UK ETS: what you need to know about reporting

The UK was a founding member of the EU Emissions Trading Scheme when it first launched in 2005. As the world’s first major carbon market, it was designed to incentivise the reduction of carbon emissions in a cost-effective way. Following Brexit, the UK established its own Emissions Trading Scheme (UK ETS) to further drive down emissions and maintain the UK’s competitiveness in a green global market.

How does the UK ETS work?

The UK was influential in the design of the EU ETS. So, it came as no great shock that when the UK ETS launched in May 2021, it looked very similar to its predecessor.

The system still works on the ‘cap and trade’ system. This means that a cap is set on the total amount of certain greenhouse gases that can be emitted by installations covered by the system. The cap is reduced over time so that total emissions fall in line with the UK’s net zero target.

This cap is converted into tradable emission allowances. For each allowance, the holder has the right to emit one tonne of CO2 (or its greenhouse gas equivalent). After each year, large energy users must give up enough allowances to cover all their emissions or face a fine.

What does it mean for companies that apply?

Facilities with installed combustion equipment above the 20MWth threshold are required to monitor and report their emissions each year. They then must surrender allowances to cover their reported emissions.

A portion of allowances will be issued for free to eligible installations (typically energy intensive industries or aviation). This follows the same approach as the EU ETS. If they are likely to emit more than their allocation, companies can take measures to reduce their emissions or buy additional allowances.

If a company decides to reduce its emissions, it can keep the spare allowances to either use the following year or sell them on. In this way, the ETS helps to monitor emissions from energy intensive industries and incentivises carbon conscious strategies. And it’s been a successful driver of reductions. Between the launch of the EU ETS in 2005 and 2019, emissions from installations covered by the scheme have declined by about 35%.

This is promising progress for the fight against climate change, and the UK ETS is expected to be even more ambitious in readjusting its cap. This will mean tighter restrictions on emission reductions in future carbon reporting, especially for big energy users.

uk ets timeline

How can EIC help?

EIC has a team of dedicated Carbon Consultants and Data Analysts who provide an all-encompassing UK ETS service. We provide you with guidance and support: interpreting complex legislation and keeping you up to date with any policy shifts. You will be assigned a dedicated Carbon Consultant who will help you navigate the reporting and compliance process with ease.

Our in-house carbon team has extensive experience with reducing energy consumption, costs and emissions for our clients. This means we can keep you ahead of the curve and prepare your business for future reporting requirements.

To learn more about how EIC can help you with reporting for UK ETS, contact us today.

COP26’s race to zero begins

EIC highlights the key points made in COP26 President Alok Sharma’s speech, which symbolised the beginning of the organisations ‘Race to Zero’ campaign, and how business leaders can take a poll position despite the starting gun having already been fired.

Mapping the future

News that the UK will postpone its hosting of the UN climate change conference (COP26) was not unexpected, given the necessity for social distancing that COVID-19 has imposed, however it did raise concerns over the UK’s determination to enact a green recovery post-lockdown.

While the UK track record may, in part, justify some of these concerns, individual safety is not the only benefit of such a delay to talks, for one the nations taking part will need a clear idea of the state of their respective economies once lockdown ends before committing to new policy. 

And from a psychological perspective it might be argued that due to the all-consuming nature of the pandemic when it comes to public and government attention, the conference would not receive the attention necessary if it went ahead this year.

How far we’ve come

Despite the conference now being slated for Q4 2021 (-12 November), Alok Sharma gave a speech last Friday that reasserted the UK’s ambitions and responsibilities with regards to the 2050 net zero target and how the race to zero was already hastening its completion.

The UK, in collaboration with Chile and the U.N., are already leaders of the Climate Ambition Alliance – representing over half of global GDP – however Sharma insisted in his speech that “…we must go further”.

Sharma outlined some of the UK’s major achievements in reducing carbon emissions in the last thirty years:

  • Since 1990 the UK economy has grown by 75% while simultaneously reducing carbon emissions by 43%
  • In the same time, the UK has two offshore wind turbines able to power 2,000 homes, as of 2020 the UK is leading nation for offshore wind capacity
  • Globally, the cost of solar and wind power have dropped by 85% and 49% respectively
  • Over two thirds of the worlds nations can now generate renewable energy cheaper than coal

While details of the path forward remain scant – not surprising given the reasons for postponement – Sharma made it clear that liberating capital to fund green initiatives and widespread support for electric vehicles would be crucial to the UNFCCC’s success.

Approximately 1,000 business leaders, representing revenue totalling in excess £3.5tn have committed to the scheme including British motor giant Rolls Royce. According to the United Nations Framework Convention on Climate Change UNFCCC, around 75% of these businesses have already developed strategies and targets aligned with the 2050 target.

