Private Wire

The network is often owned by the consumer or sometimes by an energy services company (ESCo). Private wire systems enable locally generated electricity to be sold directly to local customers. Transmission and distribution charges are avoided and so are electrical losses through the national gird/distribution networks. Buildings are interconnected with appropriate high voltage/low voltage private wire networks.

Private wire schemes are generally designed to satisfy their own electrical demands and export surplus power to the grid. This is achieved via an enabling agreement for exempt supplier operation, which can also benefit from exemption from the Climate Change Levy. In the event of a National Grid or local electricity board power cut, the system continues to operate in ‘island' mode via a black start generator. Equally, if the private wire grid fails, the national grid can act as back-up.

A key document in relation to setting up a private network is the Electricity (Class Exemptions from the Requirements for a Licence) Order 2001. (http://www.opsi.gov.uk/si/si2001/20013270.htm)

The ‘Citiworks' case challenged the electricity supply monopoly of private wire systems at the European Court of Justice, on the grounds that they breached rules on third party access to electricity networks. The ruling by the ECJ does not make private wire illegal, but it does require that private wire networks allow third party access to customers. This can be achieved in principle without changing the private wire arrangement.