No Hot Air

You can listen to this post as a podcast. Find The Sustainable Futures Show here: http://www.anthony-day.com/sustainable-futures-show/  

Somebody asked me the other day whether there’s really enough to say about sustainability to fill a weekly podcast. The truth is that there’s so much going on that most of it has to be left out. For example, this week is Paris Climate Week, incorporating the 2-day Business and Climate Summit. Earlier this month there was a Responsible Business Summit in Singapore, Morgan Stanley have issued a new report on sustainable investment, in New Zealand consumers are calling for greater transparency from suppliers and Apple is preserving forests. But why did I call this episode “No more hot air”? Two reasons. First, “Sustainable Energy without the hot air” published by David Mackay in 2009, is now more relevant than ever. I've mentioned it a couple of times and suggested you read it. In case you haven't had time I’ve rounded off this episode with a summary of the main points. The second reason for calling this episode “No more hot air” is that it’s time for action on CO2 and climate change, not talk. No more hot air.

First, a few sustainability stories which caught my eye.

Responsible Business

Sustainability strategies may be increasingly adopted by a growing number of companies worldwide, but communicating these efforts and engaging both internal and external stakeholders remain a challenge for many, especially if they want the stakeholders to come on board and be part of the efforts.

At the first Responsible Business Summit Asia held in Singapore this month, one of the issues discussed was the need to get a company’s sustainability efforts understood by its target audience – whether it is an internal or external stakeholder group. This is because a company’s ability to communicate its efforts and engage stakeholders could determine the success of its sustainability efforts.

“What we are trying to do now is to tell our story better,” said the head of corporate social responsibility at Chinese firm Huawei, the world’s largest telecommunications equipment maker.

“This way, we can grow our partnerships, work with more people and have an even bigger positive impact in the communities we operate in,” she said. “We can’t do it on our own.” A spokesman from Diageo, the world’s largest producer of spirits, confirmed that good community relations were essential to sustainable business.

Business and Climate Change

Meanwhile, in advance of the Paris Business and Climate Summit this week,  Paul Polman, chief executive of Unilever, said governments must set clear CO2 targets to force low-carbon innovation. He said Unilever had faced business costs €300m-to-€400 million higher than normal due to extreme weather. He said "The reality is, if we don’t tackle climate change we won’t achieve economic growth.”. Polman called on other chief executives to join him to lobby governments on the issue. Clearly he has COP21 in view - that’s the United Nations Climate Summit taking place also in Paris, in December this year. One hundred and ninety-six countries will come together to agree an international policy on carbon emissions and climate change. Many believe that this could be the last opportunity to take action to prevent global temperatures rising by more than the critical 2℃. Unsurprisingly, companies relying on cheap energy from fossil fuels and the producers themselves of oil, gas and coal are firmly opposed to carbon controls and are lobbying strongly. On his side Paul Polman is supported by The B Team, a group which urges governments to bring greenhouse gas emissions to zero by the middle of the century. B Team members include Virgin’s Richard Branson and industrialist Ratan Tata.

Investors

What do investors think about sustainability? Bankers Morgan Stanley have established an Institute for Sustainable Investing. For the moment they find that sustainable investment is being held back by misperceptions of potential returns. In fact they make a strong business case for sustainable investment. Key resources such as water, clean air and soil are underpriced. Minerals and energy are increasingly scarce and at the same time demand for all these things is growing as population grows by a forecast 2 billion by 2050. More than that, the global middle class, with expectations of western consumption patterns - western diets, western travel, western consumer goods and so on -  is expected to accelerate demand by growing by 2.5 billion by 2030. “Sustainable Business is business, not philanthropy,” states Morgan Stanley. Well they would say that, wouldn’t they? Even so, if they can persuade investors to make a business of decarbonising the global economy that can’t be bad for humanity.

Apple's Trees

Apple are in the news for preserving forests. Are these forests of apple trees? No, these are the trees this high-tech firm needs to assure sustainable supplies of paper and packaging for all its products. Apple have announced a plan to work with the World Wildlife Fund to improve the management of 1m acres of forests in China. This follows their announcement last month to donate money to Conservation Fund to buy and protect 36,000 acres of forests from commercial development other than forestry product production in Maine and North Carolina. Did you listen to the Sustainable Futures Show episode on the Green Supply Chain? (20th February 2015) Apple is making the point that we are all dependent on all parts of our supply chain. Some elements might be quite remote and not obviously connected to the core business, but they are important nonetheless. Apple is not only securing its supply chain here but it’s showing itself to be an environmentally responsible business. Given the almost cult following that Apple has among millions of consumers world-wide, that message is immensely strong.

The Paris Business and Climate Summit ended yesterday. 200 days before COP21, the UN Paris Climate Conference, French president Francois Hollande called for a miracle in December. A miracle to achieve consensus among all 196 participating nations to agree on measures to control carbon emissions and keep the increase in global temperatures below 2℃. He called upon the business community for support, with carbon capture and storage, new clean technologies and enhanced energy efficiency. If it’s difficult to achieve consensus within one country it’s certainly a challenge to achieve consensus among 196 countries. Nevertheless he believes it can be done. However, Tony Hayward, chairman of Glencore, the world’s largest supplier of  power station coal clashed with representatives of the solar and wind turbine industries, indicating the sort of debates which are likely to rage between now and December and indeed will be crucial in reaching an agreement. Hayward’s point was that renewables could never provide alternatives to coal for the process industries of countries such as India. Kerry Adler of Skypower and José Manuel Entrecanales Domecq, chief executive of Spain’s Acciona group, a large wind power developer, disputed this. With advances in electricity storage there is no reason why renewables should not provide base load power. The debate continues.

