The Energys Group January 2018 horizon scan: EU ups the ante on buildings energy efficiency standards

At Energys Group, we are constantly monitoring global work on energy efficiency. And we’d like to draw your attention to a change at EU level that many of us may have missed in the Christmas build up.

On December 19, while most of us were pondering what Santa might deliver, the EU delivered a different kind of present.

Reuters reports that the Union has created new rules on energy standards for all new public buildings, plus improvements for existing buildings, which account for considerable EU greenhouse gas emissions.

“The fight against climate change starts ‘at home’, given that over a third of [the] EU’s emissions [are] produced by buildings. By renovating and making them smart, we are catching several birds with one stone: energy bills, people’s health, and the environment,” Commission Vice-President Maros Sefcovic said in a statement.

The new rules, which aim to boost energy performance across the public sector and encourage renovations aimed at creating more energy-efficient buildings, are most welcome.

But at home, we can’t say for sure whether the EU’s move will make differences in the UK as 2018 progresses.

The key is the Great Repeal Bill. The BBC explains that this critical plank of legislation has reached the committee stage in the House of Commons, which is where there will probably be many attempts by MPs to change its wording.

The idea is that all existing EU legislation will be copied across into domestic UK law, to ensure a smooth transition on the day after Brexit.

So, theoretically at least, now the EU has raised its standards on efficiency, there’s no reason why these new rules shouldn’t remain in place here after Brexit too.

This would be a real positive for energy efficiency in the UK public sector. We already have Minimum Energy Efficiency Standards delivering real change across rented properties. If we can embed EU-derived laws to raise the bar on new public buildings, and renovate existing schools and hospitals, we can massively improve the quality of our public services and increase our transition to low carbon.

At Energys, we hope these new EU standards make it into UK law as Brexit progresses.

What exactly will the new EU rules do?

The EU package creates a clear path towards low and zero emissions building stock by 2050, underpinned by national roadmaps to decarbonise buildings.

First, it encourages the use of information and communication technology (ICT) and smart technologies to ensure buildings operate efficiently, by introducing automation and control systems.

Additionally, it introduces a ‘smartness indicator’ which will measure buildings’ capacity to use new technologies and electronic systems to optimise operation and interact with the grid.

Given the Government’s determination to update and reinvent a smarter UK grid, we feel sure these new EU efficiency changes should make it into UK law. And because EU member states determine their own internal laws on top level standards like these, we could take the measures even further if we have the will.

Let’s be sure our sector as a whole continues to advocate, and ensure this EU efficiency reform package doesn’t get swept under the Brexit carpet.

The final word

January is generally a quiet time, as the sector gets back to work and looks forward to a year of promise. But this EU news, delivered quietly before Christmas, is a real reason to celebrate.

Let’s use the EU lead to push for a more radical, disruptive, energy efficient UK public sector as Brexit deadlines draw ever nearer.

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As we approach 2018, what key trends in energy efficiency are closing out the year?

Energy Live News is reporting that a new energy and carbon reporting framework would be supported by 87% of decision makers in British businesses.

The news comes from npower Business Solutions, whose research shows UK stakeholders believe new frameworks could drive a nationwide reduction in energy use, bills and carbon emissions.

According to Energy Live News, the survey of 500 senior figures suggests reduced energy costs would be the biggest benefit from a change in reporting frameworks (58%), followed by increased energy efficiency (54%) and reduced bureaucracy (45%).

The intriguing industry sentiment comes in response to the Government’s October 2017 Streamlined Energy & Carbon Reporting Consultation, which will run until January 4 2018.

Its purpose is to seek views on how to replace the reporting element of the Carbon Reduction Commitment, which will be abolished after the 2018/19 compliance year.

“The reform package has been put in place to cut down administration burdens and raise energy efficiency awareness for UK PLC,” comments Kevin Cox, Managing Director, Energys.

“In our organisation, as experts on energy efficiency, we are aware of the fact that reporting can be burdensome, but it’s also incredibly valuable.

“It can drive internal change, behavioural change, and take energy efficiency right up the boardroom priority list. We urge every UK company to make it their business to look at the consultation.

“If we can start off 2018 in the right way, with a fantastic new framework that delivers more and more energy efficiency throughout the year; that will be an amazing Christmas present.”

Gas vs energy efficiency

Elsewhere, Carbon Brief has analysed whether gas, which accounts for more than a third of UK emissions, can continue to play a role in the provision of energy, given the UK’s current climate ambitions.

Its research, released on December 5, cites recent analysis by the Tyndall Centre which suggests the role of gas will be extremely limited, due to the small remaining carbon budget.

Alternatively, Carbon Brief finds that energy efficiency remains a more attractive option for achieving long term carbon mitigation and business opportunities in the UK.

