2012: E2B Pulse on the year ahead
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2012 will be a crucial year in the transition to a low carbon economy
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06/01/2012
To say 2011 was a year of ups and downs for the low carbon economy is something of an understatement. Assuming the ancient Mayans miscalculated the end of days, what can we expect in 2012? E2B Pulse takes a look at the most significant events, policies and sectors for the year ahead.
Green Deal
It’s due to be launched in October, but there’s still uncertainty about the government’s flagship energy saving plan, the Green Deal. Described by Climate Secretary Greg Barker as “the biggest home improvement programme since the Second World War,” it aims to improve the energy efficiency of 14 million UK homes.
Under the scheme, energy efficiency will be possible and affordable by allowing people to take out loans of up to £10,000 to pay for improvements, which are then repaid over a fixed period through the savings made on energy bills. Similar support will be available for businesses, as well as extra help for vulnerable people or those living in homes which need more work than Green Deal finance alone can pay for.
The scheme has come under fire, particularly over its financial mechanisms and potential uptake.
Last month, the Committee on Climate Change (CCC) said the Green Deal and the Energy Company Obligation (ECO) - which focuses on vulnerable and lower income people and harder to treat properties – would fail, addressing less than half the CO2 emissions from the domestic sector. The CCC also said the scheme will only result in the insulation of 700,000 lofts (just 10 per cent of the potential) and 1.7 million cavity walls (30 per cent of potential).
Shadow Energy and Climate Change Secretary Caroline Flint has claimed the scheme is in “chaos." Speaking in November, she said: “We are still not clear about what incentives households will be offered to take out the Green Deal. How the Energy Company Obligation is going to deliver for the 5million households who live in cold homes. Or what the government is going to do to ensure the interest rate for a Green Deal package is low enough to secure the widest range of energy efficiency measures and the best deal for bill payers.”
Paul King, CEO of the UK Green Building Council, said the scheme has the potential to be “game-changing” by creating a low carbon refurbishment market, but the government needed to outline how they will incentivise take-up amongst home owners and building occupiers.
Critics will argue the government needs to iron out the creases of the Green Deal, after the consultation on it closes on January 18.
Renewable Heat Premium Payment scheme
After the £860million Renewable Heat Incentive (RHI) - designed to encourage businesses to generate their own renewable heat from biomass boilers and ground source heat pumps – was delayed just a day before it was due to be launched in September, the government will be keen to get the Renewable Heat Premium Payment scheme right.
In a sense, the scheme is the RHI’s little brother, and will offer a total of £15m for 25,000 renewable heating systems in peoples’ homes. The government aims to launch it alongside the Green Deal, later this year. Grants of up to £1,250 are available to homeowners to install technologies such as ground source heat pumps, biomass boilers, air source heat pumps or solar thermal hot water panels.
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Biomass boiler
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The scheme, which is available to homes that already have loft and cavity wall insulation, opened for applications in August, last year, and closes on March 31.
When the initial announcement was made last year, Philip Sellwood, Chief Executive of the Energy Saving Trust, which is running the scheme, said: “Without a doubt, the main barrier that prevents people from taking the plunge [with heat technologies] is the up-front capital cost. This is a great start in overcoming this obstacle.”
However, there have been concerns the grants available are not high enough to attract people. At the time the scheme opened for applications, renewable energy consultant Alan Simpson said it was “driven by a towering lack of ambition.”
Carbon Capture and Storage
Observers will no doubt accuse the government of adopting an on-the-fence position towards Carbon Capture and Storage (CCS) over recent months. Scepticism over their commitment comes from the decision to abandon the £1billion CCS project at Longannet, in Scotland, in October, and comments from chief secretary to the Treasury Danny Alexander a month later over the future of the £1billion funding for CCS.
But the Department for Energy and Climate Change insists it is committed to the mitigation technology, which captures carbon dioxide from fossil fuel power stations and stores it in offshore, underground structures such as depleted oil and gas reservoirs, and deep saline aquifers.
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Energy and Climate Change Secretary Chris Huhne
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Just three weeks ago, Energy and Climate Change Secretary Chris Huhne said: “We all want to see a new cost-competitive CCS industry in the 2020s. That means we need to create certainty around the level of investment needed to get CCS operational, and also additional running costs. We want CCS deployed not just in the UK but around the world.”
Mr Huhne also confirmed the £1billion of funding was still available for capital investment.
And it seems there is real evidence of the technology progressing as a £20million pilot CCS project was launched by SSE at their coal-fired power station in Ferrybridge, Yorkshire, at the end of November. SSE has also agreed to work with Shell on the development of a CCS project at Peterhead gas-fired power station, in Scotland.