Sustainable Energy - the book

And so to Sustainable Energy without the Hot Air. This book was written by David MacKay, Fellow of the Royal Society and Regius Professor of Engineering at the University of Cambridge. Shortly after publication he was appointed Chief Scientific Advisor to the Department of Energy and Climate Change. In the book he has analysed the energy consumption of the average UK citizen. This covers not just the energy we use for heating, lighting and transport, but the energy we use to provide the food we eat, to run our public services and defence forces, to manufacture and deliver all the goods we buy and to run all the equipment and gadgets that we own. Against this he looks at the potential output from the various renewables, ranging from solar panels and wind turbines to tides, waves and geothermal energy. Even though each section is meticulously researched and presented in detail, it’s written with the general reader in mind. The author uses clear examples, simple illustrations and approximations to make things easy to understand. At the same time his assumptions and data sources are listed in notes to each chapter. The conclusion is that the average Brit needs 125kWh each day to maintain our current standard of living. That’s not electricity, it’s power from oil to drive our cars, from gas to heat our homes, from coal to run our power stations and so on. Although the theoretical maximum output from renewables could come close to matching this, the practical reality comes nowhere near. We cannot cover every roof with solar panels, we cannot instal wind turbines on every spare piece of land, we cannot put barriers across every tidal estuary. What we can do will yield about 14% of what we need. 

And the rest? We eliminate fossil fuels from our transport fleet by converting all vehicles to electricity. We convert our central heating to electricity, not with electric radiators or storage heaters but with heat pumps. For every unit of electricity used by a heat pump it’s possible to extract around three units of heat from the air or the ground, depending on the type of pump. We exploit the renewables we have, to provide renewable electricity. In the short term at least, we use clean coal with carbon capture and storage and we use nuclear energy to provide additional electricity with no additional carbon emissions. The final piece of the jigsaw is imported electricity from distant solar farms in foreign deserts. Technically this is feasible; politically it could be problematic. Theoretically enough solar energy falls on only a small part of the Sahara Desert to power the whole of Europe and provide 125kWh of energy to everyone in North Africa as well. If the countries meeting in Paris this December are serious about cutting carbon emissions then they will have to consider ambitious solutions. No shortage of investment opportunities there!

That’s all for this week, but what do you think? How likely are we to get a sensible agreement in December? What do think of David Mackay’s suggestions? As I mentioned before, his book can be downloaded free of charge at withouthotair.com. 

I’m always keen to hear from you about this or any other sustainability issues. mail@anthony-day.com Let me know what you think, let me know what you’d like to hear more of, let me know if you’re an expert and you’d like to be interviewed for the Sustainable Futures Show. 

Revolution - a film by Rob Stewart

Watch the trailer here: http://ykr.be/hn62dkp6v 
This review also available on The Sustainable Futures Show (podcast)

What’s it all about?

This film will appeal to anyone who is concerned about the environment, sustainability or climate change. Anyone else could well tune out and switch off in the first few minutes.

What’s it all about? It’s a film about our relationship with sharks. No, wait, here’s Rob Stewart mugging to the camera home-movie style. It's a documentary about making a documentary about sharks. No, wrong again, we’re now talking about coral reefs, the acidification of the oceans and the threat to fish stocks. Now we’re looking at global forests, at the destruction of some 75% of the world’s forests and its effects on the production of oxygen. And finally - it’s about CO2 emissions, it’s about man-made climate change, it’s about mega-corporations, coal and particularly about Canadian tar sands.

There is so much information in this film. There’s some amazing photography, especially the underwater scenes. There are some pretty disturbing scenes. There are things everyone should know. I had no prior knowledge or expectations of this film and we could have done with some signposting. It would have helped if I’d seen the trailer beforehand. Why watch this film? What’s it going to tell us? Why is it important? How does it affect me? Without answers to some of these questions I’m afraid the general viewer will just switch off. There is no clear thread at the start. 

The later part of the film shows how concerned citizens took their message to COP15, the 2009 United Nations Climate Change Conference in Copenhagen, and how the conference closed with no real result. We saw anti-coal protesters outside the White House in Washington. There was detailed coverage of the protests at COP16, the 2010 conference in Cancun, Mexico. Again, little was achieved and this time the protesters were expelled.

My main criticism of this film is that it lacks a strategy for action. The filmmakers suggest that if you don’t like what the government is doing on climate change you should elect another one. (We tried that in the UK last week and it didn’t work. Climate change and the environment were never discussed in the election campaign. Public awareness is the first challenge. People don’t know so people don’t care.)

This film reminded me of Al Gore’s “An Inconvenient Truth”. They both give an account of the threats and risks to our planet and to our life on earth, but they don’t say what we should do about it. “The Age of Stupid” was a similar film. “How could we have been so stupid as to get into this mess,?” it asked, but it didn't suggest any solutions. If you wait to the end of Al Gore’s film, as the credits roll you see little hints like, ”Drive a smaller car” or “Turn the heating down 1 degree”.

If you wait to the very, very end of Revolution, after all the credits - which are extensive - after the Canadian tax status statement, the very last line before fade to black  reads: “Open your eyes. Be brave. Fight for something.”

What? Fight for something? Is that it? If we don’t know what we’re fighting for we’re certainly not going to achieve anything.

The most memorable statement in the film for me came from Dr Patrick Moore (no, not the astronomer) A former Greenpeace activist and now an advocate of exploiting the Canadian Tar Sands. He said: “Tomorrow morning 300m vehicles in America need to start up to keep civilisation running. If they don’t get their oil from here, they’ll get it from somewhere else.” You can’t argue with that. At least, not in the short term.

The film criticises the negotiators at the Climate Conferences for all talk and no action. But we could criticise the activists and the filmmakers for all protest and no solutions. Ban coal, ban oil, but what then? And the Cancun conference was in 2010. Why nothing about the conferences which have taken place since? Why nothing about COP21, the next major UN Climate Change Conference coming up in Paris in December?

If you’re interested in the environment, in sustainability and climate change, you should see this film. It will remind you of the issues and probably add to your knowledge. If you’ve never taken an interest in these issues, you too should watch Revolution. It’s hard work to start with, but it provides a wealth of information. Make up your own mind as to what the action points should be. It’s not time for panic, but it’s no time complacency either.

Of course, you might turn round to me and say, “Right, if you’re so clever what course of action do you recommend?” And I could respond that I’m just the reviewer of the film; it’s not up to me. 

That’s  tempting, but it’s too easy, so here’s what I suggest.

We need to lobby governments to commit to clear targets for agreement in Paris in December. 

