Green Intelligence - April 2023
5 sustainable changes to make for Earth Day 2023
2023’s?Earth Day ?lands on April 22nd, celebrating our planet and encouraging investment in climate adaptation, mitigation and management. Here are five sustainable changes you can make for you and your business to decarbonise and invest in our planet.??
1 Technological??
LED lighting is a quick, easy win for businesses looking to decarbonise,” says Ashley Hulme, Green Economy Advisor. “Most properties will have the infrastructure in place to swap light-for-light or in most cases reduce the number of fittings required which will bring instant results.”??
?Estimates have shown that switching to LED technology could help businesses and households across the UK eliminate an estimated 3.9 million tonnes of CO2 emissions. On average, installing LEDs in your home or business generates a 50-80 per cent reduction in energy use and cost savings from the moment of installation. This represents a cost-savvy, simple and effective means of decarbonising a property with more efficient lighting technology.??
?Read our comprehensive?LED guide ?for more information.??
2 Managerial??
Have you got a clear, concise, and practical environmental policy in place???
?An environmental policy will give a better understanding of your company’s impact, set the foundation for meaningful and measurable environmental improvement, demonstrate to staff and customers that you take environmental issues seriously, and communicate to stakeholders that you are taking necessary steps to grow sustainably. An increasing number of people care about the environmental policies corporations publish, and weak, greenwashed policies risk facing harsh scrutiny.??
?When writing your environmental policy, it’s essential to be clear, use formal, business-like language, state your policy and remain on-topic. Corporate jargon and statements that can’t be supported with evidence should be avoided.??
?If you need support writing your environmental policy, sign up to the fully funded?Low Carbon Skills: Journey to Net Zero ?programme and learn how to develop clear, meaningful policies for your business.?
3 Transport??
Think about the way you and your staff travel to the office and between meetings. Are you encouraging public transport use and low carbon travel? Have you implemented a Cycle to Work scheme to encourage your staff to uptake sustainable transport???
?The difference in CO2 emissions generated over a single journey by a petrol car compared to national rail, for example, is substantial. By encouraging a switch to public transport and low carbon transport, you can decarbonise your businesses travel emissions leading to a plethora of benefits, including cleaner air, less pollution, and healthier staff.??
4 Digital??
An excessive amount of energy is required to keep our digital world ticking over. The internet consumes around 416.2TWh of electricity per year and contributes to 3.7 per cent of global carbon emissions. Poorly designed websites with superfluous content generate higher levels of associated emissions each time someone visits the webpage.??
?The recommended target is for no more that 1g of carbon to be produced each time someone visits your website. At present, energy consumption of digital technologies is?increasing by 9 per cent each year , largely owing to the fact that more businesses have transitioned to online operations.??
?In basic terms, the simpler your website is, the greener it is. Stripped back sites that only spotlight essential content with basic images and text will contribute far less to global emissions. This doesn’t mean your website must be plain and uninspired, it means you need to think critically about the content you upload and the design of your site. Some effective techniques to reduce your website’s carbon emissions include:??
You can calculate your website’s carbon emissions using?this tool. ?
5 Waste?
Addressing waste issues within your business can help improve your reputation, comply with national regulations, prepare you for future policy changes targeting waste reduction, and save you money. For Earth Day 2023, consider which materials and resources your business may be using unnecessarily, and explore ways in which you could switch to more sustainable resources and reduce the amount of waste you generate.??
?Reducing your waste has a five step approach:??
1)?Prevention – stop waste at the source??
2)?Reuse – reuse anything you can before disposing of it??
3)?Recycle – consider which waste can be recycled and phase out single-use materials??
4)?Recover – identify wastethat can be used to create other products to reduce reliance on virgin natural resources??
5)?Dispose – process any additional waste to be disposed in the most sustainable and efficient way possible??
Finding the right support??
If you are seeking support to decarbonise your business, get in touch with?Green Economy ?and speak to one of our trusted expert advisors. You can also search our online?marketplace ?to find reliable local suppliers of green technology and services ready to assist you with your net zero transition.??
