Season 3, Episode 10 – Game Changers: The Case for Community Energy and Smarter Grid Connections

Lorraine Johnston:

Hello and welcome to ESG Matters @ Ashurst. I'm Lorraine Johnston, an Ashurst partner specialising in sustainable finance. You're listening to Season 3 of Game Changers, from innovators at the cutting edge of technology to impact investors funding a cleaner energy future. Each and every one of our guests is changing the game in their field.

In today's episode, you'll hear our conversation with Claire Reid, the director of Strategic Partnerships at SNRG, a company on a mission to create the UK's premier next-gen infrastructure by designing, funding, and operating smarter grid connections. With more than 20 years' experience in energy generation, Claire is responsible for microgrid's growth in the UK residential sector. Let's jump in and hear the discussion.

It's very lovely to meet you. I guess where I wanted to start was just a little about you, about your background. So, you've got over 20 years in energy generation. So, what first drew you to the industry? And also, what was your journey in terms of operating with renewables?

Claire Reid:

Thank you for having me, Lorraine. It's a pleasure to be here with you. I grew up in a region of the UK where people had to choose between heating their homes or feeding their families. And I thought, "That cannot be okay. We're in one of the richest countries in the world. Why do we have fuel poverty?"

Mid-university, I used my gap year to join one of the top energy companies known as SWEB at the time, it's now EDF Energy, and learn about the various fossil fuels that were prominent in the late 1990s and how they were transmitted, distributed, used. So, when I finished my studies, I had an invitation to return and continue at the EDF Group, and that's where I carried on exploring energy efficiency and technologies. It was like all my science classes at school combined. And then my curiosity and with their investment, I moved into the world of nuclear power.

Nuclear is not a fossil fuel, but it's significant and it's powerful, it's exciting. And at the time, it was a new technology for me. In fact, I still have a piece of uranium from Sizewell B in Dorset home. It wasn't long before I moved myself to London and quite often commuted to Paris, where I learned more about sustainability and energy's role in this.

In actual fact, I entered a competition with 4,000 others to design a smart home, and it won me the opportunity to join the Beijing Olympics in 2008. And the objective was, how could we make, four years later, London 2012 even more energy efficient and even more sustainable? That's when I realised that energy crossed many different industries and it influenced people's day-to-day lives, even in sport.

Interestingly, when I was in Beijing, the Chinese government switched off thousands of their factories, steel mills, coal-fired plants, all to make the city look better, remove its very visible layer of smog. And they switched those off during the entirety of the Olympics. But through that, discovered how significant, how much damage there was to the air quality. And it changed China forever. And they now continue to shut down their factories and lead the world into renewable technologies. And it was because of that global leadership that coal has, last year, for the first time, stopped its rapid surge. And whilst we enjoy that plateaued growth, we in the UK are now proud to evidence how greenhouse gases have hit levels that we haven't seen since the 1800s, and that's due to the removal of coal. And I'm a big part of that.

And in 2013, I moved to British Gas, which is now part of the Centrica group, and I found myself back in that world of heat-and-eat customers, and it was a reminder of why I joined. So, combining my experience in China and the new technologies that were coming through thick and fast, Centrica group invested in an innovations team, which I joined and led. And some of your listeners may be familiar with Hive and Mixergy. They were born out of the Centrica group. And that was when my focus shifted away from fossil fuels and from nuclear onto how can I be part of this great transition to a world of renewable energy.

And then in 2003, I joined renewable world through the company of SNRG, spelled S-N-R-G, who are all about enabling communities to generate their own green energy. And that's through renewable sources such as solar, wind, heat pumps.

I really believe that customers choosing between heating their homes or eating will one day not exist, and those customers will be given tools such as solar panels generate their own energy. It's here, it's free, and it's all around us.

Lorraine Johnston:

That's an amazing journey, isn't it? And very sort of definitive moments that have taken you from each particular organisation and each particular role. So, you're now at SNRG, S-N-R-G. Can you tell us a little bit more about what they do? The SNRG microgrid is described as a communal energy system that can integrate dozens, hundreds, and even thousands of homes in a single location. But could you possibly walk us through how that works in practice?

Claire Reid:

Yes, of course. Perhaps I'll start with explaining what a microgrid is. So, imagine you're building a new community for, let's say, 300 new homes and a school. And to comply with Future Homes Standards, you're going to put solar panels on each of those homes. And some of those houses, some of those homes will have really big roofs and they'll be facing south, and they will be generating huge amounts of energy. And with solar energy, unless you use it straight away, you lose it. And then, within that community, you may have some homes that are being built next to trees, so they've got lots of shading, and/or facing north. So, they'll generate probably 50% less energy than that big south-facing roof. And then you may have some apartments within that same community, and they're sharing that one single roof between 12 different families.