• A global fixed price for carbon, increasing year by year would be a start. 
• All those 300m vehicles, and all the others in the rest of the world, need to start up every day until we can create alternatives. Tax incentives must encourage rapid innovation in transport.
• We need to decarbonise electricity production by 2050, maybe earlier. This means that no-where in the world will we use fossil fuels to generate electricity. It’s a big ask, but many experts believe it’s possible. Make no mistake, to do this we will have to manage demand as well and eliminate waste so that demand can match supply.
• Governments must implement a public information programme so that people understand the reason for changes. This is probably the biggest challenge of all, because many politicians themselves do not understand the issues and quite a lot of them don’t want to believe the facts, for whatever reason.
• The international community must recognise that in the short term at least, poor countries and poorer people in developed countries will be hardest hit by the change from fossil fuels. Steps must be taken to protect them, for two reasons. One is that we have a moral duty to help those worse off than ourselves, and if you don’t buy that then if we neglect the poor there’s good chance that they will all rise up and destroy what we’re trying to do.
• Finally, it’s all very well to demonise mega-corporations, but given the vast proportion of the world’s assets that they control, it’s unlikely that we will achieve a low carbon world without their involvement. Governments must give them incentives to reinvent themselves, and penalise business as usual.

What do you think?

Will we all freeze in the dark this winter?

We’ve had a number of people warning us about blackouts this winter. Strange. I read a report 10 years ago called “Mind the Gap” which predicted that the lights would go out in 2015. Now we’ve heard from the heads of npower and edf, and the National Grid has just published its annual Winter Outlook Report. Ed Davey, Environment Secretary, has told us that there’s absolutely no cause for alarm, so now we know it’s really serious! Or do we?

Our problem is that electricity demand grows year by year and our power stations get older and older. As they get older they get less reliable, and this year we’ve had two major fires and four stations taken off-line for urgent boiler repairs. If there’s another breakdown, will we be plunged into darkness? And is darkness all we have to worry about?

National Grid is responsible for the distribution of gas and electricity across the United Kingdom. It doesn’t generate power and it doesn’t sell gas or electricity to consumers. It just provides the energy super-highway, and the generators and the energy companies pay to use it. National Grid must balance supply with demand and ensure that power is available wherever and whenever it’s needed. December and January are the months of greatest demand; hence the Grid publishes a Winter Outlook Report. The press have made much of the suggestion that the safety margin, the amount by which supply exceeds maximum demand, has fallen from 17% three years ago to only 4.1% now. 

These statistics, as always, have to be looked at in context. The 4.1% margin is against Average Cold Spell (ACS) demand, the coldest part of winter. Winter weather is unpredictable, so we could have a cold spell which lasts longer and is even colder than predicted. National Grid admits that it cannot predict the weather, but then, even the Met Office struggles at times. Apart from bad weather, the other risk factor is power station breakdowns. Although some are much bigger, the average power station accounts for around 1% of supply. So theoretically we could lose four of them, in the coldest weather, and still struggle by. Of course, this is a very unlikely scenario, and National Grid has in any case taken steps to increase the safety margin. Three power stations that were mothballed have been recommissioned and placed on standby. Two of them are gas turbine plants and can come up to full power very rapidly. 

On the demand side, National Grid has agreements with major industrial users to accept power cuts if usage exceeds available supply. Taken together, these measures bring the safety margin, in the worst weather, up to 6.1%.

So is everything all right then? Probably a lot better than the tabloid press might make you think, but there are surely underlying problems. As economic growth continues, energy demand increases. Many of our power stations are due for replacement, but energy policy from all governments has been fragmented and vague. It’s difficult to plan a power station with a 30 or 40 year life if the politicians’ horizon goes no further than the next election. My prediction is that things can only get worse, because there is no quick fix to a shortage of generating capacity. Even with a 6.1% safety margin National Grid can’t rule out localised blackouts, although they do expect to hold them to no more than 36 minutes. 

The popular reaction to blackouts is to rush out and buy candles, and that is certainly what we did when we had regular power cuts in the 1970s. The world has changed dramatically since then. We didn’t have mobile phones and we didn't have cash machines. We certainly didn’t have computers. Many families still kept warm in front of open fires. Remember, you may have gas central heating, but it goes off when the electricity goes off because all the controls are electric. Quite a lot of infrastructure has back-up generation. For example, you’ll usually find a diesel generator tucked away at the back of your supermarket. Generators support mobile phone masts - the remoter ones, anyway, - but a blackout is likely to close ATMs. If the weather turns really cold, make sure you stock up on cash. And it might be worth buying a camping gas stove so you can have a hot drink. And a wind-up lantern is so much safer than candles! In business, data is your most precious resource. You do always back up, don't you? Keep your laptop and your phone charged up. And a UPS - uninterruptible power supply - should be in place to let your larger computers power down smoothly if the power goes off.

All this is about electricity, but National Grid is responsible for gas as well and we use a lot of that in a cold winter; for industry, for central heating and for generating electricity. We still get gas from the North Sea, but it’s declining and we now import a significant proportion of our gas. The predictions of the Grid’s Winter Outlook are that we have a substantial margin of reserves and production over maximum demand - around 24%. The key risk factor here is political. Russia is a major supplier of gas to Europe and much of it is routed via Ukraine. If Russia restricts supplies to Ukraine, as it has done in the past, then the rest of Europe suffers. The UK does not import gas directly from Russia, but if supplies to Europe were cut any imports to the UK from the Netherlands or Belgium would probably be cut as well. 

The Winter Outlook takes this into account and assumes that any shortages would be made up by increased imports of Liquefied Natural Gas (LNG). Last year just under 20% of our imported gas was LNG and most of that came from Qatar in the Persian Gulf - not the most stable region politically. National Grid makes the point that we could maintain supplies by increasing these imports, but only by paying world prices which are highly likely to escalate if there is a shortage. As far as gas supply is concerned, we’re in a secure position. Cost is something else, so turn down the thermostat a degree or two, fit that double glazing and roof insulation, upgrade the boiler and enjoy as much heat as you can from as little gas as possible.

The supply and distribution of energy to the UK is clearly a highly sophisticated operation. Now there’s another factor to add to the risks from breakdowns, bad weather and politics. This week the Intergovernmental Panel on Climate Change (IPCC) published its fifth assessment report (AR5), warning that we must cut co2 emissions by drastically reducing fossil fuel use. Launching the report, Ban Ki-moon, UN General Secretary, said, “Science has spoken. There is no ambiguity in their message. Leaders must act. Time is not on our side.” At the moment, well over half the electricity in the UK is generated from fossil fuels - coal and gas. The UN urges nations to divest from fossil fuels and invest in renewables to prevent global warming from exceeding a 2℃ rise. The report shows how this path can improve economic performance. 

