Low carbon technologies in a green economy - Energy and Climate Change Contents


5 ENERGY USE AND EFFICIENCY

TRANSPORT

109.  In 2008, the amount of energy used by the transport sector in the UK was 58.81 million tonnes of oil equivalent.[146] Transport is the third largest producer of CO2 emissions in the UK, of which cars and light-duty vehicles are almost 70%.[147]

ROAD

110.  The Government has prioritised low carbon vehicles as one of its five key sectors and technologies where the UK has the potential to take a global lead.[148] The vehicle scrappage scheme, unveiled in the 2009 Budget, similar to those introduced in other countries, offered consumers £2,000 towards a new car or van if they traded in a 10 year old plus vehicle which they had owned for 12 months or more. The scrappage incentive is made up of £1,000 from the Government and £1,000 from the motor industry. In general, the scheme lead to replacing older more polluting cars with newer more fuel-efficient vehicles.

111.  The scrappage scheme was described by the Energy Savings Trust as a "huge missed opportunity […] which could have been defined in such a way as to require that the new vehicles bought with that public investment had a significant lower CO2 emission."[149] Professor Julia King, Aston University, shared this concern, stating that "it [the scrappage scheme] was introduced without a requirement on new cars being, for example, at least below the 130 grams per kilometre [threshold for CO2 emissions], which will be the new European Union requirement for 2015."[150] The New Economics Foundation described it as a "perverse incentive to keep us locked into an energy-intensive form of transport."[151] However, the Minister told us "the scheme was announced to help at a very difficult time in the recession a very important sector in this country, the car industry, and it was a business support measure and it was a job support measure to keep people in jobs. It was not designed to be an environmental measure at all."[152] But, the Low Carbon Vehicle Partnership (LCVP) noted that "the scrappage scheme was introduced primarily in order to support the UK motor industry because of the pressure that it was under […] cars bought under the scrappage scheme are averaging 134 grams per kilometre [CO2 emissions], whereas the average for the UK this year is 150 grams per kilometre."[153]

112.  The vehicle scrappage scheme has had a positive effect in reducing emissions by accident; any future stimulus for the automotive industry should be designed to stimulate a move towards low carbon vehicles, for example, by requiring that the new vehicles purchased have a CO2 threshold below 130 grams per kilometre.

113.  In April 2009, the Government published its strategy Ultra Low Carbon Vehicles in the UK. The Government introduced a £2.3 billion package of support (the Automotive Assistance Programme) for the automotive sector in the downturn, which has been tailored to support development of low carbon products. The Government is also providing £100 million to support research and demonstration; £250 million for consumer incentives to buy lower carbon vehicles (around £20 million of this will be used to develop an electric vehicle charging infrastructure framework, leaving £230 million in the form of subsidies for new purchases); and £20 million procurement of Low Carbon Vehicles for government.[154] The LCVP noted that the "£230 million investment to support purchase will give you around 50,000 vehicles."[155] However the Committee on Climate Change have called for 1.7 million vehicles.[156] Professor King told us "the £230 million in support for electric vehicles from 2011 onwards is good, but […] we have suggested that the figure needs to be, realistically, more like about £800 million."[157]

114.  In February 2010, the Government announced further details of how these funds will be spent. A new Plug-in Car Grant will provide consumers with up to £5,000 towards the cost of ultra-low carbon cars at the point of purchase. These grants will be available from January 2011. The Government also announced that £30 million will be spent on charging infrastructure in London, Milton Keynes and the North East.[158]

115.  We welcome the Government's Plug-in Grant programme, which provides support for consumers choosing electric vehicles from 2011 onwards. We recommend that the amount invested in subsidies between now and 2020 should be increased substantially, reflecting the ambitious target of 1.7 million electric vehicles set by the Committee on Climate Change.

116.  Electric and hybrid electric vehicles have the potential to significantly decarbonise road transport even with the current carbon intensity of grid-generated electricity. However, the full benefits of the electrification of road transport emerge when the electricity generation sector is decarbonised. The timing of recharging of electric vehicles is crucial. National Grid noted that:

for electric vehicles to succeed to mass-market levels and enjoy the greatest environmental and economic benefits, the charging process must be concentrated overnight. […] Moreover, we believe that smart metering and smart grids will play an essential role in facilitating overnight charging behaviour with customers.[159]

117.  The long-term benefits of electric vehicles will only be achievable with a smart-grid that has been designed with electric vehicles in mind. The development and implementation of a smart grid and smart meters must be carried out in consultation with developers of electric vehicles.

118.  There are significant opportunities for the UK to develop and export low carbon technologies in the transport sector. The LCVP told us:

there are some genuine areas in which the UK has real world leading expertise. I would highlight particularly electric vans where we have companies like Smith and Modec who are supplying around the world. We have tremendous expertise in the power electronics industry […] Companies like Zytek, Ricardo and Lotus Engineering, for example are doing huge amounts of work in this area.[160]

Professor King described the low carbon vehicle demonstration project, which by 2010 will result in 340 ultra-low carbon vehicles across a small number of cities in the UK:

Things like the low carbon vehicle demonstration project […] have attracted the world's attention to us and the announcement of that was followed quite rapidly by Toyota's announcement that we would be one of the first two countries in which they would be building the new Prius and then Nissan's announcement that they would be bringing battery manufacturing to the UK and potentially also their electric vehicle, the Leaf, to be manufactured in the UK. […] The requirements for us going forward, I think, are to make sure that our supply chain is well positioned to adapt to the new technologies that will be needed in vehicles of the future.[161]

119.  Whilst low carbon vehicles (electric or hydrogen) offer huge potential to decarbonise the transport sector the LCVP commented that "there is probably at least a 50% improvement that we could deliver in the efficiency of our existing vehicles by mid 2025 to 2030 through a whole range of technologies: new engines, new aerodynamics, better light, better tyres, so on and so forth."[162] Advanced biofuels also have a role to play. E.ON told us "in the short term there is the opportunity to pursue more efficient conventional petrol and diesel technologies (including the use of biofuel) whilst the first alternatively fuelled vehicles are brought to market".[163]

120.  The LCVP told us that there are certain areas in which the Government can afford to be entirely neutral between rival technologies. However, there will be other areas, particularly where new infrastructure is required, "where government will need to actually make choices because it will be too expensive in order to invest in a whole range of different technologies".[164] LCVP went on to explain:

there are a small number of technologies which are now emerging as likely to be medium and long-term solutions. Electrification, both pure EV [electric vehicle] and plug-in hybrid, is likely to have an important role [...] biofuels will have an important role also and it may be that that role in the longer term is more as a power source for a range extended hybrid vehicle rather than being used in combination with petrol and diesel in an internal combustion engine. If we can address the challenges of hydrogen and fuel cells, it may be that the hydrogen and fuel cells become cost-effective in some period beyond 2030, at which point government will have to decide whether or not we need to make the investment in that technology then or, indeed, our existing mix of technologies is fit for purpose for the foreseeable future.[165]

121.  AIR products told us they were concerned that the UK is failing to prioritise the need to invest in hydrogen.

A 'hydrogen fuel cell - electric hybrid' vehicle has a much broader user-potential than current plug-in electric vehicles. The batteries used to power electric vehicles cannot offer the same range, performance and refuelling time of a conventional vehicle and will therefore be attractive only to a niche market. By contrast, electric-hydrogen hybrid vehicles can compete with conventional vehicles in terms of range, performance and refuelling time and like electric vehicles give off no emissions at the point of use. […] In fact, hydrogen vehicles are closer to commercialisation than many think. Hydrogen is already a realistic transport fuel today. In California an extensive hydrogen powered fleet already exists with further plans to extend the network of fuelling stations.[166]

Indeed, we visited the National Fuel Cell Research Centre (NFCRC) in California and were impressed by the progress that has been made towards deploying hydrogen fuel cell-electric hybrid vehicles.

