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Here’s why London’s next mayor should set up a municipal energy supply company

The next mayor of London could make up for slow progress on climate change under Boris, and keep energy costs at Transport for London (TfL) down at the same time, by setting up an energy company. A publicly owned alternative to the “Big 6”, following in the footsteps of companies established by Bristol and Nottingham, could also sell low and zero carbon electricity directly to Londoners.

The mayor is currently in the process of developing a junior electricity supply licence operation, known as Licence Lite. This will allow the Greater London Authority to procure electricity from decentralised energy generators in the city, and sell this output on to TFL.

But my proposal would go beyond License Lite and instead establish a fully licensed not-for-profit energy supply business. This would manage TfL’s significant and growing electricity requirements, and extend supply services to London’s homes and businesses.

There are good reasons for doing this. For one thing, London has to reduce its overall energy use. London’s population is currently rising by 100,000 each year. Careful planning is needed to meet the energy needs of these people, keeping homes warm and supporting the economy, whilst at the same time accelerating carbon cuts.

Since 2008 London’s total emissions have been cut by 11 per cent – but that’s short of the 17 per cent required by now, and means the city has emitted 15m tonnes more CO2 than predicted in the mayor’s original strategy.

And a recent London Assembly Committee report on the long term challenges for sustainable growth in London found that only the “low demand” scenario in the mayor’s London Energy plan could meet the 2025 and 2050 carbon reduction targets.

We need to find savings, too. New information shows that, within five years, TfL’s electricity costs are expected to rise sharply, by almost £50m. As an organisation, TfL is currently the single biggest consumer of electricity in London and one of the top 10 electricity consumers in the UK. But it is lagging seriously behind on generating onsite renewables.

There are a number of explanations for these forecast increases: the expansion of TfL’s existing underground network, a greater frequency of trains (including the introduction of the night tube), increased cooling requirements for new trains and stations to combat urban heat island effect, and significantly the start of major new Crossrail services.

Crossrail 1 represents a missed opportunity for deploying solar and other zero carbon electricity technology. I’ve obtained information from TfL about their plans – and there is little evidence of technologies like solar panels being incorporated into station roofs, platforms or along the open sections of Crossrail’s 118km of rail tracks.

This is not altogether surprising. TfL’s 2009 Environment Report highlighted that just 0.03% of TfL’s renewable electricity was generated onsite. Worse, the proportion has not changed over the past five years, with TfL reporting that it only has a total of 11 solar PV arrays installed across its estate, with an installed capacity of circa 250kW – less than the capacity on the London Olympic car park.


This is extremely disappointing, given TfL’s 300 locations across its 5,700 acre estate. It has only now committed to examining the potential for Solar across their existing buildings roof spaces including car parks.  Following on from an innovative study conducted by Network Rail, TfL have stated they will examine the potential for trackside Solar installations.

A fully licensed energy supply company would go much further than License Lite and give the mayor the ability to sell electricity directly to the public and to businesses. It’d give the mayor additional powers to deliver energy efficiency retrofit and insulation services, too, to help London homes and business reduce costs and carbon emission.

And it won’t even be expensive: when Bristol City and Nottingham City set-up municipal energy companies, costs were between £1m and £1.5m.

I’ve been bringing these ideas to Boris Johnson’s attention, but he has lacked the vision to take them up. It will fall to the next mayor to take forward the ideas.

Baroness Jones of Moulsecoomb is a member of the Green party and of the London Assembly. 
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