This is a big issue for the UK, where the government is offering substantial tax incentives and subsidies for the development of fracking. Fracking produces oil and gas securely, free from interference by foreign governments, but oil and gas are fossil fuels. Should we be going this way, when even the Rockefeller Foundation, based on the fortunes made from Standard Oil, is selling off its fossil fuel investments and investing in renewables? Surely the tax breaks and subsidies should be going into continued development of renewables. 

Whatever happens, we need some hard and urgent decisions made by government. Unfortunately the present government seems inclined to ignore the evidence, pushing on with fracking, talking about “green crap” and the “green blob” and with a former environment minister calling for our Climate Change Act to be suspended. Despite all this we need decisions. 

Decisions which will determine whether or not we spend our future winters freezing in the dark!

No surprises!

 No surprises in the Autumn statement after all the leaks. No surprise that Labour criticised the whole thing. Sadly, no surprise that energy policy, which is crucial to the long-term prosperity of the country, is being treated as a short-term political football. Obligations on energy companies have been relaxed so they are now able to save consumers about a pound a week on bills. Once again an increase in fuel duty has been scrapped. Subsidies for onshore wind power have been reduced and at the same time the duty on gas produced from fracking is cut in half.

In the short term, reductions in energy bills and the fuel duty freeze will help with the cost of living, (though Is £1 per week really important when the average energy bill is now some £1200 per year?) It’s suggested that the reduced support for onshore windfarms is designed to head off a threat from UKip, which is totally opposed to them. All these are good political points in advance or the 2015 election. Not sure why George Osborne is so desperately keen to promote fracking, when it’s clearly so unpopular!

Altogether, these measures are symptomatic of a chaotic energy policy. There are three issues that have to be taken into account when planning energy supplies - cost, security and pollution. 

Let’s look first at fracking. Driving high-pressure water down into shale deposits to drive out oil and gas looks like a good idea. It’s been very successful in the US. The Americans have reduced their carbon footprint by using shale gas, which is a much cleaner fuel than coal. They calculate that they are sitting on reserves of shale oil which are greater than all the oil left in Saudi Arabia. Certainly ticks the security box - as it would for the UK. We’re talking about resources firmly within our borders and under our control.

The trouble with fracking is that it doesn’t tick the other two boxes. Gas is still a fossil fuel which produces co2 when burnt. Globally, we cannot afford to burn all our fossil fuels because if we did the co2 would cause runaway global warming and extreme weather events which would damage food production and make some parts of the world uninhabitable. (Of course George Osborne doesn’t believe in this. He’s with the 5% of scientists who believe it won’t happen. The other 95% are sure it will.) Fracking uses vast amounts of water, it causes minor earthquakes and it releases methane, a highly potent greenhouse gas, into the atmosphere. Then there’s the cost. Nobody knows what gas from fracking will cost. Looks as though George expects it to be very expensive. That’s the second time he’s cut the duty! The sad thing is that fracking is no silver bullet. Nobody even yet knows whether it will work outside the US. In the UK the geology is different, the population density is different and the planning laws are different.

Relaxing the obligations on the energy companies means that they can slow down the process of offering free insulation for cold homes. Well-insulated homes mean less energy and lower bills. There are some (a very, very few) high-spec council homes that cost no more than £20 a year to heat. That’s the dilemma of the privatised energy companies. The less we spend, the less profit they make. In the long term more insulation, more efficient heating and lower bills are good for the consumer and good for the balance of payments. (Don’t forget, we import 20% of our gas from the Middle East, much of our coal from Russia, even electricity from France!) So who will win this one? The consumer or the energy companies? Don’t hold your breath.

Has the government really got an energy policy? Some of us have been warning for years that the lights could go out in winter 2014 or 2015, as power stations are retired before new ones are built. The government has announced a new nuclear power station that won’t be ready for 10 years, they’re offering subsidies to fracking but they don’t know if that works - and it will probably also take 10 years to commission. Meanwhile they are preserving demand by cutting back on insulation  and scrapping the fuel duty rise, and limiting supply by cutting wind power subsidies. Is that a credible policy?

August – and it’s all gone quiet

The Olympics are over, and everyone seems to have gone on holiday.

What have we got to look forward to when we get back? CRC is still with us for the foreseeable future. There were suggestions that it would be abolished in the Autumn, or replaced with something simpler, but will the Chancellor give up the £750m it yielded this year?

Mandatory Greenhouse Gas Reporting (GHG) has had wide press coverage. It’s been hailed as an example of the UK being a world leader in carbon management. How can this be?

• It will apply to UK-registered companies quoted on the Main Market of the London Stock Exchange, European exchanges, NYSE or NASDAQ. That’s about 1,800 companies, whereas CRC covers 2,700.


• The proposals are to monitor the six Kyoto gases. There are constant calls for CRC to be simplified, and that scheme only monitors the one gas – CO₂. They are even talking about including Scope 3 emissions (created by your product in the hands of your customer.)


•  There are no plans to impose penalties or charges for emissions.


• There is no standard methodology required for reporting.


• The whole consultation is very vague (only 6 pages.)

Greenwash, anyone? Oh, I forgot, it’s the silly season.

Hopefully there’ll be some sense by the time the consultation closes on 17^th October, but aren’t we leaving things a bit late? If the government is truly going to reduce the nation’s emissions by 80% by 2050 or even 30% by 2020, is a vague scheme which will allow people to report in any way they like really going to make a difference?

This certainly looks less and less like the greenest government ever. Was I really naïve enough to believe the hype?

In September, our new Sustainability Works website launches, based on my new keynote speech and my book of the same title.

You can keep ahead of the game because the book is AVAILABLE NOW on Kindle. 

 

Pay CRC PDQ. Is GHG your new USP?

CRC payments are due tomorrow – 31st July – which means the money must be cleared and in the government’s bank account by then.

Although it’s likely that the Chancellor will announce a consultation in September on replacing the CRC, it’s not over yet. The scheme could survive until the end of the first phase, which means that we’ll be reporting – and paying – right through to July 2014.