Its research explains; ‘While gas displaces some coal initially (prior to 2020), as is currently being observed in the UK’s electricity generation sector, the modelling points to a cost-effective pathway where new investment is focused on renewables and in energy efficiency measures.’

“We’re pleased to see more evidence that energy efficiency is the best option for mitigating carbon and delivering futureproof, responsive UK businesses,” says Cox.

“Many in the sector know and understand that the energy you don’t use is always cheaper and greener than any fossil fuel, even one which acts as a ‘bridge’ to help kick the UK’s historic fossil fuel addiction.

“We advocate; get energy efficiency to the top of the pile now, and let’s not pretend that fossils represent more than a transitory option at best.”

Energys wishes all our friends and partners a Happy Christmas, and we look forward to keeping you up to date with the sector throughout 2018.

Was 2017 finally the breakthrough year for low carbon and energy efficiency?

By any estimation, the sector has received some significant boosts this year.

In the Clean Growth Strategy, the Government made a solid commitment to lead the world in cost effective clean growth, setting out, in clear terms, a blueprint for Britain’s low carbon future.

That wasn’t all. Shortly afterwards The Industrial Strategy gave encouraging signs for low carbon, offering up measures to help large businesses cut energy use and bills.

Some of the headline promises included £2.5 billion to support low carbon innovation from 2015 to 2021, up to £10 million for innovations that improve the energy efficiency of existing buildings, and an Industrial Energy Efficiency scheme to help large companies install measures to cut their energy use and their bills.

Such themes been in the background for years, but politically, in 2017 they finally found their way into solid policy.

So today we ask; if 2017 started the breakthrough, what do we need in coming years to make low carbon ever more real on the ground in the UK?

Is this the beginning of the end for fossil energy and the old status quo?

“At Energys, we feel that there are hints 2017’s policy declarations do indeed signal a turning point in the UK’s evolution towards low carbon,” comments Kevin Cox, Managing Director, Energys.

“It is very important to remember that not long ago, a great many commentators were forecasting major issues for the UK’s environment policy, claiming that with Brexit in the headlights, there was nothing to stop us slipping back to a fossil based agenda.

“It is very clear that while there is always more to do, this has not happened. Indeed major policy documents have taken us far in the opposite direction; towards energy efficiency, low carbon, electric vehicles and major alterations to our electricity network.”

Yet, amid all this positivity, work remains to be done.

Policy vs reality

In environmental spheres, policy leads real world change. But policy alone is not a panacea; cash, while welcome, is not the sole solution.

One element that hints at real meaning behind the top level promises and strategic direction, is the appointment of an independent Industrial Strategy Council, planned for next year, to hold Ministers to account over progress.

When we look back on historic environmental promises, often the truth is that the money went to the wrong places, too slowly; that the funds established were misdirected.

The Council must ensure this doesn’t happen, and that the cash set aside for energy efficiency and low carbon reaches the places it can work best.

Moreover, as Brexit beckons, we must be aware of the UK’s challenging growth forecasts and give close attention to our burgeoning low carbon industry even while negotiating our exit from the EU.

The final word

All in all, the future for low carbon is not necessarily less challenging than prior to 2017’s policy moves.

But there is now room for hope and opportunity. There is a real sense that there is no turning back from this point, and that a lower carbon UK is unequivocally where we are firmly headed.

For this, we must be grateful. Let’s enter 2018 bursting with positivity, ready to do the hard work to back up the promising lead Government Ministers have delivered.

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The IFC says energy efficient buildings could drastically cut global C02, but policy and standards must step up also

The International Finance Corporation (IFC) has weighed in on energy efficiency.

IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries. It’s in such countries that climate change is predicted to hit hardest.

This status gives IFC’s words and position massive clout. IFC’s report, entitled Creating Markets for Climate Business, says making buildings more energy efficient could reduce carbon emissions dramatically, but only if countries adopt better building codes and higher standards too.

It’s a riveting piece of news, which should catalyse debate in both emerging and developed markets. What’s behind the IFC claims?

IFC lays it on the line for energy efficiency

The IFC offers compelling headline stats on what the right mix of energy efficiency, codes and standards can offer to mitigate global C02.

In Indonesia, for example, regulations created with IFC support have mandated energy efficiency requirements for large buildings throughout the capital.

This opened the door for the private sector to supply solutions; IFC now estimates the benefits include avoiding over 700,000 metric tons of carbon emissions, plus energy savings of almost $70 million in the last 3 years.

There are more astonishing figures. IFC says investments in green buildings could reach $3.4 trillion by 2025 in key emerging markets. That’s a huge chunk for energy efficiency firms to win.

But this will happen only if developing countries adopt the best building codes and standards and create targeted financial incentives such as green building certification and mandatory benchmarking of energy use.

