HOME 2025: FLEXIBLE WORKING AND OUR LOW CARBON FUTURE

1 HOMES DRIVING SYSTEM CHANGE

HOME 2025: FLEXIBLE WORKING AND OUR LOW CARBON FUTURE

12 October 2015

An initiative of

In partnership with

INTRODUCTIONThe Home 2025 project, a collaboration of The Climate Group’s network, highlights how we can all contribute to tackling climate change and living better lives through the way we build, power and use our homes. The impact on emissions from action at the level of the home can be transformative, and we don’t need to wait for the results of global climate change talks to start enabling these benefits. But we do need an approach that allows and encourages the greatest number of people possible to become part of the solution.

This first instalment of the Home 2025 project is focused on flexible working. One of the key shifts underway, enabled by macro trends such as mobility and technology shifts in a globalised world, is more flexibility in how we use our homes as platforms to work smarter and better. The environmental benefits are already beginning to be felt, and more potential will be unlocked as technologies advance to enable lower energy consumption of our devices, and greater connectivity to colleagues and networks.

ABOUT THE CLIMATE GROUPThe Climate Group is an award-winning, international non-profit. Our goal is a prosperous, low carbon future. We believe this will be achieved through a ‘clean revolution’: the rapid scale-up of low carbon energy and technology. We work with corporate and government partners to develop climate finance mechanisms, business models which promote innovation, and supportive policy frameworks. We convene leaders, share hard evidence of successful low carbon growth, and pilot practical solutions which can be replicated worldwide.

ABOUT CANONCanon is a global leader in imaging solutions, renowned around the world for innovation and high-quality products and services for capturing, processing and printing information, documents and high-quality images.

Canon is passionate about the power of image.

Canon is focussed on innovations which enrich the lives and businesses of their customers while reducing related environmental impacts, throughout the product lifecycle and within Canon’s own operations.

HOMES DRIVING SYSTEMS CHANGE The home is at the intersection of numerous systems, and these systems are deeply entrenched in and support current and growing levels of consumption – food, power, heating, cooling, electronics, household appliances and more.

Interventions in the home can directly reduce emissions – we are familiar with the importance of turning off lights or buying more efficient appliances. But changing patterns of consumption or behaviour at home also holds the potential to indirectly drive change in surrounding systems. As the global population continues to grow, the only way to ensure we continue to increase energy productivity is to ensure that both direct and indirect energy, as well as resource consumption in the home, are addressed. Though the examples on the following pages focus on energy, solutions to direct reductions in other consumption (appliances, food, water) and limiting resulting waste will also have system-wide emissions reduction benefits (#circulareconomy).

And yet paradoxically it is often the individual living in that home who feels most helpless in the face of environmental challenges. The challenge isn’t an Apollo mission – putting one man on the moon – but a distributed set of solutions that allow the 8 billion people that live on this planet by 2025 to collectively begin to create the low carbon world we all would like to live in, now.

How are homes driving climate change? And where do we look for solutions to 2025?


New business models driving

systemic change in

energy, food, transport, waste and environmental systems.

Every consumable

product or service has an

invisible life cycle of impacts before and after

we consume it in our homes.

Indirect impacts

Direct impacts

HOME 2025

Cooking

Heating

Cooling Lighting

Appliances

Electronics

Buildings account for 32% of the global energy demand and around 1/3 of global carbon emissions.

Residential buildings account for 74% of global final energy demand of the building sector.1

6823.68

8.32

Other

Buildings

Residential

Global final energy demand

Services

32

THE HOME OF 2025: DRIVING ENERGY PRODUCTIVITY AND SYSTEMS TRANSFORMATION

The number of households globally is projected to grow by 68% by 2050, almost twice the rate of population increase. Convention on the Organisation for Economic Co-operation and Development (OECD) countries are expected to reach 608 million households by 2050, while in non-OECD countries household numbers are estimated to reach 2,551 million by 2050.2

Single-family homes are currently the largest subsector by number of buildings, area per person, energy consumption and CO

2 emissions. However, the size of homes varies dramatically between

countries.3 The IEA estimates that when South Africa is excluded, annual residential electricity consumption by 791 million people of sub-Saharan Africa (approximately 40 TWh) is the same as the electricity consumption of 19.5 million people living in New York State.4

Energy end use in Europe largely due to heating (up to 75% in Germany’s case).

