Large companies to be forced to implement energy efficiency

Shadow Chancellor Ed Balls last night criticised the Government for not doing enough to promote energy efficiency.

Proposals for an Energy Savings Opportunity Scheme (ESOS) have been published by the Government that will make it compulsory for large companies to undertake energy audits.

The aim is to enable companies to identify opportunities for saving on their energy bills through improved energy efficiency. The Department for Energy and Climate Change (DECC) estimates that up to £1.9 billion could be saved.

The proposals form part of the Government's implementation of the EU Energy Efficiency Directive, under which large enterprises have to identify cost-effective ways to invest in energy efficiency. These ESOS assessments will be carried out by approved assessors.

The proposed scheme would apply to all large enterprises in the UK, including charities and any other UK organisations outside the public sector, if sufficiently large. Small and medium enterprises (SMEs) will not be required to participate, unless they are part of a large corporate group enterprise, but could do so on a voluntary basis.

An ESOS assessment would undertake a review of the total energy use and energy efficiency of the organisation, including the measurement of an energy intensity ratio (e.g. energy use per employee or per unit of output) and, as appropriate, considering the variation in energy use over time within key buildings, key industrial operations, and key transport activities (exempting de minimis energy use).

The review would need to be proportionate and sufficiently representative “to permit the drawing of a reliable picture of overall energy performance” of the organisation and present clear information on potential savings, which identify and quantify cost-effective energy savings opportunities.

These should be, wherever practical, based on life cycle assessments (LCA) instead of simple payback periods (SPP), as the former are more realistic.

All procedures for doing this are outlined under the international standard for energy management, ISO 50001, with which all energy and facility managers are encouraged to become competent.

The Government has come under sustained criticism recently for failing to do enough to promote energy efficiency.

Last night, speaking at a Green Alliance event, promoting their report, which said that £180 billion of new infrastructure is at risk without political leadership, the Shadow Chancellor, Ed Balls, promised that Labour, if elected, would set a decarbonisation target and do more to promote energy efficiency.

He attacked the Chancellor George Osborne for “scaring away” green investment in infrastructure and energy efficiency.

He said that on energy efficiency the government had “failed to deliver. The construction industry is crying out for clarity on the next steps in Labour’s successful zero-carbon homes strategy. The Green Deal, which replaced previous successful domestic energy efficiency schemes, has so far helped just four households this year".

He added: "We will also put an end to the mixed signals that are causing confusion and deterring investment by posing a false choice between gas and renewable energy. We support efforts to secure new domestic gas supply, although there are real environmental concerns that must be addressed. We will need a secure gas supply in the decades ahead.

"But while 'fracking' has had a major impact on energy prices in the US, most experts believe any impact in Europe is uncertain at best. Any balanced and low-carbon energy strategy for the years ahead will need gas, renewable energy and, in our view, nuclear too," he concluded.

DECC's consultation will close on 3 October 2013.


Shadow Chancellor Ed Balls last night criticised the Government for not doing enough to promote energy efficiency.

€22 billion EC R&D package to support low carbon industries

Máire Geoghegan-Quinn, European Commissioner for Research, Innovation and Science, said that the partnerships will underpin growth and jobs in key sectors of a knowledge-based European economy.

The European Commission has announced a €22 billion Innovation Investment Package for sectors including fuel cells and hydrogen, biofuels and cleaner, quieter aircraft.

In total, more than half of the money will go to low carbon industries.

The programme intends that over the next seven years, the EU's contribution of €8 billion will mobilise €10 billion from the private sector and close to €4 billion from Member States.

It will be accomplished through the establishment of a series of public-private partnerships under the

These are in form of Joint Technology Initiatives (JTIs) between the EU and industry to provide vital funding for large-scale, longer-term and high risk/reward research.

They set out commitments, including financial commitments, and address strategic technologies that will underpin growth and jobs in key sectors of a knowledge-based European economy. Over four million Europeans are currently employed in these sectors.

The initiative will help make Europe a more attractive location for international companies to invest and innovation and contribute to meeting many EU objectives, including 3% of GDP invested in R&D and 20% of GDP coming from manufacturing by 2020.

Máire Geoghegan-Quinn, European Commissioner for Research, Innovation and Science, said at a press conference that many of the EU's competitors are investing faster and they are thinking big. "There need to bolster both public and private spending if we are to stay in, never mind ahead of the game," she said.

Most of the investment will come through five JTIs:

1. Clean Sky 2 (CS2): to develop cleaner, quieter aircraft with significantly less CO2 emissions;


2. Innovative Medicines 2 (IMI2): to develop next generation vaccines, medicines and treatments, such as new antibiotics;


3. Fuel Cells and Hydrogen 2 (FCH2): to expand the use of clean and efficient technologies in transport, industry and energy;


4. Bio-based Industries (BBI): to use renewable natural resources and innovative technologies for greener everyday products;


5. Electronics (ECSEL): to boost Europe’s electronics manufacturing capabilities.

The Commission is also proposing to extend the SESAR (Single European Sky ATM Research), which aims to modernise Air Traffic Management in Europe.

The public-private partnership of the Biobased Industries Consortium (BIC), a cross-sector group of 48 large and small companies, is worth €3.8 billion; it will accelerate the deployment of biobased products in Europe by 2020.

"This is a unique partnership that places sustainability at the heart of all economic, social and industrial activities," said Berry Wiersum, chief executive of Sappi, a global paper company. "It is about realising the untapped potential of biomass and waste, to deliver sustainable growth in Europe."

Guy Talbourdet, chief executive of Roquette Frères, said that BIC comes at a critical time for European development of the bioeconomy. "It will accelerate the market entry of new biobased products 'made in Europe' in the so-called biorefineries. The use of locally grown biomass will not only enable growth and jobs in rural areas across European regions, but it will also reduce the EU's reliance on fossil or proteins imports."

The Proposal for a Council Regulation on the Fuel Cells and Hydrogen 2 Joint Undertaking will expand the use of clean and efficient technologies in transport, industry and energy and improve energy security in Europe.

NEW-IG (New Energy World Industry Grouping), the leading European industrial association, that represents much of Europe’s hydrogen and fuel cell industry, acknowledged that some 150 projects and over 430 industry and research organisations have already won support under the current programme.

This will now be continued under the new proposals, which will step up activities with a €1.4 billion budget until 2020. Pierre-Etienne Franc, Chairman of the Board of NEW-IG called the announcement “a sign that Europe will strive to establish this technology as a key enabler for its future energy and transport roadmap. Joint priority setting and a long term perspective are key to enabling private investment in such complex, societal challenges.”

Màire Geoghegan-Quinn added: "Thanks to the current Fuel Cells and Hydrogen partnership, you can take a ride on hydrogen-powered pollution-free buses in five cities across Europe.

"But much research and development is still needed to make this application of FCH technology widespread and those for clean energy production and storage commercially attractive. The EU and industry will continue to work together under this new initiative to help reduce the carbon footprint of our energy and transport sectors."

Henri Winand, CEO of Intelligent Energy, observed, “This public-private partnership is testament to the very real possibilities of hydrogen as an important energy vector for more sustainable and competitive energy systems.”

The Commission's proposals are expected to be finalised and approved by the European Parliament by the beginning of 2014.

Fierce lobbying on biofuels criteria as EU cap passed

The bête noire of the bioethanol and biodiesel industry, Timothy Searchinger, argues that their use increases world hunger.

MEPs voted 43-26 in favour of a 5.5% cap on European support for biofuels, as new research showed that growing fuel crops in place of food creates more hunger and deforestation.

Today’s vote was on whether to endorse a strict cap on crop-based biofuels, to curb emissions from ‘indirect land use change’ (ILUC) caused by, for example, the clearing of forest to grow palms for oil.

Lobbying is fierce on all sides of the argument, as parts of the biofuels industry that have invested billions in securing first and second generation biofuel sources, now found to be harmful, fight to preserve the status quo. But other parts are in favour of the move and want it tightening further.

On the side against the cap are MPs in Humberside and East Yorkshire, where some of these companies are based, who are backing a campaign by the biofuel industry trade organisation, the Renewable Energy Association (REA).