If the CRC is replaced, something will have to be done to replace the government’s £750m revenue from the sale of allowances.

There’s another consultation out since last week. DEFRA wants your opinion on the Greenhouse Gas Reporting draft regulations. Answers, please, by 17^th October.  At the moment the suggestion is that they will review reports by quoted companies in 2015 and consider widening the net in 2016 to include other large organisations. There is no suggestion of financial levies or penalties, but then, CRC was supposed to be financially neutral.

There is already controversy over the GHG Reporting proposals, particularly that no consistent method is required for measuring emissions. This and other concerns are raised in a recent Guardian blog. The idea of reporting is that shareholders and stakeholders will be made aware of the risks that the reporting companies face and presumably will encourage them to act responsibly. Doesn’t all this sound incredibly laid-back? Doesn’t it sound as though we’ve got all the time in the world?

So how is the government going to maintain or replace its CRC revenues? In the short term, while the scheme still exists, it could get the goose to lay as many golden eggs as possible by raising the price of carbon allowances. Watch out for the Chancellor’s Autumn Statement in October! Or maybe they’ll follow the example of the Australians, who are now taxing major CO_2e emissions from landfill at AU$23/tonne (£15.35). Or perhaps they’ll do both. But will it really make a difference?

Managing emissions is only one part of sustainability. I’ve just published a review of the issues called Sustainability Works. You can buy it for your Kindle here for only £1. Or if you’d like a free copy send me an email and I’ll let you have a link to the pdf version.

Something to read on holiday – and if you’re going on holiday have a good one!

 

 

CRC Update

More than 4,000 organisations still to register - less than 12 weeks to the 30th September cut-off - more time for disaggregation - PFI: who’s responsible? - landlord and tenant - Early Action Metric - monitoring carbon footprint - buying allowances - evidence pack and audit - super-smart metering to save energy and save cost.

The total number of CRC full participants was estimated at 5,000 and according to the Environment Agency only 651 have so far registered. That leaves less than 12 weeks for the remaining 4,349 to complete the process by 30th September. Of course you may already have started, but if you’re waiting to clear up some minor query or you have some doubts about your particular case the Environment Agency urges you to register now and sort out queries and errors later. No doubt there will be increasing pressure on the system as we get closer to the cut-off.

Good news if you were planning for disaggregation. The Environment Agency has extended the initial deadline until 31st July, although all your SGUs still have to be registered on their own account by 30th September.

Some organisations operate facilities provided under PFI and the PFI company has claimed that the organisation which uses the facilities is responsible. The Environment Agency has now made it clear that the “counterparty to the supply contract” principle applies, so if the PFI company is paying the bill then the PFI company is the participant.

CRC remains an issue for landlords. Remember, if you bought more than 6,000MWh of half-hourly electricity in 2008 you are a full participant even if you sold that electricity on to your tenants. When we get to the reporting phase, the landlord is responsible for reporting the total carbon footprint from all energy sources, including energy used by tenants. Can you negotiate an amendment to the lease? The CRC legislation gives you obligations, but no additional rights vis-à-vis the tenant.

If you are a tenant and taking steps to improve your energy efficiency, will the landlord pass on the benefit of lower CRC costs to you? Again, can you re-negotiate the lease?

Your Performance League Table position and your total CRC cost are both affected by the Early Action Metric and it’s not too late to get the benefit. The earlier you put in voluntary AMRs (automatic meter reading) the better, because the benefit is calculated on the proportion of your total energy that flows through them in 2010/11. Don’t forget gas meters. You have until 31st March 2011 to achieve the Carbon Trust Standard. As long as you have it in place by that date you qualify in full. The Environment Agency has just approved CEMARS as an alternative to the Carbon Trust Standard. Other standards are under review.

Quite apart from the Early Action Metric and your league table position, the surest way to reduce your CRC costs is to improve your energy efficiency and cut your energy bills. Have I told you about the super-smart metering that gives you instant feedback and detailed analysis for close cost control? Give me a call on 07803 616877 and I’ll tell you more!

Once registration is complete the next task is to prepare for the annual report and for the purchase of carbon allowances in April 2011. You need to have an evidence pack, and 20% of all participants will be audited. Have you been monitoring your carbon footprint since April? Have you got detailed records and an audit trail?

If you would like to discuss any of these points in more detail please give me a call on my direct line: 07803 616877. Together with strategic partners, Cyber Associates can help and advise on CRC registration, obtaining benefit from the Early Action Metric, monitoring your carbon footprint and establishing an employee engagement programme to maximise your energy efficiency.

I look forward to talking to you!

Best wishes,

Anthony Day

PS NoWatt, our super-smart metering partners, have a window in August due to customer holidays. If you want a rapid assessment and installation we can help you to start saving money on energy in a matter of weeks. Call me on 07803 616877!

Carbon Reduction Commitment

Is CRC just another tax?

If you’re liable for the Carbon Reduction Commitment (CRC) you should have heard from the Environment Agency by now. This measure will affect about 20,000 UK organisations - public and private - who pay for their electricity via a ‘half-hour’ meter. That’s any organisation with a peak load exceeding 100kW. About 5,000 of these will be spending £500,000 or more annually on electricity, and they will be full participants in the scheme. What does this mean? Any organisation with a half-hour meter will have to report its energy use and its carbon footprint. Not just for the department with the heavy electricity usage, but for the whole organisation including subsidiaries, branch offices and remote sites. Not just electricity consumption, but gas and fuel oil as well. Auditable records must be kept and there are penalties for non-compliance. Reporting starts now and in April 2011 the 5,000 largest users will have to pay for their CO2 emissions at £12/tonne, both for actual emissions in 2010/11 and forecast emissions in 2011/12. How much will that be for your organisation?

So is this just another tax? The government might say not, because in October 2011 it’s going to give all this money back - yes, every penny. What’s the point? On the basis of actual emissions in 2010/11 the government will construct a league table, ranking organisations according to how good they have been at reducing their emissions. When the government returns the levy the best performers will get more than they paid and the worst performers will get less. And the following year the targets will get harder.

This is all part of the obligation under the Climate Change Act to cut CO2 by 34% by 2020 and 80% by 2050. With UK emissions still growing, even standing still will be difficult. The oil price has been on the rise for most of this year, so energy is going to be expensive to buy and if you use it inefficiently the government is making it expensive to use!