Energy end use just over 30% in South Africa, where the majority (40%) results from cooking.

Europe is already largely urbanized (80%)

Between 60-75% of the current building stock will still be in use in 2050.

The growth of new dwellings is relatively small: 13 million to 2025 across all EU27 countries.

Sub-Saharan Africa is rapidly becoming urbanized (South Africa: 64%; Nigeria 47%) and expected to become the second largest home construction market by 2025. In Nigeria alone, 1.5 million homes will be needed each year to 2025, and up to 20 million homes are expected by 2050.

In South Africa, 2.5 million new homes are expected to be built between 2015 and 2025 .

Sources: data.worldbank.org and IEA, Transition to sustainable buildings, 2013 and Arcadis construction projection to 2025.


Renewableelectricity

HOME OF 2025

HOME 2025LOWERING ENERGY USE

Smart consumer side management

– Smart thermostats

– Smart meters

– Smart lighting

– Connected home

Self-produced energy and storage

(Decentralized power generation)

– Solar PV

– District heating

– Fuel cells

– Battery storage

Smart consumer behaviour

– Energy consumption habits

– Recycling

– Overconsumption (food, clothes, etc.)

– Travel choices

– Work behaviour

Energy efficiency at home (reduce consumption)

– Efficient electronic appliances

– Building insulation

– Low consumption lightning

– Clean cooking solutions

– Efficient heating and cooling technologies

ENERGY AND THE HOME OF 2025Homes in 2025 may not look different to today’s homes, but we can count on the fact that the technologies in and around them will be different. A typical family home could contain more than 500 connected devices by 2022, according to Gartner research. The above graphic shows some of the predictions for home energy-consuming devices and behaviours, such as the rise of ‘prosumers’ or homes that produce their own power.

What does this mean for home-based working? People will be more and more likely to expect the flexibility to work from anywhere, as the global trends on the following pages illustrate. For instance, in the UK, homeworking has the potential to reduce carbon emissions by over 3 million tonnes a year across the whole country.5

HOMEWORKING HAS THEPOTENTIAL TO REDUCE

CARBON EMISSIONS BYOVER 3 MILLION TONNESA YEAR ACROSS THE UK


DRIVERS BEHIND HOME TRANSITIONSThe impact on emissions from action at the level of the home can be transformative, and we don’t need to wait for the results of global climate change talks to start enabling these benefits. How are homes driving climate change? And where do we look for solutions to 2025? These are some of the drivers behind home transitions.

A typical family home could contain more than(Source: Gartner, 2014)

Worldwide shipments of smartphones will reach

In 2015, tablets will outsell notebook & desktop markets worldwide.13

ECONOMICS

Innovation in business models is improving the potential adoption of low carbon solutions. The sharing economy is driving rapid change over shorter time periods. New business models are set to change existing industries such as buildings, energy, agriculture/food and water. For example, Airbnb is allowing people to share each other’s homes, reducing the need to build and operate hotels.

Centralised Decentralised

MOBILITY

Time is money and traffic congestion wastes hundreds of productive hours each year, whilst increasing carbon emissions. European and African countries alike face mobility challenges. Shifting working and living patterns to avoid traffic promises carbon reductions, less pollution and less time wasted.

TECHNOLOGY

A revolution in information and communication technologies over recent decades has transformed our economies, how we generate value for society, how we work and what we consume. The next phase of the internet is already here: sensing, software and communications = the Internet of Things (IoT) which allows real time responsiveness not just to other people around us, but to the physical environment. We expect to be able to use our mobile devices to shop, solve problems, work, find entertainment, manage travel, and more. We will come to expect that hardware – not just software – can be deployed at an exponential pace.

Technology has been good for energy productivity, which has increased at an average 1.3% per year worldwide between 2001 and 2011.10 And cloud-based solutions consolidate emissions around data centres which are rapidly becoming decarbonized.