REA's Head of Renewable Transport, Clare Wenner, argued: “If it was mandatory for all land-using industries to account for emissions from the direct conversion of land from one use to another, as the biofuels industry does already, then there would be no such thing as indirect land use change."

But new research throws up an additional problem: when agricultural land that has been used to grow food is converted to biofuels, food prices will go up causing some people to go hungry unless previously uncultivated land is made productive.

The research, by Princeton University researcher Timothy Searchinger (known as ‘the godfather of ILUC’), says, in his words: "Biofuels have almost doubled the rate of growth in demand for food, and the system is having a hard time keeping up. If demand growth stopped, prices would come down as farmers caught up, although their efforts to catch up will cause more land use change."

His latest analysis, produced with the help of the EU’s Joint Research Centre, of a report by the International Food Policy Research Institute (IFPRI), found that of every 100 calories from wheat or maize diverted to food tanks by bioethanol production, 25 calories were not replaced.

The European Renewable Ethanol Association, is also against the cap. “I wouldn’t expect anything good to come out of Searchinger,” said Rob Vierhout, its secretary-general. “Whatever he says, he is biased. He is not even a scientist. He is a lawyer and could defend any position you want him to.”

In a previous life, Searchinger was an attorney for the Environmental Defence Fund, and wrote a prize-winning book on wetlands that led work to protect the Everglades and Mississippi river.

Another lobby group, composed of the Chief Executive Officers of leading European biofuel producers and European airlines, called 'The Leaders of Sustainable Biofuels', is in favour of the cap and wants to ensure the market uptake of advanced sustainable biofuels by all transport sectors.

It issued a statement supporting EU policy to gradually phase in less harmful third generation biofuels and supporting the ILUC principle.

But it foresees a further threat lurking in a proposed extended list of feedstock that would be eligible for support as advanced biofuels, namely the use of animal fats and used cooking oil, palm oil residue/waste and any other food feedstock waste.

It says that were used palm oil to be supported in this way, it would be "absurd and counter-productive to the objectives of this legislation".

The long list of feedstock eligible for advanced biofuels, prepared by the EU Committee on Industry, Research and Energy (ITRE), includes a number of disputable raw materials which should, this group says, therefore be excluded from the definition because it would once more "open the door to unsustainable biofuels production from food and feed crops".

Looking forward, 2020 marks the deadline for 10% of EU's transport fuels to be sourced from renewable energies. Before then, by 1 July 2014, all new biofuels installations must meet a 60% greenhouse gas saving threshold and, by 1 December 2017, all biofuels installations in operation before 1 July 2014 must meet a greenhouse gas saving threshold of 35% and 50% a year later.

By the end of 2017, the Commission will submit a review of policy and best scientific evidence on ILUC to the European Parliament and Council.

After 2020, the European Commission will not support further subsidies to biofuels unless they can demonstrate "substantial greenhouse gas savings".

15,000 jobs at risk as official support for offshore wind wavers

The launch of the London Array last week saw David Cameron praising offshore wind: but will it deliver British jobs?

Britain is not making the most of its opportunity to become the ‘Saudi Arabia of offshore wind’, according to a new report from the think tank IPPR, putting up to 15,000 jobs at risk.

The report, entitled Pump Up The Volume, says the British Isles have ideal building conditions for offshore wind, with large areas of sovereign seabed in shallow waters and close to shore.

However, it warns that the Government is not making sufficient effort to bring down costs and secure British jobs.

Offshore wind is currently more expensive than unabated gas, onshore wind or nuclear. By 2020, the cost is expected to have fallen rapidly, but it will still be more expensive than those three technologies.

Only a small proportion of offshore wind farm components are built in the UK, varying from 10% for London Array Offshore wind farm, opened last week by David Cameron, 20% for Thanet Offshore wind farm, 48% for E.ON’s Scroby Sands development, 50% for Vattenfall’s Ormonde project and 32% for E.ON’s Robin Rigg development.

These figures do not include operational and maintenance costs, which are inherently local in nature and accumulate over the lifetime of a wind farm.

IPPR argues that the levels of British workers' contributions to offshore wind will need to increase in order to realise the economic benefits of the sector in terms of jobs and growth and to maintain political commitment.

Vince Cable's business department consulted earlier this year on the feasibility of achieving the Offshore Wind Developers Forum’s vision of 50% local content.

Observing that the Government has backtracked on its ambition to secure 18GW offshore wind by 2020 and expects instead just 4.4GW to come online between 2020 and 2030, the report points out that up to 15,000 jobs could consequently be lost that would otherwise have been created.

“The UK's current policy trajectory could see it achieving a ‘worst of all worlds’ outcome: low volume, low jobs, and high costs," said Will Straw, Associate Director at IPPR, launching the report.

Pointing out that there are cost reductions to be obtained from working at scale, he added: "Unless Britain 'pumps up the volume' there is little prospect of either bringing down the costs of offshore wind or creating domestic jobs. An alternative pathway is possible, if the Government can bring together an industrial strategy for the sector predicated on a combination of ‘carrots and sticks’".

He also reiterated the need for a 2030 decarbonisation target, which would give the industry "the long-term clarity that it needs, and which has been provided in other countries".

Instead, he said, "developers must be expected to drive down costs with a subsidy regime that reduces the strike price over time".

He also added that "developers and suppliers should do more to provide apprenticeships and sponsor university and FE courses” to meet the skills gap.

The report recommends that in order to build a strong domestic offshore wind supply chain, the Government needs to attract at least two turbine manufacturers, preferably more, to build factories. This "would be a major boost, as these companies are able to attract a cluster of other companies further down the supply chain (as is the case in Denmark)".

It must also, the report argues, continue to support and build upon the country's existing strengths in the supply chain, building on its expertise in both the onshore wind and the North Sea oil and gas industry, and should support export opportunities for British firms. A new EU renewables target would help create export markets to 2030.

On the issue of reduced ambition for offshore wind, DECC clearly stated in the 2011 UK Renewable Energy Roadmap that "up to 18GW of offshore wind could be deployed by 2020 ... with over 40GW possible by 2030".

In June of this year, however, they appeared to change their ambition by announcing that the subsidy regime would allow for just 8–16GW by 2020.

DECC’s ‘central scenario’, published last October, sets out a much less ambitious path, leading to just 11.5GW by 2020 and 16GW by 2030.

The government's watchdog, the Committee on Climate Change, believes that this latter scenario "would imply unacceptable costs and risks of achieving the 2050 [decarbonisation] target".

Both developers and suppliers are concerned. The industry argues that several ports need to be upgraded to provide construction and assembly facilities for the supply chain, but the port owners will not do so unless they are given government reassurances.

Meanwhile, in relation to the grid, the lack of a costing of risk allocation between the developers and the transmission operators could result in offshore wind being more expensive than it needs to be.

DECC has not yet responded to the report.

Consultation opens on world’s first tidal lagoon

A detail from the 3-D flythrough designed to show what the lagoon will look like.

Public consultation has opened on the world’s first purpose-built tidal lagoon in Swansea Bay.

Public exhibitions are taking place at 18 locations around the Swansea Bay area from 4 July to 5 August.

The proposed tidal lagoon will have a rated capacity of 240MW, generating 400GWh net annual output, or enough electricity for approximately 121,000 homes, representing 70% of Swansea Bay’s annual domestic electricity use (Swansea, Neath & Port Talbot, 173k households); or about 9% of Wales’ annual domestic electricity use (based on 1,369k households).

The £650 million development will also host visitor facilities and other amenities including art, education, mariculture and sporting/recreational facilities.

The seawall is expected to be open to the public during daylight hours, though access will be controlled in extreme weather.

As part of the formal consultation for the proposed Development Consent Order (DCO) application by Tidal Lagoon (Swansea Bay) plc (TLSB), a new, virtual 3D programme has been prepared, which shows the lagoon in the context of Swansea Bay using an interactive fly-through.

Head of Planning for TLSB, Alex Herbert says: "This tool will help people to experience and understand the lagoon proposals as accurately as possible, so their feedback can help us to develop a truly world-class facility. All feedback from consultation will be taken into account as we move towards making a planning application later this year.”

