Cutting Carbon loCally – and how to pay for it

Cutting carbon locally – and how to pay for it
How to get serious about climate change
A report commissioned by Friends of the EARth
REsearch by Professor tony travers and Arup
An online version of this report is available at
Tony TraversLondon School of Economics
and Political Science
Friends of the Earth would like to thank everyone who gave
advice in the writing of this report, in particular:
Tony Bosworth
Quentin Given
Donna Hume
Liz Hutchins
Tim Jenkins
Naomi Luhde-Thompson
Ed Matthew
David Powell
Nick Rau
Editorial team
Editor: Dominic Murphy
Design: Deborah Thompson
Picture research: Amelia Collins
Cover images: CHI&Partners, Kirklees Council, Sustrans,
Brighton & Hove Bus and Coach Company Ltd
executive summary
local government, the
environment and the future
Energy: Energy SErvices Companies 26
• 6 Southampton District Energy Scheme
Energy: energy Services Companies 28
• 7 Aberdeen Heat and Power Company Ltd
Public spending during the next decade
Delivering cuts in carbon emissions
Developing new policies for
cutting carbon emissions
Energy: renewable energy planning policies 32
• Central Government
• Local councils
• 9 The London Plan
Low-carbon local government:
12 case studies
• 8 Gigha windmills (Dancing Ladies of Gigha)
• 10 Darlington: a Sustainable Travel Town
• 11 Brighton and Hove Buses
Transport: promotion of cleaner vehicles
• 12 Transport for London Hybrid Bus Programme
Housing insulation
• 2 Houston Residential Energy Efficiency
Transport: target to cut car journeys
Transport: target to cut car journeys
Housing insulation
• 1 Kirklees Warm Zone
Energy: renewable energy planning policies 30
references 38
Housing: retrofitting decentralised energy 22
• 3 Barkantine combined heat and power (CHP)
Building: retrofitting renewable energy
• 4
The London Transport Museum
photovoltaic project
Building: retrofitting renewable energy
• 5 Queen Victoria Market, Melbourne, Australia
executive summary
Friends of the Earth’s Get Serious About CO2 campaign
aims to drive a step-change in local action on climate
change by councils. Much greater speed and ambition
are needed in local emissions cuts if councils are to play
their part in meeting the national targets set out in the
Climate Change Act.
This report contains two pieces of research
commissioned by Friends of the Earth to help councils
take action. The first outlines how national Government
could free up more money for councils to take action on
climate change. The second details case studies of local
councils that have successfully funded green action.
1 How carbon savings can
be funded
For the first report, Friends of the Earth
has commissioned Tony Travers of
the London School of Economics to
investigate two related questions:
• What financial mechanisms can local
authorities currently use to pay for
low-carbon measures?
• What changes in national rules
are needed so they can access the
necessary funds?
Professor Travers sets out the
existing constraints as well as the
future pressures on local government
expenditure. His report describes
some key features of existing policies
for local authority work on carbon
reduction. This includes the new Carbon
Reduction Commitment, which applies
to emissions from the local authorities’
own estates.
The study then considers some of
the ways in which greater carbon
savings could be achieved through
existing programmes and investment,
such as private finance initiative (PFI)
credits and capital grants to transport.
The Building Schools for the Future
programme, for example, has been
better than some others in setting
energy-efficiency standards.
Professor Travers makes the
following points:
• L
ocal authorities already have powers
to increase business rates for specific
purposes, and they could use these to
fund, say, low-carbon transport. They
could also redirect existing transport
funding into low-carbon modes. And
they already have some powers to
apply local charges, including roadpricing.
• The Government could also increase
local financial powers. For example,
it could vary non-domestic rates
to encourage carbon savings by
businesses. Crucially, the Treasury
could encourage greater “prudential”
borrowing and investment in carbon
savings. It would do this by excluding
interest payments on such expenditure
from revenue totals for rate-capping
• The Government could also make it
easier for local authorities to impose
new charges and taxes that fund, or
create, incentives for carbon cutting.
It could allow Tax Increment Finance,
whereby the tax from rising property
values is invested locally. Greater
use could be made of Section
106 agreements and Community
Infrastructure Levies to fund local
• L
ocal authorities could also, singly or
collectively, provide green bonds or
even green mortgages to generate
local capital, and to encourage a
greater sense of local identification.
Professor Travers concludes that the
Comprehensive Area Assessment
provides a new opportunity to
encourage local authorities on climate
change. Local authorities can and
should use their existing powers and
freedoms, but central Government can
do more to encourage greater local
innovation and investment.
Friends of the Earth believes that new
sources of finance are essential if
local authorities are to maximise their
potential to cut emissions. Many of the
initiatives proposed in Professor Travers’
research require changes to current
funding systems and rules, rather than
new legislation. We therefore call on
the Government to consider seriously
these new financing mechanisms and
introduce them as soon as possible.
2 Case studies: 12 projects to
achieve carbon savings
It is important that people start to see
how cutting emissions could change
their area, and to provide practical
examples of what can be done.
There is a growing body of good
practice, across the UK and worldwide,
on how councils have successfully
funded green action. Various bodies,
including the Energy Saving Trust, have
tried to collate this. But it is still difficult
to find detailed case studies that cover
a range of key policy areas – including
organisational and financial information
– in one place.
Friends of the Earth therefore
commissioned Arup to research and
collate studies of some of the best
examples of carbon-reduction projects
and policies – together with relevant
data on carbon savings, costs and
benefits, and sources of finance. Arup
is a leading engineering and design
consultancy that has advised local
authorities on climate action plans, and
has also been involved in many of the
projects mentioned here.
We asked Arup to focus on policy
areas which Friends of the Earth
has identified as key.
The case studies begin with the
well-known Kirklees home energy
efficiency programme, which includes
more financial information than is
normally available. Added to this is an
interesting example from Houston in
the United States.
Arup’s study then considers combined
heat and power (CHP) and district
heating schemes: the new CHP facility
at Barkantine; the much older and larger
district heating and CHP scheme in
Southampton; and the CHP schemes
serving blocks of flats in Aberdeen.
It then addresses the problem of how
to treat heritage buildings, with two
examples of photovoltaic installations.
One is at the London Transport Museum
in London; the other at Queen Victoria
Market in Melbourne, Australia.
Community involvement in renewable
energy projects is increasingly important
in securing planning consent; the Gigha
wind farm is a classic example of this.
The Merton Rule has been a key driver
of energy efficiency and renewable
energy in new developments. The
carbon benefits of this across London
are outlined here.
We have two studies of car traffic
reduction: Brighton focuses on
improvements to the bus service.
Darlington focuses on personalised
travel planning.
Finally, we have a case study of the
introduction of low-carbon buses by
Transport for London. This emphasises
the procurement power of larger
authorities and how this can help to
drive the supply chain, enabling others
to benefit.
These case studies show that lowcarbon initiatives really work and can
be funded now. We are therefore calling
for all UK local councils to adopt similar
initiatives as part of their climate change
action plans, as part of a systematic
strategy to cut emissions in their area
in line with the scientific evidence of
what is needed.
Friends of the Earth
November 2009
get serious about CO2 – our campaign in a nutshell
The 2008 Climate Change Act is a
world-first law that resulted from Friends
of the Earth’s campaign The Big Ask,
which was supported by 200,000
people. The Act set out legally binding
carbon budgets and targets for carbon
dioxide (CO2) reduction by 2050, as
well as establishing the Committee
on Climate Change. The Committee
recommended that UK CO2 emissions
should be cut by 42 per cent by 2020.
40 per cent by 2020. Independent
research has shown that this level of
cuts is possible, and even before our
campaign, some local authorities had
already agreed targets that were this
ambitious. The Mayor of London has
adopted a target of 60 per cent cuts by
2025, for example, as has Birmingham
City Council. And since the launch of
the campaign, both Harrogate Council
and Haringey Council have committed
to cut emissions by 40 per cent by 2020.
Furthermore, the Tyndall Centre for
Climate Change Research has also
shown that 42 per cent is the minimum
UK contribution needed if we are to
have a reasonable chance of avoiding
runaway climate change.1
Across the country there are plenty of
examples where local authorities have
insulated homes, or built combined
heat and power plants or invested in
innovative green transport.
Friends of the Earth’s Get Serious
About CO2 campaign is making sure
that the cuts set out in the Climate
Change Act actually happen on the
ground. We are calling for every local
council to commit to cutting emissions
in their area by at least 40 per cent
by 2020, and produce an action plan
showing how it will deliver the cuts.
Those people in areas where their
council is already getting serious about
CO2 will soon start to feel the benefits.
By taking action on climate change,
local authorities can boost their local
economy, create jobs, slash fuel bills for
their communities, lift people out of fuel
poverty, reduce health problems and
improve public transport.
Local authorities have influence not
only over the emissions from their own
estates – but from homes, energy and
transport across their areas. And at
the heart of their communities, their
community leadership and placeshaping responsibilities give them a key
role in making decisions about which
low-carbon solutions are best suited to
which part of their area.
As well as calling on individual local
authorities to commit to cutting
emissions in their areas, Friends of
the Earth’s Get Serious About CO2
campaign is calling for a minimum level
of action for all local authorities, in line
with the latest science.
The science shows that rich countries
must cut their emissions by at least
The campaign is also calling for
the Government to make sure that
councils have access to the money and
information they need to make local cuts
in emissions.
Kirklees Council
A huge drive to insulate homes, such as that by Kirklees Council, will greatly reduce domestic emissions
Local Government, the Environment and the Future
Tony Travers
London School of Economics and Political Science
Public spending during the next decade
The financial crisis of 2008-09 and
subsequent recession have made it
certain that growth in public expenditure
will be sharply curtailed in the years
ahead. The major political parties
have stated their intention to continue
to deliver real terms increases in
the National Health Service and
international development budgets in
the next spending settlement. Education
may also receive some protection.
If these services are provided with
real increases at a time when overall
real expenditure is to be held or even
reduced, there will need to be efficiency
and innovation in the provision of
those spheres of provision that are
not protected. There is little doubt that
action to cut carbon emissions will
not be protected. Local government
as a whole will also face a freeze or
reduction in its spending.
Writing in the Daily Telegraph in the
early summer of 2009, Robert Chote,
the Director of the Institute for Fiscal
Studies, painted a bleak picture of
what lies ahead for public services. It is
worth quoting it at some length: “ … the
Budget shows total public spending set
to fall by an average of 0.1 per cent a
year… The outlook for public services
is bleaker still. Once the rising cost of
interest payments on the nation’s debts
is taken into account, along with social
security costs and other spending over
which the Treasury has little short-term
control, the ‘departmental expenditure
limits’ that cover central government
spending on public services and
administration will have to drop by
2.3 per cent a year in real terms, or
around 7 per cent by the third year. In
other words, they would need to be
£26 billion lower – in today’s terms – in
2013-14 than in 2010-11.”2
ways of doing things and innovative
possibilities for delivering more efficient
and environmentally sensible outcomes.
Councils will need to consider new
forms of investment and the possible
use of charging to deliver both
resources and behaviour change. If they
do not change and innovate, sharp cuts
across the board appear inevitable.
Local government, on the basis of
its recent past treatment, is likely to
find itself facing disproportionately
sharp reductions in expenditure. Many
councils are likely to face zero cash
grant increases for five or more years
ahead, coupled with very low council
tax increases enforced by the threat
of capping. Steve Bundred, Chief
Executive of the Audit Commission,
writing in The Times earlier in 2009,
stated: “… tax increases and spending
cuts are inevitable immediately after
the election, assuming that there are
signs of economic recovery by then
–and that is why any managers of a
public service who are not planning
now on the basis that they will have
substantially less money to spend
in two years time are living in cloudcuckoo-land.”3
Moreover, the pressure of public
expenditure constraints in the years
after 2010 will provide a stimulus
for councils to use resources more
efficiently and to work with other
local service-providers to improve the
productivity of public provision. The
Total Place initiative4, launched in
the spring of 2009, outlined ways in
which councils and other local public
providers could bring together their
resources so as to act more efficiently.
Hampshire County Council was cited as
an authority that had managed property
jointly for a number of councils so as
to reduce office space required and
thus increase energy efficiency. Total
Place could, if fully implemented, assist
local government in ensuring all local
providers delivered energy efficiency.
Public expenditure constraints will
inevitably put pressure on local
authorities in ways that can be seen as
both a threat and an opportunity. The
“opportunities” offered include new
Delivering cuts in Carbon emissions
Councils are often willing to make
policy changes that deliver improved
environmental performance including,
for example, reduced CO2 emissions.
However, individual authorities’
approaches to the issue will inevitably
be limited because many of them do not
have sufficient knowledge, resources or
incentives to act effectively. In the recent publication The UK
Low Carbon Transition Plan5, the
Government explained how the local
government performance framework
gives an opportunity for councils
and other local bodies to use Local
Area Agreements to deliver on
common objectives. According to the
Government, 97 per cent of areas have
chosen to set targets against at least
one of three climate change indicators.
Looking ahead, ministers stated that
they will consult about the role that local
authorities can play in meeting national
carbon budgets and how this might
work at the local level. The possibility
of new powers and flexibilities to help
councils achieve such results was
also suggested.
