EnviroCluster Peterborough Cutting Carbon Emissions...

EnviroCluster Peterborough

Cutting Carbon Emissions as an Opportunity for

Business

Gareth Jones

UK Centre for Economic & Environmental Development

(UK CEED)

Introduction

UK CEED, a charitable foundation, was established in 1984 by

leading figures from the business, government and scientific

communities.

The Centre aims to demonstrate the benefits to business and

the economy of good environmental practice. It does this

through research, promotion of good practice, provision

of policy advice to government and business, demonstration

projects and engagement activities.

Structure

Board of Directors

Chief Executive

Chris Murray

Project Managers

ResearchersProject

Officers

Associates

Academia

Private-sector

Public-sector

Research

Venture Capital

Funding

UK CEED’s funding is derived from:

•Private sources (sponsorship, membership, events, research)

•Public sources (government, RDAs, research work)

•Charitable Trusts

•Donations (from industry)

Expertise

UK CEED’s expertise includes knowledge of:

•UK environmental legislation

•European eco-innovation activities

•Support activities for UK businesses, both eco and non eco

•Environmental Management Systems (EMS)

•Environmental Impact Assessments (EIA)

•Strategic Environmental Assessments (SEA)

•Green IT

Activities

UK CEED’s activities are broadly split into 4 areas:

•Research

•Engagement

•Sustainability Tools

•Business Support

The problem…

It is not just about climate change and CO2 emissions…

•Protect natural environment / ecology

•Pollution prevention

•Sustainable development

What is the Low Carbon and Environmental

Goods and Services (LCEGS) sector?

Wind Turbine

Gearbox

Hydrogen Fuel Cell Tidal Power

Generator

Water Treatment

Plant

Particulate FilterMaterials Recycling

Facility

Low Carbon and Environmental Goods and Services

(LCEGS) Sector

Split into 3 categories

• Environmental

• Renewable Energy

• Emerging Low Carbon

Source: BERR (2009)

Low Carbon and Environmental Goods and Services

(LCEGS) Sector

Environmental

• Air Pollution

• Contaminated Land Reclamation & Remediation

• Environmental Consultancy and Related Services

• Environmental Monitoring, Instrumentation and Analysis

• Marine Pollution Control

• Noise & Vibration Control

• Recovery and Recycling

• Waste Management

• Water Supply and Waste Water Treatment

Source: BERR (2009)

Low Carbon and Environmental Goods and Services

(LCEGS) Sector

Renewable Energy

• Biomass

• Geothermal

• Hydro

• Photovoltaic

• Renewable Consulting

• Wave & Tidal

• Wind

Source: BERR (2009)

Low Carbon and Environmental Goods and Services

(LCEGS) Sector

Emerging Low Carbon

• Additional Energy Sources

• Alternative Fuels

• Alternative Fuel Vehicle

• Building Technologies

• Carbon Capture & Storage

• Carbon Finance

• Energy Management

Source: BERR (2009)

How large is the LCEGS market?

Global LCEGS Markets

Country Market Value, £bn % global total

United States 629 20.6

China 411 13.5

Japan 191 6.3

India 191 6.3

Germany 128 4.2

United Kingdom 107 3.5

France 93 3.0

Globally - £3,046bn

38% - Asia

30% - Americas

27% - Europe

5% - Africa / Oceania

Proportional to

population

Source: BERR (2009)

Global LCEGS Markets

Country Market Value, £bn % global total

United States 629 20.6

China 411 13.5

Japan 191 6.3

India 191 6.3

Germany 128 4.2

United Kingdom 107 3.5

France 93 3.0

Globally - £3,046bn

50% - top 5

Countries

Source: BERR (2009)

UK LCEGS Markets

•54,835 active companies

•881,000 jobs

•45% growth by 2017

Air Pol lution

Envi ronmental Consul tancy

Environmental Monitoring

Marine Pol lution Control

Nois e & Vibration Control

Contaminated Land

Waste Management

Water and Waste Water

Recovery and Recycl ing

Hydro

Wave & Tidal

Biomass

Wind

Geothermal

Renewable Consulting

Photovolta i c

Alternative Fuel Vehicle

Al ternative Fuels

Addi tional Energy Sources

Carbon Capture & Storage

Carbon Finance

Energy Management

Bui lding Technologies

Environmenta l

Renewable Energy

Emerging Low Carbon

Source: BERR (2009)

UK LCEGS Markets

Source: BERR (2009)

What are the export opportunities?

Market Opportunities

Developed Markets?

• Largest markets are in developed countries and rapidly developing

countries. Home markets still growing rapidly in emerging low carbon and

renewable energy sectors.

• Export opportunities greatest to countries who are developing energy

infrastructure to meet rising energy demand.

Export Markets

Where are the biggest export markets?

• China

• India

• Pakistan

• South Korea

• Thailand

Source: BERR (2009)

Export Markets

What are the biggest export markets?

• Water Treatment and Distribution

• Large Windfarm Systems

• Large Wind Turbines

• Small Wind Turbines

• Systems and Equipment for Photovoltaics

• Alternative Fuels for Vehicles

• Energy Efficient Windows

• Other Fuels in Alternative Fuels

Source: BERR (2009)

UK Exports

2.490.261France20.

