cross a housing estate. It was only after holding a meeting to consult with residents of the estate that they found a workable and mutually acceptable solution. What was striking was that it was the residents who came up with the answer – one that had not been considered by the engineers or project team.
Treating local stakeholders as citizens and not just as end customers for clean energy is not just the right thing for local authorities to do, it also has a positive practical impact on project development. The consequences of failing to engage stakeholders, or engaging them ineffectively, come with serious costs attached.
Light touch consultation with customers may seem like the simpler option in the short term. But in the end a collaborative approach with citizens is not just the right thing to do, it is the best way to get a project to succeed.
This article first appeared in Public Sector Executive.