About Nesta

Nesta is an innovation foundation. For us, innovation means turning bold ideas into reality and changing lives for the better. We use our expertise, skills and funding in areas where there are big challenges facing society.

Local energy economies; where infrastructure fails, innovation succeeds

In the highlands and islands of Scotland grid constraints have become an opportunity for innovation in local energy generation, supply and even demand. Unlike the rest of the UK, many communities in the remoter parts of Scotland have been left with inadequate grid connections and a few are even off grid entirely. Plans to strengthen existing connections or create new ones are costly and time consuming.

Luckily for many of these places renewable generation from wind, tidal or hydro power is plentiful. When the wind is blowing turbines can produce more than enough energy to meet local demands but their intermittent nature leaves communities reliant on the grid. Grid constraints not only affect incoming capacity but also the amount of electricity that can be sold back to the grid when generation is high. The result- up to 20% of generation can be lost completely. But rather than a barrier this has become an opportunity. Communities in places like Orkney are having to rethink how they better use of this extra generation locally.

At the All-Energy conference in Glasgow last week a number of Local Energy Scotland funded projects were presented as part of the Local Energy Economies session. Of the 6 innovative projects the ‘Surf and Turf’ scheme in Orkney is one of the most interesting and adventurous.

On the islands of Orkney energy is generated from tidal and wind turbines which at times of peak generation have much greater capacity than is needed. Grid constraints prevent much of this being sold back to the grid which in turn has limited the development of further renewable projects. With the Local Energy Scotland grant hydrogen storage was trialed to balance supply and demand but the Orkney Islands Council still had to look beyond domestic energy consumption to make full use of the extra capacity. A clear target was the islands  expensive diesel burning ferries. Using the grant funding these will be converted to run on electrical power and a hydrogen powered ferry is being trialed. The electricity will also be used to power operations at the harbour which will dramatically reduce its running costs. Sitting in the background and managing all this in real time is a smart grid which has help open up an estimated extra £20 million of further investment in renewable projects and private sector initiatives . A number of new renewable projects are now in the planning stages and the Edinburgh Centre for Carbon Innovation (ECCI) are working with Orkney Islands Council to take this project further and eventually electrify all vehicles on the island.

Managing demand

But it’s not just generation and supply that has to change, reducing demand is a key challenge. We tend to focus on meeting increasing demand with greater generation and better supply but this isn’t sustainable in the long run.  The Island of Eigg has a stand alone grid with 90% of the island’s energy generated by hydro, wind and solar resources (along with a flow battery bank and diesel generators as back up). To keep the costs of the projects down and ensure these resources still meet local needs the Eigg community made a collective decision to restrict electricity use to 5KW per household (and 10KW per business). There is an onus on personal energy management supported by smart meters and if a household goes over its limit they are automatically switched off from the supply and have to be reconnected manually.

Perhaps this is a bit of a blunt approach but it is encouraging to see a community exploring ways to manage its demand. While this kind of approach might not be possible on a national level, it highlights one of the benefits of moving towards a more decentralised system where local generation, supply and demand can be managed in sync and community engagement provides a powerful way to change behaviours. Nesta is exploring this further by looking at the potential and feasibility of moving more towards a decentralised energy system and within a local energy economy the benefits of community projects.  



Harry Armstrong

Harry Armstrong

Harry Armstrong

Head of Technology Futures

Harry led Nesta’s futures and emerging technology work.

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