Following on from a discussion about innovation in community energy at this year’s CARES Conference, Alex Schlicke from Scene Connect, tells us more about proposed changes to the electricity industry.

We’re often asked how communities can generate and supply energy directly within their community to create more community benefit and reduce energy costs for community members. The Scottish Government’s Community and Renewable Energy Scheme (CARES) first supported a feasibility study in Coigach back in 2016 to investigate this issue. However, the conclusion at the time was that there were insurmountable technical and regulatory barriers to supplying locally generated energy directly to the community.

Now a change to the Balancing and Settlement Codes, part of the procedures that govern the electricity industry, could be about to unlock one of the biggest opportunities in community energy for years.

This is a complex area, but Alex Schlicke, from community energy specialists Scene Connect, explains the planned modification.


In 2016, the community in Coigach in the North West Highlands had recently installed its own refurbished wind turbine and hydro scheme, but the income from the sale of community owned electricity to the Supplier was less than one third of the cost that local community members were paying to buy their electricity from the Supplier.

Coigach Community Development Company secured a grant from CARES and appointed local community energy specialists Scene Connect to investigate options for a local energy system to supply power locally. The conclusion of the feasibility study was that technical and regulatory barriers prevented any viable approach to net metering across the community. Since that time, Scene has worked with community organisations in Huntly (2019-2021) and Carluke (2021-ongoing) on local energy systems, but due to the same regulatory barriers, neither of these innovation projects have been able to progress beyond the demonstrator phase.

That could be about to change with a Modification to the Balancing and Settlement Codes (BSC), part of the formal procedures that govern the electricity industry. Modification P441 ‘Complex Site Classes’ is at a relatively advanced stage, with the Draft Legal Text having been published as the culmination of a series of workgroup meetings. Following any changes, the workgroup will finalise its Report and it will pass to an Industry Panel for consideration, and if approved it would then be implemented. This whole process could be complete by the start of April 2024.

So, what is a ‘Complex Site’, and why is the introduction of a new class of site of particular interest for community energy? Let’s take an existing example of a Complex Site, such as an airport, which has a primary substation which connects it to the 11kV low-voltage electricity network. It might have solar panels at various locations across the site and will have multiple meter points to supply power to different locations. In basic terms, the ‘Complex Site’ arrangement defines when the amount of energy exported can be netted off from the amount of energy imported, aggregated across multiple meter points.

Modification P441 proposes the introduction of a new Class which would allow approval of “non-standard” complex sites. These are being specifically configured to enable a net metering approach to be applied in a community setting. So how would it work?

A diagram with primary substation at the top, two substations underneath, and under those are complex sites with different generators and customers underneath.

(Diagram adapted from the Guidance to Complex Sites v0.2)

  • Each Complex Site must be located behind the same Primary Substation (a Primary Substation is where the voltage is stepped down from 33kV to 11kV, and a single Primary Substation supplies communities varying in size from several hundred homes in Coigach to several thousand homes in Carluke).This applies to both the generation and demand forming part of the local energy scheme.
  • Energy generation and the demand need to be contractually linked. This could be done by the Generator(s) supplying individual customers under a Supply License Exemption. This could require a whole article to explain on its own, but it is sufficient to know that securing an exemption from Ofgem would allow a local, small-scale generator from supplying electricity without all the obligations imposed on licensed suppliers which operate at the national scale.
  • Each metering system retains its own identifier, which allows customers to easily enter or exit the scheme – all the participants form the Complex Site. Crucially this means that not everyone within the area needs to be part of the scheme, retaining the fundamental principle of customer choice and market competition. In theory, everyone within the area could be part of the scheme, but each would need to have a smart meter, to allow Half-Hourly settlement.
  • Settlement (the process of working out how much energy to bill) is based on the net metered value of Generator exports minus the Imports to the generators and all customers. The overall net value for the complex site is determined at one import and one export meter. Using the example above, this site would be (10 kWh + 8 kWh) – (3kWh + 8 kWh + 10 kWh) = -3 kWh. A negative result means the site is importing (a positive result means the site is exporting).
  • In practical terms, the scheme operator will need a relationship with a supplier(s) to provide or offtake the balance of electricity depending on whether there is an overall net import or net export at the complex site. Most community energy organisations are likely to want the supplier to take on the role of metering and billing for all customers, as well as technical aspects such as liaising with the Half-Hourly Data Aggregators and Half-Hourly Data Collectors, and for settlement submissions to the Licensed Distribution System Operator.

Perhaps it’s easier to explain in practice, by going back to the community example in Coigach. The local community development company, which owns the wind and hydro turbines, gets commitment from members of the community to sign-up as customers for their electricity (this would require them to be willing to change supplier). It partners with a licensed supply partner who has the technical and resource capability to take responsibility for individual customer metering and billing, as well as the scheme metering and billing and associated administrative requirements. Based on the export and import volumes, the supplier will offer an import and export tariff specific to this site, and individual customers will sign up depending on the offer. While it might be possible for the community development company to supply customers directly by securing a supply license exemption, it is likely in practice to be technically and administratively beyond the scope of most community organisations.

If Modification P441 is implemented, and if there are licensed suppliers who are ready to provide the necessary service support, a real opportunity will open up for the local supply of electricity within communities, and without the need for any change in legislation. This could increase local income and/or reduce costs, with communities having the ability to set priorities based on local needs and objectives.

If you are interested in talking to Scene about whether your community could become a Class 6 Complex Site under BSC P441 – or simply whether your community could make and use its own electricity – please get in touch with Alex Schlicke, Co-Director at or call Scene’s Edinburgh office on +44 (0)131 603 8822.