DEMOGRAPHICS AND MIGRATION

Young and aging populations. Aging populations will characterise developed economies. Youth education and employment are already on the agenda in many countries as a means to promote stability and manage high levels of migration. Global population of 8 billion in 2025.

GLOBALISATION

In response to climate change and severe weather events, terrorism, infrastructure failures, and so on, we will see increasing preparedness for decentralised models of working. Producing and consuming energy must become more efficient and economically stable to improve local resilience in the face of global system failures.

With a total installed capacity of roughly

147 GW all of Africa has less power generation capacity than Germany.8

Hilton

95 years,

610,000 rooms,

88 countries.

£

By next year, Millennials will account for 36% of the U.S. workforce and by 2025, they will account for 75% of the global workplace.9

Airbnb

6 years, over

800,000 listings,

190 countries.6

50 billion

500

1.6 billion

1970 2000 2015 2025

Cost of congestion in London in 2030 is equivalent to the cost of the 2012 London Olympic games.7

connected IoT devices by 2020.11

smart devices by 2022.12

annually by 2017.

Stable FlexibleResilientSecure Hierarchical Collaborative


WORKPLACE TRANSITIONWith the pressures of growing populations and urbanisation, pervasive software and communications technologies have transformed the workplace creating a much more diverse work environment. Over the past 60 years, automation and the information age have completely changed the way we go about work. A decade from now, workplaces will evolve even more quickly and will need to adapt to new requirements and demands, and we can expect homes to be used much more for work as well.

UNLEASHING THE FLEXIBLE WORKER

Canon provides mobile working solutions that contribute to transforming workplace systems, for example through mobile and cloud-based printing and scanning, as well as cloud-based document management that is accessible from anywhere – home, office or on the road.

With Canon’s energy efficient printing solutions for the home (such as MAXIFY or i-SENSYS), together with powerful apps and compatibility with a range of cloud-based software, easy mobile and home working becomes reality. Canon’s devices for home office use can integrate with existing cloud-based document management systems (like Dropbox™, Evernote™ or Google Drive™), making it easy to access information from anywhere and share your work with colleagues in other locations.

It continues past traditional documents: innovations like the Connect Station allow users to share, store and view images and videos wirelessly, making it easier to share your ideas visually. In the medical sector, mobile radiology equipment coupled with image archiving and communication systems enables remote diagnosis of tuberculosis cases and thereby opening new possibility for mobile working in the medical sector.

ECONOMICS

Fuel prices and real estate prices are a major contribution to the total costs of business. Office space prices are expected to rise at unprecedented rates – especially in developing economies of Africa. Freeing up office space will be of prime business importance.

London has the most expensive office rent in the world: 2,122 €/m

2 year.

South Africa has the world’s highest annual rental growth in Sandton and Durban region – at around 35-40%.14

TECHNOLOGY

New technologies available for retail will increasingly be deployed for use at work, including tablets, mobile phones and cloud-based services. We will require low carbon solutions that meet the future working reality.

The availability of information in digital form is revolutionising the way information and documents are created, used, distributed and archived in a work context. Paper is still being used in offices, but there are now countless ways of doing digitally, remotely and using mobile devices what had to be paper-based and in an office before.

In 2015, only 1% of businesses are completely paperless, and only 3% are completely paper-based. The rest are somewhere in between.19

MOBILITY

Mobile working is on the rise. More and more workers request the freedom to work from home. New technologies will enable us to collaborate effectively digitally and remotely.

Projected urban population growth suggests a 50% rise in costs due to traffic gridlock costs by 2030, the ability to work remotely will drastically impact on future business success.

66% of workers worked remotely at some point during the month in 2011.15

Half of smartphone users want to send scanned documents to the cloud or print from their phone, but often can’t.16

DEMOGRAPHICS

Five different generations will be co-working together, but millennials will dominate. If companies don’t succeed in offering flexibility and mobility, young professionals will increasingly lean toward becoming freelancers, entrepreneurs or self-employed.

