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Past seminars

Labour Party Conference 2005

Carbon Management: Competing in the 21st Century

09.00 - 10.30, Wednesday 28 September 2005

Venue: Ash Room, Quality Hotel, West Street, Brighton

Speakers:

Chair

Sponsor:

Overview

One of the key strategies of the 21st century for combating climate change is for business leaders to act now to not only control carbon emissions, but to understand and manage the effects that climate change will have on their relationships with customers, shareholders and the community. SERA's fringe event aimed to discuss how a strategy of Carbon Management could work to achieve reduced carbon emissions alongside increased efficiency in UK businesses.

Nicky Gavron, Deputy Mayor of London

Climate change must be tackled through the combined forces of business and politics. Cities and municipal councils in particular have a very important role to play. Climate change is of the utmost importance as global warming is accelerating so quickly and therefore can no longer be ignored. For example, we only have a predicted 7 years to stop temperatures from rising before icebergs begin to melt. It is important for national government to set targets and barriers and to make full use of effective leadership and incentives.

In the UK we use a massive amount of energy, which is a great motivation for us to not only tackle climate change but also to lead the way globally and set an example for other nations to follow. London has great scientific and business expertise and resources which make it an excellent city to lead the way in climate change. Many enlightened businesses such as BP are improving their own standards regarding carbon emissions, thus showing other businesses that it is possible to be both environmentally and commercially successful.

City governments still have a lot of catching up to do, especially London. We aim to be very imaginative in London by putting sustainable development at the heart of all policy. We want to make London a global city by being progressive and working towards a "compact city" comprised of dense neighbourhoods with reduced car usage.

The congestion charge has already reduced carbon emissions by 19% in London. We now need to look at extending the use of solar panels on buildings, sustainable construction and design, and using hydrogen as an alternative source of energy. We have the potential to be producers of renewable energy as well as consumers. Businesses need political will and public action to have the confidence to wage forward in climate change and reducing carbon emissions - therefore, the public have an important role to play in supporting innovative environmental solutions.

The Climate Change Agency is backed by leading businesses, and has been set up as a wholly owned municipal company, with all the shares being owned by Mayor of London Ken Livingstone. In many cases, businesses think that using renewable energy sources is not commercially viable. However, the Climate Change Agency aims to show these businesses how environmentally friendly solutions can be viable, through providing locally produced energy services. Another option which needs to be put to greater use is CHP (combined heating, cooling and power generation). This is where four different forms of energy are produced from the single primary source - hot water, steam, cooling (chilled water) and power generation (electrical energy), in order to increase efficiency and flexibility while significantly reducing waste and carbon emissions. The big hits for such schemes as this will be new developments in London, in particular clusters of commercial buildings.

Currently, a huge percentage of carbon emissions in the capital come from buildings and the power used in them. The Carbon Accounting Group has been set up to ensure that the government is leading by example. City Hall, Transport for London, and other government agencies must make full use of renewables and become energy efficient. The sustainable development market is a new growth sector in which there could be a lot of money as it expands over the next few years. However the greatest prize will be a greener, better environment for all.

Dr Garry Felgate, The Carbon Trust

The Carbon Trust works to help businesses to reduce CO2 emissions and take opportunities placed before them in terms of carbon management.

What are the drivers for business and why should they act to manage carbon?

1. Costs - the less energy we use, the less carbon we emit. Through working towards increased energy efficiency and changes in energy processes, costs, as well as emissions, can be reduced.

2. Regulation - initiatives such as the EU Emissions Trading Scheme are changing the regulatory environment

3. Reputation - one idea is to create labels for public buildings such as shops, which give the energy efficiency category of the building, so that customers can choose to shop with or use the services of the most efficient businesses. This publicity may then persuade companies to improve their level of efficiency.

The Carbon Trust is currently working with over 100 organisations to reduce carbon emissions and improve energy efficiency.

Andy Wales, Severn Trent

Efficiency must be an important factor in shaping business patterns. Severn Trent generates 5% of the UK's renewable electricity supply and aims to expand further. Global warming will hit the water industry first in the form of floods and droughts. We need to adapt and plan now for a climate change future. We have the responsibility to advocate change and enact it in businesses. There is a real need for greater understanding and projection of environmental issues surrounding climate change and carbon management. Severn Trent are currently in a paradoxical position - increased recycling has lead to increased emissions from the transportation which collects the recycling and takes it to the relevant sites. This has led to a trade off between waste management and carbon emissions, the best solution for which would be the use of environmentally friendly transportation to collect waste such as those run on biofuels. Waste biomass and biothermals in general need to be considered further in the production of electricity. It is also important to look at the whole picture of waste, recycling and carton emissions when making plans or forming policy.

Elliot Morley, Minister for the Environment

There is a need for a greater encouragement of Carbon Accounting within companies. A framework must be set in government for a scheme of carbon trading. It has been demonstrated by the EU Emissions Trading Scheme that carbon trading can work and was popular with many companies. Each company would be granted a carbon allowance which states how much carbon they are allowed to emit. This allowance could then be bought and sold between companies - a system which would ultimately go global. There has already been interest in adopting such schemes from Japan, California and other progressive nations and states.

An expansion of this system to a domestic level could eventually involve everyone having a carbon credit card, where if you are a low carbon emitter you could sell your credits back to the carbon bank and someone else could purchase them. This could develop into a national person-by-person scheme used for things like petrol as well as home energy efficiency. This could be done for energy too as part of a huge progressive vision for the future, which involves a carbon economy and currency.

Questions and Answers

Jonathon Leek, Sunday Times - On the issues of labelling, should there be clarity and transparency over carbon and energy. How can this be clear and unequivocal?

Looking at home energy efficiency in particular, one solution could be to have buyers/sellers packs produced whenever houses go on the market, clearly labelling the energy efficiency level of the house, as well as detailing things such as if the house is in a flood zone, etc. This could also tie in with ideas about green mortgages.

Elliot Morley - Labelling is very important. The government also needs to set standards on public buildings. The Sustainable Procurement Task Group sets targets for every government department to produce sustainable procurement strategies. More needs to be done both practically and to increase awareness about the importance of the issue.

Emma Burnell, SERA. Can the 2012 Olympics be made into a Green Olympics?

Nicky Gavron: London is aiming for a zero-carbon Olympics, and discussions and planning are already underway to try and make this a reality.

There is currently a huge programme underway for refurbishing and rebuilding schools - what incentives are there to make these schools energy efficient?

Nicky Gavron: There is a lot to do in terms of public institutions which London Authority has a very progressive attitude towards. Money for schools will be withheld if refurbishment does not include a plan for energy efficiency. Though initial costs for these sorts of programmes can be high, we need to look at full life costings to see the real benefit.

Do the members of the panel support Mark Lazarowiz and Alan Whitehead's Private Members Bills concerning microgeneration, which advocate new buildings being constructed with their own energy producing facilities?

Elliot Morley: I support the bill with some changes made. Some things in the bills are vital and if the bills fail they should be pursued in a public bill.

Andy Wales: Any energy producers, such as in micro wind turbines, where the generator does not have to go up to 30 000V and come back down again saves up to 5% on energy emissions. Therefore microgeneration is a key solution for reduced carbon emissions, especially if it is combined with increased home energy efficiency.