Key findings from the latest IPCC Assessment Report
The IPCC released their latest?Assessment Report (AR6) ?on March 20th, summarising the current state of knowledge surrounding climate change impacts, mitigation and risks. We’ve analysed the report and outlined the key findings.?
1) Global temperature changes are human-caused??
The report states “it is unequivocal that human influence has warmed the atmosphere, ocean and land… Human-caused climate change is already affecting many weather and climate extremes in every region across the globe. This has led to widespread adverse impacts and related losses and damages to nature and people.”?
?Global surface temperature between 2011-2020 was 1.09C higher than 1850-1900. If you focus only on increases over land, the temperatures have risen by an average of 1.34C-1.83C across the world. Of these global temperature changes, it is likely that human-causes have attributed to 0.8C-1.3C with a best estimate of 1.07C.??
?These human-caused global temperature rises have led to “unprecedented changes” in the Earth’s climate, with each 0.5C of warming causing discernible increases in the occurrence and severity of heat extremes, heavy rain, tropical storms and droughts.?
2) Climate change is affecting the global population??
It is estimated that 3.3-3.6 billion people live in areas that are “highly vulnerable” to climate change. As a direct result of extreme weather patterns across the globe, millions of people are now exposed to acute food and water security. Currently, roughly half the world’s population experiences severe water scarcity for at least one month per year.??
?The communities most vulnerable to climate change consequences are located in Africa, Asia, Centra and South America. Small islands, the Arctic and developing economies are also extremely vulnerable to climate change impacts.??
3) The 1.5C limit won’t avoid climate disaster
Continued greenhouse gas (GHG) emissions will exacerbate warming further, with every increment of warming intensifying prevalent hazards. At a rate of 1.5C warming, 950 million people across the world’s drylands can expect to experience water and heat stress and desertification, with 24 per cent of the global population being exposed to flooding.??
?A more concerning observation is that surpassing 1.5C will lead to sever and irreversible impacts, such as species extinction and loss of human life. The report states that “in the near term, warming is more likely than not to reach 1.5C even under the very low GHG emission scenario and likely or very likely to exceed 1.5C under higher emissions scenarios.”??
4) Fossil fuels are the primary driver of global warming??
The science has spoken. Global net GHG emissions in 2019 were estimated to be 12 per cent higher than in 2010 and 54 per cent higher than in 1990, with the largest share occurring in CO2 from fossil fuel combustion and industrial processes, followed by methane and the highest relative growth in fluorinated gasses. In response to this the IPCC have proposed no new coal and the phasing out of coal by 2030 in OECD countries and 2040 in other countries. This extends further to end all international public and private funding of coal and ensuring net zero electricity generation by 2035 for all developed countries and 2040 for the rest of the world.??
?In terms of carbon budgets, projected CO2 emissions from existing fossil fuel infrastructure without additional abatement would exceed the remaining carbon budget for 1.5C. Unless a direct movement away from reliance on fossil fuels occurs, the 1.5C target will be exceeded. Investment in clean energy solutions and carbon capture storage will reduce the rate of warming, and “removing fossil fuel subsidies would reduce emissions and yield benefits such as improved public revenue, macroeconomic and sustainability performance.”?
5) Finance is a key barrier to adaptation??
The report cites insufficient finance, limited resources, and lack of private sector and citizen engagement as key barriers to adaptation and mitigation. Despite climate finance increasing over the last decade, public and private finance sources are “insufficient and constrain implementation of adaptation options.”??
?A key problem highlighted by the report is that the adoption of low-emission technologies continues to lag in developing countries, and “public and private finance flows for fossil fuels are still greater than those for climate adaptation and mitigation.” A lack of technology, investment, and capacity in developing countries is a driver of this.??
What is Energy Management?
What do we mean by energy management?
Well, it can depend on who you talk to and what their focus is.?It can be tough to find a starting point when talking about energy management as the topic is so vast but if we use the goal of saving energy as the focal point of the conversation it gives us a clearer path.