Whatever the size of your organisation, have you got an environmental management system (EMS)? An EMS is a system of procedures and controls providing a framework for the management of energy, resources and waste. It will help you identify your energy usage and carbon footprint, to control them and monitor the savings achieved.

Cyber Associates have the skills and experience to help you design, implement and maintain an Environmental Management System for your organisation to ISO 14001.

More information at www.cyber-associates.com

The Age of Stupid

Do we need another misery movie?

Review: The Age of Stupid - premiere at Leicester Square and 65 cinemas across the country.

In The Age of Stupid Pete Postlethwaite addresses us from the wrecked planet of 2055 and asks how we could be so stupid as to let climate change destroy humanity. He flicks through endless archives showing us the obvious clues to catastrophe from 2009 and before. It seemed a long film, partly because technical problems meant that about 30 minutes of footage was played twice. Partly, too, because it replayed the breast-beating and lamentations already seen in Al Gore’s An Inconvenient Truth, Leonardo di Caprio’s The Eleventh Hour, The Day After Tomorrow and all the rest.

What these films lack, and that includes the live debate following The Age of Stupid, is a credible call to action. Watching this film you might conclude that the best thing to do is to run your car on chip fat, live self-sufficiently on a small holding and protest against the nasty nimbies who oppose wind farms. It goes without saying that there’s not enough chip fat and not enough smallholdings. The effectiveness of wind farms is also very much in doubt. After the film Pete Postlethwaite pledged to give back his OBE if the government approved the proposed new Kingsnorth coal-fired power station. Ed Milliband was there to respond, but they let him off extremely lightly by not once mentioning government support for Heathrow’s third runway. Surely that’s a much more powerful national political issue than some power station down in Kent.

Sustainable economic growth is still possible in a low carbon economy, but if we are going to solve this problem we must all drive less, heat less and consume less. Life will be very different - potentially much more pleasant - if we take the low-carbon route. The Age of Stupid has missed the opportunity to show what ordinary people can do to safeguard our future, and to show what sort of future we can all enjoy if we act now. Certainly the showing raised enthusiasm both in Leicester Square and in the cinema where I was, but I fear that people will be rushing off to protest, rather than rushing off to change their lives.

Let’s go carbon neutral!

Channel 4 was severely criticized for its programme about the "Great Global Warming Swindle" and last night turned its attention to carbon offsetting. This was an altogether more balanced documentary and demonstrated that the ideas of carbon offsetting and carbon neutrality need to be approached with scepticism.

Many big names on the high street, including HSBC, Barclays, Sky and Marks and Spencer either claim to be carbon neutral or to be on the way to achieving that state. What does this mean? Every individual, household or organization causes a certain amount of carbon dioxide, the principal greenhouse gas, to be emitted. The major trigger is energy; we all use energy and most of it is created from the combustion of fossil fuels – oil, gas or coal.

Organizations that want to be carbon neutral try and reduce their use of energy as far as possible. For the energy that they cannot avoid using, they deal with the emissions caused by buying offsets. For example, if a lorry travelling the length of the country day in and day out creates ten tons of carbon dioxide, planting a specified number of trees will cause that CO2 to be absorbed. The programme showed other offsetting projects: the pig farm where methane from the pig manure was trapped and prevented from escaping into the atmosphere; the hydroelectric power station in Eastern Europe which emits no CO2 at all. If an organisation buys enough offsets it can claim that the net effect is neutral - overall it is adding no CO2 to the global atmosphere.

The problem is that there are inconsistencies and imprecision at every stage of the process. To start with, you need to define exactly how much carbon dioxide is being emitted before you know how much you have to offset. There are no universally agreed standards and this can lead to farcical situations. If you want to offset the emissions created by your air travel, British Airways will sell you offsets provided by Climate Care. However, if you approach Climate Care directly to offset your flights, they will charge you more because they use a different method of calculation from British Airways and they believe that the emissions caused by flights are greater.

Suppose we have agreed on how much carbon dioxide needs to be offset. How effective are the proposed solutions? There is no doubt that trees absorb CO2 as they grow. It will, however, take several decades to absorb the CO2 that your flight emits in an afternoon. Some of the trees shown on the programme were far more heavily subsidized by the Forestry Commission than by the purchasers of offsets. If the trees would have been planted anyway, they cannot be considered as truly offsetting a particular purchaser’s emissions. There is also the problem that trees do not live for ever and while they may a lock up the carbon dioxide for a time, it will be released when the tree eventually dies and rots or is burnt. In any case, when you think of the hundreds of thousands of people in the UK who make flights every day, it is clear that trees cannot be the whole solution.

What about the hydroelectric power station in the Eastern Europe? Suppose the developer has the choice between a fossil fuel power station emitting CO2 and a hydro station which emits none. If this is a new development, building the hydro station avoids a certain amount of CO2 emissions, but it does not reduce emissions unless a fossil fuel station of the same size is closed down. There was no suggestion in the film that this was the case, (and by the way it seemed unlikely that the carbon offset payments made by Sky to the project had had any effect on whether it was going to be built or not.) The scheme does not appear to have reduced the global CO2 burden so it cannot be considered as an offset. Sky’s claim to be a carbon neutral organization is difficult to support.

As I said at the start, there is no clear universal definition of carbon footprints or carbon neutrality. Organizations can define them as they wish and can, in their own terms, claim to be carbon neutral. This is good marketing and attractive to responsible consumers. The problem is that it is doing practically nothing to reduce the CO2 in the atmosphere or to have any effect on climate change.

It is very much like rearranging the deck chairs on the Titanic. It may make people feel more comfortable and make them believe that something is being done about the dangers ahead. In fact there are icebergs ahead – only this time the problem is that they’re melting!

Spot the Difference

The Great Global Warming Swindle, the Channel Four programme which claimed that carbon dioxide was not the cause of global warming, suggested that sunspots and solar activity were major force. The theory is that solar winds drive away the particles that cause clouds to form and the reduced cloud cover means that the surface of the earth warms. In fact, while this is a respected theory, the actual observations show that there was little solar wind at the time the global warming was observed.

