The UK Government launched its Local Power Plan in February – ‘the biggest public investment in community-owned energy in British history’.[1] In this article, Brevia Energy takes a look at the Local Power Plan, the challenges faced by the Government in its delivery, next steps, and why these developments matter for industry stakeholders.
What is the Local Power Plan?
The Government has set aside up to £1billion of funding from Great British Energy (GBE) to support local and community energy projects. This funding will be deployed through:
- Grants for local authorities and community groups to develop early-stage proposals.
- Loans to support the construction of community projects and for the purchase of stakes in larger renewable projects.
- A new Local Investment Fund, directly investing in viable projects.
Funding will be targeted to underserved parts of the country, with the goal of every community having the opportunity to own its energy and build local wealth. This cements the expectation for developers to demonstrate local economic impact and social value as part of their project proposition. GBE will also supply expert guidance to support communities in project development. This is intended to reduce resource barriers that have historically held back community schemes.
Community schemes are also to benefit from wider reforms to planning and grid connections. The Government is exploring the deployment of existing powers from the 2015 Infrastructure Act to require developers to offer shared ownership to local communities. This would have direct implications for project structuring and stakeholder engagement strategies for developers, as community participation becomes an expected component of development.
Challenges the Government Faces
The Conservative Party has argued that the Local Power Plan neglects to address affordability, failing to reduce wholesale electricity prices or address grid connection backlogs. The Party has also suggested that the £1 billion investment lacks clear value-for-money and will only deliver marginal savings for a small number of buildings, while families continue to face high bills.[2] The broader role of GBE has also been brought into question, being labelled as an expensive new state body that duplicates existing institutions, rather than materially reducing underlying electricity costs and prioritising large-scale generation.[3] A key challenge for the Government is to demonstrate that this public financing will produce measurable reductions in system-wide electricity costs and make a structural market impact, or otherwise risk losing public support in the clean energy transition.
Securing public buy-in is crucial for the delivery of the Local Power Plan. However, it is also proving increasingly difficult for the Government to maintain. With the rise of Reform, there is mountinontossure move away from the Clean Power 2030 target. There are growing questions around whether public support for the clean energy transition can endure as additional costs, such as the Nuclear Regulated Asset base, are layered onto consumer bills. Nonetheless, Bill Esterson MP, Chair of the Energy Security and Net Zero Committee, has highlighted the potential for community energy projects to reduce bills and improve public confidence in the clean energy transition.[4]
Next Steps
Going forward, the Local Power Plan is designed to move quickly from ambition to delivery. GBE is expected to launch its full Local Product Portfolio come autumn this year. GBE is also anticipated to begin its Local Product Sprint soon. And, by Springtime, the Government is expected to publish a shared-ownership template and guidance. At the same time, GBE will announce its first partnership agreements and launch the initial grant schemes. By summer, a series of pilot projects will be underway, demonstrating the new GBE Local products in a real-world setting.
For industry, this programme signals a clear change in how the Government is approaching the energy transition. For all projects, the key will be to demonstrate how local communities are being brought along as part of the energy transition towards Clean Power 2030.
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[1] Great British Energy and Department for Energy Security and Net Zero, Local Power Plan, 9 February 2026, Link.
[2] UK Parliament, Local Power Plan, 10 February 2026, Link.
[3] UK Parliament, Local Power Plan, 10 February 2026, Link.
[4] UK Parliament, Local Power Plan, 10 February 2026, Link.