In general, energy management can mean monitoring, controlling and analysing your energy usage to then use the information you have collected to optimise and lower your overall consumption. This can simply mean looking at monthly or quarterly bills from your provider and making reactive changes, all the way up to implementing a system that controls this for you proactively.
Where should I start with energy management?
Start by monitoring your energy consumption if you don’t have a reference point it is very difficult to gauge if any changes you make are successful. The simplest way you can do this if you don’t have any technology already in place is by asking your energy provider for your half-hourly electricity bills.?Most businesses will have meters with this capability and it allows you to look at not only how much you are consuming but when.
If you know the operations of your business, it then allows you to question the peaks and the timings of your consumption. Are you using more energy than makes sense outside of operating hours??Do some days have much larger spikes in use than others?
This should be enough information to make a start on a few tweaks to lower your energy consumption but if it doesn’t, or you want to take it a step further, you can install energy monitoring equipment.?Equipment like this comes in a number of ways, it could be sub-metering, an energy monitoring platform and/or sensors across your property that give you more in-depth data on what area or item is consuming power at any given time.
The next steps for managing your energy
Now that you have a baseline and data that you’ve analysed, you can start to make data-driven adjustments and operational changes to better manage your energy and lower your consumption.?There could be some quick wins that you notice where equipment or machinery is being left on out of hours and putting a process in place or a control strategy with a piece of technology like an energy management system could help
There could also be behavioural change aspects that you see huge benefits from and that cost nothing but these can be difficult to implement.?It often means getting your team really engaged and supporting your mission to lower your energy consumption and carbon footprint.?Some businesses set up team goals, incentives and more.
How do I control high energy consuming items
One of the best places to start is looking at those high-energy-consuming items and seeing if they are controlled manually, on a timer, or with a central point of control.?It’s often the case that schedules for equipment and heating were set a long time ago and don’t reflect the operational hours of the business and in some cases where they are controlled manually, they get left on constantly.
This is where pieces of technology like an energy management system (EMS) or building energy management system (BEMS) can really help.?These systems vary with some simply pulling all of the consumption data into one place and others allow for better control of your equipment.
One area I have seen a lot of success during my time at Pilot Group is looking at heating. Industrial heaters such as warm air blowers and radiant tubes are often used inefficiently, and the implementation of an EMS has seen gas bills for heating reduced by an average of 40%.?An EMS like Pilot Group’s not only gives you a central point of control for all your heaters (as well as items such as compressors, air conditioners and more), but it also uses smart technology to actively lower your energy consumption.
Expert tip: Check your heater efficiency rating, which is usually found on the service sticker. You could have the best control strategy in the world but if your heater is inefficient, you could be wasting a large amount of energy.
What savings can I expect from an EMS?
A few examples of how a system like an EMS can generate savings are:
Energy efficiency measures to save you money
In summary energy management can mean everything from monitoring and controlling your energy consumption all the way changing behaviour of the people involved in the process. The key starting point, if you are looking to reduce your energy usage, is to get yourself a baseline of what you’re consuming, even if this is just your bills from your energy provider, you’ll need this to know if any changes you make are working.
From here you can look at making operational or technological changes to better control your systems, anything from better processes to more monitoring or even new equipment, andif you have industrial gas heaters, an EMS could significantly help manage their impact.
Next steps for lowering your energy consumption:
Is it the beginning of the end for the energy industry’s ‘dirty little secret’?
OVO Energy has become the first of the Big 6 to stop using cheap certificates to ‘green’ their electricity tariffs, which actually provide ‘little to no benefit’ to growing renewable energy in the UK.
In an announcement on 18 April, the energy giant said it will immediately end the use of Renewable Energy Guarantee of Origin (REGO) certificates, which provide proof that a unit of power has been produced from renewable sources such as wind or solar, and are commonly used to certify that a tariff is 100 per cent renewable.
Research commissioned by OVO found that 81 per cent of people believe that ‘100 per cent renewable electricity tariffs’ backed by REGOs help to fund new renewable energy projects. However,?this is not the case.
