Improving Energy Efficiency BSRIA’s Operation & Maintenance Benchmarking Network Paul Huggins AD, Carbon Trust Programmes December 2013
The Carbon Trust The Carbon We are a not for profit group with the mission to accelerate the move to a sustainable, low carbon economy – We advise businesses, governments and the public sector on their opportunities in a low carbon world – We measure and certify the environmental impact of organisations, supply chains and products – We help develop and deploy low carbon technologies and solutions, from energy efficiency to renewable power
Presentation flow Review of the UK’s major energy policies The context for energy efficiency Government policy response Drivers of government action Our on-the-ground experience confirms the energy efficiency opportunity Excellent opportunities exist across all sectors Total percentage carbon and energy cost savings opportunity 11% identified in 2,132 organisations in the public, services, retail, and chemicals sectors. Identified measures hold the potential to reduce emissions by 2MtCO2e and energy costs by £253 million annually. Identified % carbon savings opportunity Identified carbon savings opportunity by by sector technology and sector ktCO2e/ Year 1,845 126 Public 11% Other 100% Waste Process-related 90% technologies are Process 80% important in Motors Services 13% 70% manufacturing sectors like CHP chemicals 60% Refrigeration 50% Lighting Retail 11% 40% HVAC Lighting, HVAC, and building controls are 30% Office equipment important in building- Controls & operations 20% based sectors Building construction & fabric 10% Carbon & energy Chemicals 7% Carbon & energy management management is important 0% everywhere Non-energy- Energy-intensive intensive (public, (chemicals) services, & retail) Industry action on energy efficiency
Drivers of government action Environmental, social and economic
Advice to government is that we need to act now on climate change now. March 2013; climate-warming gas in atmosphere passes 400ppm milestone
Intergovernmental Panel on Climate Change Confirms global warming trends & that human action is the dominant cause of climate change • The IPCC is an international body created by the UN in 1988 to collect and synthetize the latest science on climate change • Overall, the report represents a confirmation of global warming trends and the expected negative impacts of current emission pathways on the global climate 6
Intergovernmental Panel on Climate Change What does this world map mean? Scientists are now all but certain that climate change is mostly caused by human action, and that it is already leading to changes in regional weather patterns, with extreme events on the increase
Intergovernmental Panel on Climate Change A linear relationship exists between temperature increase and anthropogenic emissions The IPCC confirm that: • warming in the climate system is unequivocal; • that human influence on the climate system is clear; and • it is extremely likely that human influence has been the dominant cause of observed warming. To put it another way, there is no other scientifically robust cause for the observed level of warming, it can only be attributed to human activity. If we are to contain to a 2 C rise then we have already used over half our global carbon budget
Drivers of government action Social
Global population growth will impact UK markets A bigger, healthier, better educated and aspirational population › UN projects world population will grow from 6.1 billion in 2000 to 8.9 billion in 2050 › OECD forecasts that the global middle class will increase by three billion people over the next 20 years › Demand for energy, food, water and materials (such as steel) is expected to increase by 30% to 80% by 2030
Government policy will be driven by Stresses on energy, water, land and material resources › Economic impacts driven by scarcity › Resource price increases › Increased price volatility › Environmental impacts driven by use › Increased carbon emissions › Water stress › Land use › Resulting in…. › Reduced security of supply › New regulations
Global businesses are telling us and the UK government that they are conscious of the resource scarcity risks They are using their purchasing power to shape the market Source: Carbon Trust survey of senior executives in Brazil, China, Korea, UK and USA, Oct 2012 Answer to: “When do you think these areas will become of critical importance to you effectively running your business?”
Drivers of government action Economic
Energy prices are rising Electricity & gas costs have nearly doubled over the last seven years Source Castle Cover 2011
Government policy response Focused on energy efficiency
UK Government is acting on future energy cost and supply risks - significant UK energy savings exits “[DECC] estimate that through socially cost-effective investment in energy efficiency we could be saving 196TWh in 2020” Equivalent to 22 power stations 11% lower than baseline 41MtCO 2 e less emissions Source: The Energy Efficiency Strategy : The Energy Efficiency Opportunity in the UK (2012)
Current context on UK GHG emissions Energy consumption and emissions increased in 2012 All GHGs CO 2 571.6 MtCO 2 e 479.1 MtCO 2 UK net emissions of CO 2 were • 2012 provisional UK emissions • estimated to be. based on Kyoto Protocol greenhouse gases basket. CO 2 accounted for about 83 per • cent greenhouse gas emissions (in • 3.5 per cent higher than the 2011) 2011 figure of 552.6 million • 4.5 per cent higher than the tonnes 2011 figure of 458.6 MtCO 2 . Source: 2012 UK GHG Emissions, Provisional Figures, • and 2011 GHG emissions. March 2013
UK non-domestic emissions impact Non-domestic building (18%) and industry account (22%) account for 40% of UK emissions UK non-domestic emissions (MtCO 2 e) Industrial Commercial Public (70%) (21%) (9%) Total: 248Mt 24 29 23 19 14 64 20 12 13 8 22 100 Other Refrigerators & 75 Compressors Motors Percent (%) High & Low Temperature Processes 50 Computing Catering and hot water Lighting 25 Note: 1 Includes emissions HVAC from manufacture of coke, petroleum products & nuclear fuel products, recycling, water 0 purification, Metal & Chemicals Retail Services Public sector Rubber, plastics construction, mining & minerals & wood quarrying and Food, Engineering Other Hotel & Other unclassified industrial clothing & & vehicles industry 1 Leisure commercial processes. Source: BIS, Defra, Carbon paper Trust analysis, 2006
UK Government and Carbon Trust analyses show a range of market failures inhibit action • The different market failures drive Market failures, include: government to provide a range of policies that drive wide spread behaviour change • misaligned incentives • imperfect information • undervalued energy efficiency opportunities • embryonic markets Source: 1. “What are the factors influencing energy behaviours and decision-making in the non-domestic sector ?” [DECC, Nov 2012] 2. Carbon Trust analysis
The government has taken widespread action. A review of the UK’s major energy policies ign seeks to bar inefficient products from the market • Eco Design OS mandatory energy audits from 2015 for large companies • ESOS • EDR Feed in tariffs for energy efficiency (capacity market, across all areas) rgy RHI RHI energ • RHI is a long-term subsidy for renewable thermal energy
One policy is insufficient to alter behaviour Multiple policies impact on product markets ECA ETL Eco design Building Regulations CATAPULT Product policy Impact ENCOURAGE DEVELOPMENT DRIVE CUT OUT purchase of new, more The existing market least of the most sustainable Number of products toward purchase sustainable sustainable products of more sustainable products products products in market Fund demonstrators • Minimum standards Pricing and trading • • Intervention • Business Support Labelling • Procurement advise • Education • Voluntary agreements • • labelling Fiscal incentives • LESS PRODUCT SUSTAINABILITY MORE
Industry action on Energy Efficiency Improving energy efficiency
Our expertise is built on deep experience The case for action on energy efficiency is compelling We have worked with: 75% 70% 90% 50% FTSE 100 companies Local Authorities Higher Education Institutions NHS Trusts and undertaken: to deliver: 35,000 on-site surveys 50,000 £1.6bn £4.5bn advice line calls per annum spend on energy efficient equipment energy waste avoided
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