PEDs: Grid Partners or Grid Problems? How cities can advocate for PEDs as a new urban energy standard

Cities can become Europe’s local energy system catalysts

Regional and municipal authorities can adapt European policy for the specific needs of their citizens and businesses. Cities define urban planning priorities and building codes, setting legal frameworks for DSOs to follow. Municipalities also hold a unique position of public trust with citizens, essential for orchestrating fragmented energy stakeholders (tenants, owners, DSOs) who otherwise would not have reason to collaborate.

For PEDs, cities represent the optimal facilitation actor towards collective clean energy pathways, leveraging available EU resources to advantage local energy systems over grid energy, including new business models like energy sharing. Where EU policies are not yet available, cities can actively advocate for them towards policymakers. 

Cities also have an increasing responsibility to ensure urban resilience against energy shocks and price volatility for their citizens. PEDs represent a core anchor of this strategic defence, stabilising cost of living whilst supporting wider net zero ambitions.

“Since PEDs are still a new and largely academic concept, the City of Zurich is only starting to engage with their practical relevance. To better integrate PEDs into urban planning, we shifted our approach from ‘How can you implement our PEDs?’ to ‘How can PEDs help you achieve your urban climate goals?.”

– Vanja Djinlev, Pol4PEDs

Experts within DUT projects propose four priorities for city authorities to effectively facilitate PEDs

1. Market-oriented PED support

Cities can, and must, advocate for new mechanisms which reshape existing energy markets in favour of local systems. This could involve targeted subsidies for new local energy infrastructure, ownership, and delivery models, or introducing dynamic tariffs which encourage energy flexibility measures as an alternative to further grid infrastructure usage and investment. Further, while energy sharing represents a critical component of commercial viability for PEDs, restrictive regulations and tariffs hinder its uptake in many countries. Through taxes and negotiation, cities should remove these barriers to clearly establish locally shared green energy as the most economical option.

2. Advocate for PED policy and local energy markets

Cities are not a neutral audience, but active stakeholders in the energy transition, often holding positions on the Boards of DSOs who manage district-level energy grids. By recognising and proactive leveraging this shareholder status, cities could influence new pricing models away from grid energy. Municipalities should form strategic coalitions to advocate at the national level, driving regulatory reform away from centralised distribution and establishing clear legal frameworks for local energy markets.

3. Demonstrate compelling PED impact to escape the “pilot trap”

To advocate effectively for sustained political commitment, municipal leaders need concrete evidence for the impacts of PEDs, including reduced energy bills, enhanced energy security, and societal inclusivity. Rare examples, such as ASTER in Flanders, offer clean energy at €0,19/kWh, compared to a high Belgian average of €0.35/kWh Future innovations must favour economic and policy research which demonstrate PEDs are not just technically possible, but highly preferable and able to be standardised as a real energy alternative for millions of homes.

4. Institutionalise PEDs by embedding within master planning

PEDs are invariably viewed by policymakers and financiers as niche research initiatives rather than genuine energy system alternatives. To achieve widespread adoption, cities must systematically embed PED principles[1] as priorities within urban planning and municipal building codes – not just green add-ons. Municipalities can also legitimise PEDs through alignment with existing legal structures such as Energy Communities. Finally, cities can facilitate the creation of urban data spaces, trusted digitals ecosystems where DSOs can share data and PED energy models PEDs created.

[1] https://dutpartnership.eu/news/dut-updates-its-strategic-direction-new-roadmap