How REGOs work
When an energy supplier purchases power directly from a renewable energy generator, they also obtain the REGOs that come with that power. At the end of the year, the supplier should then ‘retire’ these certificates to Ofgem as proof that they have bought enough renewable electricity to cover their customers’ needs.
However, because of the way the market currently works, the electricity and the REGO certificate that comes with it can actually be bought and sold separately. A surplus of certificates on the market means that REGOs are extremely cheap, so energy firms can buy up certificates in bulk at low cost, in effect greenwashing electricity that can come from any source – including fossil fuels.
Distraction from real action
To overcome the problem, OVO will join others in the industry in calling for a new kitemark system for green tariffs to help customers avoid greenwashing practices by “clearly identifying which tariffs support decarbonisation or the generation of renewable energy”.
Writing in The Times on 18 April, OVO’s CEO Raman Bhatia said: “At best, these [REGO-backed] tariffs run the risk of giving customers a good but misleading feeling about being green. At worst, they are an active distraction from the real steps we need to make energy greener and cheaper. If we don’t take a new approach then we risk failing to get to net zero which would be a climate catastrophe.”
Instead of purchasing REGOs, Bhatia added that OVO will divert spending towards helping customers cut their energy demand through free and discounted green technologies such as smart thermostats, insulation, support to understand energy usage and payments for shifting consumption to greener and cheaper times of the day.
Big implications?
OVO’s move has already been backed by Good Energy, a rival supplier which already purchases renewable energy directly from generators rather than relying on REGOs.
“By ditching its purely REGO-backed product OVO has indicated where green tariffs are going,” explained Good Energy CEO Nigel Pocklington. “Big suppliers can have more impact through demand shifting, efficiency and innovative tariffs. So if they want to help decarbonising energy that is where they should focus.”
A move away from cheap REGO-backed tariffs could have wide-ranging implications for the green economy, as many businesses currently rely on such tariffs to report a reduction in their carbon footprint. Rooting out greenwash in the sector could therefore drive investment towards more impactful measures such as energy efficiency and on-site renewables.
Surges in wind and solar promise green future energy
A surge in wind and solar energy coupled with behavioural changes amid the global energy crisis are curbing emissions from fossil fuels and creating reliable clean energy grids. As global renewable energy capacity continues to increase, our reliance on fossil fuels lessens and net zero targets seem increasingly attainable.
China’s wind power boom
A key contributor to the clean energy surge is the global expansion of wind energy. Current estimates anticipate the global wind energy market will surpass the 1TW milestone for installed capacity by the end of 2023. A significant factor driving this is the rebound of China’s wind power market as developers continue to nearly double annual wind capacity year-on-year as demand in China surges.
China alone has added an average of 80GW of new wind capacity over the 10-year outlook, accounting for 50 per cent of global new capacity. Aside from China, global wind capacity added 44GW in 2022 which equates to a 4 per cent decrease year-on-year, largely owing to inflation and supply chain disruption worldwide.
Wind and solar produced 12 per cent of global electricity in 2022, up from 10 per cent in 2021, with over sixty countries now generating over 10 per cent of their electricity from wind and solar as all clean electricity sources, covering renewables and nuclear, hit 39 per cent of global electricity capacity in 2022.
Wind power doesn’t look set to halt either. IberBlue has recently announced?plans to add 1.96GW of floating wind ?off the North-Atlantic coast of Spain and Portugal, estimating necessary investment of $4.36bn to build and maintain the wind farms which will contain 29 wind turbines of 18MW each, occupying an area of 530km2 . Meanwhile, the UK continues to hold the status of world-leaders in offshore wind power, with?ambitious targets ?to increase the UK’s offshore wind capacity fivefold to 50GW by 2030.
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Fall in fossil fuel reliance
As the world’s renewable energy capacity increases, reliance on fossil fuels will likely decline. 2023 could represent the first ever annual drop outside of a global recession or pandemic in the use of fossil fuels such as coal, oil and gas to generate electricity.
Fossil fuels are the?single biggest contributor to global warming ?and phasing out their use is essential to avoid the devastating consequences of climate change. However, recent global economic crises may be a catalyst for such change. A?KPMG survey ?found that households are adapting to low-carbon technologies in an attempt to soften the impact of soaring energy bills.
