The UK government has signalled that the increasing use of decentralised energy forms part of its plan to achieve the UK's contribution to the EU's sustainable energy targets. Much of the technology for decentralised energy already exists, although it is not widely used in the UK. There will be need for new developments in onsite energy production, and in the delivery, integration and regulatory infrastructure to support it. Other State of Science reviews for this project describe particular energy technologies, but this paper highlights selected developments in thermal technologies and in biological processes which offer the potential for breakthroughs in converting biomass to energy. The effectiveness and deployment of decentralised energy can be enhanced by systems and infrastructure technology, not just for electricity but also in heat and biogas networks. Such systems are expected to be a focus of rapid development over the next two decades. Opportunities exist particularly in active networks. smart metering and intelligent tariff-interactive load management. Substantial regulatory and policy reform will be required to optimise the potential for onsite energy generation and effective two-way interchanges with centralised energy systems. There will be need for a regulatory system for heat networks and appropriate incentives for active networks. The development of an energy services business model in the industry will not progress until the compensation model changes to make it viable. The strength of the drivers for a trend towards decentralised energy, coupled with a wide range of scientific developments, should make this a very dynamic sector and present a host of new opportunities for British technology. (C) 2008 Queen's Printer and Controller of HMSO. Published by Elsevier Ltd. All rights reserved.