122.  We note that hydrogen is essentially a carrying fuel and that it is only as low carbon as the source from which it has been derived. We draw attention to the production of hydrogen that may be possible as a by-product of the pre-combustion Carbon Capture and Storage process.

123.  We are encouraged that the UK appears to be moving in the right direction and making the most of the opportunities to develop an export industry in low carbon vehicles. It is clear that the UK is particularly strong in the automotive supply chain, which should be supported and encouraged by the Government. Improvements to existing technology and the replacement of fossil derived liquid fuels with lower carbon alternatives present the fastest opportunity to reduce emissions. Electrification of road vehicles presents a more sustainable route to total decarbonisation but represents a less mature technology that requires significant support during the demonstration phase. Hydrogen and fuel cells represent a longer-term aspiration, although a significant number of major automotive manufacturers will be ready to offer vehicles within the next few years. We are concerned that the Government, whilst supporting battery electric vehicles, is not offering the same level of support to hydrogen fuel cell powered vehicles.

124.  Reducing transport CO2 emissions can also be done through behavioural change rather than the development of new low carbon vehicles. Professor King told us "if we were to enforce the 70 mile per hour speed limit on motorways, we would save 1.4 megatonnes of CO2 per year. If we were to reduce it to 60 and to enforce that, we would save another 1.5 megatonnes of CO2 per year. That is over five per cent of the transport CO2 emissions."[167] In addition to investing in new low carbon vehicles, the Government should engage with the public on the issue of reducing CO2 emissions and reducing the cost of journeys by driving slower. In future campaigns, the Government should articulate the need for adhering to the national speed limit by reference to reducing emissions and cost to drivers as well as for reasons of road safety.

RAIL

125.  The rail network carries 3.5 million passengers a day, while contributing less than half a percent to the UK's domestic carbon dioxide emissions. Total rail CO2 emissions are estimated at 3.3 million tonnes for 2006/07 of which 2.7 million tonnes is from passenger rail and 0.6 million from freight rail. The average carbon dioxide emissions per passenger kilometre for a passenger rail journey is about half that of an equivalent car journey and about one-quarter of an equivalent journey by air.[168]

126.  In terms of track miles, the rail network in the UK is approximately 40% electrified. The majority of electric routes use 25 kV 50 Hz AC (Alternating Current) overhead electrification, and the rest is made up of third rail 750 V DC and some 1500 V DC (Direct Current). Approximately 60% of passenger kilometres are on the electrified network.[169] Dr Stuart Hillmansen, University of Birmingham, told us "[AC systems and DC systems] are connected to the electricity grid and to some extent the tailpipe emissions, if you like, are the same as those in the power station. So in the future the railway automatically benefits from any decarbonisation or increased renewables penetration into the grid mix."[170]

127.  In July 2009 the Government announced a £1 billion plan to electrify the main rail route between London and Swansea, and a second smaller line between Liverpool and Manchester. This will increase the proportion of electric train journeys in Britain from 60% to 67%. Network rail told us they very much welcome this announcement, "but we believe it should mark the start of a rolling programme of electrification, given the clear environmental benefits it brings. In particular, Network Rail would like to see the Government commit to the electrification of the Midland Mainline."[171]

128.  Lightly used parts of the rail network are unlikely to be electrified, as it would not be cost-effective. Dr Hillmansen told us "those parts of the railway […] may need to look at alternative technologies to provide propulsion power and there will be technology transfer from other sectors. The work that is happening in the automotive industry, for instance on battery technology and high efficient motors […] can be transferred over to the railway industry in due course."[172] The knowledge transfer network (KTN) responsible for bringing together industry, research and government stakeholders in transport, is the Intelligent Transport Systems KTN.

129.  We welcome the announcement of a £1.1 billion programme for Network Rail to electrify the Great Western Mainline (London to Swansea) and the shorter line connecting Liverpool and Manchester. However, we hope to see a more strategic long-term approach to rail electrification from the Government. We would also like the Government to assure us that steps are being taken to ensure the effective transfer of technology from the automotive industry to the rail industry through the Intelligent Transport Systems Knowledge Transfer Network, or other appropriate knowledge transfer networks.

130.  Although rail transport has the potential to be zero carbon if the majority of passenger kilometres are on electrified routes and the electricity supply is decarbonised, Dr Hillmansen acknowledged, "An empty train may be very efficient but if there is no-one on it then it is an environmental disaster. So increasing the load factor is an important issue."[173] However, domestic rail travel is often prohibitively expensive in comparison to domestic air travel.

131.  In August 2009, Network Rail published a study setting out options for a new high-speed line. Network Rail recommended a new high-speed line connecting London with Birmingham, Manchester, Liverpool, Glasgow and Edinburgh.[174] Furthermore:

Network Rail found that this new line would reduce road vehicle journeys by 3.8 million a year and flights by 2.8 million a year by 2030, reducing CO2 emissions annually by 39,000 tonnes and 250,000 tonnes respectively. The study also found that this high speed line would also generate revenue and benefits worth almost £55 billion, paying for itself 1.8 times over.[175]

132.  The average carbon dioxide emissions per passenger kilometre for a passenger rail journey are about one-quarter of an equivalent journey by air. Domestic air travel is generally faster than the equivalent rail journey, encouraging more people onto a form of transport with a larger carbon footprint. The Government must do more to address this if it is serious about reducing UK carbon emissions. We recommend the Government introduce regulations designed to ensure the introduction of fairer transport pricing structures that reflect the climate impact of various modes. We also hope to see firm commitments and timetables for delivering more high-speed rail. 

SHIPPING

133.  The shipping industry is vital to the world economy, carrying over 80% of international trade by volume.[176] In 2007, the UK shipping industry directly employed 96,000 employees, and with a turnover of £9.5 billion, the industry directly contributed £4.7 billion to UK GDP.[177] Carbon dioxide emissions from international shipping account for approximately 2.7% of total global emissions.[178] However, the Chamber of Shipping told us "we are by far, by a long way, the least carbon-emitting transport mode, ten times less than road and significantly less than [aviation]."[179] Despite this, the Environmental Audit Committee report, Reducing CO2 and other emissions from shipping, concluded that emissions from shipping cannot be allowed to grow uncontrolled, and that it will take several years before technical changes start to make a significant difference.[180]

134.  In recent times, the shipping industry has started to adopt various measures that should help to reduce emissions, such as improving current propulsion technologies, engine improvements, fleet management techniques, cold-ironing and reducing steaming speeds. The Chamber of Shipping told us

These technologies […] can be implemented, but the nature of the industry means quite often that the person who has control over the application of those methods might not necessarily be the shipowner, it could well be the charterer […] industry assessment is that these existing technologies rolled out to their maximum might yield an improvement generally of between about 15 and 25 per cent [lower emissions].[181]

135.  Other technologies that may help to reduce carbon emissions in the medium to long term include:

  • Wind power technologies such as 'sky-sails', essentially large kites: these could save up to 35% of a ship's fuel with relatively small capital costs;
  • Biofuels: a viable near-term option which can displace fossil fuels and reduce emissions (up to 80%), the barriers to which are economic rather than technical;
  • Nuclear power: unlikely to be cost effective or viable in the short to medium term, with barriers perceived to be safety issues and public perception of the technology;
  • Hydrogen fuel cells: not fully developed for commercial implementation, and hydrogen production from renewable sources with current technology and energy prices would be prohibitively expensive—this could be a long term option; and,
  • Electric propulsion, battery electric and hybrids: best suited to vessels that have variable patterns of operation—full hybrids incorporating energy storage (batteries) are in initial stages of development, but savings are unknown.[182]

