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3.1.2 Sectoral Emissions
Figure 3-3: Employment in Havering and UK by Sector (SIC Section)
Source: Business counts data from NOMIS (https://www.nomisweb.co.uk/query/select/getdatasetbytheme.asp?theme=49)
A detailed overview table of the number of businesses in Havering in each sector differentiated by business size can be found in Appendix 0.
With the context of the size and type of businesses in the Borough, it is then useful to understand the quantity of emissions associated with each sector so that decarbonisation action support can be targeted.
Business emissions broken down by Standard Industrial Classification (SIC) section3 in Havering are shown in Table 3-1Table 3-1 below. The total number of businesses in each sector is also provided for reference.
SIC Section Number of Businesses (2019) Total Emissions (ktCO2e)
Transportation and storage
Water supply; sewerage, waste management and remediation activitiesManufacturing
Construction
535 40 405 2475
Wholesale and retail trade; repair of motor vehicles and motorcycles
1325 Human health and social work activities 415 Administrative and support service activities 860
Electricity, gas, steam and air conditioning supply
10 Accommodation and food service activities 475
Education
150 143 71 70 58 49 19 17 10 7 7
Source: Business counts data from NOMIS (https://www.nomisweb.co.uk/query/select/getdatasetbytheme.asp?theme=49) and EMSI Labour market data.
Based on the above, at the highest SIC Section level (i.e. largest sector grouping based on standard UK industrial classifications), ‘Transportation and storage’, followed by ‘Water & Waste’ and ‘Manufacturing’ are the highest emitting sectors in Havering.
Breaking these down further into subsectors (i.e. SIC 2-digit division) highlights the specific activities driving most of the emissions:
1. Division 49 – ‘land transport’ (subsector of ‘transportation and storage’); 2. Division 38 – ‘Waste collection, treatment and disposal; materials recovery’ (subsector of ‘Water & Waste’); and 3. Division 23 – ‘Manufacture of other non-metallic mineral products’ (subsector of
‘Manufacturing’) Table 3-2 below shows the Top 10 emitting sub-sectors. This shows that ‘land transport’ is the single largest emitting sub-sector by a substantial amount, being more than double the next most emitting sub-sector. This demonstrates that it will be vital to address this sector to be effective at decarbonising commercial activities in the Borough.
Other notable sectors include water transport (which covers transporting passengers or freight over water, including sightseeing cruises, boats, ferries, water taxies, etc.), which has a higher value than it would for many boroughs and is challenging to decarbonise due to the fuel used in this sector. Specialised construction activities are also of note as these will involve diverse activities that will be harder to target for decarbonisation than for many of the other sectors.
SIC (2 digit) Division Number of Businesses
49: Land transport and transport via pipelines
335
38: Waste collection, treatment and disposal activities; materials recovery
30
23: Manufacture of other non-metallic mineral products 15
Total Emissions (ktCO2e)
102 43
35
43: Specialised construction activities
1,755 34
37: Sewerage
5
50: Water transport
15 47: Retail trade, except of motor vehicles and motorcycles 665
46: Wholesale trade, except of motor vehicles and motorcycles 42: Civil engineering 86: Human health activities
355
145 235 28 27 21 19
16 13
Source: Business counts data from NOMIS (https://www.nomisweb.co.uk/query/select/getdatasetbytheme.asp?theme=49) and EMSI Labour market data.
Of course, total emissions do not give the entire picture. Whilst ‘Manufacture of other nonmetallic mineral products’ and ‘Specialised construction activities’ have almost the same total emissions attributed to them, the number of businesses associated with these emissions is vastly different (15 compared to 1,755). This demonstrates that attempting to reduce these emissions will be very different in practice between these sub-sectors as there will be a very big difference in the number of businesses that will need to be engaged to achieve similar reductions.
The following Figure 3-4 demonstrates the dynamic between total emissions and number of businesses. It is relatively easy to see three distinct groupings. The first is the large number of sub-sectors close to the origin of the chart demonstrating low emissions and (relatively) low numbers of businesses. These sub-sectors will need to be engaged and supported but might not be a priority. There is then a grouping of lower emissions per business but where emissions are still notable. These will be particularly challenging to support due to the high number of businesses involved. Finally, there is the higher emissions per business grouping where relatively few businesses will need to be engaged to make a difference (not taking into account the challenge of decarbonising the sub-sector).
Figure 3-4: Comparison of Havering Business Sector Emissions against Number of Businesses
Lower emissions per business
Higher emissions per business
Source: Business counts data from NOMIS (https://www.nomisweb.co.uk/query/select/getdatasetbytheme.asp?theme=49) and EMSI Labour market data.
Looking at the higher emissions per business grouping, it is possible to draw up a different ‘top 10’ which is demonstrated in Table 3-3 below.
Table 3-3: Havering’s Top 10 Business Sub-Sectors by Emissions Intensity
SIC (2 digit) Division Number of Businesses
37 : Sewerage
5 23 : Manufacture of other non-metallic mineral products 15
50 : Water transport
15
38 : Waste collection, treatment and disposal activities; materials recovery 21 : Manufacture of basic pharmaceutical products and pharmaceutical preparations 35 : Electricity, gas, steam and air conditioning supply 22 : Manufacture of rubber and plastic products 10 : Manufacture of food products 49 : Land transport and transport via pipelines 27 : Manufacture of electrical equipment
30
5
10 20 20 335 10
Emissions Intensity per Business (ktCO2e)
5.52 2.35 1.78
1.43
1.16
1.03 0.41 0.37 0.31 0.30
Source: Business counts data from NOMIS (https://www.nomisweb.co.uk/query/select/getdatasetbytheme.asp?theme=49); Emissions data from EMSI employee counts data; Eunomia analysis of emissions intensity.
Examining the emissions intensity per business between different sectors in Havering (see Table 3-3 above) can help identify businesses in intensive sectors where there is the potential for large emissions reductions.
There are low numbers of businesses registered in many of these intensive sectors. For example, the top three categories are dominated by 35 businesses and therefore support programmes can be very effective with only a small number of businesses needing to be engaged.
It should be noted that Table 3-3 takes an average of the total emissions for all businesses in that sector, assuming that all businesses will be emitting at similar levels regardless of their size. It may be the case that some businesses in a specific sub-sector are responsible for the majority of emissions emanating from that sector; nonetheless Table 3-3 provides a useful starting point, highlighting a leaderboard of emissions for the Borough.
Whilst targeting the most intensive sectors can lead to dramatic reductions, it is often the case that many of these sectors are some of the hardest to decarbonise. This could be due to the core business revolving around highly intensive materials or processes (e.g., manufacture of plastic, generation of energy from fossil fuels), or sectors involving transportation who are reliant on transport electrification and the decarbonisation of the grid in order to reduce their emissions.
By contrast, it is also possible to focus on easier to decarbonise sectors (for example retail), but which have larger number of businesses, making engagement more challenging. This has the advantage of creating a sense of greater engagement in the Borough with the challenge of decarbonisation which can lead to ripple effects across the Borough.
Given this context, if support is to be offered based on economic sectors it is likely to be beneficial to:
• Target the sub-sectors that have high total emissions regardless of number of businesses (see Table 3-1); • Ensure particular exploration of support to the handful of sectors with very high emissions per businesses in case dramatic improvements can be achieved (see Table 3-3); • Provide a broader support to sectors with lower total emissions but where the challenges are similar.
