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News Update
Carbon border charge to finance EU green growth
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Revenues from the forthcoming European Union’s proposed carbon border charge can be used to help finance the bloc’s green transition. But this will never be declared as the charge’s official objective, because the new levy must be created only for environmental reasons, to avoid contravening World Trade Organisation (WTO) rules.
Steps being taken to tighten the trading price of carbon allowances within the European Union’s emissions trading scheme (EU:ETS) are set to increase the current price of between €25 and €30 per tonne. Official forecasts from AEFP, the French equivalent of the CBI, reckon that these will reach a minimum of €40 per tonne by 2030 and above €230 per tonne by 2050.
Because these prices are borne only by European participants, this June the European Commission is set to publish a “carbon border adjustment mechanism.” The goal is to avoid carbon leakage, whereby companies relocate manufacturing abroad to countries where pollution costs are lower.
Two main options are under consideration. These are a border tax, which unless skilfully constructed may contravene WTO rules. Or a notional carbon levy mirroring the EU:ETS. Under this option, a benchmark of carbon consumption is created for a given product corresponding to the EU average. It is then multiplied by the current ETS traded price. Crucially, such an external allowance would not be tradable.
Amongst industrial sectors most likely to be covered initially are those designated as “raw materials”. These include the cement, steel and chemical industries.
For so long as the new UK:ETS has trading prices on a par with the EU:ETS, it is not likely to have much impact on business based in the UK. It is clear though that, should significant divergences in the system take place, then the new arrangements would be imposed on UK-based firms.
Patrick Pouyanne, CEO of Total, endorsed the concept as a “very logical extension of the EU’s carbon price policy.”
REPORT STATES 2M JOBS TO BE CREATED IN DEVELOPED COUNTRIES
Jobs in energy efficiency set to surge
Creating millions of jobs in energy efficiency is the fastest way to restore prosperity and combat climate change. It will deliver far more employment than any form of electricity generation.
That is the verdict of the International Energy Agency, which has already identified almost 2m jobs due to be created in the next two years in developed counties, with many more to come if governments create the right stimuli.
Two thirds of these jobs would be in the buildings sector. Most of these would be in retrofitting existing buildings. Over 75 per cent of buildings likely to be being occupied in 2050 have already been built.
One of the main beneficiaries of the scheme would be for people with few academic qualifications, currently the worst hit by unemployment. The remaining jobs would be found in transport (20 per cent) and industry (16 per cent).
According to the IEA, “as energy efficiency investments can be mobilised quickly, they are one of the most attractive investments in the energy sector. This is particularly energy efficiency upgrades means that spending £1m on improving energy efficiency will generate between 6 and 15 jobs, depending upon the sector.
Scaled-up worldwide there are potentially millions of jobs in delivering energy efficiency. It is billed as “the single quickest and cheapest way of reducing carbon emissions, since it both reduces existing demand for energy and renders many new power stations unnecessary.”
for governments seeking to protect existing jobs, or generate new jobs during the recession.”
The IEA estimates that in 2019, before COVID 19, there were 2.4m energy efficiency jobs in the US, only 750,000 in China, but approaching 3m in Europe. Of these, the UK Office of National Statistics identified 114,000 in the UK.
According to the IEA, the remarkable labour intensity of many
Sainsbury’s commits to reduce Scope 3 GHGs by 30%
Supermarket chain Sainsbury’s has committed to set an absolute target to reduce its Scope 3 Greenhouse Gas emissions by 30 per cent by 2030, together with a net zero target for its Scope 1 and 2 emissions by 2040, in line with the Paris Agreement.
As part of Scope 3, Sainsbury’s will be working with selected suppliers to develop their own Scope 1 and 2 targets, and measure their performance through industry disclosures such as CDP and the Higg Index.
The retailer has reduced its Scope 1 and 2 carbon emissions by 42 per cent in the last 16 years despite growing as an organisation by 46 per cent.