136.  Delivering new technologies in new ships can be problematic. The Chamber of Shipping explained:

Shipowners find it very difficult to go and buy the most efficient ships because the shipyards hold the whip-hand and they will build a ship which is most convenient for their production platforms […] the IMO [International Maritime Organization] is addressing this […] through something called the 'energy efficiency design index' which is mandating new standards for every new ship to be built to. We were very much hoping, from an industry perspective, that that would be a mandatory requirement, but at present, because of the sensitivity of international negotiations around carbon, some of the nation states of the IMO have held that back and it is just voluntary at the moment.[183]

They added that technologies such as wind, nuclear, hydrogen fuel cells and electric propulsion were "at a prototype stage for land-based sources, let alone ships […] they need to be proven and robust before they are likely to be rolled out across the fleet."[184]

137.  We note that technologies such as wind, hydrogen fuel cells and electric propulsion are at prototype or early commercialisation stage on land. The Government should ensure that knowledge transfer networks working in the transport sector are active in transferring technologies from land-based transport sectors to the shipping sector.

138.  Negotiators at the United Nations Framework Convention on Climate Change (UNFCCC) had started to address issues relating to shipping and aviation prior to the UN Climate Change Conference in Copenhagen last year. Carbon dioxide emissions from these sectors are not covered under the Kyoto Protocol and it was hoped that a new global agreement at Copenhagen would change this. Unfortunately, this did not happen. The national shipowner associations of Australia, Belgium, Norway, Sweden and the United Kingdom have stated:

Shipping is the glue that holds world trade together, and is already the most carbon-efficient means of transporting goods. Shipping must be permitted to grow so that it can continue to service the demands of world trade and a rapidly expanding global population - but needs to do so in a sustainable way. Trading under a cap is the only option which would permit international shipping to do just that - and thereby to meet both the needs of environmental and trade policy.[185]

139.  The shipping industry has shown a commitment towards reducing carbon dioxide emissions despite the fact that their emissions are not included in the UK carbon budgets, or governed by any international agreement. They have determined that an international cap-and-trade scheme is the best way of achieving emissions reduction. The Government must push for an international binding emissions reduction target for shipping with a clear timetable for delivering policies to meet it.

AVIATION

140.  UK aviation CO2 emissions have grown by over 50% in the past ten years due to increasing demand in both passenger and freight traffic; aviation CO2 emissions now account for around 5% of total UK greenhouse gas emissions.[186]

141.  A common criticism of aviation is the environmental impact of short-haul flights, which are often achievable using other modes of transport. Aviation is also considerably less energy efficient per passenger kilometre than other modes of transport, such as rail, which can also be far more easily decarbonised than aviation. However, National Air Traffic Services (NATS) told us:

Our calculations show that domestic air traffic represents around about a fifth of the 2.4 or so million movements that we handle as NATS in the UK every year, but that actually only accounts for 14 per cent of the CO2 emitted in the system, so those flights are operated by relatively efficient twin-engine aircraft, so their emissions are less than the proportion of the traffic.[187]

142.  In December 2009, the Committee on Climate Change (CCC) reported that fuel efficiency and operational improvements in aviation are likely to result in a 30% reduction in carbon emissions per seat km flown and that sustainable biofuels could account for 10% of aviation fuel use in 2050. For this reason, it argued, aviation policy should be based on the assumption that demand growth between now and 2050 cannot exceed 60% if the UK is to meet the Government's target that aviation emissions in 2050 must not exceed 2005 levels. Faster technological improvements are possible, but unless they are achieved, it is not prudent to assume that demand increases of more than 60% are compatible with the target.

143.  We heard about the types of technologies that are likely to have the biggest impact on the aviation industry from Sustainable Aviation, a strategic group of the UK's leading airlines, airports, aerospace manufacturers and air navigation service providers:

Engine and airframe developments, together with second-generation biofuels, offer the greatest long-term potential for reducing aviation-related CO2. In the shorter term, air traffic management offers environmental efficiencies through new tools enabling improved procedures and more efficient use of airspace. Airports are working with airlines, on-airport businesses, and passengers to influence further carbon reductions; for instance, on-site renewable energy, and fixed electrical ground power (FEGP) to aircraft, which removes the need to run aircraft power units whilst on the ground.[188]

144.  Sustainable Aviation went on to explain that partnership between the Government and industry is necessary to bring forward these technologies:

Some of these will be incremental technologies, improved combustion, improved materials, lighter aircraft, but some of them are potentially step-change technologies. We are looking at the moment at contra-rotating open rotors, going back to very efficient propellers. Now, these can be 15 per cent more fuel-efficient than even the best enclosed jet engines today, but this is technology which none of us has touched since the 1980s […] However, to launch the programmes necessary to bring those open rotor-powered aircraft needs a huge and co-ordinated investment that the industry alone certainly cannot afford, […] so it does need government intervention, as I say, both at a UK level and a European level.[189]

They also pointed out that there was an enormous opportunity to have an impact on global aviation emissions by investing in UK industry:

We have the wings from Airbus, we have Rolls-Royce engines and we have air traffic management systems all exported from the UK all over the world. By investing in that technology, you are touching 70 per cent of future aircraft all over the world, so there is a huge gearing worldwide from investing in the technology base of UK industry, not to mention the economic benefits of doing so.[190]

145.  We note the work of the UK aviation industry in developing new technologies and systems to reduce carbon dioxide emissions. The Government should acknowledge this and continue to support the industry through developing and maintaining the right legal and fiscal frameworks. Furthermore, the Government should facilitate the export of these technologies and systems to other countries.

146.  In addition to technological opportunities for reducing climate change, emissions can be reduced through better control of air traffic. NATS provides air traffic service at 15 of the largest airports in the UK. In 2008, NATS became the first air traffic control organisation in the world to set stretching climate change performance targets. Sustainable Aviation told us "The UK model for reducing CO2 emissions related to air traffic management is the first of its kind in the world and NATS is looking to export its methodologies in order to spread the benefit."[191] NATS explained some of the initiatives being trialled at UK airports:

We currently have, what we call, an 'inbound speed trial' which is really trying to slow aircraft en route to the hold, to slow them down so that we can reduce the time they spend in the hold. We have also recently introduced an aircraft control tool called 'A-man', an arrivals manager, which allows us to better sequence the aircraft in order to get them through that holding situation and on to the ground as safely and as efficiently as possible and, as a result, reduce carbon emissions.[192]

147.  Whilst the use of technologies and changes in air traffic control are helping the aviation industry to reduce emissions, they acknowledge that real progress requires the implementation of a cap-and-trade scheme. Sustainable Aviation told us "We accept that [a cap and trade scheme] is the best route forward, but we also accept that it is the best route forward not just for our industry, but for the world getting its carbon emissions down in the most cost-effective way."[193] Despite the lack of a global agreement at Copenhagen in December 2009, aviation is due to be included in the European Emissions Trading Scheme from 2012. Sustainable Aviation told us that there would be a greater emphasis on fuel efficiency when a carbon premium is added to the price of the fuel. The impact this will have on prices depends on the carbon price and on the way in which efficiency can be improved within the industry.

148.  It is fundamentally important to have a globally agreed deal on aviation emissions as regional emissions schemes may lead to carbon leakage. The Government must push for a legally binding global deal based on global aviation emissions reduction targets.