Dr. Alison Doig, international lead at the ECIU (Energy & Climate Intelligence Unit) recently commented on the danger of complacency in the opening stages of such a race. 

“This is not, however, about pushing climate action to some date in the future; no entity can reach net-zero in 2050 without starting now… participants will have to present delivery plans, including setting interim targets for the next decade, by the time COP26 opens in Glasgow next year.”

Clean energy was the first element of the British economy that Sharma cited when referring to the need for green growth after lockdown, making it a pressing issue for business leaders looking to get a head start on net zero. EIC provides comprehensive  support and advice to businesses in the procurement, management and generation of alternative energy sources. Each service forms an element of the robust energy management service that EIC offers.

 

 

 

 

 

 

EIC’s Utility Belt: Tips for more effective utility management

EIC outlines its best advice for intelligent energy management, minor changes that can yield significant savings and the importance of consistency in establishing new workplace cultures.

Technology vs culture 

The majority of your utility belt will be focused on the technology that you are currently using or could utilise in future however there is also a short section on the culture within your business and how that can factor into your success.

Heating and Ventilation 

Comfortable ambient temperature has become something of an assumption, commercially speaking, however the technology behind it often remains unexplored except to establish its basic controls for the user. Given that air conditioning alone can account for up to 30% of a site’s energy consumption, this is a significant oversight that, sadly can be solved very simply.

Sealing off or switching on 

A common method of controlling indoor temperatures is by sealing buildings, preventing windows being left open, however this can actually exacerbate the overall costs trying to be mitigated. It means air conditioning will be working overtime during hotter periods but also that air circulation may take a dip, meaning higher concentrations of CO2 and dampened performance from staff as a result.

IoT connectivity across sites can use occupancy monitoring and responsive temperature and air quality control to mitigate these issues. The provision of real-time data streams means that you can control individual spaces across large sites, maintaining utility usages that are responsive to demand and need.

Casual is smart 

Enstating a casual dress code during acutely hot or cold weather conditions means that staff will be able to offset their own demand on heating or cooling, not to mention be more comfortable in their work. 

Dig for victory

Planting trees is also a relatively cheap and environmentally friendly way to offset heating costs, since they provide shade and fresh oxygen as well as absorbing latent humidity in the air.

Lighting 

Intelligent lighting control can save 30-50% on energy costs automating this utility according to occupancy and respective demand means that you will not have spaces unnecessarily drawing power that isn’t being utilised. 

Let the sunshine in 

Not always an option depending on how sites are initially designed, however by using automated lighting, you can schedule lights to power down during daylight hours and reactivate once night falls. 

Using what you have 

The installation of LED bulbs for better efficiency and a longer lifespan can be an added boost to light use efficiency without being disruptive to pre-installed equipment, motion sensors are another low-impact option that help ensure that light is never wasted.

Professional culture 

As social creatures, culture is effectively the software that our communities run on, understanding this means that you can leverage your professional culture to become more energy efficient with a minimum of cost.

Empowering your team 

The use of environmental posters can help remind team members that their actions have weight in something larger than themselves. Small adjustments like the use of power strips also make it easier for them to adopt the positive habits that will be the foundation of your new professional culture. 

Communicate that computers should be shut down at the end of the day rather than left in standby, especially before the weekend. It has been estimated that a company with 200 PCs could save £12,000 annually this way. 

Breaking ranks 

2020 has demonstrated many things, among them our ability to work remotely and effectively and how doing so can help foster trust between managers and staff members. Encouraging this way of business means you can reduce or re-purpose the amount you are spending on office space and its attached utility costs. The same can be said of meetings that might’ve taken place on-site, by using video technology to bridge these physical gaps you reduce the occupancy on your own sites and the utility usage along with it.

Measure for measure 

Meters and sub-meters are essential tools in understanding the energy needs of a site as well as what areas have the highest concentration of usage. Armed with this information you are better equipped to make policy decisions pertaining to both technology and culture within your utility management. The Carbon Trust has found that a site meter can save 10% in energy costs while sub-metres, which allow you to pinpoint areas where demand is highest, can offer a further saving of 30%.

Going the extra mile

There are a number of additional features that can be added to the design of many sites to both off-set and reduce utility costs including on-site solar generation & storage, combined heat and power and demand side response schemes.

EIC can create a comprehensive and all-inclusive package for your business that oversees all aspects of utility management from metering & monitoring to IoT empowered devices that keep you connected to site data 24/7.

Open architecture technology affords access to all your vital business systems, meaning EIC can communicate with, control and report on any aspect of any site including heating, lighting and ventilation. Our services page contains full details of our offerings.