Sainsbury’s worked with the Carbon Trust to define an ambitious Scope 3 target which requires the reduction of absolute GHG emissions by 30 per cent by 2030, to align to a well below 2°C scenario. This includes reducing emissions from purchased goods and services sold, upstream transport and distribution and the direct use of sold products.
Sainsbury’s will work collaboratively with its suppliers to deliver against their own Scope 1 and 2 targets to drive lasting change. By delivering against its Scope 3 targets by 2030, through innovation and collaboration, Sainsbury’s will endeavour to help customers make more sustainable product choices, helping them live well now and into the future.
Over the past year, a number of energy saving initiatives have been launched in Sainsbury’s own operations, including the installation last year of its one millionth Aerofoil in its Battersea Park Local store, keeping fridges cool and aisles warmer and saving 15 per cent of the energy used by the fridge.
The strategies outlined to reduce Scope 1 and 2 emissions will see Sainsbury’s implement new initiatives within the refrigeration and lighting space such as LED technology, along with improving overall efficiency. The retailer’s Scope 3 efforts will focus on working with its suppliers to set their own carbon reduction targets and identify opportunities across product lifecycles.
news update
ONLY £70M OF £2BN ALLOCATION SPENT
Green Homes Grant set to miss targets
The Green Homes Grant scheme is unlikely to achieve any of the objectives formally set for it during its first phase by Chancellor Rishi Sunak (right), when he announced the Scheme last July. The scheme offers subsidy grants of up to £5,000 to individual householders, covering up to two-thirds of the costs of installing a limited range of renewable energy and energy-saving devices. It provides the most generous use of public funds intended to help deliver sustainable energy for over 40 years.
Last July, Sunak stated that the scheme had several absolute objectives it would be expected to achieve. He gave a specific target for the number of homes that would be improved under the scheme, for the total amount of subsidy money that would be spent, and for the number of jobs that would be created. In each case, it is clear that as of now these targets will be missed by a mile.
At the end of January, the scheme was two-thirds of the way through its first phase. It began on September 30 2020 and will finish on March 31 2021. Just before the end of January, the Business Department - which is administering the scheme- told the Guardian newspaper that around 17,000 households had been approved to receive vouchers. Sunak’s declared target, as announced in the House of Commons, was that 600,000 individual households would benefit from the initial phase of the scheme. This means that it leaves 97 per cent of his declared objective that has yet to be met.
At the time there were a further 65,000 applications awaiting approval. Even if all these go ahead, that would still only mean that less than 10 per cent of the households target had been achieved.
Between them, the 17,000 households had received vouchers worth just £70m. Sunak had allocated £2bn to this programme, to be spent by the end of this financial year in April. So there is still £1.99bn remaining that has yet to be spent. Normal practice is for any spending Departments, that fail to use all the money allocated to their programmes, have to hand the unspent money back to the Treasury.
Sunak’s official target was that 100,000 jobs would be “sustained” by the Scheme. This is even though currently there are just 114,000 people currently employed in energy efficiency, and 49,800 in renewable energy, according to the Office of National Statistics. Whilst there has been no announcement yet regarding the numbers obtaining paid employment, given how few homes have yet been improved, it is unlikely to be anything like this number.
There are just 860 registered Green Homes Grants scheme installers across the entire country. Business Department officials rejected the proposal to utilise existing accreditation scheme overseen by established trade associations. Instead, they have insisted that TrustMark alone can decide which installers can pay to join.
Gas grid companies plan to deliver hydrogen towns
Britain’s gas grid companies have set out their plans to deliver the UK’s first hydrogen town by 2030.
Published as part of Energy Networks Association’s Gas Goes Green programme, Britain’s Hydrogen Network Plan sets out the detail of the activity that all five of Britain’s gas network companies (Cadent, National Grid, Northern Gas Network, SGN & Wales & West Utilities) will undertake to turn Britain’s hydrogen ambitions into reality, as set out in the Prime Minister’s November 2020 ’10 Point Plan for A Green Industrial Revolution’.