Dr Michael Lockwood of the Rutherford Appleton Laboratories in Oxford has published a paper in the Proceedings of the Royal Society complaining that the programme was selective in the use of his research findings. The graphs that were displayed were cut short at the point at which global warming and solar activity clearly diverged. As Dr Lockwood said, the sceptics were “..taking perfectly good science and bringing it into disrepute.”

It looks as though man-made carbon dioxide is still firmly in the frame as a major cause of global warming.

Public opinion, however, still wants to believe that everything can go on as normal.

Managing the message on climate change

I’ve already commented in the past that the climate change debate is a dialogue of the deaf. Certainly there’s lots of dialogue – maybe it’s because it’s World Environment Day tomorrow and the G8 Summit starts later this week.

Looking again at George Bush’s announcements on climate change we see a worrying message. He wants to call a global summit in America to discuss the issues to an American agenda. We already have the G8. We already have the IPCC. The last thing we want is the world’s biggest polluter trying to take over the debate. The US has made it clear that its economy depends ultimately on coal, and certainly that country has massive reserves. We know that burning coal releases CO2 – and many other substances that are far more harmful. The US line is that technology will find a way and we don’t need to cut consumption while we’re looking for the solution. No carbon trading or limits, they say, - we must not prejudice economic growth. The US is gambling on undiscovered technologies – and some believe that science proves that gamble is already lost.

Today China has entered the debate. In advance of the G8 they have announced a climate change initiative, but they too emphasise that the protection of economic growth is crucial. They recognise that there is much to be done, because China’s rapid industrialisation has led to far worse pollution than anything in the West, quite apart from CO2 emissions. As I’ve mentioned before, China is a major polluter but the pollution per head is much lower than in America and in many other countries.
We need to support China’s efforts to clean up.

We need to get used to using less energy ourselves (-not a bad strategy as it’s going to get scarce and expensive) and we need to build on what has already been developed by the G8 and IPCC – not start a new debate. We need a clear and constructive dialogue – not a dialogue of the deaf.

Good Housekeeping

More and more organisations are adopting environmental policies and taking specific actions to implement them.

Eclipse Internet, the ISP within Kingston Communications, has recently announced that it is carbon-neutral. The main input to an IT company is power and in calculating the organisation’s footprint Eclipse also included the emissions due to the daily commute of the workforce. This proved to be a not insignificant 23% of the total. Beyond making sure that heating and lighting in the offices is as efficient as possible there is only so far that such a company can go to reduce its carbon footprint without offsetting.

Carbon neutrality has been achieved in collaboration with the CarbonNeutral Company, by investing in projects which will either produce power without CO2 emissions or positively reduce CO2. Eclipse has invested in wind-farm technologies in India, a methane capture project in Pennsylvania and a Ugandan forestry project. All of these are designed not only to reduce carbon dioxide but also to support the local economies.

Carbon neutrality has a money cost – the cost of investing in the offsetting projects. The return is more difficult to quantify, but consumers are becoming more insistent that everything they buy should be “ethical”, “green” and “eco-friendly”. In response many big names on the High Street are making the investment. In time carbon neutrality may become the norm - or at least the aim - for every company (though not every company will be able to achieve it). Some progress towards carbon neutrality is likely to be expected of any organisation seeking public contracts.

Those who are first into this area will probably find their goals easier to reach through a wide range of offsetting projects. Later converts will have a smaller choice, but hopefully will sign up anyway.

Hopefully too, the market will be regulated so that the marginal operators who have been giving offsetting a bad name will be squeezed out.

Expanding Stansted

The British government is supporting the building of a £2.7bn second runway at Stansted airport. Already the atmosphere in the area is polluted to twice the level known to cause environmental damage. Increased airport use is expected to cause more pollution which will seriously damage Hatfield Forest, one of the oldest in Europe.

Quite apart from this, it is difficult to understand how the government balances this expansion with its commitment to cut carbon emissions by 60% by 2050. UK carbon emissions fell at the end of the 90s but they are on the rise again, and the 64,000 additional flights each year will mean that deeper cuts must be made elsewhere.
And then there’s the issue of resources.

Peak Oil means that fuel for all sorts of transport is starting to run out. There is no substitute for oil for aviation fuel, and even the oil industry itself is beginning to admit that future supplies will be more difficult to get and much more expensive. The Association for the Study of Peak Oil and Gas (ASPO) believes that energy shortages are much closer and much more serious than the effects of climate change. (Read their newsletter.)

Nevertheless, the government continues to act as though economic growth can last for ever. When resources become scarce will we come to resent the resources wasted on airports we can no longer use?

Fred Flintstone didn't drive a gas guzzler...

This is the title of an article by Ruth Lea in the latest New Statesman. You can find it here. Here's my reply:


"Yes, I agree, we can’t control climate change, and natural cycles and solar activity are probably part of the problem. But we can’t ignore that mankind has increased the amount of atmospheric CO2 dramatically in the last two centuries. We know that the greenhouse effect is real – it keeps the surface of the planet at a temperature that supports life – so upsetting the balance of greenhouse gases must be a risk.

Yes, the UK emits only 2% of the world’s greenhouse gases so we cannot change the world on our own. It’s a truism to say that if no-one does anything then nothing gets done, Yes, China is opening new power stations, but it’s trying to bring its population – 30 million of whom still have no electricity – up to a standard that’s still far lower than our own. China will generate carbon-free electricity from the Three Gorges Dam and is very advanced in the use of solar power. We must support them by our example.

We can cut our carbon footprint by cutting fossil fuel use. This will help us to adapt to the coming global energy crisis as fuels, led by oil, begin to run out. (And we’re talking within the next five years!) There is no alternative fuel with the capacity to replace oil and no technological solution to the shortages. It is just too horrific for most people to consider that the energy that drives our cars, heats our homes and produces everything we eat, use or wear is coming to an end. Read what the Association for the Study of Peak Oil and Gas www.peakoil.net has to say. Check on the statements of Dr Ali Samsam Bakhtiari, formerly of the National Iranian Oil Company; the presentations of international energy banker Matthew R Simmons and the books of Richard Heinberg and many others.

Changing to low-energy light bulbs is a step forward, but nothing to the changes that global energy shortages will impose on us in the next few years. We need to adapt to this now. Doing nothing is just not an option. Recognising the true problem would be a start."

They win some, we lose a lot more!

