Embedding sustainable development across Government, after the Secretary of State’s announcement on the future of the Sustainable Development Commission

Written evidence submitted by the Combined Heat and Power Association (ESD 22)


· Government buildings must decarbonise their energy supply in order to meet emissions reductions targets

· Decarbonising heat supplies should be given parity with electricity

· Quick Wins should be prioritised

· The failure to install CHP solutions as a Quick Win is most likely due to:

o CHP being an unfamiliar technology to estates managers

o the lack of available technical information in the Cabinet Office, Defra and BuyingSolutions

o the lack of systematic training for estates managers on low carbon energy provision

o the lack of procurement frameworks making the process more complicated and expensive

There are two key areas that will be addressed in this submission: the delivery of energy to public buildings, and the utilisation of Combined Heat and Power (CHP) as a Quick Win.

The policy of Quick Wins has not been successfully embedded within procurement and construction processes. As a specific example, opportunities for CHP on the Government estate have been neglected and targets have not been met. This does not appear to be due to recognition that CHP is a good option for the government estate, rather that the capability to support delivery on the ground is limited.

NB. References in this response to the Cabinet Office reflect the fact that they now have ownership of the Office of Government Commerce, where many of these responsibilities originally lay.


1. Energy consumption has been identified as a priority area in which carbon emissions from the Government estate can be reduced, but there are significant problems with the focus of efforts and the lack of progress. Changes have been made by, for example, selling buildings, improving lighting, and procuring more efficient electrical goods, but these have all been on the demand side; little has been done to address the greater issue of where the government’s energy comes from. In order to make emissions reductions on the scale required (and to support the Government’s agenda for decentralised energy) estates managers will need to develop onsite low carbon heat and electricity provision.

2. The word energy has also been used interchangeably by the Cabinet Office, Defra and BuyingSolutions with the word electricity. Heat is another form of energy, and one that is responsible for more carbon emissions in buildings than electricity. There is no SOGE target for renewable heat, only electricity, and the SOGE target for CHP only measures electricity provision, despite the fact that the main benefit of a CHP plant is an efficient, low carbon heating supply. Confusing references are made in official documents to ‘CHP heat’ and ‘renewable energy’, targets for which do not exist [1] . This is indicative of a lack of understanding of both CHP and energy.

3. Government has fallen short on its renewable electricity SOGE targets and the majority of electricity used is supplied from the grid rather than generated onsite, which raises questions over whether this process encourages renewable generation or if it simply denies it to another consumer – the problem of additionality. Objectives on low carbon energy and decentralisation would be better served by providing energy onsite or locally.

4. A focus on using renewable electricity rather than energy efficiency to reduce carbon emissions has had the perverse effect of limiting options for more cost-effective measures. Much of the Government estate consists of old buildings in urban areas, which are unsuitable for many renewable technologies, yet are ideal for forming the basis of a CHP district heating scheme. This would generate cost and carbon savings in the short term, while the heating infrastructure installed could be used to delivery renewable heat with economies of scale in the future.

5. There is very little advice available to public sector estates/energy managers on how to implement onsite low carbon generation technologies. The Cabinet Office and BuyingSolutions websites and documentation offer little in these areas and the Cabinet Office have suspended their programme of technical ‘Masterclasses’ that provided practical support to estates managers, leaving individual departments to procure training separately, at greater cost, if at all.

Combined Heat and Power

6. CHP is ideally suited to many buildings in the public estate. There is often little that can be done to improve the fabric of the building (lack of cavity walls for insulation, or listed status preventing external cladding or solar panels) and their urban location limits the possibilities for technologies such as wind or hydro power. The NHS Sustainable Development Unit has identified that in hospitals for example, there is a typical payback for CHP of just 2.8 years [2] and Trusts such as St Thomas’ and Guy’s are saving around £1.5m per year on their energy bills. Indeed, the SDU have identified a negative marginal abatement cost for CHP, meaning that switching to low carbon heat/electricity through CHP saves you money as opposed to being more expensive, as is the case with other technologies.

7. CHP has been identified as a ‘Quick Win’ (now ‘Government Buying Standards’) by both the Office of Government Commerce (OGC) and the EU sustainable procurement programme, Green Public Procurement (GPP). In addition to its obvious meaning, Quick Wins are mandatory minimum standards for products that should be implemented as part of the EU Energy Services Directive. The standard for CHP is ‘Good Quality’ CHP (GQCHP), which was created to fulfil UK obligations for the CHP Directive and translates to a primary energy saving of at least 10% over business as usual. Despite these policies, there has been very little progress in the uptake of CHP on the public estate.

