This article by Sunil Shah, DPP’s head of sustainability, first appeared in The Times on 13 November 2009.
The Carbon Reduction Commitment, (CRC) the mandatory emissions trading scheme, begins in April next year yet public sector bodies are failing to adequately prepare or are still ignorant of their obligations. Worse still whilst Local Authorities have had significant help through the ‘Save to Spend’ programme over recent years the lack of resources and skilled personnel has meant that many authorities have not yet utilised effectively this benefit or worse still have received the funding but not used it.
More than £80m of funding has been made available to the public sector to help reduce energy consumption. With this level of financial and additional commercial support, there is little excuse for inaction and not meeting the targets.
Cost effective savings of 20%-30% could be made immediately by energy efficiency within Local Authority buildings but there is little inclination to deliver these immediate savings and they still cry out about budget and resource deficiencies.
The new legislation covers both private and public sector organisations with electricity consumption of 6000MWh or more per year, roughly equivalent to an annual energy bill of £500,000.
Most private sector organisations have understood the threats and are well advanced in their preparations. However whilst many local authorities, fire and police authorities, hospitals and schools will fall within the remit of the CRC little has been done to effectively incorporate the requirements at a strategic level
The public sector has very good reasons to act early. A CRC league table will rank organisations and those highly ranked will receive a bonus payment with poor performers being penalised – a charge that will no doubt be passed on to the tax payer.
In addition to the CRC local authorities are also required to measure their CO2 emissions under National Indicator 185, a framework of performance measures set by central government. Failure to show decreasing emissions under both NI185 and the Carbon Reduction Commitment have the potential to seriously damage the reputations and funding availability of local authorities and public sector bodies.
There is a danger that the implementation within Local Authorities will be bogged down in red tape as they need to align their carbon reduction strategy as much as possible with existing asset management and capital investment approaches.
Public sector bodies should be implementing the following approach or it is highly unlikely they will achieve their targets and make best use of taxpayers money:
Carry out an organisational review to understand liabilities and readiness. Map out and engage with all stakeholders involved in delivering the legislation.
Identify organisational requirements and develop a strategy that encompasses key needs, business case, costs and early action measures, 2008 inventory of half-hour meters, and communications approach.
Implement measures that can be taken to obtain the early action credits. Send through a list of the relevant meters to the Environment Agency to ensure calculations and payments are only made on those meters.
Forecast and monitor carbon emissions over a period of at least six months to assess accuracy of the model developed. Identify a series of projects to test the system and the calculation methodology using a robust system to understand and capture savings.
It is from the first league table to be published that future credits and energy efficiency will be measured so public bodies that act now and achieve a good early action metric will feel the benefit for the following years and avoid being named and shamed.
Sunil Shah is head of sustainability at DPP, a firm of planning and sustainability consultants.