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The UK is on track to meet its first carbon budget, Energy and Climate Change Minister Joan Ruddock said today as the first ever annual emissions report under the carbon budgets system was presented to Parliament.

Under the Climate Change Act, the UK has to report annually to Parliament on progress in meeting its carbon budgets. The UK has to cut its emissions by at least 34% by 2020, and by at least 80% by 2050, below 1990 levels.

Energy and Climate Change Minister Joan Ruddock said:

“Today’s emissions score card shows that the UK’s climate change policies are working and that we’re on track to meet our carbon targets.

“Since 1990, the UK’s emissions have been cut by 22%, which means we’ll more than meet the international commitments we made.

“We’re putting in place policies to make the low carbon transition by supporting investment in clean energy, in insulating homes and creating green jobs.”

Taking into account the use of carbon units, the net UK carbon account in 2008 was 606.7 MtCO2e. This is 22% below ‘base year’ emissions, which were 777.8 MtCO2e.

Notes for editors

1. Today’s Annual statement of emissions for 2008 can be found below:
   Annual statement of emissions for 2008
2. The level of the first three 5 year carbon budgets – covering the periods 2008-2012, 2013-2017, and 2018-2022 – were set in May 2009 at 3018 MtCO2e, 2782 MtCO2e and 2544 MtCO2e. These represent reductions of just over 22%, 28% and 34%, respectively, below 1990 levels.
3. Today’s report shows that on a carbon budgets basis in 2008, net UK emissions were 626.0 million tonnes of carbon dioxide-equivalent (MtCO2e). This is 11.9 MtCO2e (1.9%) less than net UK emissions in 2007. In addition, 19.3 MtCO2e worth of carbon units were bought in 2008 by companies in the UK operating under the EU Emissions Trading System (EU ETS).
4. Reporting of greenhouse gas emissions for the UK’s carbon budgets only includes emissions within the UK, and excludes both Crown Dependencies and Overseas Territories. By contrast, reporting of greenhouse gas emissions under the Kyoto Protocol is based on emissions in the UK, its Crown Dependencies, and those Overseas Territories (Bermuda, Cayman Islands, Falkland Islands, Gibraltar and Montserrat) that are party to the UK ratification of the Kyoto Protocol.
5. Under the Kyoto Protocol, the UK has to cut its emissions by 12.5% below 1990 levels. On a Kyoto basis, UK emissions are now 19.4% below 1990 levels without emissions trading or 22% including emissions trading.
6. Under the Kyoto Protocol the UK reports against a base year of 1990 for carbon dioxide, methane and nitrous oxide emissions, and 1995 for fluorinated compounds (HFCs, PFCs and sulphur hexafluoride). The same approach has been taken under the Climate Change Act.

See also:

• Climate Change Act 2008
• Carbon Budgets
• EU Emissions Trading System (EU ETS)

 

Church House Conference Centre, London

Good morning and thank you for having me here today. I just want to apologise because I do have to rush off soon but hopefully I’ll have a few minutes to take some questions afterwards.

I’d like to talk to you about the CRC Energy Efficiency Scheme, something I think you’ve all come to know as CRC.

Businesses, governments and public bodies all over the world are recognising the role they can play in tackling climate change. There is an urgent need for public sector and businesses to play that role. And this is not something the government can do alone, everyone needs to play their part.

This action, this fundamental change in behaviour, if united, and in large enough numbers it could result in getting a real change globally, in how we combat climate change.

Aim and benefit of CRC

Which is why, on the 1st April the CRC scheme will come to fruition. It is aimed to get attention at board room level, to encourage changes in behaviour and infrastructure.
It’s designed to raise awareness and encourage that change in behaviour that I’m talking about. Because increasing our energy efficiency, not just reducing our emissions, is essential for this country getting to a low carbon destination.

But that’s not the only benefit, as the scheme will save you money. In fact, by 2020 businesses will save a billion pounds a year. And at the same time the CRC scheme will prevent at least 4 million tonnes of CO2 entering the atmosphere.