Alister Kratt, Partner of LDA Design, said: “As the project develops, the opportunities that the masterplan provides should secure significant benefits for Swansea, including the completion of an attractive marine park which extends into the bay.”

As the project is an offshore electricity generating station of more than 100MW, it is considered to be a Nationally Significant Infrastructure Project (NSIP) under the Planning Act 2008, and so requires that a DCO is first granted by the Secretary of State for Energy and Climate Change via an application to the Planning Inspectorate (PINS).

Because it is located in Welsh coastal waters, it also requires a marine license to be granted via an application to the Marine Licensing Team of Natural Resources Wales (NRW) on behalf of the Welsh Government.

Additional consents may also be required from City & County of Swansea Council (CCSC) or Neath Port Talbot County Borough Council (NPTCBC) for elements of the Project which sit outside the NSIP and DCO.

How the plant will work

In order to control the flow of seawater to generate electricity, the Tidal Lagoon will be built by forming a 9.5km-long, U-shaped seawall running from Swansea Port out to sea before curving back to re-join land adjacent to Swansea University’s new Science and Innovation Campus (SAIC).

The seawall will have a sediment core held in place by a casing of sediment-filled geotextile tubes, known as Geotubes®.

The outside of the structure will be covered in rock armour of various sizes, depending on its level of exposure. The sand used to form the walls will be taken from within the lagoon footprint.

Rock armour will then be brought in by sea to provide protection. The top of the seawall will have an access road which will be used for operation and maintenance of the lagoon as well as for visitors.

In the south-western part of the seawall there will be a turbine/sluice gate housing structure. The housing structure will contain between 16 and 22 hydro turbines, which will be permanently underwater.

These turbines (which will be 7m-8m in diameter) will generate electricity on both the flood (in-coming) and ebb (out-going) tides. There will also be around 10 sluice gates, which will be underwater and able to let seawater in and out of the lagoon without going through the turbines, as required.

To generate electricity, as the sea starts to rise (flood tide) from low tide level, water is prevented from entering the lagoon for an average of 2 hours 5 minutes, and this creates a difference in water levels, known as ‘head’.

Once sufficient head has been reached, the water is allowed to flow into the lagoon through the turbines, turning the runner (which is shaped like a propeller) and generating electricity.

This process is repeated on the ebb tide, where the water is prevented from leaving the lagoon until there is sufficient head to start the process again.

Towards the end of the ebb or flood tide the sluice gates will be opened. This is to empty or fill the lagoon as quickly as possible before low or high tide level.

By doing this, it ensures that the lagoon water level is as close to the outside sea level as possible, before the tide starts to rise or fall again.

This is to maximise electricity generation and to keep the intertidal area as close as possible to that occurring naturally outside the lagoon.

An option to pump the seawater at the end of the tide is also being looked at to further equalise seawater levels.

This generation sequence will happen four times a day in total. The electricity generated from the lagoon will be transported to the nearest National Grid substation at Baglan by underground cables.

The cables will be laid in the seawall and then alongside existing roads/paths to the River Neath and onto the substation. To cross the River Neath, the cable will either be put through existing disused pipes or it will be drilled underneath the river.

Tidal Lagoon Power Limited

Tidal Lagoon Power Limited is privately funded and founded by Mark Shorrock, CEO, who has founded four companies including Wind Energy Ltd, a Scottish-based developer of wind farms. He grew Wind Energy Ltd into the largest independent developer of wind farms in the UK with over 650MW of wind farms moving through the planning process.

In 2006, Mark founded Low Carbon Investors, investment manager of the AIM listed Low Carbon Accelerator fund which he also founded. In 2008, he founded Low Carbon Solar Holdings, a private investment vehicle currently investing in solar power plants in Spain.

Prior to founding TLP, Mark was a founder of Low Carbon Solar which, in 2011, developed and funded the deployment of £70m of solar energy, totalling 28MW.

Tidal power globally

There are currently three large scale uni-directional tidal range plants in operation: Annapolis in the Bay of Fundy, Canada (30MW), La Rance in Brittany, France (240MW) and Sihwa in Korea (254MW).

There are also experimental tidal range energy projects being tested in Russia, UK, Australia, USA, Argentina, Canada, India, Korea and Mexico.

Potential sites for tidal range energy projects include the UK, France, Eastern Canada, Pacific coast of Russia, Korea, China, Mexico and Chile.

Other sites have been identified along the Patagonian coast of Argentina, Western Australia and Western India. In total, 70% of the Earth’s surface is ocean and 500,000km2 of that offers over four metres of tidal range.

Swansea Bay is one such place, and has been chosen as it offers the necessary conditions for building lagoons: the water must be shallow and the tidal range must be large.

The Severn Estuary holds the second highest tidal range in the world and Swansea Bay reaches a range of just over 10m.

As well as benefitting from this key characteristic, Swansea has a gently sloping seabed (suitable for this construction method) and proximity to a population centre, such that transmission losses are minimised from the electricity produced.

Minister meets 'test family' in zero carbon home

Energy Minister Greg Barker MP (right) with Laura and Nik Glazebrook and Paul Hicks of VELUX, outside the four bedroom CarbonLight Homes project in Kettering, Northamptonshire.

Energy and climate change minister Greg Barker yesterday saw for himself the benefits of living in a low energy house when he met one of two test families who are living in a 'CarbonLight Home' as part of a 15 month study.

The VELUX CarbonLight Homes are located in Kettering, Northamptonshire. Mr Barker toured the houses accompanied by Kettering Borough Council’s leader Cllr Russell Roberts, and met the Glazebrook family, who are living in one of the homes as part of a study to measure the homes’ energy performance and monitor their effect upon the families’ overall health and well-being.

“This energy-efficient home is inspirational," said Mr Barker at the end of his visit. "It dispels the myth that green living involves sacrifices of style, luxury or comfort. It’s so bright, light and airy, with high ceilings and lots of family space.

"It’s clearly delighting the couple and their kids who live here. This vision gives something to learn from for the rest of the country."

He used the opportunity to promote the Green Deal, which he said "is giving people a chance to retrofit their homes with energy efficiency measures by removing expensive upfront costs.

“And it’s great to see new, efficient, homes, like these ones in Kettering, being built as well.

“Our housing stock is currently among the least energy efficient in Europe, so upgrading older homes and building new more efficient ones is absolutely vital if we’re going to cut our emissions and help people reduce their energy consumption.”

Paul Hicks, Sustainability & Design Manager at VELUX, added: "It is crucial that the green agenda is placed at the forefront of government policy-making. We hope the Minister’s visit to the CarbonLight Homes has demonstrated that innovative design can be employed to create inspirational carbon neutral houses, encouraging a wholly sustainable lifestyle and offer a viable solution to the challenge of reducing carbon emissions.”

The two homes meet the future demands for sustainable buildings and were developed with a focus on the health and well-being of their occupants. They are also designed to interact with local conditions and use natural resources to reduce carbon emissions.

While in the area, the Minister also met with the MP for Kettering, Philip Hollobone, and a range of public and private sector partners to understand more about the area’s innovative approach to energy efficiency and sustainability issues.

Councillor Russell Roberts, Leader of Kettering Borough Council, said that Mr Barker's visit "follows an on-going dialogue with him on the opportunities that exist in Kettering and we are keen to continue this dialogue in the future."

The VELUX CarbonLight Homes

These homes have been designed and built to the new government definition of ‘zero carbon’, and are intended for ordinary people. They make use of their surrounding environment in an intelligent way to maximise daylight and encourage a sustainable lifestyle.

Design-wise they are open plan and incorporate high levels of daylight and natural ventilation in order to minimise energy consumption among residents and generate a sense of community.

They intended to demonstrate that common-sense design can be used to create inspirational sustainable houses that can be easily replicated by the UK’s volume house builders.

The CarbonLight Homes were developed in a strategic partnership between the VELUX Group, HTA Architects, Kettering Borough Council, Willmott Dixon and the North Northants Development Company, WindowMaster, VELFAC, Drexel and Weiss and Sonnenkraft supplied the products for the house.

The CarbonLight Homes are one of six buildings in Europe to be constructed by the VELUX Group as part of the Model Home 2020 project.

