EfficienCity is a virtual town, but pioneering, real world communities around the UK are using similar systems. As a result, they're enjoying lower greenhouse gas emissions, a more secure energy supply, cheaper electricity and heating bills and a whole new attitude towards energy.
While our government promotes the fallacy that we need coal and nuclear to keep the lights on, innovative councils, businesses and individuals are taking the leap into a cleaner, greener future with decentralised energy.
What is decentralised energy? Well, it's pretty much the opposite of our present, outrageously inefficient energy system, which was designed to meet the needs of a society that hadn't even heard of climate change. This centralised system is a shambles - in fact, it would be impossible to invent a less efficient way of generating energy.
The typical power plant in the UK is only 38 per cent efficient. By the time we use electricity in our homes and offices, we've lost nearly 80 per cent of the usable energy inside the fossil fuels we burn.
This is mostly because we have two separate energy systems: one for electricity, and another to heat water and buildings. It's news to some, but heat is a far bigger culprit than electricity when it comes to global warming.
For electricity, we burn fossil fuels in a few large power plants, miles away from the homes and offices they supply. Two thirds of the energy available in fossil fuels is lost in the power plant as waste heat (a by-product of electricity generation) and during transmission. Another 13 per cent is lost through inefficient use in our buildings.
For heat, we burn more fossil fuels (mostly natural gas) in boilers in our homes, offices and factories.
It's a little bit like putting radiators on the outside of your house instead of inside it; we're burning one lot of fossil fuels for electricity, and another lot for heat, but waste heat is a by-product of electricity generation. Can't we just burn one lot of fuel to generate electricity, and capture the 'waste' heat at the same time?
We can. Combined heat and power or CHP does exactly that.
Combined heat and power
CHP is the heart of an efficient, decentralised energy system like EfficienCity's. It's the most efficient way possible to burn fuel because so little energy is lost as waste heat. That's how CHP plants in Denmark can reach up to 95 per cent efficiency.
Because the heat needs to be captured and piped around the local district, CHP plants are usually sited in the towns and cities where the electricity and heat will be used. This makes it more efficient for electricity generation as well as heat; very little energy is lost in transmission.
If we combined the efficiencies of CHP with improved efficiencies in the home (proper insulation say, and minimum efficiency standards for appliances), we'd practically eliminate the profligate wastage of our current system.
CHP is also brilliant in the transition from a fossil-fuelled energy system to one based on cleaner, greener fuels like biogas and biomass. CHP plants can run on a variety of fuels, which means that the fuel mix can include fossil fuels like natural gas but, as more cleaner fuels like biogas become more available, they can switch to those.
Pretty much any organic matter can be used to produce biogas; farm waste is the most famous example (thanks to The Archers) but we could be reaping energy from all of our food that ends up as landfill. Biodegradable waste makes up about half of our total landfill, where it produces large amounts of methane, another greenhouse gas.
Local renewable energy sources
But decentralised energy isn't all about CHP. There's an abundance of energy out there in our natural world, ready to be harnessed. We could be harvesting energy from the wind, the sun's rays, the ocean, underground springs and even the earth itself. According to the government, just the wind, wave and tidal resources of our windswept island could meet 40 per cent of our energy needs by 2020. In the longer term, the sky's the limit.
A flexible, scalable energy system
Unlike our conventional power plants, decentralised energy is completely scalable and flexible. You can have a tiny CHP plant in a supermarket or an enormous industrial plant like Immingham, which will soon provide as much electricity as Sizewell B. You can have a single wind turbine like the one at Manchester City's stadium or a massive wind farm like the forthcoming London Array.
This also means that decentralised energy systems can be installed much faster than huge power plants, and can be tailored to fit local needs.
Whereas decentralised systems like EfficienCity's rely on local, diverse energy sources, our current system will soon rely mostly on imported fossil fuels.
On top of that, using hundreds of small energy generators instead of a few major ones means there's a far lower risk of system failure; it's far less likely that several small plants will fail at the same time than that one big plant will.
If a local decentralised network did fail though, only one small area would be affected, and that area could import from neighbouring areas.
No more energy price hikes
Decentralised energy can also save consumers an enormous amount. Efficiency measures alone can save consumers a whopping £12 billion a year (the government's own figures) and they save more money than they cost to implement.
But there are other savings to be made. Although energy from decentralised systems may be more expensive per kilowatt hour than energy from coal, it can actually work out cheaper for the consumer. Why? Because only 37 per cent of the average British electricity bill is for the electricity. The rest goes to propping up the grossly inefficient infrastructure.
And of course, if the UK decoupled itself from the fossil fuel market, we'd be protecting ourselves from the massive price increases of gas, coal and oil, which will inevitably keep coming.
Reclaim the power!
Every major political party agrees that the future is decentralised. Every party, that is, except Labour, which wants to lock us into our archaic and criminally wasteful energy system with new coal and new nuclear power plants. With climate change already happening, that's precisely what we don't need.
We’ve decided to reclaim the power from the dinosaurs in Whitehall, by asking local councils to take the leap into a genuinely sustainable energy future like the one portrayed in EfficienCity.