The Local Democracy Economic
Development and Construction Bill “will
require each English region to develop
a new single Regional Strategy, which
must include plans to tackle climate
change”. The Government now wants
to encourage local authorities and other
local bodies “in bringing forward more
community-scale heat and electricity
generation. For example, community
heating provides 2 per cent of heating
needs in the UK, but it could play a
bigger role up to 14 per cent”. The
Government now expects local councils
“to incorporate energy planning into
their decision making processes,
through the Climate Change Planning
Policy Statement”. In the 2009 Budget,
the Government announced £25 million
to help fund community heating
infrastructure, including at least 10
exemplar schemes across the country.
The Government will work with the
Local Government Association to
extend heat mapping, to potentially give
councils more powers to require new
developments to connect to heating
schemes and, thirdly, to attempt to
ensure new power stations provide
combined heat and power output
for customers. The Government has
worked with the energy regulator to
make it easier for community energy
schemes to interact with the wider
electricity system. Funding has
been provided to create a guide for
community energy developments.
The Government has stated it “will
clarify the scope for local authorities
to establish rolling investment funds,
including through their own borrowing,
designed to permit individuals and
groups in their areas to fund schemes”.6
The key issue here will be the extent
to which councils are able to borrow in
such a way that will not lead to a risk
of consequent revenue costs creating
a risk the authority will be capped.
That is, even if the Government
clarifies the position of councils to
“establish rolling investment funds”,
the operation of the existing local
government revenue funding system
would mean that any on-going interest
charges or other costs related to the
investment would automatically add to
the council’s current spending figure
used in relation to the Government’s
capping regime. Few, if any, councils
would be likely to incur borrowing that
risked squeezing out existing revenue
spending. Unless the Government
exempted the revenue consequences
of borrowing to fund community
energy schemes, few councils are
likely to deliver them. In an earlier report, the Government
outlined a range of actions local
government could be involved in to
address the issue of climate change. In
the Energy Measures Report, published
in 2007, the Department for Business,
Enterprise and Regulatory Reform
suggested councils could use their
prudential borrowing powers, stating,
“This can be very useful in supporting
plans to increase energy efficiency
in the council’s own estate and
operations.”7 Of course, these powers
are precisely the ones discussed above,
where the use of borrowing powers
will be circumscribed by the threat of
council tax capping if additional debt
charges are incurred.
The Energy Measures Report listed the
main opportunities available to local
authorities in tackling climate change.
Such opportunities were identified in the
following spheres of provision:
Community leadership
Community planning
Schools and education
Transport in the community
Own estate and operations
Civic and amenity buildings
Council housing
Finance and procurement
Service delivery
Social care
Economic development.
Proposals within each area of service
provision included engagement with
the public on issues relating to climate
change and the use of resources, and
the better use of services such as
public transport and public buildings.
The list of services and proposals was
more a checklist than a detailed plan of
action. Local councils were expected to
work up their own programme on the
basis of the Government’s list.
The Local Government Association
(LGA) has provided leadership in
identifying good practice within
authorities that are already delivering
CO2 reductions, and has provided
information about what steps might
be needed to encourage many more
councils to adopt similar policies.
The LGA has also made efforts to
encourage all its members to achieve
the following objectives:
• All local area agreements should
contain at least one target relating to
climate change
• All councils should signing the
Nottingham Declaration or its
• C
ollectively to reduce their carbon
footprint by 1.5 million tonnes
• C
ollectively to reduce emissions by
32 million tonnes
• To have an understanding of how
climate risks affect core service
delivery, infrastructure, assets and the
well-being of local communities by
the end of 2011.
Of course, it is in the nature of local
government that individual authorities
will move faster or more slowly
towards any particular objective. The
best authorities will develop good
policy and implement it ahead of the
majority. Woking is generally cited as
the first UK authority to have adopted a
comprehensive climate change strategy
sufficient to meet the Royal Commission
on Environmental Pollution targets of 60
per cent reductions of CO2 equivalent
emissions by 2050 and 80 per cent by 2100. However, other councils are
making their own contribution to policy
development and, thus, to a reduced
environmental impact.
The Local Government Information
Unit (LGIU) has undertaken a project
on the operation of a carbon trading
scheme within local government. Such
a scheme will start in 2009. In its
review of a “shadow trading” carbon
trading arrangement, started in 2008,
the LGIU was able to draw conclusions
about a real scheme. “Carbon Trading
Councils… was based on a simulation
of a carbon trading market that
allowed local councils to learn about
trading in a safe environment. The
framework… mirrors a real trading
scheme – operating in real time, with
real emissions data and real carbon
reduction projects. The main difference
being that carbon allowances are
negotiated with a monetary value, but
no actual money is exchanged. This
allows councils to test strategies and
take risks. Councils completed their
first year of trading in July 2009. Their
experience shows the pressure points
and opportunities of entering a cap and
trade scheme. There is no doubt that
most organisations will need to take a
good look at their energy management
so they can bridge the gap between
their current position and the rigour of
the Carbon Reduction Commitment.”8
The LGIU work suggested that councils
need to do more to involve a wider
range of people across the institution
and also to improve the monitoring
and audit of the policy. The report also
encouraged local authorities to move
beyond their own estate and activities
so as to encourage local residents
and businesses to become involved in
carbon reduction. Looking ahead, councils will need to be
creative in the use of their financial and
general powers in the years ahead. Not
all policies require additional money to
deliver them. Similarly, local authorities
could lobby for additional powers that
would give them the flexibility to improve
their environmental performance. The
next section considers possible options
for councils to pursue, either individually
or collectively.
Developing new policies for cutting
carbon emissions
Existing legislation, regulations and
the wider public policy framework
are not “neutral” in relation to cutting
carbon emissions. Laws and regulatory
frameworks created in the past
create incentives and disincentives
that randomly impact upon, say, CO2
emissions. A policy to close schools
with spare places may create a demand
for additional car use. Planning policies
may encourage low-density out-of-town
developments that discourage public
transport use. VAT rules encourage new
development as opposed to the re-use
of existing properties. Local government is subject to many
financial systems and regulatory
frameworks. It can itself determine rules
and funding systems that encourage
(or discourage) behaviour in others.
The policy changes discussed below
are examples of how the Government
and local councils could amend policy,
funding systems or rules so as to bring
about great cuts in carbon emissions.
None would be expensive. Indeed, they
are explicitly suggested in the context
of the expected public expenditure
constraints that lie ahead. Some
proposals are aimed at Whitehall and
others at local councils themselves.
Central Government
Initiatives deliverable within current
It would be possible to allocate existing
capital grants and PFI credits so as to
provide incentives for carbon-cutting
forms of behaviour, in particular in
relation to transport, waste and housing.
Whitehall could use its capital support
in such a way as to encourage district
heating, transport modes and housebuilding that reduced CO2 emissions
and/or other environmental benefits.
There might also be a benefit to giving
relative priority to local schemes
because these would allow the public to
see at first hand how change was being
made. Resources, particularly capital
grants, could be shifted from national to
local government budgets so as to allow
local public support for cutting carbon
emissions to bear directly on their use. In 2009-10, capital grants to local
government are expected to total £2,134
million, with the transport receiving
the biggest central support. Table 3
below shows capital grants for each
major service in 2009-10. Transport
and housing are the largest totals.
By transferring grants from central to
local government, Whitehall would be
able to ensure local pressures for, say,
improved property insulation could be
met by councils.
PFI credits provided to local authorities
in England in 2008-09 (the last year
for which there are figures) totalled
£1.992 billion, slightly higher than in the
previous two years. The serviceby-service breakdown is shown in
Table 4 below.
Schools are currently by far the biggest
recipients of PFI credits within local
government. The Government, in
developing its Building Schools for the
Future strategy, has required good
design standards as an element in
the programme. The Commission
for Architecture and the Built
Environment (CABE) has worked with
the Department for Children, Schools
and Families to deliver a required
Minimum Design Standard for all new
schools built within the programme. Environmental performance including
CO2 emissions is an element in the
Minimum Design Standard.9
Table 3 Capital grants to
local government in England,
2009-10, £m
Highways & transport
Social services
Planning &
Table 4 PFI credits given
to local government in
England, 2008-09, £m
PFI credits
Social services
Fire & rescue
Central services
Source: Department for Communities and Local Government,
Statistical Release Local Authority Capital Expenditure and
Receipts, July 2009, Table 3b
Source: Department for Communities and Local Government,
Local Government Financial Statistics England No 19, Table 4.7a
Developing new policies for cutting carbon emissions
Local government already suffers a
significant amount of central direction,
so any change to the allocation of
grants or PFI credits should not be
a matter of extending Whitehall or
quango control still further. Rather,
the Government needs to examine its
entire suite of grants and other capital
resources – such as PFI credits – with a
view to delivering more outputs through
local government. In the allocation of
such resources, the Government could
give priority to encouraging better use
of natural resources and reducing
emissions. Such a change would
increase the likelihood that councils
would deliver improved capital assets
at the highest possible environmental
standard. The Government could
provide guidance and assistance,
leaving local government to implement
policy in a locally-sensitive way. Central Government could also amend
the operation of the national nondomestic rate so as to allow councils
to create incentives for cutting carbon
emissions. There are already powers
to allow authorities to assist charities
and rural shops by reducing nondomestic rate payments. It would be
relatively easy to allow councils to
reduce the level of NNDR payments of
businesses that adapt their buildings
and/or activities so as to reduce their
carbon emissions. Authorities could then
encourage businesses to reduce their
carbon emissions by providing short or
longer-term discounts for companies
that change their behaviour. In 2008-09,
councils gave mandatory relief totalling
£1.869 billion, plus further discretionary
relief of £39.4 million. If the Government allowed councils
to offer such incentives, it would be
important that the Government itself
allowed authorities to “net off” the total
of the NNDR foregone from payments
to the national pool of NNDR receipts.
Otherwise, the impact of any NNDR
discount would be borne by local council
taxpayers. In effect, the Government
would provide an opportunity for
councils to incentivise environmental
efficiency at zero cost to local taxpayers.
The overall impact on the national
NNDR pool would depend on the
number of authorities that chose to
offer incentives. The Government would
then have to decide, as at present, on
the overall level of external support to
councils, including NNDR.
The Government has recently
legislated to introduce a Business Rate
Supplement (BRS) which will allow
councils to raise an additional nondomestic rate up to 2p in the £. The
Mayor of London is to use this power
to fund debt charges on borrowing
to part-fund the east-west Crossrail
project in London. Crossrail is likely to
have significant environmental benefits,
including reduced carbon emissions,
partly because it will allow clustering
of economic activity in relatively
densely-populated parts of the country
and partly because it will help switch
people from cars to public transport.
The BRS could be used in a similar
way elsewhere to fund public transport
or other major projects to improve the
infrastructure. Another way of encouraging carbon
emissions cuts would be by allowing
councils greater freedom to incur
capital expenditure of particular,
environmentally-related, kinds whose
interest costs would not then count
against revenue expenditure for capping
purposes. Since the introduction of
the “prudential rules” based system
of capital expenditure control in 2004,
it has been possible for councils to
undertake new capital expenditure
so long, broadly, as the authority
concerned was not over-indebted and
would be able to make the necessary
repayments. However, because any
additional interest charges generated
score as revenue spending, there
is a risk that new capital spending
commitments will require higher
council tax levels than would have
been required if the additional capital
expenditure had not occurred.
The scale of local government’s
expected capital expenditure in 2009-10
is shown in Table 5 below.
Table 5 Local government
capital expenditure in
England, 2009-10, £m
PFI credits
Highways & transport
f which:
Social services
Recreation & sport
Note: the expenditure totals for services shown within “Other” (eg,
social services) are differently presented on a different accounting
basis to the “Other” total. They thus do not add up to the total.
Source: Department for Communities and Local Government,
Statistical Release Local Authority Capital Expenditure and
Receipts, July 2009, Table 2
Developing new policies for cutting carbon emissions
It would be possible for the Government
to determine, for example, that revenue
expenditure required to fund the interest
payments on investments designed
to reduce carbon consumption and
emissions would not “score” for council
tax purposes. In effect, councils
would be allowed to set council taxes
marginally above any Governmentimposed capping level if the additional
tax amount was to fund interest on
particular items of expenditure. The
local authority’s external auditor could
guarantee any such items were being
charged appropriately.
The figures shown in Table 5 suggest
that if councils were given greater
freedom to fund capital spending by
exempting certain kinds of debt charge
expenditure from the revenue totals that
are used for capping purposes, even a
five per cent rise in capital expenditure
would be over £1 billion per year. A 10 per cent increase would lead to
an additional capital spending total of
over £2 billion. Such sums devoted to
environmentally-related improvements,
including reducing CO2 emissions,
would have a double advantage: an
energy-saving benefit coupled with
greater local government freedom. Initiatives requiring new legislation
The Government could also remove
impediments to introducing new
charges or taxes that would create
incentives for particular behaviour.10
The Lyons Inquiry, which reported in
2007, proposed that councils should
have greater freedom to set smaller
local revenues or charges that, among
other things, might encourage different
behaviour . The Eddington Review of
transport policy, published shortly before
Lyons, had made similar suggestions.11
The Local Government Association has
long supported the idea that councils
should be given greater powers to raise
local revenues, including from new
taxes and charges.
The Government could introduce
legislation that allowed councils to
introduce new taxes or charges related
to the environment. For example, local
levies on pollution, airports or fuel for
vehicles could be envisaged. Road
pricing and off-street parking charges
are already possible under existing law,
as are charges for waste collection.