INDUSTRY

149.  In 2008, the amount of energy used by industry in the UK was 30.53 million tonnes of oil equivalent.[194] Table 5 shows the breakdown of energy use in 2008 by industrial group.
Table 5. Industrial energy consumption by main industrial consuming group in 2008
THOUSAND TONNES OF OIL EQUIVALENT
IRON & STEEL 1,524
NON-FERROUS METALS 959
MINERAL PRODUCTS 2,553
CHEMICALS 5,456
MECHANICAL ENGINEERING & METAL PRODUCTS 1,485
ELECTRICAL & INSTRUMENT ENGINEERING 986
VEHICLES 1,373
FOOD, DRINK & TOBACCO 3,591
TEXTILES, LEATHER, CLOTHING 956
PAPER, PRINTING, PUBLISHING 2,226
CONSTRUCTION 510
OTHER INDUSTRIES 5,913
UNCLASSIFIED 3,001
TOTAL 30,534

Source: DECC, Digest of UK Energy Statistics

150.  The top five energy using industrial groups are:

  • chemicals;
  • food, drink & tobacco;
  • mineral products;
  • paper, printing, publishing; and
  • iron & steel.

151.  With a turnover in excess of £50 billion, the chemical industry is one of the UK's largest manufacturing industries.[195] The International Council of Chemical Associations produced a report in July 2009, Innovations for Greenhouse Gas Reduction, analysing the chemical industry's impact on greenhouse gas emissions. In 2005, the emissions linked to the chemical industry were approximately 3.3 GtCO2e (gigatonnes—or, billion metric tonnes—of carbon dioxide equivalent). However, gross savings via the chemical products and technologies provided to other industries were estimated at between 6.9 and 8.5 GtCO2e. In other words, for every GtCO2e emitted by the chemical industry, 2.1-2.6 GtCO2e was saved elsewhere. The biggest levers for emissions savings were identified as:

  • insulation materials for the construction industry;
  • chemical fertilisers and crop protection to improve agricultural productivity; and
  • advanced lighting solutions e.g. compact fluorescent lamps (CFLs).[196]

The report also assessed how the industry's impact on GHG emissions would change in two scenarios to 2030. The chemical industry will benefit from wider decarbonisation of energy generation and energy efficiency measures. However, there are also major opportunities to develop more sustainable use of available feedstocks and develop new technologies for better disposal, recovery and recycling.

152.  The UK food and drink industry is the largest manufacturing sector in the country; with a turnover of £72.4 billion it represents approximately 14% of total UK manufacturing.[197] It is also a major energy user, with annual consumption around 45 TWh, which corresponds to primary CO2 emissions of 11.3 MTe per annum.[198] In recent years, the industry set CO2 emissions reduction targets and is making good progress towards achieving its goal. The Food and Drink Federation (FDF) told us:

In November 2007, as part of its public Five Fold Environmental Ambition, FDF members committed to an industry-wide absolute target to reduce CO2 emissions by 20% by 2010 against a 1990 baseline. We are on target to achieve this. We also set an aim to achieve a 30% reduction by 2020, in order to send a clear signal nationally and internationally about the scale of change required and to show leadership on behalf of the sector.

Energy efficiency improvements, investment in new more efficient plant, process design, supply chain optimisation and, increasingly, renewables will all be important in achieving this goal. In its first annual progress report, published in November 2008, FDF was pleased to report a reduction of 17% by 2006 compared to 1990 - an average saving of 58,000 Te CO2 per year.[199]

153.  We welcome the progress made by the chemical industry in identifying its impact on greenhouse gas emissions and congratulate the food and drink industry on its reduction in carbon dioxide emissions. The Government should encourage the sharing of best practice between industries so that others may follow.

154.  Mineral products include the aggregates, asphalt, cement, concrete, lime mortar and silica sand industries. The Mineral Products Association (MPA) told us that CO2 emissions reduction is particularly important for the cement industry as cement manufacture leads to the emission of CO2 directly from the process. The MPA told us:

In the cement industry a great deal of early action has already taken place. Over the last 10-15 years there has been widespread rationalisation and investment in lower carbon technology. Between 1990 and 2008, the MPA Cement member companies have reduced direct CO2 by 38.8% and 2008 emissions were 5.18 MtCO2 lower than 1990.[200]

155.  The most significant low carbon technology for the cement industry is carbon capture and storage. The Committee on Climate Change's first report stated that carbon capture and storage is clearly feasible and no fundamental research breakthrough is required for the cement industry.[201] However, the MPA told us "there is a great deal of research needed to ensure that the product (which is very carefully regulated by European Standards) is unaffected by the changes to the kiln system".[202] They go on to explain that:

The European Commission non-paper aimed at the co-financing of 12 CCS demonstration projects has missed an opportunity in the cement industry. It states in its eligibility criteria that a cement CCS demonstration project should be 500 kt/y avoided CO2 at 85% capture. This is not demonstration scale but full scale for many of the UK plants and the UK Government should aim to approach CCS in the industrial sectors at a more achievable and realistic level.[203]

156.  The iron and steel industry will also benefit from CCS demonstration in industry. The Carbon Capture and Storage Association told us:

Whilst the initial and biggest prospect for CCS is in power generation, with the potential to reduce CO2 emissions by up to 90 per cent, the technology cuts across many sectors of a future low-carbon economy. For example, certain parts of industry, such as cement and steel, will have little or no other option for reducing carbon dioxide emissions besides CCS.[204]

157.  We are concerned by the Mineral Product Association's claims that EU financing of cement CCS is for plants at full scale rather than demonstration scale in the UK. The Government should assess whether financing for CCS demonstration in the cement and steel industries can be achieved at a more realistic scale.

158.  Nationally, the manufacture of pulp, paper and paper products together with printing and publishing is a £44 billion per annum turnover industry employing 410,000 people.[205] The production of one tonne of paper uses 24 trees, requires 1.5 tonnes of coal for electricity generation, and emits five tonnes of carbon dioxide.[206] A move from print to electronic products may appear to be a viable solution to unnecessary carbon dioxide emissions. However, a study by the Swedish Royal Institute for Technology found that if somebody read the news in a printed newspaper each day they would be responsible for emitting 28 kg of carbon dioxide per year. Alternatively, reading it online for 30 minutes a day would result in 35 kg carbon dioxide per year because of the electricity used by the computer, network etc.[207] However, this may change as we move towards a decarbonised electricity supply. Technologies for reducing carbon dioxide emissions from the sector are similar to those in other business environments—sourcing green energy, building technologies, and energy efficiency measures.

ENERGY EFFICIENCY IN BUILDINGS

159.  Energy efficiency measures are often described as low-hanging fruit in relation to reducing carbon dioxide emissions. This is the case in both domestic and non-domestic buildings, and whilst many low carbon technologies will work in both sectors, there are some that are specifically tailored to non-domestic buildings such as factories, offices, schools and hospitals. Buildings in the non-domestic sector account for around 18% of total UK emissions.[208] Willmott Dixon told us that the Government should set legislation rather than ambitions for non-domestic buildings to achieve carbon targets by 2020.[209]

160.  The British Electrotechnical and Allied Manufacturers Association (BEAMA) told us that support for low carbon industry shouldn't simply focus on green start-up companies and renewable technologies, and that existing industries also have an important part to play.[210] The Energy Services and Technology Association (ESTA) explained that "energy efficiency is good for business, because it reduces waste and improves profitability."[211] Indeed, the Department of Energy and Climate Change acknowledged that UK businesses could save £6.4 billion per year through low and no cost resource and energy efficiency measures.[212] However, Tesco told us that the incentive of reduced energy bills is not always in itself a sufficient driver to improve the energy efficiency of buildings.[213]

161.  BEAMA identified some of the technologies with the biggest potential for stimulating a low carbon economy and improving the energy efficiency of buildings:

Smart metering systems for electricity, gas and water utilities deliver significant energy reductions. They achieve this by providing information for consumers, by automatically controlling equipment, and by facilitating demand response techniques. Conservative carbon reductions of 5-10% are reported from world examples.