The government has announced a plan to shut 2500 POst Offices in order to save money.

Closing Post Offices may save the government £4m per week (very tiny in total expenditure terms) but it puts the cost of travelling to more distant central offices on to the consumer - many of whom are elderly or poor, or both. If people have to travel into town then maybe they will do their shopping there and the local shops near the closed post offices will lose business until they too close. Then everyone has to travel into town.

I thought the government was committed to lower carbon emissions, but these extra journeys will do the opposite. They may save £4m per week, but the hidden costs will be far, far more!

More about the bill

The government’s Climate Bill has been published. It has already led to much debate and it is, after all, a discussion document. Nothing is expected to be approved and implemented much before the end of 2008. There are many grounds for criticism, but first of all let us welcome the fact that something is being done, even if we don’t think it’s enough. Hopefully we can get it changed before it’s put in place.

The overall target of the bill is to reduce the country’s carbon emissions by 60% by 2050. There will be a series of five-year objectives and there will be legal sanctions if these are not met. If carbon emissions are as serious as we are led to believe, you could almost expect that progress towards targets should be monitored on a weekly basis rather than every five years. The government’s reaction is that if they were to set annual targets it would be easy to fail to reach them in any one year which suffered a very harsh winter. These things should average out over five years. Nonetheless, there should certainly be annual targets and annual reports on how close we are to meeting those targets because otherwise there will be no chance of meeting the five year target.

This bill introduces legal sanctions for failure to meet the emissions targets, but the way they are presented seems quite odd. It is not the polluters who will be penalized, but rather the government minister responsible, who will be hauled before the courts for a judicial review and if found guilty will have to make amends. These amends are the purchase of carbon offsets. This implies that if we don’t actually meet our targets, we can buy our way out of the problems by buying carbon credits. Secondly, these carbon credits will of course be bought with taxpayers’ money although the taxpayers themselves will have little control over the emission levels. Thirdly, ministers rarely stay in a particular office for more than two or three years, so by the time it becomes clear that five year targets have been missed the minister responsible will be far away.

Another aspect of all this is that the government talks exclusively about the control of carbon. The unspoken assumption is that if we restrict our carbon emissions then everything will carry on as normal. In fact, the best scientific estimates are that if we reduce our carbon dioxide emissions we will prevent things from getting worse than they otherwise would. The public does not seem to be aware that global warming, or rather global overheating, is a fact; that climate change is highly probable; that the sea-levels are measurably rising; that glaciers are receding and ice caps are melting and that there is probably nothing we can do to stop this happening within our lifetimes or within those of our children or grandchildren.

If we do cut back on our carbon emissions we may prevent from things being as bad as they might otherwise be. We still need to protect ourselves against the floods, the famines, the forest fires and the violent and more frequent storms that may well be caused by climate change as a result of global overheating. Nobody seems to mention this.

And as for the disruptions that will be caused as fossil fuels run out - well that’s another story that you’ve heard me comment on in previous posts!

No point having a blog

..unless people read it! I learnt the other day that people are most likely to visit a blog if they have read about it in someone else's blog. Apparently this beats search engines and any opther form of referral. I got this information from Graham Jones who specialises in internet marketing and optimising your presence on the web. Here's a link to his blog - http://www.grahamjones.co.uk

It's worth a visit - he's always giving away free stuff!

And if you write a blog on energy and climate change issues as I do, send me a link and I'll put it in another post - and I hope you'll do the same for me!

It's the law

...or at least it soon will be. Today the British government publishes its Climate Change Bill which is expected to set 5-year targets for carbon dioxide emissions. This comes after a weekend when the Conservative opposition were making it clear how green they were. Bit of a balancing act - they want to restrict air travel, but they don't want to upset families who might vote for them so maybe they will target the frequent fliers. Gordon Brown has also set out his stall in a speech, making it clear that he's green and voter-friendly at the same time.

The bill has already attracted criticism. Why have 5-year targets and not annual targets? If things are as desperate as the press and politicians tell us surely we should be watching the situation week by week. It's easy to be cynical and assume that climate change is just another bandwagon and a convenient excuse for raising more tax.

My own view is that the whole thing is far too simplistic. The unspoken message is that if we cut carbon dioxide we will stop global warming, avoid climate change and everything will go on as normal. In fact, the only effect we may have is to make future climate change less bad than it might otherwise have been. If we cut carbon dioxide by cutting our fossil fuel consumption we will also cut production of the other nitrous and sulphurous pollutants than no-one ever mentions, so that might be a hidden bonus.

The real threat of course is Peak Oil. As production volumes decline we will be forced to use less, travel less and consume less, but we could never tell that to the voters. As conventional oil declines it's likely that we will start exploiting oil from coal, shale or tar sands. And when we do that you can forget carbon dioxide limits or pollution controls!

2020 vision at the EU

This week European Union leaders have been debating carbon dioxide (CO2) emissions and they have a firm commitment to achieve at least a 20% reduction of greenhouse gas emissions by 2020 compared to 1990. Furthermore, they will increase energy efficiency in the EU so as to achieve the objective of saving 20% of the EU's energy consumption compared to projections for 2020,

Central to this is a binding target of a 20% share of renewable energies in overall EU energy consumption by 2020 and a 10% binding minimum target to be achieved by all Member States for the share of biofuels in overall EU transport petrol and diesel consumption by 2020.

Leaving aside the controversy generated by Channel 4’s film – whether CO2 reduction is possible or worth while – there must still be doubts about whether any of this is achievable. Elsewhere in this blog I have commented on how biofuels are much less green than people would like to think. Biofuel crops absorb CO2, but growing, harvesting and processing them takes up so much energy that the net gain is small or in some cases negative. Growing the crops puts pressure on food crops or rain forests, and to some extent we will burn green fuels while exporting the disadvantages of the fuels to third world countries where the crops are grown.

Biomass is part of the way towards reaching the EU’s 20% target. Today Drax Power, which runs the UK’s largest power station, announced plans to grow biomass on an area equivalent to one fifth of the land of Wales. This will produce sufficient fuel to provide 10% of the requirements of Drax. The station produces 8% of the UK’s electricity, so biomass will account for just 0.8%. If we took over the whole of Wales to grow biofuel crops we would still only achieve 4% of the UK’s electricity – and where would we put the Welsh? -