At Energys, we take this underlying theme from the news…

If such trillions can be leveraged for C02 mitigation and energy efficiency in emerging markets, where financial resources are stretched, just consider what we ought to be achieving at home to help lead C02 reduction.

The opportunities are there, but they will cost

Overall, IFC’s report says energy efficiency in buildings needs an additional $296 billion globally, per year, to meet existing climate targets.

In terms of the standards both developed and emerging states require along with the cash; these must set minimum thresholds for energy performance, requiring certification to dedicated criteria.

In addition, programmes and codes should organise building data into a standardised format, that can be used to develop building benchmarking schemes; crucial for differentiating greener, more energy efficient buildings in the real estate market.

Without these elements, a lack of reliable data and awareness about energy efficiency and green building can hinder efforts to create a viable market.

Philippe Le Houérou, Chief Executive of the IFC, said: “The private sector holds the key to fighting climate change.

“We can help unlock more private sector investment, but this also requires government reforms as well as innovative business models, which together will create new markets and attract the necessary investment. This can fulfil the promises of Paris.”

What does it all mean at home in the UK?

“When we see a report that highlights how codes, standards and investment can build emerging market energy efficiency, we must then apply this thinking to how the UK, an established market, should be leading,” comments Kevin Cox, Managing Director, Energys.

“The sums and the benefits the IFC is talking about are vastly significant. Of course, many energy efficiency codes and standards for buildings already exist here in the UK.

“The Government has recently promised to consult on improving the energy efficiency of new and existing commercial buildings, and on raising minimum standards of energy efficiency for rented commercial buildings in its Clean Growth Strategy.

“Could we see the UK taking a stronger position in the field, and providing the leadership IFC proves could be so valuable in helping our own and developing markets mitigate carbon?”

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The Bonn Climate Conference; what might it mean for efficiency, policy and tomorrow’s business?

As we write, The Bonn Climate Conference is ongoing; and is due to conclude today.

A lot of very negative headlines on rising C02 emissions have galvanised the event. 2017 looks set to be among the hottest 3 years on record, after C02 surged to a record high in 2016.

So while solid work is being done, the reality is there’s a huge distance to cover before emissions are meaningfully controlled, and the mantle of action will likely fall on the world’s businesses.

What needs to happen at Bonn?

There’s huge focus in Bonn to prove the US move out of the Paris agreement won’t derail progress. But, there’s a great deal else delegates need to achieve.

Speaking of the US, The New York Times writes that much of the crucial work at Bonn will happen behind closed doors, as diplomats try to build on the initial Paris agreement, crafting new rules and guidelines that, they hope, will help turn hazy national promises into concrete action.

One widely recognised problem with the current Paris pledges is they’re fairly vague. Pre-Brexit, the European Union vowed to cut emissions 40% below 1990 levels by 2030, but offered few specifics on how to achieve that goal.

EDIE explains that the thousands of representatives from 195 countries are gathered in Bonn from November 6 to work on a ‘rule book’ for implementation of the Paris Agreement.

Essentially, the summit is expected to lay the groundwork for the rules and guidelines which will need to be established by each country before December 2018’s COP24 summit in Katowice, Poland.

“This nitty gritty is the key to actually reducing carbon,” comments Kevin Cox, Energys Managing Director. “When you take the pledges and run with them in terms of solid policy, you start to see the concrete low carbon landscape emerging.”

What exactly will be ready by the end of Bonn?

This is impossible to say, but remember the aim is that new rules to make the Paris pledges more useful will be here by 2018, so we might see some detail on these emerging by the end of the conference.

Of course, there is one major risk at Bonn. Following the US moves to denounce the Paris agreement, there is a concern that other countries will follow suit.

It’s to be hoped that this does not happen, but if it does, all progress could be derailed. This is unlikely, especially given Chinese positivity and a new sense of global statesmanship emerging from China in the nationalist wake of President Trump.

But even delays, or perhaps an uncommunicative US presence at the event might slow progress, and as more and more of the world’s leaders agree, time is not on our side.

“We need the new rules which make the Paris promises more coherent, and we need them soon,” says Cox.

“Without these it’s difficult to sense where the future will lie. Of course the UK has its own rules and we are setting our own path to low carbon. But we need to see our role within a global context and to do that we need to see movement on the concrete actions to deliver the Paris sentiments.”

An endgame at Bonn?

Ultimately, Bonn won’t provide an endgame for UK corporate leaders seeking certainty on efficiency, policy and tomorrow’s business.

But we might just get a glimpse of how the world plans to make Paris promises real, and how that will impact at home.

And this, ultimately, will affect the global low carbon market, which will also feed into how the UK’s low carbon futures play out.

As ever, everything is at stake as the world continues its battle to put C02 on the back-foot.

We hope you enjoyed this article? See more of energy policy articles here. Please drop us a line if you’d like to chat about any of the issues and themes covered or to find out more about our energy saving technologies.