The CRC targets the UK’s largest private and public sector organisations. And the threshold has been set at 6000 MWh/annum.

The simple fact is, the costs saved by improving your energy efficiency through the CRC will greatly outweigh any costs from the scheme. And the threshold for qualification has been specifically chosen, so that the CRC will capture those organisations who will benefit financially from taking part.

And why are we introducing this? Because climate change demands that we conserve our resources. Because if we don’t limit our temperature rises to two degrees there will be consequences to our climate; and because it is the socially responsible thing to do.

Heating and powering work places accounted for a tenth of the UK’s emissions in 2008. And there is compelling evidence from the Carbon Trust, that shows only a third of cost effective measures are being taken up, even among leading companies. This needs to change and the CRC will make it happen.

I’m not saying that CRC is the only answer to climate change but it leads the UK in the right direction. And it will bring about that change in our behaviour which is so urgently needed.

But we are also thinking practically for how organisations can realistically make these changes.

Through last year’s budget, Salix Finance invested almost £55 million in public sector bodies all over England, for energy efficient technologies

All this, with an additional £5m has now been allocated for more than 1400 projects across 200 public sector bodies - which will not only cut emissions, but reduces fuel bills too.

And reducing energy use makes business sense - UK businesses could save over £3 billion a year on their energy bills through being more energy efficiency.

We must not ignore the opportunity of a low carbon economy. The global market for low carbon goods and services already worth £3 trillion. And that is projected to grow to over £4 trillion by 2015.

Given the recent financial climate, I’m sure you’ll agree that’s welcome news.

What the papers say

Now I’m conscious that the CRC scheme has come under some criticism in the media.

I think it’s a real shame that something so important like the CRC has been mis-interpreted in the media as a hindrance and a bureaucratic one at that.

Organisations like the National Theatre, Hilton Hotels and the London Fire Brigade have all given us their support to the scheme.

While it is true that the CRC will affect thousands of businesses – public and private; we think that the number of organisations that will have to participate in the scheme, will be roughly 5,000.

A further 15,000 - 20,000 organisations who have a half hourly meter settled but who don’t consume enough electricity to qualify will need to make a simple information declaration, but they won’t need to do anything else.

Of course we won’t know the exact final number of participants until after the scheme has gone live. But I can tell you that we have estimated roughly 4-5000 organisations will qualify.

The information from the electricity companies has allowed the Environment Agency (EA), the administrator of the CRC scheme, to contact each of the organisations that will have obligations under the CRC – so we are confident that the scope of this scheme has not been underestimated.

It has also been said that we haven’t done enough to raise awareness of the scheme.
Since 2008, we have sent out 13,000 letters to private and public bodies informing them of the scheme.

And the EA held two national events, one in Manchester in February, and in London earlier this month to help raise awareness.

We have also published three consultations since 2006.

The first was in November 2006, this was the start of the CRC, but at the time it was known as the Energy Performance Commitment.

In June 2007, we launched a second consultation on the implementation proposals for the CRC to secure the required emissions reductions.

In March 2009, the third consultation was launched on the draft order to implement the CRC - it closed on 4 June 2009.

The EA also published guidance last November, with further guidance coming before the end of this month. So I urge everyone who is affected by the CRC to take a look at what the guidance has to say.

A couple of examples

Many organisations have already started to prepare for a low carbon future and are taking early action.

First Direct, for example, have a programme where idle computers are turned off at 7pm. Since 2006, First Direct have saved £200,000 a year on their energy bills and reduced their emissions by 1,500 tonnes of CO2 per year.

Citigroup set themselves a global target for CO2 reductions. They monitor their own emissions by a simple computer system, set up by themselves, that collects half hourly data. Which then goes to an in-house database.

To date, this database has provided the evidence needed, for Citigroup to become more carbon conscious. And the CRC will help them focus on energy efficiency; and help improve the economic credentials of these projects.

These are simple actions but, they go a long way.