However, experience of local
government efforts to use road pricing/
congestion charging and waste charges
beg questions of a different kind for
central Government. If councils wish
to use new, smaller, taxes or charges
to create incentives of particular kinds
it would be important that national
Government and politicians did not
then impede any such reforms. The
proposals by some councils to move to
different patterns of refuse collection
or to charge for waste collection taking
account of the weight of material thrown
away, has generated opposition from a
number of leading national politicians.
If central Government is serious about
reducing environmental impacts, it must
ensure it (and its politicians) do not
impede local innovation. The Government could take steps to
allow local government to use new
forms of investment vehicle, such as
tax increment finance (TIF), that would
allow councils to invest in assets that
would reduce carbon emissions in
such a way as to produce efficiency
gains that would raise land values
and thus the potential to “capture”
increased taxation so as to pay for the
investment. Business Rate Supplement
income could also be used to part-fund
such projects. The Centre for Cities
has proposed the use of TIF to allow
councils to undertake regeneration
projects that might not otherwise
be delivered.12
In the Chancellor’s 2009 Budget, the
possibility that Birmingham City Council
might use a TIF-type arrangement to
rebuild Birmingham New Street station
was considered.13 The scheme would
be paid for by the yield of taxes from
developments around the station that
would take place only if the station
improvements were delivered. Such
an arrangement could also be used by
councils to develop and deliver projects
where the returns from investment, in
terms of lower energy use and other
savings, would mean a local project
would produce savings that would
pay for the interest charges on the
borrowing needed to allow the project
to go ahead. Because of the potential
for savings resulting from effective
environmental projects, TIF-type
schemes could undoubtedly help in
delivering improved outcomes. Local councils
Local authorities could re-invest existing
local resources so as to shift activities
from high-carbon to low-carbon
outcomes, for example, councils might
revise transport strategies so as actively
to encourage low-carbon modes. The
key to any progress is the extent to
which councils have the evidence-base
that would allow them to use resources
differently so as to change resource
use. It is in this sphere of activity that
local authorities would probably benefit
most from guidance and examples of
how changes might be made to existing
practice. Councils could also examine the case
for using Section 106-type resources
(produced by new developments)
Developing new policies for cutting carbon emissions
specifically to ensure developments
meet improved carbon emissions
standards or to build district heating
systems. Of course, in the short
term, while the economy is in deep
recession, the number and value of
new developments yielding Section 106
contributions will be much diminished.
But once the economy starts to grow
again it would be possible to add new
environmental requirements to Section
106 deals or, alternatively, to make
demands for Community Infrastructure
Levy (CIL) payments that would allow
improved environmental performance.
However, it is important to be realistic
about how much can be sought from
any particular Section 106 or CILtype contribution. In the foreseeable
future, private developers are likely
to find it hard to find financial backing
for many of their projects. Any threat
to profitability, for example by overzealous demands for additional
facilities or payments funded by
private developments, could reduce
the chance that such projects will
start. This problem is not unique to
environmental demands. It is part of a
wider set of difficulties linked to likely
increased dependency in future on
private developments at a time when
profitability may be lower than in the
boom years of the late 1990s and
early 2000s. Finally, linked to the possibility of
additional freedoms for councils to
invest to deliver carbon emission cuts
(as discussed above), would be the
possibility for local authorities to issue
bonds to fund projects designed to
improve environmental performance by,
for example, reducing CO2 emissions.
Smaller authorities might work jointly, or
at the sub-regional level, to issue bonds.
Although councils generally prefer to
raise capital resources from the Public
Works Loans Board (because it is
generally cheaper) there are examples
of councils issuing bonds to fund capital
investment. In the past, local authorities
regularly used such instruments.
The benefit of using bonds in this way
is that the conditions attached to the
bond would provide pressure for the
delivery of a high-quality project. Bond
issuers are required to report to bondholders about the delivery of assets
and infrastructure. There would also be
an opportunity for councils to convince
people that they should invest in local
bonds to fund local projects, thus
creating stronger civic engagement.
Bonds would be less likely to contribute
to economic “bubbles” and wider capital
market problems. “Green bonds” could
have explicit terms and conditions
written into them that bound the issuer
to achieving particular environmental
objectives with the resources
raised. Such schemes might include
improvements to local public transport
or the creation of district heating or
energy-generation capacity. Bodies such as the Carbon Trust and
companies like Salix will be able to work
with councils in funding experimentation
and new funding approaches.
Resources are already available for
initiatives of this kind, though there is
sometimes a risk that one Government
objective, such as limiting council tax
increases, gets in the way of others,
such as rebuilding infrastructure so as
to improve environmental performance.
Indeed, across the board, there is need
for Whitehall to realise that a number
of controls over local government have
the effect of impeding innovation and
therefore making re-investment less
likely than if local government was less
The proposals considered in this
paper are not radical or revolutionary,
though they could be steps towards
local authorities playing their full role
in the low carbon revolution. The ideas
discussed in this paper are intended to
promote greater local autonomy and
decision-making to encourage bolder
local action to cut carbon emissions.
Because there are some 500 local
authorities in the United Kingdom,
experimentation among them will lead
to change that is likely to move more
quickly to adopt new ideas. The country
would not have to wait for central
Government, eventually, to make a
change. Localism means progress. The
modest changes and reforms proposed
here would assist councils to make
progress more quickly.
The new Comprehensive Area
Assessment will also provide an
opportunity for the Audit Commission,
which is developing the policy, to
encourage councils and other local
partners to deliver environmental
objectives, including policies leading
to a reduction in carbon emissions. The CAA regime will consider the
achievements of not only local
government but also local health, police,
fire and other providers. It is intended to
include environmental measures within
CAA though the wider future of public
sector regulation, including CAA, is
clearly uncertain. reduce carbon consumption. In reality,
councils still have reasonable autonomy
in the way they organise their own
activities and also in their capacity to
encourage particular forms of behaviour
by their residents and businesses.
Cutting carbon emissions is a sphere of
activity where local government still has
the capacity to lead and deliver.
Tony Travers is director of the Greater
London Group, a research centre at the
London School of Economics. His key
research interests are local and regional
government and public service reform.
But the Government also needs to
signal its willingness to move in the
direction of greater freedom, so as
to encourage local authorities to be
more innovatory and to be willing to
initiate more new projects. If lifestyles
and infrastructure are to adapt and to
reduce their impact on the environment,
reinvestment and change will be
needed. There must be a risk that, as
the Government cuts capital spending
in the years ahead, less progress will be
possible. Relatively modest increases
in local autonomy would be a counterbalance. Overwhelmingly, action will
need to be taken in peoples’ homes and
the streets that surround them. Local
government is a key element in reducing
carbon emissions. Local authorities in Britain still have
significant freedoms – if they choose
to use them. After many years of
centralisation and the growth of a
perception that councils have lost much
of their freedom to act, it would be all
too easy to imagine that local authorities
had no capacity to make the kind of
changes required as a result of climate
change and/or the need to take action to
Low carbon local government
12 case studies
This report details a range of case studies that illustrate
best-practice in delivering significant greenhouse gas
reductions. From local authorities in the UK, to cities around
the world and ranging from a small island community to one
of the world’s largest metropolises, the examples chosen
demonstrate real innovation and leadership in tackling climate
change. Despite their geographical and policy breadth, the
key elements of all these programmes could be replicated in a
typical British local authority.
It is impossible to look at the
programmes detailed in this report
and not notice the strong generic
themes which emerge. While each
local authority faces distinctive
issues and will have to develop a
set of policies that is specific to its
own circumstances, the strategy
that emerges is likely to be a unique
combination of elements that are
universal to many other local authorities.
There is, therefore, great value for
most local authorities in learning from
best practice elsewhere, particularly
in economically straightened times
when there is an increased premium
on achieving maximum efficiency from
public spending. Innovation inevitably
involves risk. The chances of success
are far greater if one has success (and
failure) elsewhere to learn from.
Every local authority will need to
develop a whole suite of policies to
reduce greenhouse gas emissions,
covering every sector of the local
economy and across a broad swathe
of daily of life. There is no single policy
that will be sufficient in isolation to
realise the increasingly tough emissions
reductions that the best available
science tells us is necessary to avoid
catastrophic climate change.
This report considers best practice from
around the world in key policy areas
(housing retrofit, transport modal shift,
planning regulations, distributed energy
supply, building mounted renewables
and cleaner road vehicles) which are
likely to be generic to the widest range
of local authorities and which, if taken
together, could constitute the basis for a
comprehensive climate change strategy
for a local authority.
In reviewing best practice on climate
change by local authorities for this
report, a number of key themes
have emerged:
• The technical barriers to introducing
strong greenhouse gas emissions
policies are relatively minor.
The biggest determinant of
success is strong political or
officer leadership.
• For example, it is often repeated
within local authority circles that the
policies successfully applied in the
“leading” authorities are the product
of “special circumstances” or unique
funding opportunities. But officers we
spoke to in these “leading” authorities
were consistent in arguing that, on
the contrary, they didn’t feel that
they had done anything particularly
difficult, that the mechanisms they
had used are available to most of
their peers, and thus they couldn’t
understand why more authorities
hadn’t done something similar.
• If one applies a simple energy
hierarchy approach to tackling
climate change – first attempting to
reduce demand for energy (or put
another way, cut out the wasteful
use of energy); second maximise
efficiency of energy supply (thus the
focus on combined heat power and
cooling) – then the third element, of
meeting residual energy demand
through renewable energy sources,
becomes less daunting, both
technologically and financially.
• Furthermore, there are significant
financial and other societal benefits to
many energy efficiency measures, of
which building retrofit is perhaps the
clearest example, in both generating
significant household savings,
creating local jobs and stimulating
spending in the local economy. This
all fits well with local authorities’ core
purposes. However it is necessary
to take an investment horizon that is
perhaps slightly longer than normal
(five or six years) to realise this.
• W
hile there are many local authorities
that have pioneered one or two really
successful greenhouse gas emission
reduction programmes, there are very
few authorities that are on track to
deliver a fully comprehensive climate
mitigation programme, sufficient
to properly contribute to meeting
the UK’s rightly challenging carbon
emission reduction targets. There
is likely to be significant first-moveradvantage for those authorities which
step up to this task most quickly and
efficiently – and, of course, potentially
large disbenefits for those authorities
that are left behind.
• Finally, while there are many great
examples of innovation, local
leadership alone is not delivering
the across-the-board local authority
12 case studies
action needed to tackle climate
change. Ultimately to achieve the
tough emission reductions required,
at the pace needed, it is inevitable
that central Government will need to
set the level of ambition of emissions
reduction that local authorities must
have responsibility for meeting. How
the emissions cuts are achieved is
best determined at a local level, but
the scale of change required is so
significant that this has to be
a national effort in which every local
authority participates.
There is a long tradition in UK local
government of success in improving
the public realm and raising quality of
life. From education, to health care,
to transport and sewerage, it has
frequently been municipal authorities
that have innovated and found
inspirational new ways of tackling the
problems that have emerged out of
industrialisation and urbanisation.
There has been no challenge bigger
than that posed by climate change, and
local authorities again need to rise to
the task and play their full role in the
transition to a low carbon economy. We
welcome the opportunity provided by
Friends of the Earth for us to contribute
to responding to this challenge.
Mark Watts, Director, Arup
The case studies
Kirklees Warm Zone
The most successful and
comprehensive home insulation
programme of any local authority in
the UK. Kirklees is the only council
that offers all of its residents free
home insulation (by 2010).
Houston Residential Energy
Efficiency Programme
An innovative example from the United
States of a partnership between a
private sector electricity utility and
a local authority.
Barkantine combined heat
and power (CHP)
A successful combined heat and
power (CHP) system to a mix of
consumers, that also demonstrates
a successful partnership between
a private energy utility and a
local authority.
Photovoltaics at London
Transport Museum and Queen
Victoria Market, Melbourne
From opposite sides of the world,
two of the few examples of the
successful installation of photovoltaics
on a heritage building, demonstrating
the technical feasibility for the large
number of UK local authorities who
have grade listed buildings within their
Southampton District Energy
The largest commercially developed
district energy scheme in the UK and
a pioneer of geothermal energy.
Aberdeen Heat and Power
Company Ltd
Another successful CHP programme,
that has also incubated a local job
creation and training programme.
Gigha Windmills
A truly community-based renewable
energy project, where the financial
gains from renewable energy are used
to achieve wider local aims.
The London Plan renewable
energy targets
Darlington: a Sustainable
Travel Town
The first of the Sustainable Travel
Towns to publish its results,
demonstrating important lessons
for other local authorities, particularly
in relation to Individualised
Travel Marketing.
Brighton and Hove Buses
An award-winning transport
programme that has made Brighton,
along with London, one of the few
authorities in the UK to achieve a
modal shift away from car usage to
public transport, walking and cycling.
London Hybrid Bus
This has pioneered hybrid bus usage
in the UK. Given the size of London’s
bus fleet, what happens in the capital
to a large extent determines the UK
bus market.
The UK pioneer (along with Merton
Borough Council) of using planning
powers to drive greater installation of
renewable energy and CHP supply in
new developments.
housing Insulation Case study 1: Kirklees Warm Zone14
Kirklees Council
Kirklees Warm Zone scheme, which
recently won the Ashden Award for the
best local authority sustainable energy
scheme in the UK, is the largest local
authority home insulation scheme in
the UK. Funded by Kirklees Council, it
offers free loft and cavity wall insulation
to every household in Kirklees. It aims
to make every home in Kirklees warmer,
more comfortable and less energy
intensive over a three-year period – in
order to reduce energy bills and reduce
carbon emissions.