Advanced heating controls are available for use with all gas heating systems. Independent evidence shows that savings of 6% are achieved compared with traditional well-controlled systems. Significantly higher savings can be achieved by upgrading all systems to minimum levels of control (10-20%).

Building Automation [and Control] Systems (BACS) in commercial buildings can save up to 20% of Heating Ventilating & Air Conditioning (HVAC) consumption. Actual efficiency figures depend upon site-specific factors and installation and maintenance. Lighting controls using constant dimming and occupancy and time switching for commercial and domestic buildings. Energy use reductions vary, but robust evidence shows on average 20% - 30% reductions in lighting usage.

Lighting controls using constant dimming and occupancy and time switching for commercial and domestic buildings. Energy use reductions vary, but robust evidence shows on average 20% - 30% reductions in lighting usage.[214]

162.  Despite the downturn in the economy, sales of energy efficiency products and technologies are still growing. ESTA told us "demand for the latest automatic Monitoring & Targeting (aM&T) systems is seeing growth in the order to 25% per annum. Lighting control systems are likewise showing continued growth (a slightly lower figure of around 10% per annum)".[215] However, further support through a long-term policy framework would be welcomed by the industry. BEAMA cited recent good examples of long-term policy decisions including "the long-term commitment to building zero carbon homes by 2016, the phasing out of incandescent lamps by 2011 and the three year advance notice of the switch to condensing boiler installations in 2005."[216] One suggestion from ESTA was to make more use of Display Energy Certificates (DECs). These are currently required on large public sector buildings (more than 1,000 m3 area), which are visited frequently by members of the public. "ESTA believes this tool should be used on all buildings, except the smallest. Where they are already in use, they must be renewed annually and we see this as a useful tool for building operators to assess - and improve - building energy performance on a regular basis".[217] The Carbon Trust told us:

There are about 40,000 buildings with those certificates [DEC]. One could enforce or mandate that all public sector buildings implement the cost effective opportunities linked to those certificates. In doing that you would save around a billion pounds per annum on energy bills and save about 23 million tons of CO2 and really stimulate the supply chain in the buildings industry.[218]

Willmott Dixon also called for more widespread use of DECs, to include hotels, supermarkets, and privately owned buildings that are frequently visited by the public.[219] Evidence we received from Tesco went further, recommending that the Government could:

offer reduced business rates for those properties that achieve low emissions, based on an existing measurement system such as that used for Display Energy Certificates […] for instance, a 10p tax cut in the multiplier for achieving a particular energy rating would finance £100,000 of energy savings at a typical Tesco superstore and would significantly influence investment decisions. This could be made cost-neutral, either within the business rates system (with commensurate penalties for the worse performing buildings), or more widely within the tax system.[220]

Greenpeace were also in favour of reducing business rates as a way of increasing interest in energy efficiency, in particular for small and medium companies.[221]

163.  Energy efficiency technologies for non-domestic buildings include smart metering, advanced heating controls, building automation and control systems, and lighting controls. Most of these technologies have already been developed and are ready for widespread deployment. We have heard that whilst energy efficiency is good for business profitability, a reduction in energy bills is often not enough of an incentive for companies to invest. Government should introduce more effective policies to encourage businesses to become energy efficient. Existing systems such as the Display Energy Certificates (DECs) provide an excellent means of measuring the energy efficiency of a building. DECs should be rolled out to all medium to large private sector buildings and the Government should investigate the feasibility of reducing business rates for businesses that improve their energy efficiency rating.

INDUSTRIAL COMBINED HEAT AND POWER

164.  Combined heat and power (CHP) is the simultaneous generation of usable heat and power. It can deliver low carbon heat and electricity if the energy input has a low carbon footprint, for example, sustainable biomass or gas from anaerobic digestion. The Food and Drink Federation (FDF) told us:

The food and drink manufacturing sector is already a significant user of CHP with around 500 MWe installed capacity, though this tends to be concentrated at larger installations. It is recognised that there is significant further potential, however relatively few new installations have come on stream in recent years largely due to poor payback periods.[222]

165.  Current financial support mechanisms for industrial CHP include Climate Change Levy exemptions, Levy Exemption Certificates for exported power and Enhanced Capital Allowances (ECAs). The FDF told us "Further incentive for renewables CHP could come from additional financial support such as higher (>100%) ECAs or increased renewable obligation certificates (ROCs)".[223]

166.  However, Centrica were less optimistic about the potential of CHP. They explained that it provided lower CO2 emissions reductions than renewables, nuclear and CCS. They told us "Much of the technical potential is not economically feasible, and any short term gains are likely to be outweighed by the long-term negative effect of locking businesses into fossil-fuel based heat production."[224] In contrast, E.ON told us: "Combined heat and power on an industrial scale continues to have a very important role in ensuring the more efficient use of fossil fuels".[225]

167.  Combined heat and power can be an effective low carbon technology in particular sectors where there is easy access to sustainable fuel, for example, biomass or gas from anaerobic digestion in the food and drink industry. In these circumstances, the Government should actively encourage industry by providing an appropriate level of support. This should be kept under review and determined in consultation with industry. However, the use of CHP technology fuelled by unabated fossil fuels has no place in a green economy driven by the need to address emissions reduction targets.

DISTRICT HEATING

168.  District heating involves the use of a centralised system which provides heating requirements, such as space heating and hot water, for a cluster of local properties or through heat networks for hybrid supply of heat to commercial, industrial and public buildings, along with domestic properties. It can help to reduce the cost of energy to consumers because large scale generation of heat is more cost effective than generating heat using individual boilers in individual properties. District heating can also lower CO2 emissions, although the extent to which this happens depends on the type of fuel used. The use of CHP technologies in district heating projects allows the efficient, integrated generation of usable heat and electricity for local communities. Greenpeace told us it is important to move towards district heating not simply because of the energy savings that CHP offers but also because of the strategic advantage, so that as we move to low carbon energy sources, it will be easier to convert one centralised installation serving 1,000 homes, than to convert the heating systems in 1,000 individual properties.[226] The recent Government report, Warm Homes, Greener Homes: A Strategy for Household Energy Management, calls for wider take up of district heating in urban areas and in commercial and public sector buildings.[227]

169.  District heating provides efficiency savings through the large scale generation of energy and is best suited to densely populated urban areas or large buildings (such as hospitals and schools). We support the Government's call for wider uptake of district heating in these areas. However, the Government must ensure that every effort is made to source low carbon fuel for district heating projects if it is serious about meeting emissions reduction targets.