Leading by example

Now no one in this government expects to introduce something like this without actively taking part in it ourselves. All government departments are taking part, even those that don’t meet the threshold.

The Carbon Trust are using my department as an example of how an organisation can demonstrate what an energy efficient department could look like. When we first moved to Whitehall Place, the building had one of the worst energy performance ratings in Whitehall.

We rose to the challenge and now our estimated savings are £74,000 per year, from becoming more energy efficient – and this prevents 327 tonnes of CO2 entering our atmosphere.

The public sector alone is directly responsible for around three per cent of the UK’s emissions, so I see the CRC scheme as an opportunity for the public sector to demonstrate leadership on climate change and energy efficiency.

But that’s not all, we have also taken other measures to make sure we lead by example, in reducing our emissions and becoming more energy efficient.

All new schools will be zero carbon by 2016, and the NHS aims to reduce its 2007 carbon footprint by 10 per cent by 2015.

We have the Climate Change Levy (CCL) which applies to all but the smallest businesses. And the Climate Change Agreements which are forecasted to save over 11 million tonnes of CO2 this year.

And last but not least, we are still very much committed to reducing our emissions by 34 percent by 2020; and 80 per cent by 2050. As we have legislated to do so in the Climate Change Act 2008.

Conclusion

So to conclude, all companies, future and existing, public and private, must become part of a climate change solution that accepts their constraints on greenhouse gas emissions.

We need to push ourselves to make as many reductions as possible, in our own energy use first, but also become energy efficient. And the CRC is one of the ways we are leading by example in tackling climate change.

We know what must be done, but it falls to everyone to act with a similar sense of purpose and embrace that change in behaviour. Because it is an opportunity not only to protect the environment, but also to help the public sector, our businesses - and in turn - help the economy to grow.

Energy Minister David Kidney today launched a nationwide skills academy for the power industry at Ratcliffe-on-Soar power station in the East Midlands - and praised the work being done in the area.

E-ON's Engineering Academy at Ratcliffe power station will form part of the National Skills Academy for Power, which has been developed by electricity companies and their supply chain, and will provide a strategic lead for developing the skilled workforce the energy industry needs as it moves towards a low carbon future.

The National Skills Academy for Power will receive £2.9 million of government funding over the first three years of its operation - matched by funding from employers. After three years, the Academy will be self-funding, with revenues from subscriptions and services.

Energy and Climate Change Minister David Kidney said:

"There are going to be tens of thousands of highly skilled jobs up for grabs in the energy sector over the coming decade as billions of pounds is invested in the UK as we make the low carbon transition.

"The Government is providing nearly £3 million of funding for this new Academy because we want to make sure companies have access to highly skilled workers, and that people have the right help and training to take up these great opportunities."

Commenting on his visit to the Ratcliffe-on-Soar, David Kidney said:

"There is great work that is already being done to train and provide the right skills for Britain's energy workers."

"E.ON's Engineering Academy will form an important part of the national skills academy for power, helping workers in the East Midlands make the most of the massive uptake in energy jobs that will be needed over the coming decade."

Dave Newborough, Head of Employee Relations, E.ON and Chair of the National Skills Academy Shadow Board said:

"Over recent years collaboration amongst sector employers has increased significantly on addressing skills issues. We see the National Skills Academy for Power developing in to the key portal for stakeholders to engage with the sector on the skills agenda ranging from Government departments through to education and training providers and most importantly with the much needed future talent looking for a rewarding career during this exciting phase of industry development as we enter a low carbon world".

Steve Davies, Chief Executive of the National Skills Academy for Power added:

"The launch today of the National Skills Academy for Power gives Power Sector employers a vehicle with which to address the significant skills issues that we know the industry is facing, from an ageing workforce, massive infrastructure replacement and renewal programmes, through to emerging technologies including renewable energy and smart metering. Already the National Skills Academy for Power has the support of many leading sector employers ensuring that the products and services delivered by the Skills Academy exactly meet employer's needs."

Notes to editors

 

1. For further information on new National Skills Academies, see www.bis.gov.uk/news

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