The survey reports 92 per cent of the 2,800 UK billpayers surveyed made changes to their energy use over the winter, with 69 per cent claiming bills were higher than expected and just over half (56 per cent) saying they purchased a gadget to help reduce energy consumption.
Overall, the survey implies that reducing energy use was the most popular approach to curbing excessive bills. However, when asked about the measures they took to reduce energy use over the winter (October 2022 – February 2023), 28 per cent of billpayers switched to LED lighting and 19 per cent opted for better insulation.
As households act more efficiently when it comes to energy use and global renewable energy capacity continues to increase, reliance on fossil fuels seems set to decline as we approach the net zero deadline.
What patent figures reveal about green tech innovation
Intellectual property expert Appleyard Lees’ analysis of patent filings across several key environmental issues shows that innovation is growing rapidly, including in some surprising areas.
The firm’s second annual edition of its?Inside Green Innovation report ?looks at patent filings in the areas of heat pumps, solar, batteries, hydrogen, sustainable plastics, carbon capture and food.
Heat pumps – four wheels versus four walls
Patent data for heat pump technology show that innovation in this area is surprisingly shifting towards the field of transportation, rather than traditional applications in buildings.
Filings in transport-related heat pumps from 2017-2021 rose by around 14 per cent on the previous five years, with car makers such as Hyundai, Ford and Toyota featuring heavily. This growth is likely aimed at solutions for heating the interiors of electric vehicles, which is more challenging than in petrol and diesel vehicles. Heat pump technology may also improve the efficiency of EV batteries during colder months.
However, heat pump innovation is still required in traditional applications. “The difference in effectiveness between installing heat pumps in new build and existing properties, the inefficiency of current equipment in cold weather, inadequate electricity supply for mass usage and total life costs for heat pumps are all challenges that need addressing through innovation,” explained Adam Tindall, partner at Appleyard Lees.
Batteries – solid-state and recycling
The future of EV batteries could be founded increasingly on solid-state technology, according to the report. Whereas patent filings in conventional lithium-ion battery technology is plateauing, solid-state innovation is rising significantly.
“Annual priority filings in solid-state battery technology went from 75 in 2015 to more than 400 in five years, with Japan dominating the field,” said Paul Benyon, Appleyard Lees senior associate. “That said, there’s life in Li-ion yet, with battery makers shifting their attention to alternative materials.?
“Equally, there are recent moves to address the recycling challenges of both solid-state and Li-ion batteries, with new patent applications arising from California.”
Hydrogen – from grey to green
Innovation in green hydrogen – hydrogen produced via electrolysis of water rather than via natural gas – is reaching record highs. While the patent filing rate for green hydrogen has increased steadily since the 1990s, it leapt by 160 per cent in the second half of the 2010s.
Particular attention is also being paid to transport applications via hydrogen fuel cells, with an upsurge in patent filing for innovations in trains, buses, trucking and lightweight aircraft.
“Hydrogen technology still needs to advance significantly in some areas, in particular production, distribution, and storage before it can become truly viable and mainstream, but it is clear that industry sees a way forward with increasing investment in innovation,” said senior associate Chris Mason.
Carbon capture – direct from the air
Global innovation in carbon capture, utilisation and storage (CCUS) technology is reaching a peak not seen since 2012, according to the report. More than 140 patents were filed in this area in 2020, half of which relate to direct act capture, where technology advances are required to overcome high costs.
Patent attorney Ashley Wragg commented: “Improving current or developing novel technologies will, we believe, increase global interest in carbon capture – including the industrialisation of air capture.
“However, a promising future alternative could come from using algae as a natural, direct air capture method. Current innovation includes growing algae in large ponds to remove carbon from the air and bury it underground – and this area is attracting interest from major companies.”
Business energy bills to rise again: Who is affected
The government has launched a new campaign to help organisations drive down their energy consumption after energy bill relief was slashed for tens of thousands of businesses.
The new?Business Energy Efficiency ?campaign offers guidance on how organisations can boost their efficiency, cut costs and increase their cashflow through low-to-no cost energy-saving measures.