The project has reduced around 28,000
tonnes of CO2 per year (June 2009),
and it is estimated that it will reduce up
to 55,000 tonnes per year by the end of
the project.
The programme involves assessing
all households, street by street within
wards. The households are approached
using contact with community and
voluntary groups, intensive marketing
and direct mail. Trained assessors
carry out door-to-door visits to check
insulation status. If additional insulation
is required, a contractor installs mineralfibre insulation in lofts and cavity walls,
at no cost to the home owner.
There are many funding programmes
across the UK set up to provide costeffective domestic energy efficiency
measures, particularly for priority
households in fuel poverty. However,
some contribution is required from those
households who are regarded as able
to pay, and even a minimal cost has
been found to deter households from
upgrading their insulation. Kirklees
has achieved a much higher take-up
through installing insulation at no cost
at all to households.
Kirklees’ offer of free insulation to all households ensured a good response
The area-based approach has
increased contractor productivity by 50
per cent, as geographically scattered
installation approaches can incur
significant travel time for surveyors
and installers.
• To tackle fuel poverty
• Deliver a low carbon Kirklees
• Improve the uptake of state benefit
support by residents
• To create jobs
Kirklees also uses the door-to-door
visits to raise awareness of other
council services, leading to significant
increases in uptake, for example of
benefits by vulnerable citizens.
Kirklees Warm Zone relies on two of
the simplest and most cost-effective
measures to reduce energy use and
carbon emissions from homes:
cavity wall and loft insulation, using
In 2006 it was estimated that there
were around 35,000-45,000 homes in
fuel poverty in Kirklees. The council’s
Affordable Warmth Strategy was
adopted in 2007 to work in partnership
with relevant organisations in all
sectors, to tackle four main areas of
concern – the local authority housing
stock, vulnerable residents with health
issues, financial inclusion and improving
awareness and education.
In setting up the Kirklees Warm Zone,
the council aimed to set up a one-stop
approach to improve the domestic
energy efficiency of housing across the
local authority with four main aims:
Funding and financing
Total cost
Circa £20million over a three-year
programme, confirmed at the start of
the project in February 2007.
Breakdown of expenditure
The current average cost per measure
installed is approximately £224.
Sources of funding
Circa £11million Carbon Emissions
Reduction Target (CERT) funding from
Scottish Power and £9million from
Kirklees Council from its Capital Plan.
The Capital Plan is funded by a complex
kirkless warm zone
mix of grants, revenue contributions,
capital receipts and borrowing, but
for most projects the type of funding
is not hypothecated to the projects
themselves. In other words the council
funds the plan as a whole rather than
its constituent parts. However, Warm
Zone was in effect funded by additional
prudential borrowing – as part of the
overall Capital Plan.
Key partners
• Scottish Power is the main co-funder.
• National Grid is a co-funder and
supplied resources to develop the
business case.
• Yorkshire Energy Services (YES)
is the managing agent. It provided
premises and equipment and
integrated Warm Zone into
its business.
• W
arm Zones Ltd provided:
consultancy support, methodology,
case studies, contact with other Warm
Zones and networking opportunities
with potential partners.
• M
iller Pattison is the insulation
• The Citizens Advice Bureau,
Kirklees Benefits Advice Service,
The Pensions Service and Revenues
and Benefits offer benefits and/or
debt advice.
• W
est Yorkshire Fire Service provides
fire safety checks and smoke alarms.
• Yorkshire Water provides water
conservation advice.
• C
arers Gateway offers support to
people who care for friends or family.
• S
afelincs is the contractor appointed
to supply the carbon monoxide
• Energy Saving Trust advice packs.
• 32,068 households received an
insulation measure up to June 2009.
This is 51 per cent of all households
surveyed by contractor; 85 per cent
received loft insulation and 15 per
cent received cavity insulation.
• Insulation measures will save the
average household £200 per year
on their fuel bills.
• 28,000 tonnes of CO2 per year have
been avoided (June 2009).
Economic benefits
• E
stimated that every £1 invested
returns £4 into the local economy.
• Total householder fuel savings are
around £6.5m per annum (June
2009), but this should increase once
the scheme is completed.
• YES has employed 11 full-time staff;
Miller Pattison has taken on 85 new
staff and has built a new depot and
training centre in Cleckheaton. More
than 200 fitters have been trained
so far.
• YES has taken on 38 self-employed
assessors (July 09).
• A further seven jobs have been
generated or are dedicated to the
Warm Zone in Kirklees Council, the
Citizen’s Advice Bureau, Scottish
Power and Safelincs the carbon
monoxide provider.
• 1
17 households identified as
eligible for additional benefits – with
an average increase of £2,809. £328,642 of increased benefit
uptake as a result of the scheme.
• Average increase to date of SAP
rating from 47 to 51.15
• S
ix lives potentially saved as a result
of activation of carbon monoxide
detectors in two properties.
• M
ore than 40,000 households have
been referred for measures such
as benefits advice, water saving and
fire safety.
• 1
,700 households have been referred
for Warm Front grants for heating
system improvements.
Customer feedback
• As of 2 September 2009, 105,183
Kirklees households have signed up
to the Warm Zone scheme, which
in itself provides evidence that local
people are positive about the scheme.
• 2
9,384 customer satisfaction forms
have been sent out, with 10,581
returned. Key headline findings
are that Miller Pattison is achieving
93.8 per cent of all appointments
for surveying and 87.6 per cent for
installation. The overall customer
experience is ranked as Good for
the Warm Zone. • M
any customers have given
additional positive comments
about the scheme on the customer
satisfaction forms. For example:
“All in all a very good service from
start to finish by all members of
the Warm Zone team.”
“ This is a great scheme.
Many thanks.”
“ The whole process ran smoothly
from start to finish – a job well done. Thank you to all concerned.”
“ Very pleased with the work
undertaken by the installation team.
Very friendly bunch of lads. Treat
people in the manner and they do
a good job for you with a smile.”
“ Very efficient, polite and workmanlike
service by all concerned from first visit
to installation.”
• K
irklees Warm Zone has a knock-on
effect on the behaviour of customers
– directly through having a well
insulated home, which means they
can turn their heating down; and
indirectly by making them more aware
of how they could be more energy
efficient in their homes.
ome of the comments made by
customers include:
“ The Warm Zone scheme has helped
me realise the importance of energy
efficiency in my own life. I had always
been a bit shy of things like energy
saving light bulbs... but since using
the ones Warm Zone sent, I now put
them up everywhere. Out of it all I feel
I have developed an understanding
of a carbon footprint. I have
grandchildren and it makes you think
what it is going to be like for them in
the future. The whole thing has raised
my awareness which is one thing I thought I would never be bothered
“ I now turn my boiler down as the
house keeps the heat in. The whole
place is very warm. Kirklees Warm
Zone is extremely good, they are
friendly and have excellent customer
service. As a parent and a worker
I’m very busy, but the whole project
worked around me.”
“ Kirklees Warm Zone is saving
people’s money and lives. They have
put a lot of thought into it... it really is
a good scheme.”
“ It certainly feels warmer. We now
turn our heating down which we never
used to do.”
Barriers to replication by other local
None – Kirklees has used existing
local authority powers and budgets and
taken advantage of a national energy
efficiency scheme.
Replicable funding sources
CERT and
Funding), Prudential Borrowing
More information
Case study contact
Dr Philip Webber. Tel: 01484 223568.
Email: [email protected]
Housing Insulation
Case study 2: Houston Residential Energy Efficiency Programme16
In 2006 the US City of Houston
embarked on a pilot project to improve
the quality of life of residents in lowincome neighbourhoods, by reducing
energy consumption, electricity bills
and CO2 emissions. The city began in
the community of Pleasantville, piloting
free energy efficiency improvements
in an area where homes were largely
built in the 1950s and 1960s and in
such a way that they were expensive to
heat and cool.17 The scheme has since
been expanded to nine neighbourhoods
across the city.
The city of Houston partnered
with Centerpoint (a local electricity
distribution company which owns all the
city’s transmission and distribution lines)
and has now delivered free energy
efficiency retrofits to 5,300 low-income
homes. The city’s goal is to have 8,000
“weatherized” (insulated) homes by the
end of 2009.
Although 90 per cent of recipient
households own their own homes,
these residents found it difficult to selffinance energy improvements, and were
receptive to the offer because of the
reduction in their energy bills.
The city has found that the programme
can be delivered in an affordable
way, using existing budgets and staff
expertise to leverage core funding
through a partnership with a private
energy utility, Centrepoint.
The programme tackles one
neighbourhood at a time. This
community-based approach allows
the programme greater efficiency by
concentrating efforts in one area before
moving on to the next. Neighbours can
share experiences with one another,
which promotes the programme
and educates everyone about the
importance of energy efficiency. The
programme also made use of an
educational website.
The main technologies used are
some of the simplest domestic energy
efficiency measures, including:
caulking of windows, insulation
and draught proofing.
houston residential energy efficiency programme
Funding and financing
Total cost
Estimated at around $9.8 million
(£6.02 million)
On average, in homes that have been
weatherized as part of the scheme,
electricity usage has fallen by 12 per
cent each month. During the summer
when electricity bills are higher,
homeowners witnessed reductions of
up to 20 per cent, saving households
up to $870 (approx £520) annually.18
Barriers to replication by other local
This is a US scheme but the mechanism
used (ie a partnership with a private
energy utility to take advantage of their
legal responsibility to deliver energy
efficiency measures) is highly relevant
to the UK.
Breakdown of expenditure
The insulation measures cost
approximately $1,400 (c£860) per
house, paid by Centerpoint; 7,000
homes have so far been fitted.
Sources of funding
All financial investment is made by
Centerpoint, with the City of Houston
providing in-kind support.
Funding structure
Centerpoint provides financial
investment, and the City of Houston
provided dedicated staff to work on
the project.
Key partners
The key partner to the City has
been Centerpoint, the sole electricity
transmission and distribution provider
in Houston. As in the UK, energy utilities
have a legal obligation to invest in
energy efficiency.
The Residential Energy Efficiency
Programme is thus mutually beneficial
for Centrepoint and the Houston City
authorities. The city has been able to
achieve a significant scale of home
retrofit for a relatively modest outlay.
Centrepoint, through partnering with
the city, is able to reach households
more efficiently, while reducing energy
demand avoids the expensive cost of
having to build additional power plants
and transmission and distribution
lines to meet otherwise rising demand.
Centrepoint focuses on low-income
households because the returns
(ie total energy reductions) are, on
average, higher.
Houston citizens in general also gain,
as all energy infrastructure costs are
ultimately passed on to the rate payer
through higher energy charges, so less
infrastructure development costs due
to lower energy demand means lower
bills for all households.
Annual CO2 reductions totalled
approximately 1,000 tonnes for the
initial pilot of 600 homes in
Pleasantville. More up to date figures
are not yet available, but would
be expected to show savings of
approximately 11,600 tonnes of
CO2 per year.
Replicable funding sources
CERT (see Case study 1), and www.
Prudential Borrowing
More information:
Case study contact
Gavin Dillingham, General Services
Department, City of Houston. Email:
[email protected]
Economic benefits
The Pleasantville pilot recorded the
creation of four full time equivalent jobs.
However the monetary benefits to local
residents (savings on energy bills) is
significant, and is important in helping
to alleviate fuel poverty.
The programme enabled local people to
gain skills and experience that equipped
them to gain further employment; also
new jobs were created through the
REEP programme.
housing: Retrofitting decentralised energy
Case study 3: Barkantine combined heat and power (CHP)
The Barkantine combined heat and
power (CHP) scheme, in the London
Borough of Tower Hamlets, provides
heat and electricity to around 600
dwellings, a swimming pool, a primary
school, a nursery and the Barkantine
community hall.19 Commencement
of work began on 1 June 2000, with
customers receiving heat by November
2000 and the CHP plant was operational
by the end of February 2001.
The CHP plant at Barkantine, private
finance initiative (PFI), is owned and
managed by the Barkantine Heat
and Power Company (BHPC) which
is part of EDF’s energy generation
portfolio. BHPC was initially jointly
established by EDF Energy, the London
Borough of Tower Hamlets Council’s
Energy Efficiency Unit, and Defra as
a National Pathfinder scheme. The
London Borough of Tower Hamlets and
Barkantine Heat and Power Company
have entered a 25-year concession
agreement contract until 2026.
At Barkantine, each resident can have
their electricity supplied by BHPC. All
flats are equipped with an individual
heat meter and residents can pay for
their heating using a variety of methods.
Residents can opt into the scheme
through an on-site community liaison
officer, who is in close contact with the
residents to help them solve any issues
they may have with the heating system.
EDF Energy is responsible for overall
maintenance of the system.
BHPC supplies heat and power to
its customers through its own private
wire and pipe network. An energy
services company (ESCo) can gain
an “exempt licence” from OFGEM
to supply up to 1MW of electricity to
residential customers on private wires.
This means that it does not face many
of the regulatory costs that apply to
larger suppliers and so reduces costs, in
theory enabling the ESCo to offer lower
prices to residents.
If there is no alternative connection
to the national grid, then the ESCo
becomes a monopoly supplier and
residents have no choice about whether
or not to be part of the scheme. In
Barkantine’s case there is a grid
connection. Individual residents all
have access to the scheme as of right,
written into their tenancy contracts.