Between them, the companies are responsible for owning and operating the pipelines and other infrastructure that currently deliver gas to 85 per cent of homes in Great Britain.
Britain’s Hydrogen Network Plan also sets out the work gas network companies will undertake to meet the UK’s other hydrogen objectives, including being ready by 2023 to blend up to 20 per cent hydrogen into local gas grids and to help the UK meet its hydrogen production target of 1GW by 2025 and 5GW by 2030.
It sets out how they will help deliver a network of refuelling facilities for zero emissions heavy good vehicles, and connect the renewables production, carbon capture and storage and hydrogen use for industrial ‘SuperPlaces’, helping deliver two clusters by the mid-2020s and two more by 2030.
The plan explains how the companies, responsible for owning and operating £24bn of energy infrastructure, will: • ensure the safe delivery of hydrogen through innovation projects. This includes work being undertaken by the Hy4Heat programme (led by BEIS), to test different household appliances such as boilers, heaters and cookers in variety of different settings; • maintain security of energy supply, to ensure gas networks have enough capacity to meet Britain’s energy demands using hydrogen; • work with people’s needs, to help reduce carbon emissions whilst ensuring that people and businesses have a choice of different low carbon technologies – in our homes, our offices and factories, as well as on our roads; and • deliver jobs and investment, including through the replacement of old iron mains gas pipes around the country with new, hydrogen-ready pipes instead. By 2032, the companies are planning to have invested £28bn in such projects.
IN BRIEF
Gemserv adds to energy expertise
Professional services firm Gemserv has acquired Ecuity Advisory Ltd as part of its drive to expand services for clients seeking to accelerate the transition to net zero.
Ecuity’s extensive expertise in energy, mobility and environmental policy complements Gemserv’s established role as a manager of high-profile projects in the energy and other sectors.
The acquisition of the Birmingham-based firm, for an undisclosed sum, will create a combined group with some 220 staff and annual revenues of around £30m.
HVAC specialist updates website
International manufacturer of valves, sensors and actuators, Belimo, has updated its global website.
With its functional structure and updated design, the new Belimo website offers all users optimal service – regardless of which end device might be used.
New features and functions of the site include: • a clearer guide to what users are looking for faster with clearly structured and intuitive navigation; and • simplified valve selection as well as streamlined system planning; The new Belimo website is available online at www.belimo.co.uk
Updates to heat network code
A major update to CIBSE’s Heat Networks Code of Practice provides extensive guidance for the design, installation and, critically, the ongoing performance monitoring of district heating systems.
CIBSE Code of Practice 1 (CP1 (2020)) now includes key outputs for each objective that can be used to demonstrate a heat network is performing as expected. This includes a series of checklists to allow clients to set an initial performance target and to monitor the system against this target throughout the design development process to give investors confidence in the system’s performance.
news update
EV charging points set for hotel chain
Whitbread – owner of the Premier Inn hotels - has appointed ENGIE to install high power GeniePoint charging points nationwide, with 600 committed across 300 hotels over the next three years.
ENGIE will begin installing the chargers in March, with the first scheduled in Enfield, London.
Access to the charging points will be for guests, as well as members of the public using the GeniePoint Network – one of the largest national EV networks. The company will install high specification 50kW+ chargers that replenish electric cars in just 30 minutes with 100 per cent renewable energy.
Sam Hockman, divisional CEO – futures at ENGIE UK & Ireland said: “A big factor for drivers considering the switch to EV is access to a broader range of charging options. This significant investment at Premier Inn sites will provide hundreds of new, convenient charging locations across the UK and also give customers access to ENGIE’s wider GeniePoint network.
“This important move by Whitbread highlights the key role the hospitality sector can play to support not only the uptake of EVs, but also the UK’s wider commitment to become net zero by 2050.”
Simon Leigh, procurement director at Premier Inn said: “Electric vehicles are one of the ways in which the UK strives for a greener future and we’re pleased to help drive this goal forward with what we believe is the UK’s biggest roll-out of rapid charging points to date.