It was launched on 1 April, the same day that a new energy bill discount scheme came into place for businesses across the country.
What’s happening to energy bill relief?
The?Energy Bill Discount Scheme (EBDS) , which runs until 31 March 2024, extends government-funded energy bill relief for businesses for a further year but at significantly lower levels than the Energy Bill Relief Scheme (EBRS) it replaces.
In reality, only organisations that fixed their energy contract at the peak of the energy cost crisis in the second half of 2022 are now likely to be eligible for a discount on their bill, with the rest returning to market prices that are still significantly above pre-2021 levels.
Even those that are eligible will only receive a maximum discount of 2p/kWh for electricity and 0.7p/kWh for gas – a significant reduction on the relief previously available. A more generous discount system is available to those that qualify as ‘Energy and Trade Intensive’ industries, but in reality only a few hundred companies are likely to benefit.
‘Cliff-edge is here’
According to energy consultancy Cornwall Insight, in the worst case scenario businesses that locked in fixed bills during the peak of wholesale energy prices in 2022 could be facing up to a 133 per cent rise in their electricity costs from April.
“The cliff-edge we’ve been about warning for months is sadly here – tens of thousands of small firms are now at an existential risk as government energy support will largely downscale to a scheme that offers almost no help,” said Tina McKenzie, policy chair of the Federation of Small Businesses (FSB), which has called on the government to allow SMEs to renegotiate their energy contracts.
“We found that 24 per cent of small firms are trapped in fixed contracts, and of them, 28 per cent say they could be forced to downsize, close or restructuring their businesses. This equates to 370,000 small businesses.”
Simple actions to cut energy use
The scaling back of energy bill support is yet another reminder for businesses to take measures to reduce their consumption and cut their carbon footprint in the process.
The government believes a substantial number of UK businesses are missing out on “huge potential savings” due to a lack of information on how to cut down on their energy costs. Its new campaign outlines a range of possible actions organisations can take, from having better sight of energy consumption to upgrading and modifying equipment.
Lord Callanan, minister for energy efficiency and green finance, said: “Businesses, charities and public sector bodies can access helpful and practical advice on simple actions they can take to substantially reduce their energy use – and potentially increase profits.
“Not only will this help lower operational costs by up to hundreds of thousands of pounds, but smarter energy use will help us deliver on our critical pledges to cut demand by 15 per cent and reach net zero by 2050.”
Do you need energy efficiency support?
If you are seeking energy efficiency support,?get in touch ?with one of our expert advisors who can talk you through the green technologies available to your business. Search for local, trusted suppliers via our?marketplace ?and begin your energy efficiency journey today.?
UK Government’s ‘Green Day’ – key policies???
A day after the?Climate Change Commission found that the UK is ‘strikingly unprepared’ ?for dealing with the impact of climate change, the UK Government’s ‘Green Day’ relaunches its strategy to deliver net zero, by driving investment into nuclear and carbon capture and storage.?
The?‘Powering Up Britain’ report was published today ?(Thursday 30 March) by the Department for Energy Security and Net Zero, following a review of the previous Net Zero Strategy and in response to the?Independent Review of Net Zero ?conducted by Chris Skidmore MP. Of the report Chancellor of the Exchequer Jeremy Hunt said:
“Transforming our energy system is no longer just about tackling climate change, it is also a matter of national security. To protect ourselves from future price spikes, we need to accelerate the move to cleaner, cheaper, home-grown energy.”
This and the key headlines demonstrate a marked shift in the narrative away from climate change towards energy security. Two strategies were released today the?‘Powering Up Britain – Energy Security Plan’ ,?the second to be issued this year ?and the?‘Powering Up Britain – The Net Zero Growth Plan’ ?which is the UK Government’s second net zero strategy in two years.
Green Economy will provide a deep dive into the detail of the Net Zero Growth Plan in the coming weeks, but we’ve laid out today’s key announcements below.
Key announcements from Powering Up Britain announcement
Of the report, Amy House, Director of Green Economy commented:?