Model Home 2020

Model Home 2020 is an experiment launched by the VELUX Group that represents its vision of how future buildings can be both climate-neutral and comfortable and attractive places to live, through use of daylight and fresh air.

The project is designed according to the next generation of design principles, called ‘Active House’, in order to achieve a balance between energy efficiency and optimal indoor living conditions.

The building dynamically adjusts to its surroundings and yet is climate-neutral. Each instance of the design must reflect and respond to the different climatic, cultural and architectural conditions of the countries in which it is constructed.

Model Home 2020 comprises six demonstration projects. Each was implemented in close cooperation with local and regional partners, suppliers, architects, engineers and researchers.

The demonstration houses will be open to the public for 6-12 months after completion and then sold. They will then be monitored during occupancy to learn how the experiments turn out in real-life conditions.

The experiments in Denmark, Home for Life in Aarhus and Green Lighthouse in Copenhagen, have been in use for a year, those in Germany and Austria opened in the autumn of 2010, and those in the UK and France opened in 2011.

Two more finance institutions divest from fossil fuels

Christine Tørklep Meisingset, Storebrand's Head of Sustainable Investments, said she believes the stocks will be “financially worthless” in the future.

Storebrand, a Norwegian financial services group, and Dutch bank Rabobank have become the latest companies to announce they will pull out of the investments in the fossil fuel industry, citing the stability of long-term investments as the major factor.

Storebrand has investments in 13 coal and six tar sands enterprises which it will let go. It said in a statement that it believes these stocks will be “financially worthless” in the future.

“If global ambitions to limit global warming to less than 2 degrees Celsius become a reality, many fossil fuel resources will become unburnable and their financial value will be dramatically reduced,” said Christine Tørklep Meisingset, Head of Sustainable Investments.

“Exposure to fossil fuels is one of the main sustainability challenges facing business, so for us it is a logical and necessary step to adjust our investments accordingly,” she said.

The decision was made public a day after a similar announcement from Rabobank, an ethical Dutch bank with a partnership with WWF. This institution, which specialises in financing agriculture and food businesses, has said it will no longer invest in shale gas or tar sands.

It said it believes that the risks of water and soil contamination from fracking, and the risks to biodiversity, ecosystems and local residents, are too high.

It will also refuse loans to farmers who decide to lease their land for such purposes.

The company cited a recent Duke University study, published in the Proceedings of the National Academy of Sciences, of 414 one drinking water boreholes in Pennsylvania, a location where natural gas production increased by 69% in 2012, which found methane in 82% of samples. The claim is that nearby drilling has caused the gas to migrate into water.

The notion of the future worthlessness of present investments in fossil fuel extraction has been termed a 'carbon bubble'. The term comes from a March 2012 Carbon Tracker report, 'Unburnable Carbon'.

This found that the fossil fuel reserves owned by the top 100 listed coal and top 100 listed oil and gas companies would, if unleashed, emit a total of 745GtCO2, which represents five times the amount that can be burnt unabated, without catastrophic risk to the planet.

In other words, 80% of these assets are, according to current technology, unburnable.

Meisingset added: "We do not offer 'ethical funds' at Storebrand. The same high sustainability standards apply to each and every company and sector. This offers an unprecedented level of security for our clients. No matter which fund or portfolio their assets are invested in, the same high standards apply".

As a direct result of these higher standards for fossil fuels, all 13 coal producers in the Energy sector (MSCI All Countries index) are excluded from Storebrand’s portfolio. In addition, the exclusion covers the six oil companies that have the highest exposure to oil sands, measured by both actual production and reserves.

In total, Storebrand has excluded 177 companies and 32 countries for breaches of the company's minimum standard for sustainable investments.

As PV installations double, everyone is urged to install LEDs

“It’s important for mac birmingham to be as sustainable as possible,” says Simon Creed (left), head of technical resources at mac birmingham, here seen with Paul Hutchens, managing director of Eco2Energy in the art gallery.

There was a huge increase in installations of feed-in tariff-linked solar PV systems in Britain during June 2013. 64.4MW of PV were installed over a four-week period from June 3 to June 30, according to figures supplied by DECC.

That is over double the 30.7 MW installed over the previous four-week period.

As prices have come down, the number of installations has increased throughout 2013, with 215MW installed in the first six months of the year.

Even so, there is no denying that the upfront investment is high. For those in charge of commercial and domestic environments, there is a wide choice of much easier ways to reduce a carbon footprint and see drastic reductions in energy bills.

According to Steven Ellwood, Managing Director of lighting provider BLT Direct, switching conventional lights for LEDs can provide a quicker, more reliable and higher return on investment than installing PV solar, since it is so easy and prices of these units are also tumbling.

They fell by 1% on the global market in the same month, June.

“Energy-saving lighting solutions are a much faster and more convenient way to give a home or business an eco-friendly twist," says Ellwood. "They are easy to install, they start making savings immediately, and there is not a huge initial outlay to add them to a home or commercial environment.”

The vast majority of the energy-saving LED lighting solutions that are on the market nowadays have bases which are compatible with existing fittings in many buildings.

Often it is just a case of simply replacing the old bulbs or strip lights. However, it is recommended that reputable installers and brands are used, since some products now available are of poor quality.

Even ‘feature lighting’, such as those commonly reserved for high energy-using halogens, are available in LED fittings, reducing energy usage by around four-fifths or 80%.

Although more expensive, LEDs can pay for themselves through the energy saved within six to nine months.

These bulbs also have much longer lifespans, meaning that once installed, they immediately begin to save money and contribute towards helping the environment for many years at any time of the day or night, says Ellwood.

Moreover, he adds that they also make a good companion to solar panels, since they reduce overall electricity requirements, meaning that the electricity from the panels will go further.

Birmingham's arts centre lights the way for sustainability

For instance, Birmingham’s popular arts centre, mac birmingham, is set make significant energy savings and reduce its light pollution, thanks to advanced LED lighting installed by energy efficiency specialist Eco2Energy.

The £7,000 investment is expected to save mac over £3,000 per annum on energy running costs and reduce CO2 usage by approximately 5,918kg each year.

Attracting over 850,000 visitors per year, centre is planning to make even more energy savings by replacing a further 250 lights.

“By making a relatively small investment, we’re able to further reduce our carbon footprint and save on energy costs,” commented Simon Creed, head of technical resources at mac birmingham. “It wins on every level and with payback on our investment expected in less than three years, we couldn’t be happier."
It is not the first investment in green technology at mac birmingham.

The complex kick started its ‘green initiative’ in 2012 with a 9.9-kilowatt solar PV system installed by Eco2Energy’s sister company Eco2Solar.

It now generates over 9,000 units of green energy per annum, equivalent to making 214,000 cups of tea.

“It’s important for mac birmingham to be as sustainable as possible; our aim is to be as energy efficient as we can and share this with our visitors by creating a ‘green zone’," said Simon Creed.

Midlands based Eco2Energy, part of Eco2 Solutions Group, was appointed as project installer to replace 100 track lights with high energy efficient LED lighting in the complex’s public galleries and main gallery.

Paul Hutchens, managing director of Eco2Energy said: “mac birmingham is a prime example of how businesses can invest in smart energy technologies and see immediate savings.”

“It’s excellent to see such a prominent complex in the regional arts community be so passionate about becoming totally energy efficient.”

Eco2Energy has developed its own ‘business friendly’ smart energy assessment designed to make energy efficiency simple for businesses.

Eco2Energy’s low carbon consultants work with businesses to review current energy usage, identify where savings can be made and make recommendations on the best efficiency measures to reduce carbon omissions and energy bills.

With a comprehensive range of smart energy technologies including LED and Low Energy Lighting, Voltage Optimisation and Building Energy Management. Other energy-saving solutions include Energy Efficient Cooling and Insulation.

How do you communicate action on climate change?

It's values that count in getting people on your side.

Anyone trying to get the public or interested parties on board for a project in the energy and environmental industries, or any campaigner working in the area of climate change, at some point has to find a way to 'sell' their project and the reasons for it; in other words, to 'sell' the relevance of renewable energy, energy efficiency, or climate change to particular groups of people.

This is not as easy as it sounds, and this week it was my pleasure to organise and participate in a workshop led by George Marshall, of the Climate Outreach and Information Network (COIN) on the subject of communicating climate change, which was based on his considerable research into the topic.

