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UK Local Authority engagement with the Energy Service Company (ESCo) model: key characteristics, benefits, limitations and considerations

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    Rights statement: NOTICE: this is the author’s version of a work that was accepted for publication in Energy Policy. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Energy Policy, VOL78, (March 2015) 10.1016/j.enpol.2014.11.016

    Accepted author manuscript, 477 KB, PDF-document

Original languageEnglish
Pages (from-to)198-212
JournalEnergy Policy
Early online date26 Nov 2014
StatePublished - Mar 2015


This paper outlines how some UK Local Authorities (LAs) have opted to engage with the Energy Service Company (ESCo) model in a bid to enhance their influence over local energy system change and help them to deliver on their political ‘public good’ objectives. Three common approaches to LA ESCo model engagement are outlined: 1) LA owned ‘arms-length’ model; 2) private sector owned concession agreement model; and 3) community owned and run model. The LA’s decision to establish its own ESCo, or alternatively enter into a partnership with another, depends on: its willingness to expose itself to risk, the level of strategic control it desires, and the resources it has at its disposal. However, the business case is contingent on the extent to which the national policy and regulatory framework facilitates and obligates LAs to play an active energy governance role. Stronger alignment of local and national energy agendas through communication and coordination between different governance actors could help to remove critical barriers to LA ESCo engagement and their wider energy governance activities.

    Research areas

  • Local Authorities, Energy Service Companies (ESCos) , Local energy governance, Business model

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