DOMESTIC

170.  In 2008, the amount of energy used in the domestic sector in the UK was 45.64 million tonnes of oil equivalent.[228] Baxi Group UK told us "Domestic CO2 emissions account for 27% of total UK emissions in 2005 and over three quarters of energy used in the home is for heating and hot water".[229] Energy efficiency measures in domestic buildings will be met through the introduction of existing and new building technologies (including windows, doors, insulation and building control systems). The global market value of the building technologies sector in 2007/08 was £390.48 billion; the UK had a 3.30% share of this. The UK employed 107,000 people in this sector in 2007/08. Based on forecast growth in domestic market value, this could potentially rise to 154,800 in 2014/15.[230]

171.  The Government has an ambitious target in place for all new homes to be zero carbon by 2016. However, it is important that all domestic buildings, existing and new-build, are energy efficient if the UK is to meet its carbon dioxide emissions reduction targets for 2020 and 2050. The Micropower Council told us that at least 70% of the existing housing stock will still be in place in 2050, therefore, emissions from these existing homes must be tackled as part of any commitment to reduce emissions.[231]

172.  The Government has put in place a number of mechanisms to encourage the uptake of energy efficiency measures in existing domestic buildings:

  • The Carbon Emissions Reduction Target (CERT) commenced in April 2008. It is the Government's flagship household sector energy and carbon saving scheme. CERT places a 3-year obligation on energy suppliers to meet household carbon saving targets. Suppliers meet these targets by promoting the take-up of energy saving measures, including loft and cavity wall insulation and high-efficiency lighting and appliances. The Government is consulting on an extension to CERT until December 2012.
  • The Community Energy Savings Programme (CESP) commenced in September 2009. It encourages energy companies to work with local councils and voluntary organisations to carry out house-to-house calls to promote energy efficiency measures in deprived areas. However, it has been introduced on a fairly limited basis, covering only 100 areas and approximately 90,000 households.
  • The Warm Front Scheme commenced in 2000. It is designed to provide grants for people on qualifying disability or income related benefits to install energy efficient measures in their homes. It provides a package of insulation and heating improvements up to the value of £3,500 (or £6,000 where oil, low carbon or renewable technologies are recommended).

173.  The Minister told us Warm Front has funding until 2011, the CERT will be extended to 2012, and the CESP will run until 2012.[232] In the 2009 Pre-budget Report, the Government also announced a new Boiler Scrappage Scheme. This is a scheme to upgrade household heating systems by offering a £400 voucher to replace a working G-rated boiler with a new A-rated boiler or a renewable heating system, for example a biomass boiler or a heat pump. The Government is also piloting a home energy Pay As You Save (PAYS) scheme in conjunction with the Energy Savings Trust. This scheme is testing out new ways to finance home energy makeovers. Consumers are given the opportunity to invest in energy efficiency and microgeneration technologies with no upfront cost. Repayments are spread over a period of time and are paid through the savings that are made through the consumers' energy bills. In March 2010, the Government published Warm Homes, Greener Homes: A Strategy for Household Energy Management. One of the proposals in this strategy is to expand the PAYS scheme by introducing legislation to allow Pay As You Save loans to be tied to the property.[233]

ENERGY EFFICIENCY

174.  Despite the Government's many initiatives and the ease with which most energy efficiency measures, for example insulation, can be installed, consumers are surprisingly slow to act. E.ON told us "from an energy policy perspective, investment in improving energy efficiency is amongst the lowest cost options for reducing CO2 emissions."[234] One specific challenge is that of improving the energy efficiency of rented accommodation, where the cost of high energy bills falls to the tenant but the cost of home improvement would naturally fall to the landlord. The Government has acknowledged this challenge; in its household energy management strategy it proposes to consult on setting minimum energy efficiency standards for rented properties.[235]

175.  We heard from a number of organisations that the Government's green stimulus for energy efficiency was inadequate. The Sustainable Development Commission believes there is scope for an £11 billion per year domestic retrofit programme. They told us:

this would reach an average of one million households a year over and above those reached by existing and currently envisaged policy measures. By contrast, the 2009 budget provided an additional £375 million to support energy and resource efficiency in businesses, public buildings and households over the next two years.[236]

176.  Greenpeace have reported that an energy efficiency programme of £525 million per year would be required just to meet fuel poverty needs. To meet longer-term needs, they claim that public and private investment will need to be of the order of £5 billion per year.[237] Retrofitting the existing building stock is by its very nature work that has to be done locally. Advocates of stimulating green jobs in this industry argue that not only are jobs local, but they are created quickly and don't require lengthy training programmes. Greenpeace told us "for every €1 million of investment we get about 8 to 14 directly created jobs and between 9 and 40 indirectly created jobs."[238] New jobs that are created in this sector must be designed to promote energy efficiency measures rather than a business-as-usual approach to home improvement. According to research by BEAMA, 70% of people have said that the heating installer made the decision on their heating system.[239] Installers of building technologies must be ambassadors for energy-saving technologies.

177.  The Government's strategy for household energy management, Warm Homes, Greener Homes, proposes to overhaul the scope of Energy Performance Certificates to give householders a better understanding of what they can do to improve the energy efficiency of their homes. This would include an online modelling system so homeowners can do a virtual green makeover before taking action.[240]

178.  Energy efficiency is described as low hanging fruit when discussing ways of reducing emissions. However, despite Government initiatives, consumers are often slow to take advantage of support for insulation and other energy efficiency measures. To date, Government initiatives on energy efficiency have not been nearly ambitious enough. However, we welcome the proposals within the strategy on household energy management, Warm Homes, Greener Homes. We hope the Government will pay particular attention to introducing new regulations to tackle the energy efficiency of existing housing stock, such as requiring properties to achieve a minimum energy efficiency standard before sale or lease is permitted. We would also like the Government to investigate the feasibility of encouraging households to improve their energy efficiency rating, as defined in the Home Information Packs (HIPs), in exchange for lower council tax rates.

179.  The UK also has strengths further up the supply chain in the development of new low carbon technologies. E.ON pointed out one example of an area where the UK is particularly strong—organic light emitting diodes (LEDs) and optoelectronics for lighting and displays.[241] The Carbon Trust also highlighted this area; they told us:

[LEDs] are going to commercialise by 2014. The private sector are putting a lot of investment into LED technology […] There are niche opportunities for the UK, particularly in the luminaire designs, so we could help stimulate luminaire design. The types of policies we need are the ones that will unlock the barriers for implementation of LEDs and get them in fast because we need cost effective energy efficiency as soon as possible, ideally all implemented by 2020 across the building stock.[242]

180.  They went on to explain that targeted policies are needed for specific technologies, rather than a generic incentive mechanism, for example changing the way building regulations look at lighting or altering the way information is presented on lighting products so that it is easier for consumers to make a comparable decision on the relative benefits of LED lighting versus other types of lighting.

181.  There are also areas of energy efficiency, such as solid wall insulation, where there are currently few affordable technology solutions. The Energy Savings Trust told us "Unless we can really invest in things like solid wall insulation and work out how we are going to make it work, then we are going to be missing huge opportunity to reduce the UK's carbon emissions."[243]

182.  It is important to tailor specific policies to specific technologies to overcome barriers unique to the deployment of those technologies. Light emitting diodes (LEDs) are a good example of one technology that will benefit from this approach over the next four years. We hope the Government will work closely with technology developers and industry to determine potential barriers to the widespread commercialisation of LEDs (and other new technologies) and address these ahead of their deployment. Where there are specific challenges that need to be addressed, such as solid wall insulation, the Government should fund research and development of technologies that will overcome these.

183.  The responsibility for supporting and implementing energy efficiency measures is spread across a number of stakeholders, from central and local government to organizations such as the Energy Savings Trust and the energy utility companies. E.ON told us:

We favour a regional franchise approach to upgrading the UK housing stock from 2013 onwards in which a single organisation is charged by Government with delivery within defined geographical area supported by the availability of low interest loans for consumers.[244]

184.  National Energy Action have proposed a whole-house retrofit approach to energy efficiency:

The whole-house retrofit programme will identify the basic measures required by the household such as draughtproofing; double glazing; and cavity and loft insulation. Beyond this, more costly measures will be assessed including solid wall insulation, the requirement for renewable/low carbon generation in /on the property and the potential for connection to district heating.[245]

Greenpeace are also in favour of this approach. They described the 'Green Concierge Service', which they would like to see improved and rolled out proactively: "The Green Concierge is someone who comes in, gives the advice, says what needs to be done, and actually manages the project. So that unpicks some of the potential barriers."[246] The Government's recently published strategy for household energy management, Warm Homes, Greener Homes, proposes to introduce a one stop shop energy helpline for people to access trust-worthy information about how to benefit from energy efficiency measures.[247]

185.  We encourage the Government to take a more detailed look at the 'whole-house' approach to energy efficiency. We welcome its proposals to introduce a one stop shop energy helpline; however, the Government should consider a more ambitious 'Green Concierge' scheme, which would involve on-site consumer advice on energy efficient home improvements. Our forthcoming report on fuel poverty will also look at some of the options available for increasing energy efficiency.