A classic mistaken piece of publicity, I suppose, is the TV advert prepared by Defra, and related press advertisements, for its Act on CO2 campaign. You can't actually see it at that link, although you can read about it.

Two of the press advertisements were withdrawn following numerous complaints to the Advertising Standards Authority.

Astonishingly, Defra never tested this advert before airing it on national TV. All they did was show it to other people in the Department, thus wasting about £18 million of public money, George Marshall told us.

The danger of this type of advertising (another example is the disastrous TV ad by 10:10) is that it alienates more people than agree with it. It's no good producing a piece of work that addresses the values of one group of people, if everyone is going to see it.

Conversely, George gave a 'thumbs up' to a series of adverts by British Gas in which they showed people from various different backgrounds just talking about how they felt about climate change.

A workshop exercise encouraged us to talk about our feelings around climate change and what we ourselves do about it, rather than referencing science or reports. The difference was dramatic.

The lesson is: emotions are what chiefly connect most people to other people, especially if they feel that their values are shared.

George is working on a book which involves talking to people in the Republican right (Tea Party) in America about their feelings about climate change.

It's in America where opinions about climate change have become the most polarised on ideological grounds, with four out of five Democrats supporting action on climate change, and the corresponding proportion of Republicans having the opposing viewpoint. It's produced stalemate in Congress on climate change action.

If ever anyone is to bridge the gap between those constituencies, it would have to be done by finding what values they share with each other, perhaps segmented subgroup by segmented subgroup (for example working class black Texans, or middle-class white New Englanders).

There are plenty of things which George recommends we avoid: visual cliches (polar bears, cracked mud, floods) and verbal ones (words like green, eco, save the planet), not just because they are overused, but because they don't address the values the audience cares about.

Not even talking about money that can be made from a particular action (carbon trading for example) is necessarily the right approach, since doing this alone ignores the social reward which might be gained by undertaking the required action, which, in the end, can be far more important than making money.

"Don't assume that any existing campaign works," he says. "What are the values of your target audience? Speak to them. Ask them. Note down what words they use, then employ them back if relevant".

The second rule is to generate an aspirational social norm. He cites as a really successful campaign, one that has been used for 30 years in Texas to stop people littering. It doesn't even mention litter, just has a series of country music celebrities, whom the target audience will recognise, each saying "I don't do it', followed by the punchline slogan: 'Don't mess with Texas'. It's tough, it's macho, it's Texan, it's effective.

Just look at the other slogans on that link: "Be patriotic: respect and love the land you live on".

Another campaign rooted in good market research, not yet launched, which he shared with us, is one aimed at the Welsh people. The research showed that people in Wales value above all their landscape and their sense of community.

Part of the reason why the campaign against wind farms in Wales has been so successful is because it possesses all of the attributes of a good campaign: it is viral, community-based and speaks to common values.

It also plays upon people's fear of change.

The campaign to counter this would appeal to the same values, but point out that the landscape has always been "shaped by the hard work of the people".

It will point out that climate change is not something in the future, which people can push away and pretend is not happening now and so therefore does not justify action today. It will say that climate change has been happening since the start of the Industrial Revolution, its effects are being felt now, and they will only get worse in the future.

It will celebrate that Wales is blessed with natural resources that we value and can utilise: they may once have been coal, but are also, and always have been: water, wind, forests, sunshine and sea.

And it will point out that there is a long tradition of renewable energy in Wales: people have been using hydroelectric power for over 100 years. They have been using wood for fuel for much longer.

The uplands of Wales were not always how they are now, with a consequent need to preserve them in this state, but were once covered in mixed forest and teeming with wildlife. Many of these hillsides have been denuded by sheep farming and conifer plantations planted in rigid rows.

The landscape is not ‘natural’ and has always been in flux.

Wind farms, in other words, are part of the Welsh tradition, and can bring many benefits to the communities that host them.

A successful campaign must also recognise that the environment is also the streets outside our front doors, the air we breathe, and is affected by how we dispose of our rubbish.

A further point made by George is that many people (but not all) value belonging to a community.

If, therefore, a member of their peer group can be persuaded to advocate the action that we are looking for, then they will listen, and change.

Connected with this, an enhancement that George would have recommended to the feed-in tariffs programme would have been that each person implementing FiTs would, firstly, display in their window a small notice explaining what they have done, and secondly be financially rewarded for each person they recommend to join the scheme in their community.

These features could be applied to any of the renewable energy support schemes the Government is currently promoting and greatly boost their success.

To take an example from a parallel field, I happened to be part of the communications team for childhood immunisation in the NHS at the time of the first MMR controversy in 2001-02. My response was to publish friendly, factual material so parents could understand the importance of immunisation.

But people don't base their decisions only on facts and reason.

Having listened to George, if I was doing it again I would get mothers who have immunised their own children to simply say why in their own words.

Because these mothers talking from their own feelings are so much more likely to be trusted than the government.

A testimony of this sort carries the message: "I am one of you. I care for my children so I immunised them. I think everybody should do so, for the common good."

Similarly, for climate change, you yourself should say to your audience: "I am one of you. I care about climate change because it is already affecting me," and then advocate the action that you are trying to achieve.

British Prime Minister opens world's largest wind farm

David Cameron called the London Array  "a big win for is renewable energy" because it shows that we can "have renewable energy projects at scale... right here in Britain".

Yesterday saw the launch by Prime Minister David Cameron of the world’s largest offshore wind power plant, the London Array, located in the Thames estuary, approximately 20 kilometres off the Kent and Essex coast.

Owned, developed and built by a consortium consisting of Dong Energy, E.ON and Masdar (Abu Dhabi’s state backed renewable energy company), it has a total capacity of 630 megawatts (MW) and will generate enough power to supply 500,000 British households with clean electricity.

It is estimated to reduce annual CO2 emissions by approximately 900,000 tons, equivalent to the emissions of 300,000 passenger cars. Construction involved over 75 organisations and 6,700 people.

The London Array consists of 175 wind turbines supplied by Siemens, who also made the grid connection. Dong Energy and Siemens will be responsible for the service of the wind turbines through a long-term agreement.

DECC said that companies from all over the UK had benefited, "with construction supplies ranging from cable manufacturing in Yorkshire to boats from Brightlingsea to wind towers from Scotland".

Speaking at the launch, the Prime Minister used the occasion to back wind power and overseas investment in Britain, calling it "a triple win".

“First of all it’s a huge win for Kent. This project has been built by some of the bravest seaman, some of the most talented engineers, some of the hardest workers, and it’s going to continue to bring benefits to people in Kent for many, many years to come," he said.

He added that it's certainly "a big win for is renewable energy" because it shows that we can "have renewable energy projects at scale... right here in Britain".

Thirdly, he said it proved that Britain can "do big projects", citing also "a superb Olympics", Crossrail, "the biggest construction project in Europe", London Gateway, "the biggest port construction taking place in Europe", and "here you have the biggest offshore construction anywhere in the world. I think this demonstrates Britain is a great place to invest,” he concluded.

Energy Secretary Ed Davey called it “a bulk generator of power feeding into the diverse mix on our grid. It’s attracted billions of inward investment into our economy".

He added that the reforms outlined in the Energy Bill are intended to make sure that more projects like this come about.

Other massive projects (a total of 15 GW) are already in the pipeline, such as Teesside, Gwynt y Mor off the coast of North Wales and West Of Duddon Sands off the north west coast of England.

At Gunfleet Sands, off the Essex coast, the next generation of even more powerful offshore turbines is being tested in the water for the first time anywhere in the world.

At the end of March, the 75th and final turbine was installed at Lincolnshire's windfarm off the coast of Skegness, which has the capacity to power more than 200,000 homes.

Speaking at the opening, RenewableUK’s Chief Executive, Maria McCaffery, said: “The Prime Minister’s ringing endorsement of Britain’s offshore wind industry is a real boost for the entire renewable energy sector, which is a key growth area for the British economy.

“We’re about to witness a massive expansion in the number of people we employ in the wind industry onshore and offshore, from about 12,000 now to 76,000 by the dawn of the next decade, as long as Government remains supportive – today Mr Cameron has assured us that it will”.