So, when you build a community and each home has its own solar and it's generating for itself, there will be homes that are just throwing energy away and there'll be homes that aren't generating enough to do more than switch on a kettle. And if you join all of those homes to a microgrid, everything that's generated is effectively put into a pool. And every single home on that microgrid has equal access to everything that's in that pool. So, those 12 families living under that one roof are no longer constrained by the size of their roof. They've now got access to what 300 homes have generated. And that home that was generating so much energy that even with all of the windows open, the heating on, the hot water on constant, and every electrical appliance, including its electrical vehicles, being charged, still wasn't able to use everything that was generated, instead of throwing that energy away, that's now being used by the people living in the houses that were facing north and slightly shaded. So, it becomes fair, and it becomes community.

The other piece that makes this microgrid so effective is a battery. So, there will be a communal battery located somewhere on that site, normally up near a substation, so out of view. And anything that's not used, especially in the summer months, will be stored in that battery. So, even when the sun goes down and those solar panels have stopped generating energy, there's a huge battery in the corner of that community that's filled to the top with solar energy. So those homes continue to use that solar energy, that renewable green energy.

Of course, every home is still connected to a meter, so you are only paying for what you're actually using. But the benefits here are the people living in that community will own the solar panels. The developers who will, at some point, be mandated to use renewables, they won't have to fund those renewables because SNRG will fund that. SNRG will fund the solar. SNRG will fund the communal battery. And SNRG will maintain those as well. That means your housebuilders will meet with current building regulations and that they'll be ready for the Future Homes Standard.

And because those residents aren't needing to use so much grid energy, grid capacity requirement is reduced, and that helps projects that are blocked from starting. It enables them to move forward. There's a garden town called Otterpool in Kent. And a garden town is typically a lot of houses, a lot of commercial. And this particular garden town plans to build 8,500 homes. If they were to all be built on our microgrid, those homeowners are estimated to save 100 million pounds every 30 years in their energy bills.

Lorraine Johnston:

That's incredible.

Claire Reid:

Yeah. And that's because they're using solar energy. Not only are SNRG funding this, so that takes the cost off of the housebuilders, we work that out to be, calculated that to be 34 megawatts of solar and 20 megawatts of communal battery. But the council will receive 60 pound a year for every single home that's connected in perpetuity. That's half a million that they can choose to build more community centres or employ more people into the council. And that is a real example of... a demonstration of where green renewable energy isn't just about reducing carbon and it's not just about making energy more affordable or removing the capital costs and operating costs that these developers are going to have to find, but it's also about creating a revenue generator for communities, and in this case, for the council.

Lorraine Johnston:

This sounds like an absolute no-brainer for every possible stakeholder. Presumably, there are some challenges. We know that there's some challenges in the system. We know that grid constraints can cause severe delays for commercial and residential projects, particularly here in the UK. You've mentioned briefly, but how does the SNRG microgrid overcome those types of bottlenecks

Claire Reid:

Yes, grid constraints are causing severe delays. And we have a government mandate to deliver 1.5 million new homes in the UK by 2030. Yet, you can't build homes without electricity. And right now, the National Grid cannot provide enough electricity for 1.5 million new homes.

I always think back to when the National Grid was built in the 1920s. I think it was 1926 where they first switched on their first element of that National Grid. And it was absolutely fantastic until 1950 when all of a sudden there were so many homes connected to the National Grid, the National Grid just could not cope. So, they had to upgrade the National Grid, and it took them 12 years to do that. And we're here again now in 2026. I can't believe we're in 2026. And we're here again now in 2026. And we're having to go through that exercise again because we just cannot meet these 1.5 million new homes growth on our existing network. So, we're repeating what we did back in the 1950s. We're having to improve the National Grid. And it could take 12 years. I hope, with technology and AI, that it won't take that long, but it could.

So, we need to find a solution now to get around those grid constraints, to enable people to build homes and businesses, and people want to. So, the microgrid, by bringing in renewable technologies to site, instead of businesses and homes having to rely purely on National Grid-provided energy, they're able now, through solar, through wind, through heat pumps, they're able to harness energy from the sun or from the wind or from the ground for immediate use. And through the technologies of battery storage, they're also able to store that energy. So, what that means is, the demand from those new communities, from those new builds from the grid is a lot less because they've now got blended renewable energy.