“We know that ‘range anxiety’ is a real concern for many of our guests who own electric cars. Knowing that in many locations they will soon be able to arrive and have access to a high-speed charge point to quickly refuel their car while they relax and refuel themselves will be a great source of comfort. ZERO CARBON STANDARDS TO BE MANDATED
Upgrade on the way for Part L Regs
Part L of the English building regulations, covering the conservation of fuel and power, is to be upgraded so as to mandate zero carbon standards. As well as tightening insulation standards, this will effectively ensure that no more gas boilers are installed in new homes. But not before 2025, nine years after this requirement was originally scheduled to become law.
The government has now confirmed this timing, overturning the announcement by the Prime Minister last September that such standards would be mandatory from 2023.
Back in 2010, it was the present Transport Secretary, Grant Shapps, then the housing minister under the Coalition government, who confirmed that zero-carbon homes would “become the only home you can buy after 2016.” An interim step towards that standard was introduced in 2013.
But while in all devolved administrations the original timetable was retained, the agreed timetable was torn up after the Conservative Party obtained a majority in 2015.
Consequently, the interim 2013 standards are now set to remain largely in place (with only minor tweaking) for a 12-year period, during which the official UK aspirations regarding both energy savings and climate-related targets were tightened considerably. The UK’s current emission target for 2030 requires a 68 per cent cut against 1990 levels by the end of this decade.
Additionally, house builders constructing a substantial estate have long been permitted to build all homes to the standards in operation when the first new home was built. Surprisingly, no steps are to be taken to tighten this lax arrangement.
The Future Homes Standards document sets out plans to phase out any fossil fuel heating systems from new homes. According to the present housing Minister, Chris Pincher, “the radical new standards will ensure our new homes are fit for the future by reducing emissions from new homes by at least 75 per cent.”
Effectively, this high percentage claimed concedes that not only are some new homes still being built to the even lower standards permitted prior to 2013 but also that many new homes today do not meet minimum standards. This is an issue often raised by the chairman of the Committee on Climate Change, Lord Deben, who as a former Environment Secretary used to be in charge of monitoring such compliance levels. The new document proposes no specific steps to ensure better compliance.
The document sets out some higher energy efficiency standards relevant to existing homes. These include parts for windows, heat pumps, cooling systems, and fixed lighting. New requirements for additional ventilation and indoor air quality monitoring in high-risk commercial buildings like gyms are included.
Renewables overtake fossil fuels for power generation
Analysis by Ember, an independent, not-for-profit climate think tank, reveals that renewables overtook fossil fuels as the main source of electricity in the UK last year.
With coal power already near zero, fossil gas was forced to a five-year low in 2020 by growth in wind power and below-average demand due to Covid-19. While UK renewables production is dominated by wind, it still remains overly reliant on risky bioenergy, which must be replaced with cleaner power to fully decarbonise the UK grid.
Renewables also overtook fossil fuels in the EU-27 in 2020, as well as separately in Germany and Spain.
A record 42 per cent of the UK’s electricity was generated by renewables in 2020, compared to 41 per cent by fossil fuels. Nuclear plants generated the remaining 17 per cent.
This was mainly driven by an increase in wind power. For the first time, a quarter (24 per cent) of the UK’s electricity was generated by wind turbines in 2020, doubling its share since 2015 and up from 20 per cent in 2019.
While wind showed impressive growth, solar and hydro were unchanged since last year, making up only 4 per cent and 2 per cent of the UK’s electricity production respectively. This is the second year running that solar has remained stagnant, reflecting the lack of a supportive policy environment for the technology.
Bioenergy generated 12 per cent of the UK’s electricity in 2020, posting slight growth since 2019. However, bioenergy is a much higher risk source of renewable electricity – for both climate and environmental outcomes – than the other sources such as wind and solar.
Coal generated just 2 per cent of the UK’s electricity in 2020, falling rapidly from 2015 when it delivered 23 per cent of the UK’s electricity.