The UK is expecting that offshore wind farms will help it reach its legally-binding targets to cut carbon emissions, with an aim of developing 18 gigawatts by 2020.

Larger community renewable energy schemes to receive extra support

Energy and Climate Change Minister Greg Barker said: "The expansion of our reformed Feed-in Tariff will encourage even more communities to get on board.”

New proposals to benefit community energy schemes have been unveiled by the Government.

In its response to feedback from community groups on the type of financial incentive that works best for them, the Department for Energy and Climate Change (DECC) has said it will increase the generation threshold under which community projects are eligible for feed-in tariffs (FITs) to enable larger projects to benefit.

Support for community renewable projects over 5MW is currently available under the Renewables Obligation (RO). But this pays a lower amount per kilowatt-hour than that available under FITs.

The reforms, to be written into the Energy Bill and underpinned by secondary legislation, will permit community schemes up to 10MW in size to continue to benefit from the levels of support available to those below 5MW.

Projects such as solar PV on school roofs or panels on libraries, community owned wind turbines and hydro power from local streams could all benefit under the proposed new rules.

There is also money on offer to pay for excess power exported back to the grid.

Energy and Climate Change Minister Greg Barker said: "The Coalition is determined to drive a step change in the deployment of community energy.

"We want to help consumers, businesses and communities generate more of their own clean, green electricity locally, becoming less reliant on centralised power generation. The expansion of our reformed Feed-in Tariff will encourage even more communities to get on board.”

The announcement comes on top of the launch last week of a £15 million Renewable Community Energy Fund to help community groups with the cost of feasibility studies and seeking planning permission.

DECC is also keen to explore what needs to be done to kickstart even more projects across the UK, with a call for evidence currently underway and the UK’s first community energy strategy to be launched in the Autumn.

The call for evidence wants to hear about the potential benefits of community energy, the barriers to community energy, and what might be innovative and new approaches.

The proposed changes to the FITs rules will be made as part of the Energy Bill process. Once this Bill comes into force, the Government will consult on what it will mean in practice for community schemes.

The Solar Trade Association welcomed the proposals. Its chief executive, Paul Barwell, said: “Community solar farms on lower grade agricultural land help farmers diversify their risk away from increased weather risks to their land, while at the same time fostering dual purpose land use and biodiversity. Community ownership will help secure better community acceptance for more ambitious solar farms over the existing 5MW threshold.”

However, the STA  believes that there is still an issue which needs clarifying that is preventing many community schemes from getting off the ground.

Currently all solar schemes over 50kW (the size of e.g. a school scheme) are subject to very stringent capacity constraints. For example, in any quarter, if more than 200MW of capacity of 50kW+schemes is installed, this will result in a 28% cut in all the tariffs from 50kW through to 5MW.

Furthermore, for schemes over 250kW (larger commercial or community schemes), the FIT is too low to work, leading to just a handful of projects at this size since last July. This is despite schemes over 250kW being more cost effective than many large-scale renewables supported under the Renewables Obligation (RO).

STA Head of External Affairs, Leonie Greene, said: “Solar is being unfairly constrained. It is this 'normal' mid-size of solar, dominant in markets overseas, that needs urgent attention.”

The STA is currently finalising its best practice guidance for high standards in solar farm construction, which recommend avoiding prime grade agricultural land, and provide a set of criteria which developers, builders and land tenants can use to ensure best practice.

Carbon price rises following European backloading vote

Although the bill may not become law, multinationals such as Shell, and energy secretary Ed Davey, are calling for further structural reform of the EU-ETS.

Prices of carbon on the market rose 12% following the European Parliament's vote yesterday in favour of EU Emissions Trading Scheme back-loading proposals.

The bill could determine the amount that industry in Europe will pay for its energy over the next 40 years by increasing the price of carbon allowances in the EU emissions trading scheme (EU-ETS) through a temporary withdrawal of emission permits from the market.

Today, EUAs are trading €.35 higher at €4.68, a rise of around 12%.

Edward Davey, Secretary of State for Energy & Climate Change, welcomed the vote, saying: “This is a good decision by the European Parliament and is an important step forward for climate change policy. We need a stable carbon market so we get a more certainty for investors so emissions reductions can be achieved at the lowest cost possible."

He said that the next challenge was to "focus on securing agreement to the proposals in Council in order to facilitate a deal", referring to the next stage in the passage of the bill, which will see discussions between the European Parliament, the Commission and the Council of Ministers, where most countries support the plan.

However, Poland is opposed, while Germany and Spain are undecided. It therefore remains unclear whether the bill will gain enough support to become law.

“Alongside this," Davey continued, "there should be a parallel focus on the urgent need for structural reform of the European Emissions Trading Scheme, in order to promote growth in low carbon industry in the longer term. We are calling on the European Commission to bring forward legislative proposals by the end of this year, along with 11 other EU Member States”.

The bill is intended to make it cheaper for companies to invest in clean technology such as renewable energy.

Opponents charge that it will make the price of fossil fuel-derived energy more expensive for high energy users such as the paper and steel industries.

Royal Dutch Shell and other multinationals have welcomed the vote, agreeing with Davey's call for structural reform.

Shell’s chief climate change adviser, David Hone, said that: “Backloading sends a political signal about the importance of the EU ETS, but does not address the structural problems. We urge the Commission to come forward as soon as possible with proposals for structural reforms,” he said.

What this lobby group would like to see is permanent cancellation of allowances that have been distributed too liberally, causing a glut on the market and prices to fall to a level that cannot support the amount of investment in low carbon technology required to tackle climate change.

The Renewable Energy Association's Head of Policy, Paul Thompson, while welcoming the vote, also agreed with this point: "Although the UK has already introduced its own ‘Carbon Price Floor’ designed to top up the carbon price, it is clearly preferable for carbon prices to be stable across the EU. Today’s vote goes some way to achieving this, and will reduce the risk of UK energy intensive industries being put at a competitive disadvantage. However, we remain of the view that wider scale reform of the EU ETS is needed to fix the longer term problems with the market.”

Analyst Thomson Reuters Point Carbon issued a statement saying that, should the measure become law, the price of carbon could rise to €8.80 by 2015, but cancellation of issued allowances will be required to let it rise higher.

Disagreements over policy within opponents of the move gave the swing votes to a small number of Green Party MEPs, allowing the passage of the draft law that had only been rejected by the Parliament two months previously, on the grounds of market interference.

The process leading up to the vote was subsequently highly criticised by all parties.

Bas Eickhout, a member of the Green Party, said that "Within the European People's Party it was so politicized, it was a fight between different strands in the party. For a lot of people, they had no idea what they were voting about. The longer the process went on, the more politicized it got and the more complicated it got for MEPs".

New trial will determine if the future of rail is wind powered

X-Wind's 6kW vertical axis wind turbine, the model for the one which could be seen alongside rail tracks throughout the country.

Britain's electrified railways could be up to 70% powered by wind turbines placed alongside the tracks, if a trial getting underway is successful.

A new project, part-funded by the Department for Energy and Climate Change, aims at reducing the carbon footprint of electrified railways using a specially designed wind turbine developed by British manufacturer X-Wind Power.

The product is billed as the world's most advanced vertical axis wind turbine. Called the XW-80, it has been designed for extreme reliability and exceptional performance on sites with restricted access and limited space.

The XW-80 can be installed at a density of 1MW per kilometre on long linear sites such as sea defences, road and rail corridors, or in small numbers to suit communities or businesses.

The technology, with its exceptional efficiency, low cost of energy, and near-silent operation, has been described as "potentially game changing" by major wind player Dong Energy.

Vertical axis wind turbines are not bothered by turbulent changes in direction of the wind, or blustery weather. They are therefore more suited to urban situations. Most wind turbines using windfarms have a horizontal axis.

In May, DECC awarded a total of £16 million in the first phase of its £35 million Energy Entrepreneurs Fund (EEF), part of which went to X-Wind Power. The programme has been set up to develop low carbon technologies for buildings and power generation and energy storage.

X-Wind’s EFP project will now take advantage of Network Rail’s unique land ownership to validate its vertical axis wind turbine technology in terms of performance, economics and safety, specifically when operating in narrow corridors and in proximity to trains.