186.  Most particularly, it is vital as a matter of urgency to introduce a national programme to retrofit existing housing stock. A major street by street, house by house scheme needs to be introduced. This could run alongside the current proposal to install smart meters.

MICROGENERATION

187.  Microgeneration is the localised generation of low carbon energy by households and businesses. We heard from the Solar Trade Association that it is important to install energy efficiency measures first, followed by pure renewable microgeneration technologies such as wind turbines and solar panels, and then back that up with other fuel based technologies, for example micro-CHP.[248] However it is not appropriate to put solar panels on every surface or wind turbines on every home. The Micropower Council acknowledged this in their evidence to us:

Tackling retrofit is very challenging due to the wide range of different house types, available heating sources and planning restrictions such as conservation areas and listing. The appropriate solution for each house is different and, therefore, formulating policy is difficult as, if highly prescriptive, it will probably be very inappropriate for some, if not most, dwelling types. The wide range of microgeneration technologies, however, facilitates an appropriate low carbon solution for a given house type.[249]

188.  The introduction of the Government's Feed-in Tariff in April 2010 is widely expected to increase consumer demand for electricity microgeneration technologies. The Renewable Heat Incentive, expected to roll out in 2011, is expected to do the same for heat microgeneration technologies. Centrica told us "the Feed-in Tariff for electricity and the Renewable Heat Incentive can deliver the step change necessary to take microgeneration into the mass-market mainstream."[250] The Renewable Energy Association highlighted that decentralised energy offers strong job creation opportunities, especially in the rural economy.[251]

189.  E.ON told us that they see a big role for heat pumps:

Heat pumps represent a highly cost efficient and carbon effective way of providing heat and hot water. By sourcing heat from the ground or air, using a grid electricity input, the heat pump is able to convert one unit of heat and in the right conditions produce up to three units of heat in return. Heat pumps are highly effective heat-led solutions in hard to treat locations off the gas grid.[252]

EDF Energy was positive about the potential for air source heat pumps (ASHP). "As a conservative assumption, around 2 million high temperature ASHPs can be installed in the period to 2020, providing there is appropriate financial support and installer skills are developed."[253] However, Calor Gas was less positive about ground source heat pumps (GSHP); they told us "ground source heat pumps are disruptive to fit and at up to £14,000 to install are a very expensive way of addressing the problem, particularly in rural areas which would also require a very significant investment in electricity infrastructure."[254]

190.  We have already discussed the potential of combined heat and power (CHP) in industry and in district heating schemes. CHP also has a role to play as a microgeneration technology in domestic buildings as well. Micro-CHP has the potential to replace traditional gas boilers in a centrally heated home. E.ON told us "It [micro-CHP] burns gas to produce space and water heating, whilst simultaneously generating around 3,000 kWh of electricity annually."[255] Centrica outlined the full potential of this technology in the UK:

Current forecasts suggest that mCHP [micro-CHP] boilers could provide energy bill savings for the average household of approximately 25% per year and reduce annual household carbon dioxide emissions by up to 2.5 tonnes.  Over 80% of the 21 million centrally heated homes in the UK are on the gas network and the overwhelming majority of these homes will use gas as a heating fuel. Approximately 1.5 million boilers are replaced each year in Great Britain and one scenario puts residential CHP as taking 30 per cent of this market by 2015. Collectively, the new mCHP boilers could save the equivalent CO2 emitted by eight power stations. A significant number of households use Liquid Petroleum Gas (LPG) boilers which are virtually identical to conventional gas boilers so there is no reason why LPG would not also benefit from mCHP, ultimately further extending the reach.[256]

191.  Microgeneration technologies are often expensive to install. We welcome the Government's Feed-in Tariff, which will commence in April 2010. We hope the Government will consult the relevant industries to the same extent in developing the right level of support for various technologies through the Renewable Heat Incentive.

SMART TECHNOLOGIES

192.  A smarter energy network is touted as the best way of increasing consumer interest and involvement in energy efficiency. Smart meters will be a key component of this network; the Government intends to have smart meters installed in every home within the next ten years. Mr Phil Wynn Owen, Director General, National Climate Change and Consumer Support, Department of Energy and Climate Change, explained to us that smart meters would be accompanied by a real-time display that would tell consumers what energy they are using and when they are using it. These displays will help consumers to understand and manage their consumption.[257] Whilst there is value in this as a tool for encouraging consumers to use less energy, the smart meter will only reach its full potential when used in conjunction with a smart grid and smart electrical appliances. Centrica told us that they have partnered with Vphase, a developer of energy saving products for residential and commercial properties. This partnership will see Vphase products offered to British Gas customers.[258] Smart appliances and products would be capable of communicating with the electricity or gas grid via the smart meter. For example, they could potentially be triggered to switch to an energy saving mode during times of peak demand, or future products such as electric vehicles could be set up to begin charging overnight when demand for electricity is low. Such a system would result in savings in consumer energy bills as well as providing the utility companies with an element of demand management.

193.  However, BEAMA warned us of the importance of consumer buy-in on smart meter technologies:

If the consumers do not believe that by having this technology [smart meters] in their homes it will give them a benefit, it will help them control their lives better and give them lower bills, basically it will not be accepted, it will not be used and it will be a waste of money. There is a real effort there needed. It includes education, it includes regulation, it includes local authorities, very importantly, to help people, it involves charities, and it involves central government providing the framework for really educating and informing consumers what they can do in their homes.[259]

194.  National Grid also showed concern, calling for "a coordinated and consistent communication campaign to achieve early education of consumers in how to exploit the potential from smart meters and appliances."[260]

195.  The Government should work in closer partnership with the utility companies, the electrotechnical industry and other stakeholders to ensure that an open two-way dialogue is achieved between them and consumer groups about the potential benefits of smart meters and a smarter energy network.


146   Department of Energy and Climate Change, Digest of UK Energy Statistics, Annex, Table 1.1.5 Back

147   Q 262 [Professor King, Aston University] Back

148   Ev 174 [Department of Energy and Climate Change] Back

149   Q 149 [Ms Spain, Energy Savings Trust] Back

150   Q 248 [Professor King, Aston University] Back

151   Q 22 [Mr Simms, New Engineering Foundation] Back

152   Q 516 [Mr David Kidney MP, Department of Energy and Climate Change] Back

153   Q 249 [Mr Archer, Low Carbon Vehicle Partnership] Back

154   Ev 174 [Department of Energy and Climate Change] Back

155   Q 253 [Mr Archer, Low Carbon Vehicle Partnership] Back

156   Committee on Climate Change, www.theccc.org.uk/sectors/transport/electric-cars Back

157   Q 248 [Professor King, Aston University] Back

158   Department for Transport press notice, Motorists get up to £5,000 towards cost of an ultra-low carbon car, 25 February 2010, www.dft.gov.uk Back