8. The government had a SOGE target to procure 15% of its electricity requirements from CHP by March 2010. According to the SDC in 2009, a figure of only 8.7% was reached, with no improvement on the previous year [3] . As mentioned above, the majority of this capacity is procured from off site, and over 90% is used by just three departments. In addition, only 6% of the CHP electricity that was used meets the GQCHP standard. Analysis of UK policies for complying with the Energy Services Directive commissioned by DEFRA in 2007 stated that they would not realise any of the potential for CHP [4] .

9. The failure to embed Quick Wins in procurement has been raised by the SDC, the National Audit Office [5] and the Environmental Audit Committee. In its response to the 6th report of the Environmental Audit Committee’s Inquiry, Greening Government, the government suggested that its failure to improve the uptake of Quick Wins would be remedied through the creation of a Centre for Expertise in Sustainable Procurement within OGC, but the figures above demonstrate that this has not been the case. The government has provided no response to recommendations on CHP put forward by the SDC in their annual progress reports [6] .

10. The gap between political support for CHP and delivery on the ground highlights an important issue with the Government’s ability to meet its objectives for the estate - estates managers are rarely experts on energy. Energy is a complex field and low carbon energy is new and rapidly changing, so extensive support must be provided in order for them to make informed choices when replacing their existing supply. For the Government to embed sustainability in a systematic fashion, resources must be made available to simplify the process for estates managers. As an example, there is currently no basic information on what CHP is or how to procure it in Cabinet Office documents relating to sustainable procurement, sustainable construction or sustainable energy [7] . The technical ‘Masterclasses’ mentioned above could have filled this gap, but they were not mandatory and the programme has been cancelled.

11. The lack of energy expertise within estates management could be compensated for by the creation of procurement frameworks for the relevant technologies. This would reduce the risk involved in procurement by having approved suppliers providing pre-agreed results. They would also serve to eliminate waste by reducing the time and cost involved in procurement.

District Heating

12. In the Household Energy Management Strategy [8] published earlier this year, Government acknowledged the important role that public buildings play in providing ‘anchor loads’ for district heating (DH) schemes, and made a commitment to consider connecting buildings to DH schemes where feasible. By fulfilling this pledge, the Government would be in a position to decarbonise its own heat supplies and those of the wider community. The aggregating of heat demands allows for economies of scale for any heating technology, as well as enabling the possibility of more efficient solutions such as CHP.

13. This concept however, has not reached other departments such as the Cabinet Office. DH schemes are understandably more complex than individual heating systems, so in order for estates managers to be able to consider it as an option, guidance and support must be provided.


· Establish a ‘one-stop shop’ for low carbon energy solutions on the Cabinet Office website. There should be links to relevant technical, commercial and procurement information for each technology. Quick Wins should be clearly highlighted.

· Provide systematic training for estates managers on low carbon energy provision. The most obvious method for this is to restart the Cabinet Office’s programme of technical ‘Masterclasses’ and to make their attendance mandatory.

· Develop procurement frameworks for low carbon energy technolog ies to simplify the process, reduce costs, reduce risk and eliminate waste.

· Bring decarbonising heat and cooling into parity with decarbonising electricity as a priority for the estate in the replacement to the SOGE framework.

13 October 2010

[1] E.g. Energy Efficiency Measures in the Government Civil Estate, OGC 2009

[2] NHS Carbon Reduction Strategy for England , NHS Sustainable Development Unit, 2009

[3] Sustainable Development in Government, Sustainable Development Commission, 2009

[4] Options for Implementing Article 5 of the Energy Saving Directive, BRE, 2007

[5] Sustainable Procurement in Central Government, NAO, 2005

[6] Government Response to the Sustainable Development Commission, Cabinet Office, Defra, OGC, 2008

[7] E.g. Guidance to Sustainable Operations on the Government Estate, OGC, 2008; Considering Energy Efficiency in Procurement, OGC 2009; Priority Actions for Improving Energy Efficiency across the Government Estate, 2010

[8] Household Energy Management Strategy, DECC, 2010