2012 may prove to be an interesting year for the future of CCS.
Rio+20
It came down to the wire, but an agreement to work towards a legally binding deal on global emissions was reached at the UN conference on climate change, in Durban, last month. This year, all eyes will be on Rio de Janeiro as Brazil hosts the UN conference on sustainable development, in June. So named because it takes place twenty years after the Rio Earth Summit, the conference will focus on two main themes - the green economy in the context of sustainable development and poverty eradication; and the institutional framework for sustainable development.
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Environment Secretary Caroline Spelman
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The Department for Environment, Food and Rural Affairs (Defra) is leading preparations for the UK government at Rio+20. It sees the conference as an important opportunity for international co-operation on sustainable development, and will make the case for a global green economy, and ways to tackle major global challenges such as food security, environmental degradation and climate change.
In November, Deputy Prime Minister Nick Clegg and Environment Secretary Caroline Spelman said the government will support Colombia’s proposal to develop Sustainable Development Goals to focus international attention on the need to manage the world’s natural resources sustainably.
But the summit has not been free from controversy. The Brazilian government was forced to change the dates from June 4 to 6, to June 20 to 22, to avoid clashing with the Queen’s diamond jubilee. David Cameron initially stated he would not attend because of the celebrations, but Downing Street said the Prime Minister would still not be present after the dates were altered. Ms Spelman will instead be representing the UK in Rio.
Commentators will be eager to see if renewed political commitment to sustainable development can be reached at the summit.
London 2012 Olympic Games
With so many aspects to the Olympics, from the sustainable construction of the venues and use of renewable energy, to the food eaten by spectators and athletes, and waste, it’s clear the task of delivering a truly sustainable Games is a huge undertaking.
Since winning the bid back in 2005 and up until the closing ceremony later this summer, organisers acknowledge there will be a net increase in the UK’s contribution to global carbon emissions. But since 2006, the Commission for a Sustainable London 2012, which provides assurance to the Olympic Board and the public on sustainability, has urged the key stakeholders to treat carbon management as a strategic issue; to define, measure, reduce and mitigate the negative impacts in an open and transparent way. As a result, London 2012 is the first summer Games to do a carbon footprint study that takes into account embodied and operational emissions over its seven year lifetime.
Sustainability was embedded in the initial bid and the Sustainability Plan highlights how 2012 aims to be the most sustainable Games possible, focusing on the key issues of climate change, waste, biodiversity, inclusion and healthy living.
A judgement on whether or not 2012 is “the first sustainable Olympic and Paralympic Games” as promised by London, will have to wait until the curtain closes.
Wind
In 2011 a war of words erupted between sceptics of renewable energy and the wind industry. A report by the Adam Smith Institute and Scientific Alliance claimed the UK’s plans for renewables were unrealistic, a leaked KPMG report alleged Britain could save £34billion if it ditched plans for offshore wind, and the Duke of Edinburgh apparently labelled wind technology as "a disgrace."
All these claims were downplayed by the wind industry, with the Adam Smith Institute publication provoking a direct response from government, which said the “report completely misses the point.” And last month, a YouGov poll commissioned by The Sunday Times revealed 56 per cent of the public thought the UK should use more wind power, compared to just 19 per cent opposed to it.
Where will the wind blow in 2012? The need for more offshore wind farms in deeper waters is creating technical and financial barriers. And the industry itself has acknowledged the costs of wind energy are currently too high. So, the real challenge is to make wind more cost competitive with fossil fuel based energy, and win over some of the more moderate sceptics.
Solar
The battle between government and the solar industry over the level of Feed-in Tariff (FiT) support continues to rage on with legal action being taken on both sides.
In October, DECC announced plans to cut subsidies for solar panels by around 50 per cent amid government fears that solar was eating up too much of the coalition’s renewables budget. The move sparked widespread anger in the solar industry and, in December, environmental campaigning organisation Friends of the Earth and two UK solar developers (SolarCentury and HomeSun) successfully challenged the move in the High Court.
Earlier this week, Climate Minister Greg Barker defended DECC’s decision to appeal against the ruling. A comprehensive review of the FiTs scheme scheduled for publication at the end of January should make for interesting reading.
Waste
The waste management sector had an eventful year in 2011. The impact of government's Waste Review, the importance of resource efficiency, debate over the fequency of waste collections and regulation vs. responsibility all look set to be key issues again in 2012.
A number of changes that will affect the WEEE (Waste Electrical and Electronic Equipment), packaging waste and waste batteries legislation are also expected to come into effect in 2012.
Once more unto the breach, dear friends...
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