Where electricity is produced by the
Energy Centre and not used it is
exported on to the local network and
sold to the market.
Assessment of the viability of a district
heating scheme was driven ultimately
by consideration of demand types (high
heat load) and build-profile. While the
scheme works better commercially in
areas of high density and the core of
the scheme is flatted housing estates,
the scale of development served
by the scheme means that it has
been economically viable to include
less dense (ie non-housing estate)
neighbourhoods also.
The scheme runs off a gas-fired CHP
plant installed in an energy centre in
Barkantine. The energy centre contains:
a 1.3 MWe/1.6 MWth combined heat
and power engine, two 1.4 MWth
heat-only boilers and two large thermal
storage cylinders. The energy centre
connects with the district heating
network through four kilometres of
pre-insulated pipes with a leak-detection
system. The engine is sized to deal
with winter heat loads, which can store
4.5 MWh of heat, sufficient to cover
up to eight hours of heat demand
across the district heating network.
The centre contains two large thermal
stores, which are designed to balance
out heat demands. The design enables
the operational hours of the engine to
be maximised to produce electricity at
times when there is greatest demand.
Funding and financing
Total cost
£6 million
Breakdown of expenditure
Capital cost of the project includes
expenditure on CHP plant, distribution
systems laid across the area, heat
exchangers and heat meters installed
in flats.
Sources of funding
The project received two grants:
• £
6 million from Pathfinder funding
from Defra (previously Department
for Environment, Transport and the
• £
12,500 from the Energy Saving Trust
to fund research into legal issues –
ie establishing the ESCo and
securing an exempt licence.
Funding structure
The structure of the PFI model requires
a significant number of residents to
switch electricity provider. There is an
agreement that every two years the
Borough receives 40 per cent of any
excess beyond anticipated profits, and
the remaining 60 per cent is retained
by EDF. A share of the electricity export
income is invested in the community.
The financial viability of the scheme is
secured by ensuring enough properties
are connected to support operational
costs through heat and power sales
and by exporting surplus power to the
national grid.21
2004 – present
barkantine chp
Key partners
The key delivering agent is BHPC,
with all management and maintenance
being provided by EDF Energy, and
administration by Tower Hamlets.
Barkantine CHP system is energy
efficient and has reduced business
and residential customers’ heating and
hot water bills, therefore addressing
fuel poverty. Around 600 individual
households make annual savings on
energy costs of approximately £120 on
heat and £80 on electricity, based on a
consumption of 6,000kWh of heat and
2,470kWh of electricity per annum. This
is due to the energy pricing mechanism
included in the Concession Agreement,
to which all residents have access.
The Barkantine CHP saves more than
1,700 tonnes of CO2 each year.
Economic benefits
The actual CHP plant makes up the bulk
of the cost therefore there are a limited
number of jobs generated in the local
community. However, a number of jobs
are supported in maintenance of the
heating equipment in the flats and also
that of the community liaison officer.
BHCP employs 3.5 full time equivalent
and contractors for an average of 40
working days per month.
planning an energy services scheme.
This service includes a web-based
information resource and telephone
advice through the Practical Help
helpline. It also includes up to three
days of consultancy support from
engineering company Arup for projects
at various stages of development,
which have a local authority or housing
association as a lead or major partner.
More information, guidance and
examples of energy services schemed
can be found at www.energysavingtrust.
Replicable funding sources
The recently consulted-upon
Community Energy Saving Programme
(CESP) could provide a possible
mechanism for other authorities to
replicate Tower Hamlet’s example.
CESP will be a new £350 million
Government programme running
until December 2012. It will place an
obligation on energy generators and
suppliers to partner with local authorities
to deliver community-wide energy
efficiency programmes. It is estimated
that up to 100 schemes will be funded,
benefitting around 90,000 households.
Eligible measures will include the
installation of district heating.22
Case study contact
Bertrand Courau, Operations Manager,
BHPC. Email: [email protected]
Barriers to replication by other local
None – a number of local authorities
have now established ESCos.
The Energy Saving Trust now offers a
free support services to local authorities
considering setting up an ESCo or
Retrofitting renewable energy
Case study 4: The London Transport Museum photovoltaic project
London Transport Museum
The London Transport Museum was
the first Grade II listed building in
the UK to receive planning consent
(from Westminster City Council) for
a large scale photovoltaic (PV) system,
setting an important precedent for
implementing renewable energy in
listed buildings.
The PV scheme was implemented
on the museum’s roof as part of the
redevelopment project by Transport
for London. The system was installed
by Sundog Energy Limited and the
project’s main contractor, Wates. A full
planning application was submitted
to Westminster Council by Avery
Associates Architects on behalf of
the London Transport Museum. The
application was approved at delegated
level with no appeals lodged against it.
Over their lifetime, the 52kW PV system
is expected to generate more than
2,136,000 kWh of electricity and reduce
carbon emissions by between 1,415
and 2,075 tonnes.23
Funding and financing
Total project costs were £505,000. A grant of £120,327 was received from
the Department for Trade and Industry’s
Major Photovoltaic Demonstration
Programme (PVMDP), which is
managed by the Energy Saving Trust,
with the remainder funded by Transport
for London.24
An important precedent was set when a photovoltaic system was built on
the roof of the listed London Transport Museum
Key partners
The project involved collaboration
between the Museum, the London
Climate Change Agency and Transport
for London.
The PV system provides around 16
per cent of the building’s electricity
needs (34,200 kWh) during the summer
months and has reduced CO2 emissions
by 20 tonnes per year.
Barriers to replication by other local
The London Transport Museum
demonstrates that it is possible to
incorporate renewable energy systems
on to a heritage building, in a manner
deemed aesthetically acceptable by
a tough planning authority at a prime
tourist location (Covent Garden).
Replicable funding sources
Major Photovoltaic Demonstration
Programme (PVMDP).
Case study contact
Wendy Neville, Communications
Manager, London Transport
Museum. Tel: 020 7565 7266.
Email: [email protected]
building: Retrofitting renewable energy
Case study 5: Queen Victoria Market, Melbourne, Australia
Despite being a heritage building,
Queen Victoria Market has become
the largest urban grid-connected solar
photovoltaic (PV) installation in the
southern hemisphere.25 26
The City of Melbourne wanted to create
a demonstration project, and jointly
funded this project with the Australian
Greenhouse Office. The contract for the
studies and installation was awarded to
BP Solar and Origin Energy. Installation
took one year (2,000 person hours).
In parallel, a programme of public
engagement was critical to gain public
buy-in to the project. The historic
Queen Victoria Market in the centre
of Melbourne is the largest tourist
attraction in Victoria. A 2.5 metre x
1 metre real-time display has been
installed in a prominent location in the
market so that shoppers can see latest
power reading in kilowatts and CO2
emissions saved.
1328 PV roof panels convert sunlight
into direct current electricity, which is
distributed to one of 83 solar inverters
located under the eaves of the market.
Each panel measures 1.59 metre by
0.79 metre. The inverters convert DC
to AC so that it is in line with normal
grid power. During the day electricity is
distributed within the market. Special
bi-directional meters are installed to
allow power generated by the system to
flow back to the grid when generation
exceeds the needs of the market.27 At
night, when the solar panels are not
generating electricity, the market draws
electricity from the national grid.
The city maintains a maintenance
contract with the installers, Origin
Energy, but maintenance requirements
are minimal and the panels are now
simply checked and cleaned once a
year. The real-time monitoring system
would detect if any panels, or cells on
the panels, were not functioning. It is
anticipated that the PV solar panels
will generate power for at least the
next 30 years.
Funding and financing
Total cost
£846,000 (Aus $1.7 million).
Breakdown of expenditure
The installation was undertaken as
a design and build contract, so all
costs were in one contract of $1.7m
– materials and labour to install the
PVs on the roof, as well as the realtime system for monitoring energy
use in the market and displaying it.
Sources of funding
Approximately £500,000
(Aus $1 million) provided by the
city and approximately £346,000
(Aus $700,000) from the Australian
Greenhouse Office through a
renewable energy grant scheme.
Funding structure
One-off funding from the city and
Australian Greenhouse Office for
work commissioned to BP Solar and
Origin Energy.
2003 – present
Key partners
The City of Melbourne jointly funded
this project with the Australian
Greenhouse Office. The contract for
studies and installation was awarded
to BP Solar and Origin Energy.
The project has helped to raise
awareness of renewable energy
issues and the energy consumption
of the market estate among the
general public and market users.
The project saved more than 320 tonnes
of CO2 in its first year. It has reduced CO2
emissions by 1,700 tonnes in total since
it was installed in 2003, and produces
252,000 kWh of electricity annually
(1,225,907kWh in total since go-live).28
Economic benefits
Installation of the panels required
approximately 2,000 person-hours
to complete, and five specialist solar
installers. Developing the local skill base
and increasing capacity in the industry
is considered important by the local
authorities to increase opportunities for
trained individuals in future PV installation
projects, thereby retaining job creation
within the local economy. Annual energy
savings to the market operator are around
Aus $50,000 (£25,000),29 a significant
reduction in costs. This in turn helps
support jobs at the market and suggests
a pay-back period of around 35 years at
current electricity prices.
The decision to switch the Queen Victoria
Market to solar power offers Melbourne
City Council and the community three
distinct benefits:
• Reduced energy bills for the market.
• A significant reduction in the volume of
greenhouse gases being generated in
Melbourne’s inner-city precinct.
• No impact on the operational efficiency
of the market.
Barriers to replication by other local
See Case study 4, above.
Replicable funding sources
UK Government PV funding available.
Case study contact
Shane Power, Manager Major
Project Delivery, City of Melbourne.
Tel: +61 3 9658 8626. Email: shane.
[email protected]
Case study 6: Southampton District Energy Scheme30
Flickr/creative commons
Southampton Civic Centre
The Southampton-Utilicom Geothermal
Heating Scheme is the largest
commercially developed district energy
scheme in the UK. It started with a
single customer (the Civic Centre)
and now has thousands of customers,
including more than 40 major consumers
in the city centre, served by the district
heating system.
A private-public partnership scheme,
it provides heating and cooling to
moe than 1,000 residential properties,
several large office buildings including
Southampton Civic Centre, a hospital,
a health clinic, a university, a
supermarket, several hotels, BBC
television studios, one of Europe’s
largest shopping complexes, and a
swimming and diving complex, among
others. It offers substantial capital and
operating cost savings to all consumers.
The origins of the scheme lie in the
period following the dramatic rise in
oil prices in the late 1970s, when the
Department of Energy set up a research
programme looking into the potential for
alternative energy sources in the UK,
particularly wind, wave and geothermal
energy. A number of locations were
identified as possible sites of deep
geothermal aquifers at temperatures
sufficient to provide heating for a large
number of buildings. At one such site,
located at the Marchwood Power Station
on Southampton Water, the Department
of Energy began drilling a well, hoping
to test geothermal resources held in the
Wessex Basin.
Following this initial successful trial,
the Department of Energy – working
with Southampton City Council and
the Energy Technology Support Unit –
drilled a further well in the city centre of
Southampton. Within this second well,
water was found at a depth of nearly
1,800 metres and at a temperature of
76 degrees celsius. However, the size
of the resource was deemed too small
to develop the planned large-scale
district heating scheme and the project
was abandoned by the Department of
Energy in the early 1980s.
The City Council refused to let the
project fail and, after considerable effort,
found Utilicom, a French-owned energy
management company, as a partner
with whom to develop a scheme. In
1986 Utilicom formed the Southampton
Geothermal Heating Company Limited
(SGHC), an Energy Services Company
(ESCo) to develop the scheme. The
new company was set up on the basis
of a co-operation agreement between
Utilicom and Southampton City Council,
with both parties undertaking a number
of obligations and agreeing to work
in close co-operation to develop a
successful scheme. The Joint Cooperation Agreement between Utilicom
and the council is available on request
from Southampton City Council (see
contact details below).
Commercial connections commenced
in the early days of the scheme, when
the Civic Centre signed up for the winter
of 1987-88. As part of the council’s
obligations under its agreement with
Utilicom, there is now a standard
Section 106 clause encouraging, but
not requiring, connection for all new
developments. Connection is achieved
through negotiation. Additionally a
quarterly strategic meeting is chaired by
Southampton City Council where future
connection opportunities are identified
and explored at an early stage.
The original well (for geothermal),
which can provide up to 15 per cent
of the system’s heat input, is now
supplemented by large-scale combined
heat and power (CHP). This includes a
5.7MW and a 1MW unit at the central
Heat Station CHP unit and a 0.7MW
unit at the RSH Hospital. The heat
from the CHP units is recovered for
distribution through the mains network.
Southampton’s scheme also inherited,
maintains and operates conventional
gas-fired boilers for “top-up” and
standby needs in both the Civic Centre
and hospital.
These technologies were innovative
at the time, especially when originally
conceived but are now well proven and
Funding and financing
Total cost
£8million (c£20million at 2009 prices)
Breakdown of expenditure
Cost of technology and distribution
system – developing 11 kilometres of
heating and cooling pipes.
Funding Structure
£8 million invested in infrastructure.
Primarily financed by Utilicom, the
council’s commercial partner, and a
southampton district energy scheme
European Union grant from DGTREN,
plus some Energy Saving Trust
Community Energy grants (these have
now expired). Presently the scheme
attracts funding from several sources,
including the Homes and Communities
Agency (HCA) and Defra Bio Energy
Capital Grants.
