business
Most people now accept climate change is happening; the reasons for the change are still up for discussion, but as emphasis shifts from climate change mitigation to adaptation, businesses (especially those with global activities) must now plan for the potential physical effects of climate change, including extreme weather incidents, infrastructure damage, water availability and disruption to global trade.
Adaptation offers opportunities for businesses to reduce costs through energy efficiency and on-site renewables and to participate in new and evolving carbon markets, valued at 40bn Euros in 2007 . New products, markets and services are emerging and showing signs of massive growth. According to the Stern Report, published in November 2006, the markets for low carbon energy products are likely to be worth at least £300bn by 2050.
The good news is that these relatively new products, markets and services mean new jobs and lots of them. The energy sector used to be one of the biggest employers in Britain and its decline has been well documented, particularly the pit closures. Replacement of ageing plant in the power generation sector should create thousands of jobs, with the fastest growth expected in the renewables sector – there is light at the end of tunnel; that light is green.
Corporate Social Responsibility is important. Being green and being seen to be green has driven the growth of a new voluntary carbon offset industry that has had a positive impact on customer choice, staff recruitment and employee retention. The evidence of this is the increasingly large number of ‘green’ products and businesses, including specialised ‘green’ investments/investors. Companies can now capitalise on the opportunities offered and go beyond compliance, creating economic value through energy efficiency and waste reduction savings |
The Government maintains a ‘carrot and stick’ approach to the issue, taxing businesses on energy use via the Climate Change Levy (CCL), but allowing these payments to be mitigated by energy efficiency measures. Emissions trading schemes also offer the potential to generate income on the sale of surplus allowances.
The Government’s newest cap and trade scheme to control direct and indirect CO 2 emissions is the CRC energy Efficiency Scheme (CRC), which started in April 2010 and targets large, non energy-intensive organisations like large retail groups, supermarkets, hotel chains, etc. Organisations within the private or public sector with half-hourly metered electricity consumption exceeding a cap of 6,000MWh in 2008 (an electricity bill of approximately £500,000) will fall within the scope of the first phase of this new scheme.
We understand these issues because we deal with them every day. We can help advise you in all these areas:
- compliance strategies
- protection and exploitation of intellectual property
- outsourcing
- emissions trading
- voluntary carbon offsets
- energy purchasing
- on-site renewables
- insurance
- taxes
- availability of grants
- company reporting obligations
- land use for renewables projects.
Peter Manford, Partner
Energy, Projects & Commerce
T: 44(0)870 763 1390
E: peter.manford@martineau-uk.com
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