And then what makes our microgrid smart, and we internally refer to it as a SmartGrid, is the software we use which can see how much solar energy is available at any time, any one time, and what is actually going to be required from those new homes at any one time. And then we're able to balance the peaks and troughs of energy consumption. And by proving that, we're able to demonstrate that... or we are able to show DNOs that actually we need less energy from the grid at particular sites, and therefore, we can build more houses.

It can actually work both ways. We have a factory in Oxford. They were told that they could only fill half of their roof space with a conventional solar system because the DNO, distribution network operator, had placed an export limit of 137 kilowatts on its existing connection. Again, the microgrid has really cool tech and it uses import and export controls and a hybrid solar inverter. And by using that, we were able to enable this factory to cover its entire roof in solar. Actually, it was 302-kilowatt peak of solar and 100 kilowatt battery. And all of that happened without any grid reinforcements, without any works required of the DNO.

And naturally, from the customer's point of view, and they really, really care about carbon, not only do they save 18% off their energy bills a year... And you can imagine, for a factory, an operational factory, energy bills are huge. So, they've saved 18% off energy bills. 41% of the electricity that they use in that factory comes from the solar system, so not from the grid. And they have calculated, 39 tons of carbon a year have been saved. I always get asked, "What does that actually mean?" And living in London, I talk about the red London buses. Hopefully you've been on a red London bus. But if you fill two of those red London buses with carbon, that's about a ton, that would weigh about a ton of carbon. So, 39 tons is actually 78 London buses removed off of the road.

Lorraine Johnston:

I'll be honest, I love to hear about these real-world use cases, and particularly moving from residential to industrial. We obviously have the government's Clean Energy Industries Sector Plan, which aims to double annual investment to over 30 billion by 2035. It would seem natural that there's a fit between SNRG's platform and that vision. How do you see those two working in partnership?

Claire Reid:

Oh, yes. This plan promotes and acknowledges the necessity for decentralised community-led energy projects, and especially those that are supporting the net-zero goal. In fact, a 5 million grant funding pot was put aside last year moving into this year to help push forward clean energy initiatives, which is exactly what a microgrid like ours provides, using solar and battery, connecting heat pumps, connecting electric vehicles, and then managing that energy demand.

I keep giving a good example of this, one of my most favourite projects to date in the residential world. We worked with a local community trust. And there, they built 12 new homes. It wasn't a huge site, 12 new homes. They built a community centre. They built an electric vehicle car hub. And they built all of this on our microgrid.

And within that area, they also had a football stadium. And that football stadium already had solar. It was one of the first users of solar that I've come across. But of course, that solar energy was only ever being used when football games were being played. So 73% of what was being generated was just being thrown away, given back to the grid. So we connected that stadium into the microgrid when we built the houses and the community centre. And that energy that was being wasted, lost, is now being used by that community centre and by those homes.

Now they also have solar on their rooftops because we wanted to make it as green as possible, but that project won awards. It has 6 to 8 kilowatts on its roofs. It's linked to the 50 kilowatts on the football stadium. And that whole community is now part of a shared energy pool. So the entire community, this whole new community, are operating off of renewable energy. Their bills are so affordable, and their carbon footprint is just so significantly reduced.

They also, however, as through this community trust, set up... They chose, they wanted to set up, again, an opportunity to generate revenues so that they could, over time, build up enough to start another community exactly the same as that one and build another community, invest it in the local school, in their local church. This is what green energy funds, investments like this will enable to be built.

There's also, within that plan, the Connections Accelerator. So we just talked about grid constraints. They are so real right now. And what they mean are people aren't able to build when they want to build. They're pushing back their delivery plans. Some projects are delayed by 10 years just because of these grid constraints. So, if projects are planning to use a microgrid such as ours, they will now benefit through this plan from things like the Connections Accelerator. They'll be prioritised for grid access because they're using renewable energy.

With Otterpool, the big 8,500 garden town I mentioned earlier, we are discussing with the councils there about using a solar farm to provide electricity for a significant number of homes on that site. This plan also acknowledges big initiatives like that, and they will help speed up approvals for these type of initiatives because they're forming part of a decentralised energy system.

Lorraine Johnston:

It sounds as if SNRG could be right at the heart of the future of an electrified Britain. And so, I guess, looking forward, looking perhaps, I say, to 2050, it's not actually that far away, is it, it's 24 years, what most excites you about the role that SNRG could play in that future? Where do you see this going over the next 25 years?