1986 – present
Key partners
The Southampton Geothermal Heating
Company (SGHC) is a wholly owned
subsidiary of the Utilicom Group. Both
Southampton City Council (SCC)
and Utilicom cite their co-operative
working relationship as a key factor
in the success of the scheme. Both
parties firmly agree that the Joint Cooperation Agreement and the resulting
close collaborative working, has been
fundamental to enabling the scheme to
grow to the size it is today.
This agreement, originally signed in
1986, renewed for a further 25 years in
2005 (giving a total working relationship
between the two partners, of 45 years),
committed Utilicom to:
• Develop the scheme, initially utilising
the city’s geothermal resource, and
then adding CHP.
• S
ell heat to the City Council at agreed
savings, for its own administrative
• P
rovide all necessary funding,
technical and management expertise
to ensure that scheme develops
• Taking heat wherever practical for its
own buildings.
• H
elping Utilicom promote the scheme
to other potential users.
• P
roviding general support to
Utilicom in developing the scheme –
particularly through the Planning and
Highways Departments.
• P
roviding the land for the Heat
Station at a peppercorn rent and
transferring ownership of the
geothermal resource to Utilicom.
• Treating Utilicom as a “statutory
utility” within the boundaries of
the city.
The agreement is not published but is
available from Southampton Council on
request. Southampton officers close to
the scheme argue that there is nothing
about the scheme that could not
be adapted and replicated by other
local authorities.
A notable aspect of the success of
Southampton Geothermal Heating
Company is that it has received
consistent political backing from
Southampton City Council, despite
multiple changes of council control
since 1986 – oscillating between
Conservative, Labour, Liberal Democrat
and no overall control.
After 22 years of operation, the scheme
• M
ore than 40,000 MWh of heat
each year, equivalent to nearly 7,000
• P
rovide open book accounting and a
long-term profit share to Southampton
City Council.
• 2
6,000 MWh of electricity from the
CHP plant.
In turn SCC committed to facilitate the
success of the scheme by:
• M
ore than 7,000 MWh of chilled
water for air conditioning.
With annual sales of:
• 40GWh of heat
• 22GWh of electricity
• 8GWh of cooling
Residential buildings supplied include
local authority flats, where tenants pay
for the heat supplied through their rents.
12,000 tonnes of CO2 avoided per year.
It is 85 per cent efficient (compared to
an average of about 38 per cent for
centralised power station). This high
level of efficiency won it a Queen’s
Award for Sustainable Development in
2001, regained by Utilicom in 2008,
and a National Energy Efficiency Award
in 2006.
Economic benefits
It is estimated that around 80 full time
equivalent jobs have been created in
installing the infrastructure and CHP
plant. Consumer’s energy costs are
typically reduced by between
5 per cent and 10 per cent against
the market norm. This is estimated to
total approximately £350,000 in energy
cost savings released into the local
economy annually.
Utilicom’s margins are very thin in
the provision of heat and electricity
to end consumers, and are based
on the improvement in efficiency on
local generation compared with central
Hot and chilled water is circulated
around the city:
• Through 14 kilometres of insulated
service pipe;
• W
ithin a 2 kilometre radius of the
heat station.
• W
ith just 0.5 degrees per kilometre
temperature loss.
Barriers to replication by other local
None – Southampton has used existing
local authority powers and budgets and
taken advantage of a national funding
scheme. A number of other authorities
have implemented similar schemes:
for example, Birmingham launched the
first part of its three-phased city centre
district energy network in October
2007 (its Broad Street Scheme). Since
then phase two at Aston University
has been launched and a third phase
at Birmingham Children’s Hospital is
under construction. Combined these
schemes are delivering increasing
levels of CO2 emissions reductions
within the city centre, and will form the
basis of a similar journey of expansion
as Southampton has witnessed.
Birmingham District Energy Company,
the company which owns and
operates the scheme, is another ESCo
subsidiary of the Utilicom Group.
Replicable funding sources
HCA and Defra Bio Energy Capital
Grants available, and CESP (see Case
study 3 above) will provide funding
More information
Case study contact
Bill Clark, Sustainability Policy
Manager, Southampton City Council.
Tel: 023 8083 2600. Email: [email protected]
energy: Energy services companies
Case study 7: Aberdeen Heat and Power Company Ltd31
Aberdeen Heat & Power Co Ltd (AH&P)
was established in 2002, as a not-forprofit company.
AH&P has developed and installed three
gas-fired combined heat and power
(CHP) schemes: Stockethill, Seaton
and Hazelhead. Stockethill (Aberdeen)
was the first successful community
CHP scheme in Scotland. Now AH&P
is regarded as a model ESCo for similar
projects across the UK. Further work
is being undertaken to research the
potential to switch these CHP, and
further CHP projects, to biomass.32
Stockethill – supplies heat and hot
water to 288 flats, including sheltered
accommodation, in four 19-storey
blocks; 210kW gas powered generator
in separate building.
Hazlehead – 300kW generator installed
in the former boiler room of Hazlehead
Academy. Heat and hot water supplied
to the school, four multi-storey blocks
with 188 flats, 45 sheltered housing
units, a swimming pool and separate
sports facility. Electricity is supplied
direct to the school by private wire.
Seaton – heat and hot water will be
supplied to 503 flats, some sheltered,
in six multi-storey blocks, to a sports
changing facility, and to the council’s
beachfront complex comprising
ballroom, leisure centre and ice-rink.
The CHP plant is located in a new
building which also accommodates the
changing facilities. Seaton will run off
a 2MW dual-fuel generator which will
combust natural gas and “biomass gas”.
Aberdeen City Council (ACC) created
AH&P as an arm’s length company.
Tulloch Training and the Combined Heat
and Power Association (CHPA) were
founding partners, although the former
is now less involved.
Technical design and project
management was undertaken by
Integrated Energy Utilities. Both
companies are committed to the
aims of reducing fuel poverty and
emissions reduction.
Tenants benefit from reduced heating
bills. On average, it costs an Aberdeen
tenant £40/week to adequately heat a
two-bedroom flat with electric storage
heaters, but AH&P customers are
charged less than £8/week for as
much heat and hot water as they want.
Tenants pay for the heat by the Heat
with Rent scheme run by Aberdeen City
Council. Existing tenants are not forced
to take heating from the CHP scheme,
but as flats with no connection become
available they are fitted out before the
new tenant moves in.
Development at each scheme
comprises a CHP plant, the heat
distribution system, and the installation
of heating equipment (the internals)
in each flat. The Seaton scheme will
provide base load capacity for the
extension of CHP into the city centre
and to several regeneration areas when
capacity is increased and conversion to
biomass effected.
The CHP stations have been
successfully integrated into the local
environment, with particular attention
given to the siting and design of
the Seaton CHP station. The
opportunity to co-locate with the
sports facility gives additional benefit
to a deprived community. Use of
aberdeen heat and power company ltd
recycled materials, inclusion of a green
roof to reduce rate of rainfall run-off,
and deployment of SUDS (sustainable
urban drainage systems) further reduce
environmental impact. Seaton CHP received £1.86 million
from Aberdeen City Council’s Housing
Capital Programme, and a further
£1.3 million was secured from the
Community Energy Programme.
The CHP stations are delivering heat
and generating power with 85 per cent
Funding structure (operating capital
and revenue)
Funding and financing
Total cost
Stockethill CHP cost £1.6 million.
Hazlehead CHP cost £1.6 million.
Seaton CHP cost £3.38 million.
Breakdown of expenditure
£1.6 million funding for Stockethill
included the development of the CHP
plant, the distribution system and
internal systems.
£1.6 million for Hazlehead’s CHP
included the development of the CHP
plant, distribution system and other
internal systems.
£3.38 million for Seaton CHP included
the cost of development of the CHP
plant, distribution system and other
internal systems.
Sources of funding
Stockethill CHP received £730,000 from
the Community Energy Programme
grant (a two-year Westminster
government project launched in 2002)
for capital costs. Bank financing was
provided for up to £1 million based on
income from the council of £215,000
per annum. Energy Efficiency
Commitment (EEC) money (available
to all local authorities) offset costs of
heating systems within leaseholder flats.
Hazlehead CHP received £700,000
from Aberdeen City Council’s Housing
Capital Programme, and the remaining
£600,000 came from the Community
Energy Programme.
improved and fuel poverty experienced
by tenants reduced. Residents’
responses have been investigated at
all stages and satisfaction confirmed.
Tenants in each scheme have been
surveyed and 98 per cent register
satisfaction with the results.
Funding has come from Aberdeen City
Council, and as one-off grants from the
Community Energy Programme, and
bank finance for Stockethill CHP.
Stockethill has seen a 42 per cent
CO2 reduction in the 288 flats that it is
connected to.
All schemes are reliant on some degree
of grant funding to cover capital costs.
Revenue generated from the initial
schemes is not sufficient to meet the
capital costs of future CHP systems of
any scale.
Hazlehead is predicted to achieve a 57
per cent CO2 reduction – 14,500 tonnes
– over its 25 years of operation.
2002 – present (with staggered start
dates for each project).
Key partners
Aberdeen City Council established
Aberdeen Heat and Power as a not-forprofit company. Several council services
have been involved at different times
and to varying extents: housing, finance,
legal, planning, culture and leisure, and
grounds maintenance. ACC sourced
Community Energy Programme and
other grants from central Government
and the Scottish Executive and
underwrote a commercial loan.
The Board of AH&P has directors from
the council, the CHPA, and SCARF (the Save Cash Reduce Fuel public
awareness campaign). It also has
several independent directors.
The AH&P has also partnered with the
Aberdeen Job Centre on training and
employment (see below).
The quality of a substantial proportion
of council housing stock has been
Seaton saw an estimated CO2 reduction
of 936 tonnes per year compared with
business as usual.
Through robust training programmes,
the CHP programme has been a source
of jobs and training opportunities in
Aberdeen. A partnership between
Aberdeen Heat and Power, the local
Job Centre and First Class Gas, has
retrained and employed more than 40
local unemployed residents to work in
CHP and gas installation. This aspect
of the scheme has recently been
retendered and will now be delivered by
AH&P and Gas Call.
Barriers to replication by other local
None – see Case study 6, above
Replicable funding sources
CESP (see Case Study 3 above) will
provide funding opportunities
More information
Case study contact
Colin MacLeod, General Manager,
Aberdeen Heat and Power.
Email: [email protected]
energy: Renewable Energy Planning Policies
Case study 8: Gigha Windmills (Dancing Ladies of Gigha)
Gigha is Scotland’s first communityowned, grid-connected wind farm and
was set up in December 2004. The wind
farm has three medium-sized turbines
which are significant structures in their
own right, but which the community
feels sit particularly well within the small
island landscape. The Gigha community
has named the turbines Creideas,
Dòchas and Carthanna, the Gaelic
names for Faith, Hope and Charity,
and has collectively called them The
Dancing Ladies.33
All major decisions on the community
owned Isle of Gigha are made
collectively by its citizens. In the case of
the decision-making for the windmills,
the Isle of Gigha Heritage Trust
arranged a trip to a nearby wind farm
where a discussion and debate was
held. This led to a meeting at the Gigha
Village Hall where the vote in favour of
the windmills was 100 per cent.
Alan Hobbett, a Development Manager
for the Isle of Gigha Trust, was the
catalyst for the project and worked with
several external consultants, including
general consultants, feasibility providers,
and civil and electrical contractors.
The windmills comprise three, precommissioned (second hand)34 Vestas
V27 wind turbines, each with an
installed capacity of 225 kilowatts. The
turbines were sourced from Haverigg
wind farm in Cumbria. Each turbine
stands on a three section, 30 metre,
rolled steel tower, set on steel reinforced
foundations. Three glass fibre blades
are fitted to each machine, measuring
13.5 metres in length, giving a swept
area diameter of 27 metres.
Isle of Gigha Heritage Trust
Other than the turbines themselves,
all the other equipment (cabling,
substation, transformer, switchgear
etc) is new.35
Access to the national grid and
sale of electricity was negotiated
through a connection agreement with
Scotland and Southern Energy in
order to export the total wind turbine
output. A Power Purchase Agreement
was also negotiated with a national
supplier in order to sell electricity and
levy exemptions set out within the
Renewables Obligations Certificate and
Renewables Levy Exemption Certificate.
If the feed-in tariffs for installation over
500kW provides a higher price than
4.5p/kWh, stated in the most recent
DECC consultation document, then
the Isle of Gigha Heritage Trust may
consider switching since they currently
achieve a rate of 9.695p/kWh.
Funding and financing
Total cost
Breakdown of expenditure
Wind turbines: £180,000 (£60,000 each)
Planning costs, delivery and assembly,
grid connection: £130,000 (approx) Civil engineering and related works,
roads and access: £130,000 (approx) Sources of funding
Grants: National Lottery funding
administered by Forward Scotland
and Scottish Community and
Householder Renewables Initiative.
Loan finance: Social Investment
Scotland. Equity finance: Highlands
and Island Enterprise, and Isle of Gigha
Heritage Trust.