2.570.269Russian Federation19.

2.600.272Saudi Arabia18.

2.700.283Denmark17.

2.760.288Turkey16.

2.950.308USA15.

2.970.311Italy14.

2.980.312Thailand13.

3.000.313Portugal12.

3.000.314Romania11.

3.140.328Japan10.

3.160.331Poland9.

3.360.352UAE8.

3.540.370Taiwan7.

3.750.392Pakistan6.

3.820.399India5.

3.850.403Malaysia4.

4.320.452South Korea3.

4.580.479Spain2.

12.061.261China1.

Country as %

export total

Sector

total

(£bn)

CountryRank

China

• Wind (£0.165 bn)

• Alternative Fuels (£0.156 bn)

• Solar PV (£0.156 bn)

• Building Technologies (£0.146 bn)

• Geothermal (£0.117 bn)

Spain

• Alternative Fuels for Vehicles (£.0.089 bn)

• Alternative Fuels (£0.088 bn)

• Building Technologies (£0.078 bn)

• Solar PV (£0.051 bn)

South Korea

• Wind (£0.076 bn)

• Water and Wastewater Treatment (£0.055 bn)

• Solar PV (£0.050 bn)

• Building Technologies (£0.047 bn)

Source: BERR (2009)

UK CEED’s recent research activities:

Study of Emerging Markets in the Environmental Industries Sector

DTI / DEFRA 2006

Innovation in Environmental Services

BERR / NESTA 2007

The Commercial Opportunity for London Businesses in the Environment Sector

LDA, 2008

Research

• Ulaanbaatar – one of the world’s most polluted cities (World Bank)

• City of 1 million, pollution in surrounding settlements where

migrants live in yurts where they burn tyres, rubbish and toxic

materials creating smog

• Solution being defined by UK CEED and the International

Association of Business and Parliament (IABP)

• Stakeholder group set up between local government, business and

communities to jointly find an agreeable solution

Current Research - Mongolia

City Authorities

• Air Quality Department of UB

• Mayors Office

• Air Quality Agency

Government Departments

• National Ozone Authority

• Sustainable Development and Strategic Planning Department

• Ministry of Nature, Environment, and Tourism

• Energy Authority

Citizens, NGO’s and Businesses

• Yurt district residents

Air Pollution Assessment Visit - Method

Academic Institutions

• Hydrometeorlogical Society of

Mongolia

• Mongolian University of Science

and Technology

• Institute of Thermal Engineering

Power Engineering School

• School of Mechanical

Engineering

• Chief Scientific Advisor to the

President

Long term – 20 year plan

• Increase power supply

• Improve infrastructure

• Replace coal based yurt heating and cooking technology with grid power

• Replace yurts with low cost housing

Short/mid term

• Immediate augmentation of current work on stove technology;

• Community based small scale projects:

– Community wash house

– Sustainable buildings

Recommendations

• Inverting stove technology

– Mineral Polymer foam insulation

– 50% decrease fuel

– 95% decrease in particulate emissions

– Payback is 2-3 years

• Stirling air circulating fan

– Known technology

– Easily manufactured locally and combines better comfort in the home with

low cost and fuel saving

– Payback is 1-2 years

• Flue heat exchanger

– Reduces fuel use by 10%

– Payback in 1-2 years

• Commence community wash house and sustainable build projects

Short/Mid-Term Plan

Eco Innovation

What is Eco Innovation?

• Eco-innovation means all forms of innovation activities resulting in

or aimed at significantly improving environmental protection. Eco-

innovation includes new production processes, new products or

services, and new management and business methods, the use or

implementation of which is likely to prevent or substantially reduce

the risks to the environment, pollution and any other negative

impact of the use of resources throughout the lifecycle of related

activities.

Source: European Commission (2009)

Eco Innovation

Drivers

• Need to become more resource efficient

• Policy decisions (e.g. CRC Energy Efficiency Scheme)

• Internal decisions (e.g. Environmental Management Systems)

• Resource efficiency (to save money)

• Need to improve or protect the natural environment

• Improve health and wellbeing

• Litigation prevention - avoid fines for pollution

• Feel good factor

CRC Energy Efficiency Scheme

What is it?

• Mandatory carbon emissions trading scheme for businesses using 6,000MWh of

electricity (roughly £500,000 worth of electricity pa).

• Administered by EA on behalf of DECC.

• Started April 2010 for both public and private sectors.

• 20% reduction in carbon emissions by 2020 (based on 1990 levels)

• 80% reduction in carbon emissions by 2050 (based on 1990 levels).

• Affected organisations buy allowances. Penalties also apply for non-comp.

• Allowances bought per tonne of CO2 emitted (£12 per tonne).

• Revenues are redistributed as bonuses to compliant organisations.

• Benefits to businesses through reduced costs and benefits to environment.

• The Opportunity: Energy Efficiency

EU Emissions Trading Scheme

What is it?

• Emissions trading scheme for CO2 intensive industries:

• Electricity generation, iron and steel ind., mineral processing, pulp/paper ind.