"Today we have seen the lens shift from this issue to energy security, with nuclear and carbon capture and storage to play a leading role in overcoming these challenges. The reality of these technologies however, mean we’re unlikely to see an impact to our carbon emissions for well over a decade, missing our 50% reduction deadline by at least four years. Major infrastructure projects including onshore wind and solar farms would be far quicker to implement.?
"Meaningful policy is needed to steer net zero from concept to reality. This means investing in home grown innovators that have solutions ready and waiting and compelling their integration into our existing infrastructure and our new developments."
Amy House?Director, Green Economy
Installing solar a 'no brainer' for building product extrusion firm
Based in Oldham, Greater Manchester,?QPSL ?produces polyvinyl chloride (PVC) and aluminium products for the construction industry, including flooring, insulated building products, window and door components, and bespoke extruded PVC solutions.
As a manufacturer, QPSL has long been aware of its impact on the planet and has maintained a comprehensive environmental management system (certified to the ISO 14001 standard) since 2013.
The business has also been working with specialist sustainability advisors since 2012 to improve energy efficiency, minimise waste and reduce carbon emissions.
“Solar is a no-brainer”
The wide variety of measures taken to reduce energy consumption over the past decade range from upgraded compressors and chillers to LED lighting and improved process controls. As a result, the amount of power required to process one tonne of QPSL’s PVC product reduced by 15 per cent between 2013 and 2021.?
The next improvement on the to-do list for 2022 was a refurbished roof and solar PV array to generate clean electricity on-site, providing protection from rapidly rising energy costs in the process.
QPSL engaged the services of Green Economy member?Perfect Sense Energy ?(PSE) to design and install a 558kW solar system after visiting a fellow manufacturer nearby that had also worked with PSE to add solar to its roof. “Increased energy costs have started to hit us badly,” says Product Manager, Dr. Diane Luther. “We first looked into installing solar in 2018, but at the time it was a payback of about 6 years. It’s a no-brainer now.”
“QPSL’s solar panels will pay for themselves in 3-4 years – generating an estimated 495,000kWh of clean power in year one. That equates to an energy saving of around ￡146,000 and carbon savings of around 118 tonnes.
“This may sound like a big installation – it’s 1,469 panels, covering nearly 2,500m2 of roof space – but given the massive growth in the solar industry it’s now around the average size of system we’re installing.”
Kyle Swindells?Perfect Sense Energy
Carbon reduction roadmap
During 2022, QPSL took steps to formalise its carbon reduction objectives and reporting process, having benefitted the?Low Carbon Skills: Journey to Net Zero programme ?which is fully-funded for residents based in Greater Manchester.
Although the business already had a head-start due to its successful environmental management system, JTNZ helped to widen the scope of its reporting and accumulate everything into one ‘carbon tracking’ file.
“Journey to Net Zero was good because it explained what activities you have to track, under which scope of emissions, and what is actually relevant to your business,” Diane comments.
Attending the online workshops with a range of other businesses was also a valuable experience, Diane adds: “Hearing from other manufacturers who have similar struggles is obviously useful. But even hearing from people from very different situations was insightful – a small office in Manchester city centre has to take a very different approach to net zero than us, for example. It was really good to get that broad spectrum and understand how net zero affects businesses differently.”
“Customers have started asking questions”
QPSL has now created a formal carbon reduction roadmap that breaks down its net zero ambitions, with measurable targets for 2025 through to 2050. Planned actions include moving to lower carbon logistics, switching to 100 per cent renewable energy, engaging with employees and sourcing more sustainably, such as prioritising suppliers that have a clear net zero statement.
The roadmap is already helping with stakeholder engagement and responding to customer requests, Diane explains: “We have an external paper that we can provide to stakeholders, and an internal paper with assigned responsibilities, so we can be held accountable if we don’t reach those goals.
“In the last year some of our larger customers have started asking questions like whether we have a sustainability statement and what plans we have in place for carbon reduction. We already had all the answers they were looking for, which is a nice confirmation that we are doing all the right things.”