The two-year trial consists of the design and development of an 80kW wind turbine based on X-Wind recently validated 6kW small scale generator (pictured above).

It will lead to several regional tests along Network Rail’s tracks before moving to a comprehensive rollout and the potential generation of 2,200 GWh of carbon-free electricity annually.

Michael Blaize, CEO at X-Wind Power, said: “We have made exceptional progress over the last two years, from an innovative concept to a demonstration project with the UK’s largest energy user.

"The support we have received from funding bodies such as the Technology Strategy Board and The Department of Energy and Climate Change is a clear endorsement of our technology and business strategies.”

The company believes that a distributed energy system coupled with storage technology is the only long-term energy solution for the future and that its technology could play a leading role in the supply of energy solutions globally.

Its market research has highlighted strong growth potential for the medium scale wind market. X-Wind intends to combine innovative design with robust manufacturing processes from automotive and large-scale wind industries to offer efficient and reliable products.

Greg Barker touts UK cleantech as success model for India

Minister for climate change, Greg Barker, made the case that investment in a low carbon future was good for everyone.

The mean damage caused by delay on acting on climate change is greater than the cost of taking action, according to new research published in Nature, meaning that governments and businesses cannot use the economic slump as a reason not to invest in tackling climate change.

This argument was used by Greg Barker, Minister for Energy & Climate Change, yesterday, speaking to an audience of government and business representatives while on a trade mission to Hyderabad, India.

He said that "policies that tackle climate change, while serving a noble cause, and given the tiny emissions per head of the Indian population, can seem like a long-term luxury that developing economies can ill-afford".

But he said this attitude was wrong, adding that it was a "myth that low-carbon means a break on economic growth, that caring for the environment means leaving millions in poverty, that resource-efficiency means a break on aspiration for hundreds of millions of young people, and that a green economy is a brake on competitiveness for India as a whole".

His speech was dedicated to making the case for an alternative future, and was peppered with examples of success stories in the British economy.

These included Artemis, a university spin-off which invented a new hydraulic system for use in wind turbines that was later bought by Mitsubishi, and Romag, which is producing self-cleaning solar panels which Barker thought would be of great value in India.

The minister also cited another British company, Highview, which is developing an energy storage solution that uses excess energy to chill air, which, when warmed, drives a wind turbine.

Research backing Barker's economic argument is found in an article published today in the academic Nature Climate Change journal.

It concludes that the cost of emitting an additional tonne of carbon dioxide today is $107 per tonne, based on economic growth in developed countries being around 2% per year. Conversely, if these countries continue to be in a state of economic stagnation, then this figure rises to $138 per tonne.

The authors, Dr Chris Hope (Reader in Policy Modelling, Cambridge Judge Business School) and Mat Hope (School of Sociology, Politics, and International Studies, University of Bristol) argue that the main reason for the greater damage in a low growth world is that people will have less money than expected when the worst impacts of climate change hit, and so each dollar of damage will be felt more keenly.

The researchers used an integrated assessment model called PAGE09 to estimate the mean social cost of CO2 for a wide range of economic growth scenarios. It measures the net present value of the extra damage caused by the emission of one more tonne of CO2 today.

The results show that in a world with sustained lower economic growth the mean social cost of CO2 increases, because the climate impacts occur in a relatively poor world, suggesting that, if anything, mitigating climate change should be a higher priority for policymakers in a low-growth world.

However, rapid economic growth (over 3% per year) also increases the damage from emitting carbon dioxide, because the greater resulting emissions are more likely to give rise to a greater degree of climate change.

The authors point out that the tension between pursuing policies to revive the major economies of the world and those to reduce emissions was put into stark focus by the Chancellor, George Osborne, when he argued at the 2011 Conservative party conference that "we are not going to save the planet by putting our country out of business".

According to the World Bank, economic stagnation is expected to continue into the foreseeable future.

Investment in low carbon growth, the authors say, is therefore both desirable for climate protection reasons, but also as a stimulus to the economy.

New prize to stimulate dynamic demand innovation

Stewart Reid, Future Networks Project Manager for SSE’s NINES project, says dynamic demand response will make wind power more effective and efficient.

A Dynamic Demand Challenge Prize has been launched to help meet the challenge of satisfying ever-increasing demands on the UK’s power grid, as highlighted by last week’s Ofgem report on tightening electricity margins.

The prize is the initiative of Nesta, the UK’s innovation foundation, and hopes to find new ways of managing demand to shift electricity consumption from peak to off-peak times, reducing carbon emissions and better responding to demands on UK energy supplies.

Solutions will depend upon the smart grid: new data-driven, demand side response-enabled products, technologies or services, that reduce carbon emissions by shifting energy use to off peak times or towards renewable generation.

Dynamic demand, or demand side response (DSR), is the exchange of information between electronic devices, responding to signals from the grid directly or indirectly.

It will be built into the capacity market, being created by the new Energy Bill, to can help shift electricity consumption away from peak hours where electricity consumption is high, or enable greater usage of excess electricity generation from renewables, as well as help maximise the use of the smart grid.

A number of trials are taking place at the moment through initiatives such as Low Carbon London, DECC/Ofgem’s Smart Grid Forum and the Low Carbon Network Fund.

Currently the UK’s biggest smart grid initiative is a £54 million scheme called the Customer-led network revolution in which 14,000 homes and businesses are finding ways to reduce both their energy spend and carbon emissions.

The project includes decentralised generation and demand reduction through efficient smart appliances and is trialling demand response through the combination of generation and flexibly operated appliances. It is supported by Low Carbon Network Fund, with partners UK Power Networks, Northern PowerGrid, British Gas, Durham University and EA Technology.

A new project called Smart Hooky is now trialling a range of new technologies to create a community–scale smart grid that will help Western Power Distribution understand how a rural community uses electricity at different times of the day in order to manage peak demands and let electricity networks accommodate more renewable energy.

The Dynamic Demand Challenge Prize will offer incentives, financial support and expert guidance for shortlisted projects, with a prize of £50,000 for the solution that demonstrates the most significant impact.

Constance Agyeman, development manager, Nesta’s Centre for Challenge Prizes, commented: “The Dynamic Demand Challenge Prize will support innovations that create a measurable shift in energy use. This is important because there is increasing demand on the UK’s electricity supplies and we therefore need to find new ways to manage this.”

Partners in the challenge include the Centre for Carbon Measurement, the Department for Business Innovation and Skills and National Grid. Neil Hughes, NG's head of technology, explains, “Balancing the grid will become more complex as more renewable generation comes onto the system and our goal is to help new service providers understand those challenges and develop technologies to meet that growing need”.

Jane Burston, head of the Centre for Carbon Measurement at the National Physical Laboratory notes, “Climate change and a secure, clean energy supply are two of the biggest challenges of our time. Demand side response is a critical step in supporting the shift in supply towards renewable generation. This will only be successful with engaging tools and technologies we want to use in our homes and offices.”

The challenge is open to entries from anyone across the European Union, but the solution must be applied within a UK context.

Northern Isles New Energy Solutions (NINES)

NINES is another important dynamic demand response solution that is being developed by SSE in Scotland. It aims to support Shetland’s sustainable energy future by developing and managing the electricity distribution network more effectively.

Measures used here include replacing old inefficient storage and water heaters with modern 'smart' storage heaters, and adding a new electric boiler to the existing district heating system, both of which help to balance the electricity network.

This is crucial, says Tim Rotheray of the Combined Heat and Power Association, because currently wind turbines generating electricity that is not needed at that point in time are paid constraint payments per megawatt not to feed their power into the grid.

To combat this waste, often seized upon by opponents of wind power as a reason to oppose wind farms, the power can instead be stored in the form of hot water using the systems being installed here, even diverting the power for a few seconds, as when there are spikes of generation during blustery weather.

NINES is also deploying new technology that will allow more small-scale renewable generators to connect to the network and introducing new commercial arrangements to encourage businesses to change the times at which they use most energy, similar to ones that will be in the new capacity market.

Finally, it is also installing a 1MW battery, part-funded by the Department for Energy and Climate Change, at Lerwick Power Station.