Gigha: Scotland’s first communityowned, grid-connected wind farm
Funding structure
The funding model for Gigha comprises
a three-way mix of grant funding, loan
finance and equity finance. Grants of
£50,000 and £82,000 were secured
from the Fresh Futures, Sustainable
Communities Project Fund (National
Lottery funding administered by Forward
Scotland) and the Scottish Community
and Householder Renewables Initiative
(Scottish Executive money administered
by Highlands and Islands Enterprise).
A commercial loan of £148,000 was
provided by Social Investment Scotland.
And equity holdings of £80,000 and
£40,000 were taken by the Highlands
and Islands Enterprise and the Isle of
Gigha Heritage Trust.
The loan will be repaid over a five-year
period at a fixed rate of interest, with
the equity currently held by Highlands
and Islands Enterprise (HIE) bought
gigha windmills
back by the Isle of Gigha Heritage Trust
in year five. Furthermore, over the first
eight years of the project, a capital
reinvestment fund of approximately
£160,000 will be built up, sufficient
to replace the wind turbines
(blades, gearboxes, generators
etc) when required.
With the exception of the initial
grant funding, the project is purely
commercial. The loan is at commercial
rates and the equity held by HIE
comprises shares upon which a 6
per cent dividend is paid. The capital
reinvestment fund ensures that the wind
farm is financially sustainable, providing
a pot of money sufficient to replace the
machines without recourse to further
grant, equity or loan finance.
Key partners
The key partners include:
• V
estas, a leading turbine company,
which carries out essential
maintenance work on the turbines.
• The Isle of Gigha Heritage Trust
which is community-owned and is
the central decision-maker.
• G
igha Renewable Energy Ltd,
a subsidiary of the trust.
The Gigha community is using part of
the money generated by the wind farm
to contribute to radical energy saving
measures in the trust-owned housing
stock, 80 per cent of which was below
a reasonable standard.
The Gigha windfarm produces 2.1
gigawatt hours of electricity a year,
approximately two-thirds of the island’s
electricity needs. This equates to a CO2
reduction of 1,134 tonnes annually and
a load factor of 35 per cent.
Barriers to replication by other local
Gigha clearly has special conditions that
make large wind-turbines viable.
Economic benefits
In terms of revenue, Gigha estimates
that it will achieve a gross annual
income of £150,000. After the costs of
maintenance, rates and insurance, loan
repayments and equity re-purchase,
the net profit for each of the eight years
(remaining design life for each turbine)
is approximately £135,000.
Profits from the sale of electricity to
the national grid will be used to rebuild
houses, which were below a tolerable
standard, with energy savings making
them cheaper to heat. The housing
stock is currently being upgraded to
a 30-year low-energy standard. That is,
the refurbished houses are built to low
energy standards that assume
the house will be usable for a period
of at least 30 years, and integrate
renewable energy technology, loft
insulation, fibre glass wool insulation
and double glazing. The housing
improvement programme costs
£5million over six years.
Replicable funding sources
Gigha has made a virtue of its
uniqueness to garner funding. Other
local authorities will have different
opportunities to benefit from a variety of
national funding pots.
More information
Case study contact
Paul Phare, HICEC Development Officer
(Argyll & The Islands). Tel: 01631
562125. Email: [email protected]
The wind farm project is also allowing
the residents to buy their island and
become full landowners of their island.
A significant number of temporary jobs
were created in the construction phase
of the wind farm. Additionally some
jobs were created for Gigha Renewable
Energy Ltd and further jobs will be
created in housing retrofit.
energy: Renewable energy planning policies
Case study 9: The London Plan
The London Plan (2004, with Further
Alterations in 2008) is the Mayor of
London’s Strategic Development
Strategy and sets out an integrated
social, economic and environmental
framework for the capital’s future
growth over the next 15-20 years.36
As part of the Mayor’s vision, the
London Plan outlines a range of
policies to ensure developments
contribute as fully as possible to
addressing climate change. In order
to do this, it sets out that planning
applications for new developments
should be determined using an
energy policy hierarchy, defined as:
The Greater London Authority’s
Planning Decisions Unit (PDU) is
responsible for assessing certain
planning applications against the
London Plan policies and advising the
Mayor. The criteria for development
proposals referred to the Mayor include:
• Achieving a reduction in energy
demand, through sustainable design
and construction measures.
• Increasing energy efficiency, through
prioritising decentralised energy.
• Increasing the use of alternative
energy supply, through achieving a
20 per cent on-site renewable energy
target for new developments.
Policy 4.A7 sets out the London Plan’s
policy for renewable energy, stating
that the Mayor will, and local planning
authorities should, adopt an assumption
that all new developments achieve
20 per cent of energy from on-site
renewables. The London Plan also
states that on-site renewable energy
generation can include sources of
decentralised renewable energy (ie not
on site but within the area).
When first published in 2004 the
London Plan’s on-site renewable energy
generation target was 10 per cent for
all new developments – following the
so-called Merton Rule. However, since
mid 2005 the majority of developments
routinely met the 10 per cent target and
so a more challenging benchmark was
set to drive CO2 reductions.
• New housing – over 500 units or
occupying more than 10 hectares.
• Other new uses – over 30,000sq
metres in the City of London, over
20,000sq metres in the rest of Central
London, and over 15,000sq metres
outside Central London.
• New tall buildings – over 25 metres
adjacent to the River Thames, over
75 metres in the City of London, over
30 metres elsewhere.
• E
xisting tall buildings – increase of
15 metres if then above threshold for
new tall buildings.37
While Policy 4.A7 on renewable energy
must be used in assessing planning
applications, these targets are not
prescriptive and issues of viability, such
as technical and financial issues, are
also important considerations. The
Mayor has, therefore, the flexibility to
consider applications that deliver a lower
proportion of energy from renewable
sources, due to feasibility arguments, so
long as it can be demonstrated that all
possible renewable energy options have
been explored. The 20 per cent target is
therefore a tool for planning authorities
to negotiate best possible carbon
reductions, rather than an absolute rule.
Since the publication of the London
Plan, there has been a gradual decline
in time needed for each planning
application. While in 2004 the average
planning application procedure took 700
days, by the end of 2005 this process
took just 150. This increased planning
efficiency, and subsequent upward trend
in delivering higher CO2 savings, can
be attributed to the provision of more
dedicated technical support within the
Mayor’s Planning Decisions Unit as well
as enhanced developer understanding.38
A range of guidance alongside the
London Plan is also available to
support planners and developers in
achieving renewable energy targets.
The London Energy Partnership and
London Renewables, who comprise
representatives from the Greater
London Authority and other related
private and public sector bodies,
have jointly produced a Renewables
Toolkit, which offers recommendations
in selecting appropriate renewable
technologies.39 The Toolkit advises
on issues such as technical feasibility,
outputs, costs, maintenance, design,
location and aesthetics as well as
planning and legislative considerations.
The London Energy Partnership also
organises a range of events in order to
share best practice and engage with
key energy stakeholders in London, and
also offers energy training and support
programmes for local authorities.
The Mayor encourages using a range
of technologies in order to meet
renewable energy targets, which should
be selected on potential to reduce CO2
emissions and feasibility credentials.
The renewable technologies viable for
London are identified (not in any priority
order) as:
• wind generators
• photovoltaics, roof-top and cladding
• solar water heating
• biomass heating
• biomass CHP
• g
round source heat pumps for
the london plan
• g
round sourced including borehole
cooling (non-domestic only).
Even where developments are not built
with PV panels, they must be designed
and oriented to allow fitting of this
technology at a later date.
Funding and financing
Total cost
N/A Breakdown of expenditure
Sources of funding
There was no separate funding or
financing involved in drafting of the
London Plan and renewables target
2003 – present. Due to change of Mayor
in 2008, a new London Plan is currently
being drafted. Key partners
The Planning Decisions Unit is
responsible for determining planning
applications of strategic importance
in London (see above for criteria). The
PDU then advises the Mayor, who
has the power to approve or dismiss
The London Plan sets the benchmark
for renewable energy targets which all
London Boroughs should follow. With the
exception of Merton and Croydon, all
other boroughs previously encouraged
rather than required such measures in
their unitary development plans, which
also varied by Borough. The London
Borough of Merton first pioneered a
requirement for on-site renewables to
cut CO2 emissions, known as the Merton
Rule, in 2003. Due to the Merton Rule’s
success, the policy was implemented by
the London Mayor.
More information
The Mayor’s renewable energy targets
were implemented alongside policies
that doubled new affordable home
targets in order to meet London’s
significant housing shortage.
Policies within the London Plan have
been successful in reducing energy
consumption and CO2 emissions in new
developments. Within the London Plan’s
first two-and-a-half years of publication,
350 approved developments produced
carbon savings of 74,457 tonnes per
year due to the implementation of
renewable energy policies. However,
total savings reached 419,777 tonnes of
CO2 per year when also incorporating
the effects of energy efficiency policies.
Case study contact
David Taylor-Valiant, Senior Strategic
Planner, Greater London Authority. Tel:
020 7983 4000. Email: [email protected]
Of the 350 approved developments,
the following renewable energy
contributions were achieved:
• 2
5 per cent exceeded 10 per cent
renewable energy contributions
• 8
per cent exceeded 20 per cent
renewable energy contributions.
For developments meeting or exceeding
20 per cent reductions, savings were
largely made through biomass heating
and combined heat and power.40
Barriers to replication by other local
Replicable funding sources
Target to cut car journeys
Case study 10: Darlington, a Sustainable Travel Town
This five-year project to reduce traffic
levels aims to demonstrate the effect a
sustained package of Smarter Choice
measures can have when coupled with
infrastructure improvements. Darlington,
along with Peterborough and Worcester,
were selected from more than 50 local
authorities in England who expressed
an interest in becoming showcase
demonstration towns. The three towns
were selected as Sustainable Travel
Demonstration Towns (STDT) to share
£10m of revenue funding during the
project with capital funding for building
and improvement works from the Local
Transport Plan (LTP).41
The project cut traffic by 9 percent in
just two years. Since autumn 2004, all
year 6 primary school children have
been able to take part in free cycle
training at the national level 2 standard,
with around 55 per cent of eligible pupils
completing the training each year. From
autumn 2005 year 1, 2 and 3 pupils have
been offered free pedestrian training,
with around 95 per cent of eligible pupils
taking part during the 2007/08 academic
year. Sixteen Darlington schools have
also participated in Sustrans’ Bike It
programme, receiving extra support
for events, activities and challenges
promoting cycling, for example Wheelie
Wednesdays, Bike Breakfasts and after
school cycle maintenance classes.
Individualised Travel Marketing (ITM)
is a key component of Darlington’s
Local Motion programme. ITM was
conducted over three phases targeting
different parts of the town during the
summer months of 2005, 2006 and
2007. All households in the 20 urban
wards of Darlington had the opportunity
to participate in the programme and to
receive personal travel advice.
As well as householders, 30 schools
had completed a travel plan, 20 had
installed new secure cycle parking (a
total of 1,042 spaces) and all primary
schools were taking part in the biannual
Medal Motion campaigns promoting
sustainable travel to and from school.
Twenty three Darlington businesses had
also completed or were developing a
travel plan. This includes some of the
larger employers such as the County
Durham and Darlington Acute Hospitals
NHS Trust, Darlington Borough Council,
Argos Distribution Centre and Cummins
Funding and financing
Total cost
£3.3 million
Breakdown of expenditure
Interviews, doorstep travel advisors and
some construction of cycle paths etc.
Sources of funding
Department for Transport (DfT),
through the Local Transport Plans
capital funding and specific Sustainable
Travel Towns revenue funding pot (as
mentioned earlier).
2004 – 2009
Key partners
All elements of Darlington’s STDT programme are managed by the
Borough Council, with the Transport
Policy section taking overall
responsibility for delivery in accordance
with DfT funding criteria and the
council’s policies and procedures. From October 2004 onwards, the
project received guidance from external
partners participating on a Reference
Group which meet four times a year.
By 2008:
• The share of all trips undertaken by
motorised private modes for purely
subjective reasons had fallen to 29
per cent (subjective trips are defined
as those made despite a reasonable
alternative travel mode being
• At the same time, the share of trips
made by sustainable travel modes for
subjective reasons had increased to
22 per cent.
The programme also led to significant
behavioural change:
• Nine percent reduction in car as
driver trips, achieved by switching an
average of 38 trips per person per
year to other modes.
• C
ar as passenger trips also declined
by 7 per cent.
Among the sustainable travel modes:
• W
alking saw the biggest gains in
absolute terms with an additional
38 trips per person per year being
made on foot, a relative increase of
15 per cent.
• C
ycling gained an average of 18
trips per person per year, showing a
relative increase of 120 per cent.
• B
us use saw a relative decrease of
2 per cent; other public transport saw
an increase of 18 per cent.
11 brighton and hove buses
The programme has significantly
reduced carbon emissions, with:
• Estimated annual CO2 reductions
of 7,000 tonnes compared to
2004 baseline.
• The total number of employees
working in businesses engaged
in delivering a travel plan was
approximately 11,000, or 30 per cent
of the Darlington workforce.
• E
stimated reduction of 34million
car kilometres per year compared
to 2004 baseline.
Barriers to replication by other local
Economic benefits
• Improvements made to local public
transport, and more local public
events run (which means more local
businesses engaged).
Replicable funding sources
This project was dependent on national
Government support as a Sustainable
Travel Town, but local authorities can
use their local transport plans to set out
similar schemes, supported by their own
revenue funding streams.