If you are looking to install Solar PV or other low carbon technologies in your home or place of work, you can find your perfect project partner and learn more about the process through our online searchable Marketplace.
Should we be concerned about Europe’s banks?
Europe’s banks are facing a range of challenges during a particularly trying economic era, including how to finance the carbon transition, moving away from emergency support funding, enabling the digital economy, and a general economic recovery. But should we be concerned about the health of Europe’s banks???
Spooked investors??
The most recent troubles for Europe’s banking sector involved the ￡2.6bn state-backed rescue of Switzerland’s Credit Suisse, which caused a slump across European banks on Monday 20th March. In the UK, Natwest, Barclays and Standard Chartered were all down by more than 7 per cent with a fall of around 5 per cent for HSBC and Lloyds.??
Further afield, Deutche Bank was trading 1.8 per cent lower and UBS, who rescued Credit Suisse, 3.7 per cent lower. The Stoxx Europe 600 Banks Index was down by almost 3 per cent by Monday morning, with additional declines across many of Europe’s top banks. The flurry of spooked investors was sparked by the nature of the Credit Suisse rescue deal, which saw ￡14bn of Credit Suisse’s bonds, labelled Additional-Tier 1s (AT1s), wiped out. The decision to write Credit Suisse’s bonds down to zero represents the most substantial loss in the AT1 market to date.??
?Despite what seems to be an incipient European banking collapse, experts are not anticipating a recurrence of the 2008 financial crisis which sparked a global recession.??
How does a bank collapse???
Banks tend to collapse when they?owe more money than they own. ?This happens as a result of spooked investors withdrawing deposits prompted by signs that their money may no longer be safe.??
?In Credit Suisse’s case, the bank had been facing difficulties for years following a long line of scandals, management shifts, billion dollar losses, and unsuccessful strategies. In the space of just a few months last year, Credit Suisse’s wealthiest clients withdrew more than 10 per cent of their money from its wealth management, causing significant issues for Credit Suisse’s cash outflows.??
?They began selling off their shares in 2021, by the autumn of 2023 rumours of Credit Suisse’s inevitable collapse were circulating which gave them little fighting chance by the time of their eventual collapse this month. The banks shares lost over 75 per cent of their value over the last 12 months.??
Should we be concerned???
There are a few concerning factors surrounding Credit Suisse’s collapse. It must be noted that, regardless of the banks overall reputation, Credit Suisse had healthy capital and liquidity ratios which was not enough to protect them once confidence disappeared. Further to this, Eurozone banks are not earning enough profit to cover cost of capital which is destroying shareholder value across the board. Finally, interest rates continue to rise, meaning the vale of banks’ holdings of government bonds, mortgages and other debt will continue to take significant hits.??
?The knock-on effect of Credit Suisse’s collapse has caused AT1 bonds across multiple European banks to tumble. As an example of the perceived cost of debt in the market, UBS’ AT1 bond, callable in January 2024, went from trading at a yield of 12 per cent to nearly 29 per cent. Rising bond yields are negative for bond holders due to their inverse relationship with prices. When yields rise, prices of current bonds fall.??
?Though this could mean higher returns for investors, rising bond yields reflect a lack of trust and confidence and could indicate poor economic strategy. Overall, higher yields mean higher borrowing costs for governments or banks and, as such, it becomes more expensive for distributors of bonds to service their debts.?
‘Safe and sound’?
Essentially, a pattern of major bank collapses during a period of prolonged instability is never a great sign. Collapsing banks will spook investors, leading to deposit withdrawals which have knock-on impacts on banks across the sector. As more and more investors lose faith in the state of European banks, bond yields will increase making it increasingly expensive for Europe’s banks to service their debts.??
?However, the UK banking system has been described as “well-capitalised and funded” by?the Bank of England and remains “safe and sound.” Christine Lagarde, president of the European Central Bank, has also indicated that “the euro area banking sector is resilient, with strong capital and liquidity positions.”??
National Director @ The Growth Company | Leading UK Business Growth Services
1 年A must read for any company or leader who want to improve their environmental impact or play a greater role in growing the green economy