Wealth Creation and
Managing Climate Change:
The London Approach
Andy Deacon
GLA Environment Team
Latest IPCC Findings
Stern review and Economics
• Tackling climate change is a
“pro-growth strategy”
• Showed that the costs of
action to reduce emissions
now will be 1% per year or
less, whereas the damage
costs of business as usual are
likely to be in the order of 5 to
20 % of global GDP.
• London’s financial services
sector bears the brunt of
impacts wherever they occur in
the world.
• 2005 saw weather-related
catastrophe losses total almost
$80 Billion worldwide, and over
99% of all catastrophic losses
were due to weather–related
events.
Carbon Markets
IFSL/UKTI 2007
European 2003 summer temperatures:
normal by 2040s, cool by 2060s
Temperature anomaly (wrt 1961-90) °C
2060s
observations
HadCM3 Medium-High (SRES A2)
2003
2040s
Hot in the city
• 600 people died in the
August 2003 heatwave
• London had highest
numbers of deaths for
any UK region
• London’s heat island
means inner London
can be up to 9°C
warmer than the
greenbelt
• Further development
may intensity the heat
island effect
How is London vulnerable to CC
?
1
2
3
4
5
6
7
8
Tokyo
Japan
San Fransisco Bay USA
Los Angeles
USA
Osaka, Kobe, Kyoto Japan
Miami
USA
New York
USA
Hong Kong
China
Manila, Quezon
Philippines
40
<5
<10
20
<5
<10
10
30
9
London
UK
15
30
10
Paris
France
30
25
Sources:
1 Statistical authorities, various websites
2 Munich Re, 2004
a
710
167
100
92
45
42
41
31
a
3 Munich Re, Topics 2002
a GLA DMAG estimat es
Storm surge
Tsunami
Flood
T'storm/ hail/ tornado
Winter storm
Tropical storm
City
Volcanic eruption
Rank
City GDP
as % of
Risk
Country
country's index (2)
GDP (1)
Earthquake
Natural Hazards (3)
Current CO2 emissions from London
Domestic
38%
Ground Based
Transport
22%
7%
Industrial
33%
Commercial
and public
sector
44 mt CO2
Emissions Map – Total CO2 (2003)
Energy Strategy Objectives
•
•
•
Reduce London’s contribution to climate
change, by minimising emissions of carbon
dioxide from all sectors (commercial,
domestic, industrial and transport) through
energy efficiency, combined heat and power,
renewable energy and hydrogen;
Help to eradicate fuel poverty, by giving
Londoners, particularly the most vulnerable
groups, access to affordable warmth;
Contribute to London’s economy, by
increasing job opportunities and innovation
in delivering sustainable energy, and
improving London’s housing and other
building stock.
Mayor’s Climate Change Action Plan
• Four new programmes
– Green Homes
– Green Companies
– Green Transport
– Green Energy Supply
• Plus action on GLA own
activities and on new build
• An action-based, funded
programme to tackle climate
change
Required CO2 reductions
Today
Carbon Dioxide Emissions (MtCO2)
50
45.1m
Profile of national targets and
aspirations (against 1990)
44.3m
Proposed London reductions to
achieve 450ppm stabilisation
40
15%
20%
25%
10 year
target (2016)
= 20%
30
600 million
tonnes CO2
to 2025
20
30%
Target for London = 60%
60%
(vs 2000)
10
1990
2000
2010
2020
2030
2040
2050
Energy Hierarchy
1. Use Less (Be Lean)
Tonnes CO2
2. Supply Energy
Efficiently (Be
Clean)
Building
Regulations Energy
efficiency
2006
Measures
savings
CCHP
savings
CHP
tCO2
20%
Renewable
target in
tCO2
savings
tCO2
tCO2
tCO2
3. Use Renewable
Energy (Be Green)
Lean
Clean
Green
Final CO2
emissions
Prioritising decentralised energy
generation and renewables
•
•
•
•
•
•
Design to minimise CO2
emissions from the outset
Maximise passive design and
integration with CCHP/CHP
All major new developments
should establish or connect to
a local combined cooling, heat
and power network
Minimise need for active
cooling systems
Incentivise new technologies,
as an alternative to fossil fuels
Further Alterations proposals developments to achieve a
reduction in CO2 emissions of
20% from onsite renewable
energy generation
Further Alterations to the London
Plan
Proposed new policy:
•
Boroughs should ensure that all LDFs identify and safeguard existing
heat and cooling networks and maximise the opportunities for providing
new networks that are supplied by decentralised energy. Boroughs
should ensure that all new development is designed to connect to the
heating and cooling network. The Mayor will and boroughs should work
in partnership to identify network opportunities, to ensure the delivery of
these networks and to maximise the potential for existing developments
to connect to them.