Claire Reid:

Can probably tell by the smile on my face, I'm very excited about this. Of course, if we look back in the 19th century, we had coal. In the 20th century, we had oil. And the 21st century is all about electrification. So, if I close my eyes, I imagine walking outside in a world where energy is silent and the air is clean, and... I don't know, Lorraine, if you remember, before smoking was banned in restaurants and pubs, you just didn't realise how bad it was and-

Lorraine Johnston:

Stinky.

Claire Reid:

Oh. And it wasn't until it was banned and it was removed. Now, if someone was to light up a cigarette in a restaurant, you'd be appalled by it. It would be horrific. You imagine all the petrol and diesel being removed from the roads. And right now, you don't realise how bad that smells and the noises that makes. You imagine that world where it's just electric. There are no smells. There are no noises. I do hear people when I talk about heat pumps talk about how loud is the whirring noise off of a heat pump. And I think that's just so insignificant to the noises that you just don't hear around you today. So, that's my... if I close my eyes, that's how beautiful the world could be when it's operating from a 2050 world.

Lorraine Johnston:

It sounds incredible. I guess, in order to get to that vision, there is an element of a change in human behaviour, and there is still this idea that green energy is more expensive, despite the fact that we've got IRENA's latest report that shows that 91% of renewable power projects in 2024 were cheaper than new fossil fuel alternatives. What do you think needs to happen at a human level to shift that perception and to move towards that vision of 2050 that you've set out so beautifully?

Claire Reid:

Thank you. IRENA is a fantastic source. At the Open University, we promote IRENA because it's a good fair source. I'm really grateful to be able to talk to that. There will certainly be political influence that needs to be dampened. The petrostates' wealth are reliant on us, on the need to extract and export fossil fuels, and we and other countries are currently dependent on those fossil fuels. So we do need to put up with some of those requests that come from outside of the UK, and some of those we'd rather avoid. It would be nice to be in a position to not have to, and that's what we and other countries are setting out to do through energy independence. That's what I mean by energy independence. But those petrostates will, for their own needs, continue to promote fossil fuels over green energy. And that's where we need our listeners and people to start looking at IRENA's information and data and understand themselves the alternatives and what they really mean.
Many will still think of renewables as an add-on to a fossil-fuelled infrastructure rather than its own energy source and will, in turn, see it as extra cost rather than an alternative cost. That needs to change. And I feel that's partly my responsibility to educate people in that knowledge, that information. And people fear change and they'd rather ignore it than understand it. And that's where things like the Future Homes Standard, which will force the use of renewables, really help push that forward. People will have to start understanding it and using it.

Also, often, equivalent costs aren't looked at. So, if you look at the upfront cost of an electric car, just to bring it back to the everyday, if you look at the upfront cost of electric car, it's seen as expensive. If you purchase a petrol car today, run that for 10 years, add on the service, the MOT, depreciation, fuel costs, it's a hell of a lot more expensive, let alone the future health expense that is incurred as a result of the carbon that's being released around the next generation's lungs.

Is it cheaper to build a gas power plant than a wind farm up front? Yes, but then you're required to buy gas for the next 30 years to run it. And if another country should decide to put up the gas prices? The energy crisis, 2021 to 2025, cost our economy an estimated 183 billion pounds in extra energy and fuel costs. That was a cost to the UK Treasury of around 55 billion and additional cost to our businesses, because the energy costs went up, of 65 billion. That's 120 billion UK pounds, Great British pounds. An installed, installed heat pump costs an average of 10,000 pounds installed. That 120 billion pounds would have enabled 12 million homes to be kitted out of heat pumps. Or imagine how many wind farms we could build for 120 billion. I can tell you it'd be enough gigawatts to power up to 40 million homes in the UK.

Lorraine Johnston:

Claire, these are staggering statistics. But thank you so much for setting out such clarity and with such vision what we could be working towards. If everyone saw this same future as you do. It's been an absolute delight to speak to you. Thank you so much for your insights and telling us more about SNRG. It really has changed how I look at what we need to be doing for 2050. So, thank you so much.

Claire Reid:

Thank you, Lorraine, so much for having me. And thank you to Ashurst for making this possible. Thank you very much.

Lorraine Johnston:

Thank you for listening to this episode of ESG Matters @ Ashurst. I hope you found this episode insightful. To subscribe to future episodes of Game Changers and to hear previous episodes, click on the link in the show notes or search ESG Matters @ Ashurst on Apple Podcasts, Spotify, or wherever you get your podcasts. And while you're there, please feel free to leave a rating or a review. And finally, to learn more about all Ashurst podcasts, visit ashurst.com/podcasts. In the meantime, thanks again for listening and goodbye for now.