159   Ev 240 [National Grid] Back

160   Q 253 [Mr Archer, Low Carbon Vehicle Partnership] Back

161   Q 253 [Professor King, Aston University] Back

162   Q 263 [Mr Archer, Low Carbon Vehicle Partnership] Back

163   Ev 191, para 25 [E.ON] Back

164   Q 261 [Mr Archer, Low Carbon Vehicle Partnership] Back

165   Q 261 [Mr Archer, Low Carbon Vehicle Partnership] Back

166   Ev 141 [AIR Products PLC] Back

167   Q 283 [Professor King, Aston University] Back

168   Ev 247 [Network Rail] Back

169   Ev 223 [Dr Hillmansen, University of Birmingham] Back

170   Q 273 [Dr Hillmansen, University of Birmingham] Back

171   Ev 247 [Network Rail] Back

172   Q 273 [Dr Hillamsen, University of Birmingham] Back

173   Q 273 [Dr Hillamsen, University of Birmingham] Back

174   Network Rail, New Lines Programme: Strategic Business Case, August 2009 Back

175   Ev 247 [Network Rail] Back

176   Chamber of Shipping et al., A global cap-and-trade system to reduce carbon emissions from international shipping, September 2009 Back

177   Oxford Economics, The economic contribution of the UK shipping industry in 2007, February 2009 Back

178   International Maritime Organization, GHG Study, April 2009 Back

179   Q 292 [Mr Brownrigg, Chamber of Shipping] Back

180   Environmental Audit Committee, Fourth Report of Session 2008-09, Reducing CO2 and other emissions from shipping, HC 528 Back

181   Q 307 [Mr Ashdown, Chamber of Shipping] Back

182   AEA Energy & Environment, Low carbon commercial shipping, March 2007, p 46-8 Back

183   Q 309 [Mr Ashdown, Chamber of Shipping] Back

184   Q 310 [Mr Ashdown, Chamber of Shipping] Back

185   Chamber of Shipping et al., A global cap-and-trade system to reduce carbon emissions from international shipping, September 2009 Back

186   Committee on Climate Change, Meeting the UK aviation target - options for reducing emissions to 2050, December 2009, p 34 Back

187   Q 302 [Mr Jopson, NATS and Sustainable Aviation] Back

188   Ev 276, para 3.1.1 [Sustainable Aviation] Back

189   Q 305 [Professor Parker, Sustainable Aviation] Back

190   Q 305 [Professor Parker, Sustainable Aviation] Back

191   Ev 276, para 3.4.2 [Sustainable Aviation] Back

192   Q 298 [Mr Jopson, NATS and Sustainable Aviation] Back

193   Q 317 [Mr Wiltshire, Sustainable Aviation] Back

194   Department of Energy and Climate Change, Digest of UK Energy Statistics, Annex, Table 1.1.5 Back

195   Chemical Industries Association, www.cia.org.uk Back

196   International Council of Chemical Associations, Innovations for Greenhouse Gas Reductions, July 2009, p 11 Back

197   Ev 214, para 1 [Food and Drink Federation] Back

198   Ev 215, para 4 [Food and Drink Federation] Back

199   Ev 215, para 5-6 [Food and Drink Federation] Back

200   Ev 229, para 4.2 [Mineral Products Association] Back

201   Committee on Climate Change, Building a low carbon economy - the UK's contribution to tackling climate change, December 2008, p 47 Back

202   Ev 230, para 5.1 [Mineral Products Association] Back

203   Ev 231, para 7.4 [Mineral Products Association] Back

204   Ev 159, para 6 [Carbon Capture and Storage Association] Back

205   http://www.lancashire.gov.uk/office_of_the_chief_executive/lancashireprofile/sectors/printing.asp?sysredir=y Back

206   Professor John Grace, Towards Green Publishing - presentation to the Association of Learned and Professional Society Publishers, September 2008 Back

207   KTH Centre for Sustainable Communications, Screening environmental life cycle assessment of printed, web-based and tablet e-paper newspaper, 2007 Back

208   Ev 212, para 4.1 [Energy Services and Technology Association] Back

209   Ev 288 [Willmott Dixon] Back

210   Ev 151, para 32 [British Electrotechnical Allied Manufacturers Association] Back

211   Ev 151, para 32 [British Electrotechnical Allied Manufacturers Association] Back

212   Ev 177, para 21 [Department of Energy and Climate Change] Back

213   Ev 285, para 29 [Tesco] Back

214   Ev 149, para 17 [British Electrotechnical Allied Manufacturers Association] Back

215   Ev 213, para 6.1 [Energy Services and Technology Association] Back

216   Ev 149, para 9 [British Electrotechnical Allied Manufacturers Association] Back

217   Ev 213, para 7.2-7.3 [Energy Services and Technology Association] Back

218   Q 147 [Mr Wilde, Carbon Trust] Back

219   Ev 288 [Willmott Dixon] Back

220   Ev 285, para 30 [Tesco] Back

221   Q 49 [Dr Parr, Greenpeace] Back

222   Ev 216, para 20 [Food and Drink Federation] Back

223   Ev 216, para 21 [Food and Drink Federation] Back

224   Ev 171, para 22 [Centrica PLC] Back

225   Ev 190, para 17 [E.ON] Back

226   Q 40 [Dr Parr, Greenpeace] Back

227   HM Government, Warm Homes, Greener Homes: A Strategy for Household Energy Management, March 2010 Back

228   Department of Energy and Climate Change, Digest of UK Energy Statistics, Annex, Table 1.1.5 Back

229   Ev 145, para 2 [Baxi Group UK] Back

230   Innovas, Low Carbon and Environmental Goods and Services: an industry analysis, March 2009, p 40 Back

231   Ev 227 [Micropower Council] Back

232   Q 491 [Mr David Kidney MP, Department of Energy and Climate Change] Back

233   HM Government, Warm Homes, Greener Homes: A Strategy for Household Energy Management, March 2010 Back

234   Ev 189, para 12 [E.ON] Back

235   HM Government, Warm Homes, Greener Homes: A Strategy for Household Energy Management, March 2010 Back

236   Ev 279 [Sustainable Development Commission] Back

237   Greenpeace, The case for including energy efficiency in the fiscal stimulus package, March 2009 Back

238   Q 44 [Dr Parr, Greenpeace] Back

239   Q 441 [Mr Timmins, British Electrotechnical Allied Manufacturers Association] Back

240   HM Government, Warm Homes, Greener Homes: A Strategy for Household Energy Management, March 2010 Back

241   Ev 189, para 12 [E.ON] Back

242   Q 159 [Mr Wilde, Carbon Trust] Back

243   Q 159 [Mr Lewis, Energy Savings Trust] Back

244   Ev 189, para 12 [E.ON] Back

245   Ev 232, para 8 [National Energy Action] Back

246   Q 57 [Dr Parr, Greenpeace] Back

247   HM Government, Warm Homes, Greener Homes: A Strategy for Household Energy Management, March 2010 Back

248   Q 349 [Mr Matthews, Solar Trade Association] Back

249   Ev 227 [Micropower Council] Back

250   Ev 170, para 12 [Centrica PLC] Back

251   Ev 253 [Renewable Energy Association] Back

252   Ev 189, para 14 [E.ON] Back

253   Ev 193, para 7 [EDF Energy] Back

254   Ev 157, para 5.2 [Calor Gas Ltd] Back

255   Ev 189, para 15 [E.ON] Back

256   Ev 170-171, para 18 [Centrica PLC] Back

257   Q 502 [Mr Wynn Owen, Department of Energy and Climate Change] Back

258   Ev 171, para 20 [Centrica PLC] Back

259   Q 437 [Dr Porter, British Electrotechnical Allied Manufacturers Association] Back

260   Ev 243, para 37 [National Grid] Back


 
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