Supporting text:
• This area wide approach should provide more market certainty for
Energy Services Companies (ESCo) as it should remove some of the
risk of developments not being designed to connect to decentralised
energy. The scale of opportunity for delivery may also increase
competition between ESCos and encourage the creation of small and
medium size ESCos to deal with the different scales of development.
Main Panel Recommendations on
Climate Change
• Overwhelming support for Mayor’s
approach
• New policy on Living roofs and walls
• New policy on provision of heating and
cooling networks
• Clarification on SPG on Renewable
energy and investigation of strategic fund
• Review of SPG on Sustainable design and
construction and standards in relation to
Code for Sustainable Homes
Panel recommendations (2)
• Adaptation policy – add minimising water
use and green infrastructure
• Reference to role of soft landscaping in
front gardens
• Standard for water usage in homes
reduced to 105 litres/person/day for
consistency with level 3 of Code
Overall Savings – Existing London
Plan
CO2 emissions in tonnes/year from 113 developments
with energy statements
Overall CO2 savings in tonnes/year
from energy efficiency (EE), CHP/CCHP
and Renewable Energy measures
(113 developments)
Cumulative CO2 savings over time
(113 developments)
160,000
140,000
tonnes CO2/yr
120,000
Release of the
London
Renew ables
Toolkit
Additional staff
join GLA
planning team
Total Savings
CHP
100,000
80,000
60,000
Im plem entation
of the London
Plan
Energy
efficiency and
passive
design
Renewable
energy
40,000
20,000
0
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03 03 03 03 03 03 04 04 04 04 04 04 05 05 05 05 05 05 06 06 06 06
Supporting publications
Sustainable Design and
Construction SPG: Published
May 2006 and includes
guidance how to approach
community heating, CHP and
CCHP in planning applications.
London Renewables Toolkit:
Published in September 2005
to provide technical support to
GLA planners, London
borough planners and
applicants on incorporating
renewable energy technologies
in line with the Mayor’s London
Plan policies.
http://www.london.gov.uk/mayor/environmen
t/energy/docs/renewables_toolkit.pdf
UK Power Flow Pattern 2006/7
• broad estimate is that
only 40% of the heat
generated in the
combustion process in
grid power stations is
used in the generation of
electricity
• Losses in power through
transmissions and
distribution amount to
approximately 9% of
demand
Decentralised energy
generation
• Powering London into the 21st Century Report1:
• High Decentralised Energy Scenario from 2005 to 2025:
–
–
–
–
–
33% Reduction in CO2 Emissions.
35.5% of London’s Energy Demand.
15% Reduction in Natural Gas Consumption.
Fuel Flexibility (inc. Renewables).
Local Security of Supply.
1. Greenpeace Powering London into the 21st Century – March 2006
Sources of savings from energy
supply
Microrenewables
7%
31%
Changes in
National Grid
mix
Combined
Cooling Heat &
Power
47%
15%
Energy from
biomass &
waste
Barriers to Increased Decentralised
Energy
•
•
There are serious market barriers which prevent decentralised energy from
expanding to meet the climate change targets required of it.
These are all matters that involve the interface between decentralised energy
and the market for large scale, centrally generated electricity production:
i) For all but the small schemes (which currently have licence exempt status),
the costs and burdens associated with licensable status in respect of electricity
supply and distribution;
ii) The cost of standby and top – up (imported) electricity to decentralised
generators and the price offered by licensed suppliers for exported power;
iii) The arrangements with licensed electricity suppliers for the transport of
licence exempt electricity between decentralised energy sites;
•
There is an urgent need for reform of the electricity regulatory and licensing
system, so that medium size and larger decentralised energy schemes do not
have to participate in a market structure which is not designed for them, but at
the same time fully protecting consumers.
Investing in London’s Future
• Carbon scenarios to 2026
• Different technology scenarios costed
• Hybrid scenario - £8.5 billion required over
20 years
• Investing in the low carbon future
• Delivery mechanisms discussed with
investment community
• Substantial investment appetite identified
• Onward work looking at buying cooperative, rental scheme, project facilitation
service & green fund.
C40 Cities Initiative on
Commercial and Public Sector
Buildings
• New end to end service with
three elements:
– Energy audit
– Carbon reduction
measures
– Loan for upfront outlay
• Work with 5 of the world’s
major banks and 4 Energy
Services Companies
• $5 billion raised so far
What’s on the Horizon?
• Carbon Reduction Commitment Proposal to save emissions totalling
1.2 MtC/year by 2020 from large non
energy intensive business and public
sector organisations
• Other consultations arising from
Energy White Paper – ongoing
Decentralised energy work by
OFGEM and others
• Carbon performance standards –
– Building Regulations tightening
– Code for Sustainable Buildings
– Energy Performance of Buildings
Directive
• Local authority performance
indicators