We have market-leading experience advising across the full range of options for alternative routes to market for electricity output.
We have unique experience advising on Licence Lite and peer-to-peer (generator to consumer) trading, having advised the pioneers in these two areas (the Greater London Authority and Open Utility, respectively), creating the contract architecture to make these work.
We have also advised on wheeling and sleeving arrangements under framework electricity supply agreements, white labelling, flexible trading and many distributed generation PPAs, as well as merchant and private wire off take agreements and all associated regulatory issues.
Some examples of our alternative routes to market work include:
Greater London Authority, “Licence Lite” (junior electricity supply licensing)
- representing the Greater London Authority on its pioneering application for a licence (Licence Lite) taking advantage of the derogation from the most onerous electricity supply licence conditions;
- this licensing option, first permitted by Ofgem in 2009 but, for predictable reasons, never taken up until the GLA’s application, is intended to allow the the outsourcing of some of the complexity of operating an electricity supply licence and, thereby, lower barriers to entry to new market participants
Acting for the GLA:
- advising on risk and regulation;
- creating the industry agreements needed to operate the regime.
In-depth knowledge of electricity supply licensing, PPAs, conditions of supply and the SSNOA created by us and providing continuity in support throughout the project’s evolution.
Open Utility, “Piclo” (renewable energy peer matching platform)
- Innovative P2P platform for renewable energy
- Electricity supply and demand are matched between renewable generators and consumers on a half hourly basis
- Trial partnering with Good Energy to provide market balancing services
- Consumers include Eden Project in Cornwall
We are advising the innovators, Open Utility, on their market disruptive electricity supply concept, enabling renewable generators to promote their projects and consumers to select tranches of output from their preferred generations sources to construct their own generation portfolio, via an AirBnB-style platform. Lux Nova worked with Open Utility to help design the legal framework for the platform and govern the relationship with commercial partners, including Good Energy.
We have supported Open Utility from their inception, acting in a role more akin to in-house council. Our experience sat on both sides of the table from a fully licensed electricity supplier has enabled us to provide invaluable assistance to negotiating terms with Piclo’s licensed partner.
Lee Valley Heat Network (alternative routes to market)
- an ambitious local authority led new build decentralised energy schemes in the UK, led by the London Borough of Enfield (through its wholly owned subsidiary, Energetik);
- looking to supply electricity to domestic customers plus commercial customers;
- taking power from the North London Waste Authority’s EFW plant at Edmonton in North London, and from dedicated combined heat & power plant at energy centres operated by Energetik..
Advising the Council on various options for accessing market and for improving the value of renewable energy output.
Leveraging expert knowledge of alternative routes to market to deliver an report of permissible options for electricity supply with and without an Electricity Act licence.
The National Trust, Renewables programme (route to market and regulatory options)
Acting for the National Trust in connection with their award winning renewables programme deploying hydro, biomass and solar plant on Trust sites across the UK.
Advising the Trust on various options for accessing market and for improving the value of renewable energy output.
Leveraging expert knowledge of alternative routes to market to deliver an in-depth report, taking into account restrictions within the Electricity Act, trust law and charities law.
Outer Hebrides Energy Service Company (route to market and licensing options)
- Council procured project to tackle local fuel poverty and constrained local renewable electricity generation
- Establishment of a Council and local stakeholder owned ESCO
- Partnering with licensed electricity supplier to provide services
Lux Nova advised the Comhairle (Outer Hebrides Council) on the establishment of a community owned ESCO to deliver cheaper power to local residents, sourced from wind generated power located in the Outer Hebrides. We advised on the legislative framework governing electricity supply, establishing which routes to market were possible for the Council and on the most suitable delivery vehicle, given the various advantages and disadvantages of company and charitable structures (for example Community Interest Companies, Benefit Societies and Charitable Incorporated Organisations). We also advised on the terms of engagement with a licensed supplier partner to procure electricity and deliver services to establish and assist in the running of the ESCO.
With our in-depth experience developing Licence Lite and our knowledge of local electricity supply models operating within a restrictive legislative framework, we were able to guide the Council to the most suitable commercial structure and delivery vehicle.
Eastbourne Borough Council (routes to market)
- Council procured project to examine possible routes to market for local electricity generation
- Examination of suitability of the Licence Lite model
- Examination of possible partnering models
Lux Nova advised Eastbourne Council on the potential for the Council to take advantage of the Licence Lite regime, and become a local electricity supplier. We provided in-depth advice on the potential advantages and disadvantages to the Council, analysing risks and liabilities, together with more practical administrative burdens. We also advised on the most suitable vehicle for delivery of Licence Lite and how the Council might engage a fully licensed electricity supplier to provide services.
With our unparalleled and in-depth experience developing Licence Lite with the GLA, we were able to provide the Council with a fully comprehensive briefing, clearly highlighting the benefits and downsides of a Licence Lite model.