Already in 2015, we have 1.3 billion mobile workers17

By 2025, millennials will account for 75% of the global workplace.18

1970 2000 2015 2025

MOVING PEOPLE TO WORK

Job for life Training Pension

MOVING WORK TO PEOPLE

Flexible Mobile Choices


WHY HOME WORKING?

FLEXIBLE WORK

Flexible working is epitomised by choice. People may be employed, self-employed, entrepreneurs or freelancers, all of which have varying requirements. Already, we are seeing the growing need for co-working spaces, and a rise in incubators and accelerators as societies focus on fostering entrepreneurship. At the same time, companies will be offering flexible and mobile working programs such as homeworking, mobile working, hot-desking or flexible hours.

Home working schemes are among the most adopted forms of flexible working in companies. Working or teleworking from home is initiated when employees work from their home premises using their own or employers’ IT equipment.

CASE STUDY OF HOMEWORKING IN LONDON

Case study of the economic and environmental benefits of implementing home working practice in an average size company of West London.

The results show:

1. If by working from home a worker increases by 20% its carbon footprint at home, a telecommuting employee has to travel at least 25km by train, 13km by bus or 6km by car to achieve net emissions savings.

2. If a homeworker avoids having a dedicated office space, homeworking will be always beneficial since the carbon footprint of an individual working at the office is higher than one staying at home.

3. If 30% of total employees practice teleworking every day, the workforce overall saves EUR 393,294 /year or EUR 7,023 /worker, and 59.3 tonnes CO

2/year could be saved.

NOTE: Environmental benefits depend on many variables and are therefore difficult to assess. Home or office energy consumption is likely to vary in terms of season, weather, type of insulation, efficiency of heating and cooling system, ventilation, occupancy, behaviour and so on.

ASSUMPTIONS

Location

West End London

Company

56 employees

Floor price20

2122 €/m2

Office emissions21

320kg CO2/m

2

Household emissions22

2590kg CO2/hh

EMPLOYEE

Satisfaction

Home-work balance

Reduce stress

Increase time productivity

SOCIETY

Reduce traffic congestion and air pollution

Ensures continuity of planning

Contributes to meeting global targets of reducing emissions and energy demand

EMPLOYER

Attract and retain employees

Reduce costs of floor office and energy consumption

LONDON WORKERS WASTE 82 HOURS/YEAR

IN TRAFFIC CONGESTION. (SOURCE: INRIX CEBR)

IN THE UK, HOMEWORKING HAS THE POTENTIAL TO REDUCE CARBON

EMISSIONS BY OVER 3 MILLION TONNES A YEAR

ACROSS THE WHOLE COUNTRY. (SOURCE: THE CARBON TRUST)

ENVIRONMENT

Reduce travel distances and fuel consumed

Avoid excess energy consumption in the office, and associated IT equipment


SUCCESSFUL CASE STUDIES Companies such as IBM and BT have successfully made a transition of their workplace, reducing office space, increasing profits and satisfying employees’ demands. Yet, being away from the office did not decrease productivity or line management, and even improved the overall work lifestyle of the company.

OVERCOMING BARRIERS Companies may be reluctant to adopt flexible working, in spite of cost-savings or environmental benefits, because of a range of cultural barriers. As technical barriers recede, governments look to solutions that involve flexible work for the challenges of congestion, high office prices or elderly employment. The European Framework Agreement on Telework was created in 2006 to spread and normalise this practice across the member states. The agreement first gives a definition on telework and offers guidelines to overcome potential barriers. Issues of employment conditions, data protection, privacy, equipment installation, maintenance and liability, health and security, working organisation, access to training and collective rights are addressed in the framework.

CONCLUSION: CALL TO ACTIONComprehensive climate change policies already exist in 62 countries25 and international climate negotiations continue to engage all countries in the world. 2014 was the first year in which emissions growth was decoupled from economic growth.26

But we are not doing enough to avoid dangerous levels of climate change. Bloomberg New Energy Finance has predicted that even if we achieve 60% renewables in 2040, we will reach 450 ppm CO

2e in

the atmosphere just after 2030. The annual rate of reduction in global energy intensity needs to more than double to 2.6% by 2050.27 We will require increased technological and social innovation to drive a shift in energy, food, water and waste systems, consumption practices and working practices. In the right conditions mobile and home working together with the use of energy efficient technologies for digital working can make a significant contribution to the necessary carbon reductions.