The project will help SSE plan for the replacement of its existing Lerwick Power Station, which is nearing the end of its useful life, with a smaller station than would otherwise be required.

This type of demand side response solution is already used in Denmark, for example in the Skagen District Heating system, which utilises electric as well as gas-fired CHP boilers.

Silver Springs

Silver Springs is a company which already has 10 years' experience in this area in north America and Asia Pacific. With a customer-focussed attitude to smart meters, it works directly with end users and communities and has recently established an office in the UK.

Their Oklahoma Smart Hours Programme is a demand response initiative to encourage customers to shift their energy use to off-peak hours that works by establishing local communications infrastructure and installing programmable communicating thermostats to control air conditioning units at times of peak demand.

The programme has helped 44,000 users save an average of $191 each, and delivered more than 67 megawatts of load reduction in 2012.

In the UK, another pioneer is The Ouse Valley Energy Services Company Ltd, formed by members of the Transition Town Lewes Energy Group, which includes decentralised generation and demand reduction and is currently investigating local electricity and heat distribution networks for villages and towns within the District.

The community-owned MOZES (Meadows Ozone Energy Services Company) is also delivering decentralised generation and demand reduction, with the aim of helping the community to become self-sufficient in energy use, and then to become an energy generating community.

All of these initiatives are exploring and developing models that fit with the new paradigm of using available low carbon energy in real time more efficiently, one of the chief challenges of moving to a low carbon future, that is being supported by the NESTA challenge.

UK power "will be 85% more expensive" without energy storage

Without large-scale energy storage, the UK government won't meet its renewable energy ambitions, says Edwin Koot, CEO of SolarPlaza.

The price of power in the UK will be 85% more expensive than in Germany (Europe’s biggest energy market) by May 2015, according to data compiled by Bloomberg.

U.K. power will cost £53.06 per megawatt-hour in May 2015, compared with €33.30 in Germany, according to fair value calculations on Bloomberg as of 8:40 a.m. in London.

They attribute the stark difference to Germany’s advanced renewable energy programme, which accounts for 30% of power generation, compared to the UK’s, currently standing at 11.3%.

The 2015 picture compares with an average premium of 17% over the past five years and 80% today, according to data from Marex Spectron Group Ltd., a London broker.

While Germany is seeking to consolidate its status as Europe’s biggest producer of wind and solar power by boosting its share of renewables-sourced energy to 35% in 2015 from 22% last year, the UK is targeting 15% from 11% over the same period, and is predicted to fail to meet the 20% 2020 EU-wide target.

Statkraft AS is closing money-losing gas-fed plants in Germany, while Macquarie Group Ltd. (MQG) and Vitol SA are buying British power stations, betting on gains of as much as 19% in U.K. prices by 2016, according to Societe Generale SA.

“The U.K. has built significantly less renewables to date,” Ilesh Patel, a partner at Baringa Partners LLP, a consulting firm that counts EON SE and Electricite de France SA (EDF) among its clients, said. “Germany has been on a fast-track wind and solar plan.”

Many critics of investment in renewable energy in the UK point to the fact that Germany, which is investing heavily in renewable technologies in its push to abandon its reliance upon nuclear power, currently has higher power prices than the UK.

However, Ed Davey, Energy Secretary, has consistently said that Britain's programme of supporting renewable energy will eventually lead to lower prices.

The key to this development may be investment in energy storage.

Germany is offering incentives worth €25 million to help subsidise the installation of batteries alongside solar PV systems to store electricity for use at night time. Simon Daniel, Founder of energy storage company Moixa Technology, says this "is helping our European neighbour to realise the full potential of renewable technology".

The UK Minister for Energy and Climate Change, Gregory Barker, is to deliver the keynote speech during the upcoming Solar Future UK ’13 event on July 16 at which he is expected to enlarge on his announcement, made at the recent Intersolar conference, that Britain hopes to deploy 20 GW of PV by 2020, in relation to how this affects Britain's energy storage capacity.

At the Intersolar event, Barker said that "the UK Government is totally committed to building a world-class renewables industry” and quoted Prime Minister David Cameron as saying that he wants to "make Britain a global showcase for green innovation and energy efficiency".

At the following day's Energy Storage UK '13 conference, leading industry spokespeople and cleantech businesses from the UK’s energy storage sector will discuss how the latest energy storage systems (ESS) will advance the integration of renewable energy, such as solar PV and wind.

"Deployment potential of solar PV is greater than the UK’s grid storage capacity," comments the CEO of SolarPlaza, Edwin Koot. "Without large-scale energy storage solutions, the UK Government’s ambition to reach this figure presents a significant challenge for National Grid, which has already warned that building more than 10GW will make it difficult to manage the network in its current form."

Director of the Electricity Storage Network, Anthony Price, is warning that "if the Government does not support the use of storage as part of the solution to meet our power shortfall, we will lose this opportunity, and live to regret it.

"What is low cost now will take us down power’s one-way street. It will be difficult and costly to reverse. Our plans for the Smart Grid show we need storage and we must seize this opportunity now.”

The intermittency of solar PV and wind requires utilities to maintain additional spinning reserve from polluting power stations to pick up loads, or, in the future, use demand-side reduction techniques in the capacity market, in the event of peak demand spikes.

If the potential of intermittent renewables is to be fully realised, the National Grid will require fast-acting energy storage systems that can dispatch power and respond quickly to network imbalances, says Price.

That the power industry and policy makers are not paying sufficient attention to the challenges arising from integrating intermittent power generation into the system was felt by 60% of attendees polled at the recent POWER-GEN Europe and its co-located conference, Renewable Energy World Europe, between 4-6 June at the Messe Wien, Vienna.

£15 million for community-owned renewable energy in England

A new £15 million government fund has been launched to support community-owned renewable energy projects in England.

The Rural Community Energy Fund (RCEF), which is now open to applications, is targeted at helping rural communities pay for the cost of feasibility studies into renewable energy projects, and fund the costs associated with applying for planning permission.

But the fund stops short of paying for the actual installation of the renewable technologies. Instead, the hope is that projects will then be able to attract private finance to get projects up and running.

Crowd-funding is proving to be a popular way of attracting such finance. The most recent project to be funded this way is a community-run hydro-electric scheme on the outskirts of Edinburgh, Scotland. Harlaw Hydro raised £313,000 through a ‘community share’ offer to fund the installation.

Additionally, the Co-operative Bank’s loan fund, the Co-operative Enterprise Hub are offering support for renewable energy with their campaign for a Clean Energy Revolution in communities across the UK.

Within their £1 billion commitment to fund energy efficiency and renewables is a £100 million fund for small-scale community renewables and tackling reductions in fuel poverty.

The RCEF funding can be used to support most renewable or low carbon technologies, including: wind, solar, biomass, heat pumps, anaerobic digestion, gas Combined Heat and Power and hydro.

Energy and Climate Change Minister Greg Barker said that he hoped the funding would "help kick start hundreds of clean green energy projects in rural areas across England. Not only can local generation bring people together, boost local economies and drive forward green growth, it can help save money on energy bills too.”

Environment and Rural Affairs Minister Richard Benyon added: “As well as boosting renewable energy production, the Fund will ensure that communities have the funding they need for local projects and priorities in future.”

The RCEF offers funding in two stages: a grant of up to £20,000 for feasibility studies into renewable energy projects in local areas; and, upon successful completion of this, a loan of up to around £130,000 to help with project costs, such as seeking planning permission and relevant environmental permits.

The loan is repayable to the government once projects have been commissioned, with an additional premium of 45%. This cash is expected to be derived from the income generated by their projects. The government will reinvest it back into the fund to help support further projects.

The funding is a successor to the Local Energy Assessment Fund (LEAF) that was launched in December 2011. This has led to 236 community energy generation and management projects across England.

WRAP is, perhaps surprisingly, the delivery agency for the RCEF funding, with the application forms available on their website.

Applications will only be considered from rural communities with less than 10,000 residents and larger communities located in local authority areas defined as ‘predominantly rural’.

Applications will be reviewed on a monthly basis by the Department of Energy and Climate Change (DECC) and Defra with advice from WRAP, but there is no set deadline for submission of bids.