• Will cover all metals (e.g. aluminium) and maybe aviation from 2013.

• Only covers CO2 but may include other GHGs from 2013 (Phase III).

• Permits can be bought and sold through a trading mechanism.

• Currently around €16 per tonne.

• Benefits: Reduced energy bills, income through permit sales.

• The Opportunity: Energy Efficiency

Feed in Tariff

What is it?

• Payment incentive scheme for renewable energy systems.

• Aims to increase UK renewable energy share to 15% by 2020.

• Came into affect April 2010.

• Government pays a generation tariff (e.g. 41.3p/KWh for <4kW solar PV).

• Government pays an export tariff (e.g. 3p/KWh exported to grid).

• Benefit = reduced energy bills + generation tariff + export tariff.

• Generation tariffs guaranteed for 25 years.

• Very good ROI.

• Renewable Heat Incentive coming in 2011.

• The Opportunity: Renewable Energy and Energy Efficiency

Environmental Management Systems

What is it?

• Voluntary scheme for businesses to reduce environmental footprint

• Various standards: ISO 14001, EMAS, BS8555

• Focus on energy use, transport, pollution, ecology…

• Audited to ensure compliance and that reductions are maintained

• The Opportunity: Low Carbon and Environmental Solutions

How does UK CEED support Eco Innovation?

Peterborough: The Home for Environmental Businesses

Eco Innovation Clusters: An Opportunity for Business

What is a cluster?

• Network of businesses, organisations, R&D institutions.

• Competition = innovation

• Collaboration = innovation

• Small geographical

• concentration

Private Sector

Public SectorAcademic / Research

Sector

EnviroCluster Peterborough

• 360 Environmental businesses and organisations

• 5,800 jobs

• £590m turnover

• Cluster launched by Lord Sainsbury in 2002

• Cluster attracted more than £2m of inward investment

• Peterborough recognised internationally for environ. expertise

Why Peterborough?

• Engineering Background – Railway Heritage

• Existing environmental companies, especially water-based

• Public-sector base

• Local environmental initiatives in Peterborough

• Support organisations (e.g. EIC, EnviroCluster)

• Peterborough: UK’s Environment Capital

EnviroCluster Support

• Internationalisation

• Investor-readiness

• Commercialisation support

• Marketing and branding / promotional support

• Business incubation / inward investment

• R&D support and matchmaking

• Partner-finding

• Access to grant funding and business opportunities

• Engagement and networking

• Demonstration projects

• Skills & training

Retrofit for the Future – example R&D project

• Technology Strategy Board Bid in late 2009

• EnviroCluster consortia of research, public, private, academic

• Retrofit existing property to achieve 80% energy cut

• Working with RSL to develop an end-terrace property

• Innovative, cost-effective, replicable

Example Companies

Cunnington Clark is a building services and

design engineering company with a

specialism in low energy and sustainable

design.

Example Companies

Dresser-Rand provides

innovative engineering

solutions for energy-

related industries. The

company designs and

manufactures steam

turbines, gas compressors,

CHP systems, specialist

gearboxes and special

purpose machinery.

Example Companies

The Lightning Car

Company is developing a

high-performance electric

car with 500+ bhp which

can do 0-50mph in <5s

and a top speed of

130mph.

Example Companies

Applied Energy Products

Limited manufactures and

supplies a range of heating,

ventilation, showering and

hot water products, including

low carbon solutions such as

heat-pumps, micro-wind

turbines, solar thermal

systems and mechanical

ventilation with heat-

recovery (MVHR).

Eco-Innovative Cluster Partnership (EcoCluP)

• Adapt, test and implement sector-specific support tools to allow cluster

companies to grow and internationalise.

• Toolbox for internationalisation

• Service kit for innovative SME’s

• Eco-Cluster Manager Campus

• Eco-Company Club

• Practical approach for joint research cooperation

13 partners in 10

countries

3,500 cluster companies

(mainly SMEs)

430 research institutions

Peterborough: The Home for Environmental Businesses

Eco Innovation Centre Peterborough

• Partnership activity

• Centre launched in April 2008

• Centre fully occupied December 2009

• Additional space sought in May 2010

• Incubation facilities – fully featured, subsidised offices, virtual

offices, meeting room facilities

• Centre acts as a hub for EnviroCluster activities

Aims of the Eco Innovation Centre

• Support and incubate more businesses in Peterborough, create

new businesses & jobs

• Attract new businesses to Peterborough and the region

• Enhance links with the academic and research sectors

• Engage local/regional/national businesses

• Support eco-innovation and ideas development

• Expand current centre and plan ‘Phase 2’ building

Eco Innovation Centre Peterborough

Conclusions

• Many policy decisions = greater demand for low carbon technology

• LCEGS sector is growing rapidly

• Demand for eco-innovative products and services

• Through clusters, networks, KTNs, partnerships…

• Expertise and manufacturing can take place in the UK

• Support exists from organisations like UK CEED / EnviroCluster to

support supply-side organisations

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Gareth Jones

01733 311644

g.jones@ukceed.org

www.ukceed.org | www.envirocluster.co.uk