In the next 10 years will see more evidence of climate change impacts. The home of 2025 will be both a driving force in mitigation and on the front lines of adaptation, encompassing smart technologies and solutions for domestic living and home working. We look forward to working with leading businesses and governments to increase the individual’s options for becoming part of the solution.

BT WORKING STYLE23

Costs: 11,600 home workers save the company 104 million € a year, are 20% more productive and take 63% less sick leave.

Emissions: BT generates 54,000 tons less of CO

2 in the UK.

Space: Relocating BT’s Netherlands headquarters reduced 61% of initial office space saving 1M €/year.

– Flexible working practices for its French headquarters reduced the working space from 8 to 3 floors.

– Flexible working in Budapest office increased building capacity from 40 to 90 people.

IBM24

Costs: Total savings from energy management in 2005 was $22.9 million.

Emissions: Between 1990 and 2005, IBM avoided more than 8.98 million tons of CO

2 emissions through the mobile work

program by conserving a cumulative 17.2 billion kWh of electricity.

Space: Since 1995 IBM has reduced office space by a total of 78 M ft2.

– In 2009, 40% of IBM employees in 173 countries have no office at all.

– The ratio of space to employee is now 8:1 with some facilities achieving 15:1, compared to 1:1 in 1990.

– In 2007 in the US alone, the work-at-home program conserved 5 million gallons of fuel and avoided 450,000 tons of CO

2.

emissions.


FOOTNOTES1. Calculations from data of Table 1.1. IEA, transition to sustainable buildings, 2013 http://www.iea.

org/etp/buildings/

2. IEA, 2013 http://www.iea.org/etp/buildings/

3. Energy Efficiency in Buildings: Transforming the Market, WBCSD, 2009 http://www.wbcsd.org/transformingthemarketeeb.aspx

4. Low Carbon Africa: Leapfrogging to a Green Future, 2011 http://www.christianaid.org.uk/images/LowCarbonAfrica.pdf

5. The Carbon Trust https://www.carbontrust.com/about-us/press/2014/05/homeworking-is-where-the-savings-are

6. Peers Inc, Robin Chase, 2015

7. CEBR, 2014

8. REN21, 2015 http://www.ren21.net/

9. Software consortium, http://c0120.paas1.tx.modxcloud.com/insight/

10. The 2015 Energy Productivity and Economic Prosperity Index, http://www.ecofys.com/files/files/the-2015-energy-productivity-and-economic-prosperity-index.pdf

11. The future of knowledge work, Intel http://www.intel.com/content/dam/www/public/us/en/documents/white-papers/future-of-knowledge-work-place-transformation-paper.pdf

12. Gartner, 2014

13. IDC 2013

14. Office space across the world, 2014, Cushman & Wakefield, http://www.cushmanwakefield.com/~/media/global-reports/OSATW%202014%20Publication%20updated.pdf

15. Forrester, 2011

16. Canon Office Insights 2013

17. IDC 2011

18. Software Consortium

19. IDC 2013

20. Cushman and Wakefield 2014

21. City of London Carbon Footprint, 2009. https://www.cityoflondon.gov.uk/services/environment-and-planning/sustainability/Documents/pdfs/sus_carbonfootprintreport.pdf

22. https://www.worldenergy.org/data/efficiency-indicators/

23. BT Smart numbers, case study BT Workstyle

24. Working outside the box, a study of the growing momentum of telework, IBM

25. http://www.theclimategroup.org/what-we-do/news-and-blogs/62-states-now-have-flagship-legislation-on-climate-change-un-endorsed-study-finds/

26. Renewables 2014 Global Report, REN21, 2015 http://www.ren21.net/

27. IEA Energy Technologies Perspectives 2015 http://www.iea.org/etp/etp2015/

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