Local authorities are well placed to realise co-benefits of integrated local energy systems; however, in the UK they have no statutory energy mandate. Planning and developing clean energy are discretionary, and persistent budget reductions, combined with the lack of strategic direction from the UK government for more localised energy provision, limit local capacity, expertise and resources. Nevertheless, some local authorities have led energy initiatives but have been unable to stimulate investment at the pace and scale required to align with net zero greenhouse gas targets. Using evidence from such initiatives, this paper discusses the institutional changes needed to enable local authorities to act. It examines existing climate and local energy plans, and their integral socio-economic value. Using this evidence, investment opportunities from locally led net zero programmes are identified. EU technical assistance funds provided a particularly successful route to local energy developments: based on value of investment secured against initial funding, it is estimated that GBP 1 million technical assistance funding to every local authority would lead to GBP 15 billion investment in local energy. Other potential funding innovations are assessed and the paper concludes with recommendations for policy and resource measures needed to convert local ambition into clean energy and energy saving investment at scale.

Meeting net zero emissions targets requires co‐operation of multiple actors across scales and sectors, including small and medium‐sized enterprises (SMEs); research on action by SMEs to improve energy efficiency of their buildings has however been limited. This article focuses on the work of local authorities in engaging SMEs in energy efficiency initiatives. Empirical findings are from systematic analysis of semi‐structured interviews with local authorities participating in the Energy Efficient Scotland pilot programme for national scale retrofit. The modes of governance conceptual framework (self‐governing, governing by partnership, governing through enabling, governing by provision and governing by authority) is combined with a local government capacities framework (responsibility, political authority, finance, personnel, knowledge and energy materialities) to explore the different strategies available to local authorities. Findings reveal that local authorities utilise various modes of governing for engaging SMEs; however some governing modes (self‐governing, governing through authority and governing through provision) proved more effective than others (governing through partnership and through enabling). The results demonstrate that the modes of governance used to engage SMEs in energy efficiency depend on local authority capacities. However, Scottish local authority capacities are varied, resulting in differential ability to utilise the different modes of governing. Government policy for heat in buildings therefore needs to be sensitive to the specificities of different local authorities in order to extend their capacities for engage SMEs through both direct and enabling modes of governance.

Particularly within recent years, the rising number of city actors worldwide declaring climate emergencies and pledging commitments to carbon neutrality has sparked a spatial turn in broader sustainable transition thinking, noting the importance of the local level for governing sustainable transitions. Using a Geographical Political Economy approach, this paper critically engages with path creation theory and sustainable transitions literature to explore the potential of urban net-zero carbon transitions in a multi-scalar governance framework. The main argument is that municipal ownership across sectors has a fundamental role in sustainable transitions at the city level. This paper makes a distinct conceptual contribution to sustainable transitions literature by drawing on path creation theory to illustrate how municipal ownership is a central tenet of path creation by bringing together local actors and enabling political capacity and agency to control and strategize integrated sustainable urban pathways. Using the transport and energy sectors in Nottingham in the UK, it applies the Path Creation Framework in an urban setting to illustrate that municipal ownership stimulates a positive path creation through three main arguments. First, municipal ownership enables a positive embeddedness and historical legacy in the provision of sustainable urban energy and transport services; second, it facilitates the establishment of skills and expertise that positively reinforces urban political capacity for the pursuit of urban sustainability; and third, it stimulates the creation of innovative urban projects for sustainable and equitable pathways.