More information
Case study contact
Owen Wilson, Project Manager. Tel:
01325 388 444. Email: [email protected]
transport: Target to cut car journeys
Case study 11: Brighton and Hove Buses
Brighton and Hove council introduced
the Quality Bus Partnership scheme to
increase bus usage and reduce traffic
in the city. It is one of the few places
outside London that has reduced car
traffic (down 10 per cent since 2000,
where most urban areas have seen
rises). This has primarily been achieved
through a big increase in bus patronage
(a 33.5 per cent increase between
2000/01 and 2008/9, again bucking
the national trend), although the city
has also seen significant increases
in walking and cycling (the subject of
separate, but related policies).42
Brighton is one of Europe’s leading
venue and conference centres. There
are also two universities attracting
a large student base. Given these
factors, the population fluctuates
significantly, particularly in the summer
months, placing huge pressures on the
transport system.
Bus Quality Partnerships are
agreements between local authorities
and bus operators, which involve local
authority investment in facilities and
operator investment in vehicles or
services. The partnership enables a
single predominant bus company to
deliver quality and coordinated services
in the city, such as the frequencies,
timings and fares of bus services.
With the exception of London, the
deregulation of UK bus services
restricted this coordinated approach.43
A distinctive feature of the Quality Bus
Partnership is that there is no formal
Partnership Agreement between the
city council and the bus company.
Strong continued political commitment
to public transport, and to sustainable
transport in general, is a marked feature
of Brighton and Hove’s city governance.
There is a very high local profile by the
bus operator’s Managing Director; part
of a company policy of integrating the
bus business into the community. The
bus operator has a very strong ethos of
customer service and has consistently
delivered high-quality services on
a simple, though dense, network,
since its formation in 1997, creating
a virtuous circle.
A consistency in senior personnel has
been a key to this success, and each
partner recognises and accepts the
aims, objectives and limitations of the
other. Under the partnership, the bus
company commits to delivering:
• improving service frequencies
• s imple to understand, value-formoney prices
• sustainable investment in new buses
• a
customer-focussed culture, and
effective information and attractive
promotional literature and media.
Meanwhile, the City Council commits
to delivering:
• bus priority measures
• investment in bus stop infrastructure
brighton and hove buses
• a
n effective and enforced
parking regime
• enforcement of traffic regulations and
• a park and ride facility.
Policies/strategies/knowledge required:
• The Local Transport Plan.
• Quality standards and targets.
• Q
uality Bus Partnership – the City
Council’s five Ingredients: bus
priority of road space, improved
passenger waiting areas, real time
information displays, traffic regulation
enforcement, park and ride.
• B
righton and Hove bus and coach
company’s five Ingredients: improved
service frequencies, value-for-money
fares and tickets, investment in new
buses, enthusiastic staff, effective
sales message.
• Integration with other modes of
• Interchanges: bus shelters, footways,
Pool Valley, Brighton Station.
schemes; section 106 contributions of
£1.585 million secured from developers,
a further £2.1 million funds were
secured from supplementary bids.
Sources of funding
Government, City Council, Section
106 contributions from developers,
supplementary bids.
Replicable funding sources
Following the Local Transport Act
2008, it is easier for all local transport
authorities to take forward bus
partnerships or even the franchising
of local services (quality contracts).
To support capital investment (for
example in bus priority measures)
local authorities are provided with an
integrated transport funding block by the
Department for Transport,.
2004 – present.
The increased ridership generated by
the raising of the bus network’s profile
and image has generated the profits
which have enabled sustained fleet
investment and enhanced frequencies.
Key partners
A key part of the project’s success is
the long standing and informal working
relationship between Brighton and Hove
City Council and Brighton and Hove
Bus & Coach Company. A wide range
of other partners also have a role in the
project, including Sussex Police, who
enforce correct usage of bus lanes,
and the voluntary sector, enabling a
telephone booking service.
• P
roviding accessible transport:
low floor buses, 75 accessible bus
stops, large print timetables, talking
bus stops. 12.6Impact
• S
ecurity for vulnerable users: CCTV
at railway stations, improved lighting in
bus shelters, on-board CCTV on
all buses.
• A 10 per cent reduction in private car
journeys coming in and out of the city
since 2000.
Funding and Financing
Total cost
£57.5 million
Breakdown and funding structure
£35 million of Government capital funds
in integrated transport and highway
maintenance measures; £19 million of
revenue investment by the City Council
on highway structures and local safety
• Almost 10 million more bus
passenger journeys per year in the
city than in 2000.
• Overall the number of accidents in
the city has reduced.
• 8
0 per cent of people are satisfied
with the local bus service, up 26 per
cent from 2000.
• 7
4 per cent of people are satisfied
with local transport information, up 23
per cent from 2000.
• The overall maintenance backlog has
been reduced.
Barriers to replication by other local
Case study contact
Paul Crowther, Public Transport
Manager. Tel: 01273 292479. Email:
[email protected]
transport: Promotion of cleaner vehicles
Case study 12: Transport for London Hybrid Bus Programme44
Flickr/creative commons
In a series hybrid there is no mechanical
link between the engine and drive axle.
The engine powers a generator and an
electric motor powers the drive axle.
In a parallel hybrid the engine powers
the drive axle but is assisted by an
electrical motor during acceleration. A blended hybrid is a combination of
a series and parallel hybrid.
Key partners
Four bus manufacturers have six
types of hybrid buses operating on 10
London’s routes: Volvo, Wright Group,
Alexander Dennis, and Optare.
At the beginning of 2009 there were 56 hybrid buses in London
Transport for London has initiated
a scheme to ensure all new buses
entering service after 2012 will
incorporate hybrid technology to reduce
fuel consumption and CO2 emissions,
contributing to the Mayor’s target of a 60
per cent reduction in emissions across
London by 2025. In December 2007,
there were no hybrid buses. At present,
there are 56 double and single-deck
hybrid buses in operation, out of a total
fleet of 8,300 London Buses.
The delivery of the scheme is structured
in two phases:
Phase 1 was trial and evaluation and
involved different technologies from four
manufacturers;12 hybrid buses were in
operation by December 2007; and 56
vehicles by January 2009.
The manufacturers are: Wright Group,
Volvo, Alexander Dennis and Optare.
Phase 2 is the current phase, in which
proven technology is to be rolled out.
TfL aims to have 300 hybrid buses by
2011. After 2012 all new buses entering
the fleet will be hybrid.
The hybrid buses are powered by a
combination of conventional diesel
engine and electric motor. The hybrid
driveline utilises regenerative braking to
capture electrical energy during braking
that would otherwise be wasted as
heat. This energy is stored in a battery
pack which is used to drive the electric
motor. Capturing and utilising this
energy means the buses use about 30
per cent less fuel and so produce about
30 per cent less CO2.
Three main types of hybrid bus are
operated by Transport for London
in London – series hybrids, parallel
hybrids and blended hybrids.
• R
eduction in local air pollutants will
lead to fewer cases of respiratory
problems, eg asthma.
• S
moother acceleration/deceleration
creates better passenger environment
and lower risk of accidents.
• 3
0 per cent reduction in perceived
sound levels leads to better quality of
life for London residents.
• More than 30 per cent reduction in
CO2 per bus.
• TfL regulates by far the biggest bus
fleet of any local or regional authority
in the UK and, therefore, enjoys some
ability to influence the development
decisions of bus manufacturers. Its
aggressive policy will help stimulate
a new market for hybrid bus vehicles
across the country.
• Over 30 per cent reduction in fuel
use, compared to conventional diesel
buses, means less non-renewable
resources used and less damage to
landscape (ie land, sea).
transport for london hybrid bus programme
• Initial capital costs have been 75
per cent higher than standard diesel
buses, as would be expected for a
new vehicle which is not yet subject
to mass production. TfL has invested
from the £25m climate change fund it
established to support implementing
its responsibilities under former Mayor
Ken Livingstone’s Climate Change
Action Plan. The fund was intended
to support projects that fell outside of
TfL’s normal operational budget.
• The investment strategy is thus
based on a recognition that subsidy
will initially be required to stimulate
the market for hybrid buses, but also
that later mass production and lower
operating costs (due to reduced
fuel consumption) will bring the
overall costs of hybrid buses to the
equal or below that of conventional
combustion engine-only vehicles.
Barriers to replication by other local
Now that a market has been created for
hybrid buses, other local authorities are
able to procure them in the normal way.
Using quality partnerships and contracts
(see Brighton and Hove Buses) a local
authority has the ability to encourage or
stipulate that only the greenest buses
are used by private operators.
Replicable funding sources
TfL’s relatively large budgets and
the scale of its fleet have enabled it,
through forward-looking leadership, to
invest to force bus suppliers to provide
hybrid buses to a UK specification.
Probably no other local authority could
have done this, but all authorities can
now take advantage of the competitive
market that has been created.
More information
Case study contact
Mike Weston, Operations Director,
Transport for London. Tel: 020 3054
9231 Email: [email protected]
18 Information provided by City of Houston on
23rd June 2009.
2 “Cuts are coming, no matter what Brown says”
by Robert Chote in The Daily Telegraph,
11 June 2009
19 London Climate Change Agency, Barkantine
Combined Heat and Power Plant Case
study: April 2008 (source:
3 “Our public debt is hitting Armageddon levels”
by Steve Bundred, in The Times, 27
February 2009
4 HM Treasury, Operational Efficiency
Programme: final report, April 2009,
pages 69 to 77
5 UK Government, The UK Low Carbon
Transition Plan, 2009, page 94
6 UK Government, The UK Low Carbon
Transition Plan, 2009, page 96
7 Department for Business, Enterprise and
Regulatory Reform, Energy Measures
Report, September 2007
8 Local Government Information Unit, Carbon
Trading Councils Taking Stock, 2008,
page 4
9 See Commission for Architecture and the Built
Environment, The 10 assessment criteria
10 Lyons Inquiry report
11 Eddington Review report
12 Centre for Cities, TIF
13 Budget 2009, TIF
14 All information verified by Kirklees Borough
Council, unless otherwise referenced
15 SAP is the Government’s Standard
Assessment Procedure for Energy Rating
of Dwellings. SAP 2005 is adopted by
government as part of the UK national
methodology for calculation of the energy
performance of buildings. It is used to
demonstrate compliance with building
regulations for dwellings - Part L (England
and Wales), Section 6 (Scotland) and
Part F (Northern Ireland) - and to provide
energy ratings for dwellings.
16 All data from City of Houston Residential
Efficiency Program (REEP), General
Services Department Executive Summary,
January 2009 and responses provided
by the City of Houston, unless otherwise
20 The relevant grant funding stream today
will be the Community Energy Saving
Programme (CESP) Consultation
Response and Analysis, DECC/DCLG
June 2009,
21 Sustainable Homes case study on London
Borough of Tower Hamlets. Date of
publication unknown.
22 Community Energy Saving Programme
(CESP) Consultation Response
and Analysis, DECC/DCLG June
34 The replacing of medium sized turbines
with larger ones in smaller wind farms
across Europe has increased the
availability of second hand turbines with
significant design lives remaining. The
Gigha Windmills were previously used at
Windcluster’s Haverigg 1, wind farm in
Cumbria and each have eight years of their
design life left.
35 Highlands and Islands Community Energy
Company, Isle of Gigha Community Wind
Farm. Date of publication unknown.
36 Greater London Authority (2008) The London
Plan: Spatial Development Strategy for
Greater London – Consolidated with
Alterations since 2004
37 The London Energy Partnership and London
Renewables (2004) Integrating renewables
energy into developments: Toolkit for
planners, developers and consultants
38 London Southbank University (2007) Review
of the impact of the energy policies in the
London Plan on applications referred to the
39 The London Energy Partnership and London
Renewables (2004) Integrating renewables
energy into developments: Toolkit for
planners, developers and consultants
40 London Southbank University (2007) Review
of the impact of the energy policies in the
London Plan on applications referred to the
29 Arup calculation
30 All data sourced from Southampton City
Council and Utilicom unless otherwise
31 All information provided by Aberdeen Heat
and Power unless otherwise stated
32 The source of biomass is still being
investigated by AH&P, pending the results
of commissioning being undertaken by the
University of East Anglia.
41 Socialdata and Sustrans Darlington
–Sustainable Travel Demonstration Town:
Travel Behaviour Research. Final evaluation
report for Darlington Borough Council,
March 2009 (source:
42 ELTIS, High-Quality, High-Use Bus-based
public transport – Brighton & Hove, Sept
2008. (source:
44 All information supplied by Transport for
London unless otherwise stated
This report is part of Friends of the Earth’s Get Serious About
CO2 campaign. It has been prepared for local government
officers and members, as well as Friends of the Earth local
groups. It is designed to show how local authorities can make
deep cuts in carbon dioxide in their areas – and how they can
pay for them.
The report consists of two pieces of research. The first outlines
how more money could be freed up for councils to take action on
climate change. The second details successful local initiatives to
cut carbon dioxide emissions. Both are intended to show local
authorities that cuts in CO2 emissions are not only necessary –
but are possible too.
report commissioned by Friends of the EARth
REsearch by Professor tony travers and Arup
Making life better for people by inspiring solutions to environmental problems
Friends of the Earth, England Wales and Northern Ireland
26-28 Underwood Street, London N1 7JQ, United Kingdom
Tel 020 7490 1555 Fax 020 7490 0881 Website
Trust company number 1533942, charity number 281681
Printed in the UK on paper made from 100 per cent post-consumer waste
November 2009