Tyndall Report.Indd

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The Tyndall Centre is a partnership of researchers from nine UK research institutions:

University of Cambridge, SPRU (University of Sussex), ITS (University of Leeds), CEH Wallingford, Cranﬁeld University, ERU (CCLRC-RAL)

The Tyndall Centre is core funded for an initial ﬁve years by a partnership of three of the UK’s Research Councils and receives additional support from the DTI.

www.tyndall.ac.uk Decarbonising the UK Energy for a Climate Conscious Future

Contents

Foreword by Colin Challen MP 03 Summary for policymakers 04 Summary of the Tyndall integrated scenarios 06 Introduction 10

Section One: The Tyndall integrated scenarios 13 Methodology 17 Description of the ﬁve scenarios 20 Carbon dioxide emissions 31

Section Two: Main ﬁndings from the Decarbonising the UK projects 33 The supply of renewable and clean energy 38 Integrating renewables and CHP into the UK electricity system 38 Security of decarbonised electricity systems 38 The hydrogen energy economy 39 PhD project highlight: Assessment of decarbonised industrial utility systems 40 Sustainable energy in the built environment 41 Climate change extremes: implications for the built environment in the UK 41 Fuel cells: providing heat and power in the urban environment 41 Microgrids: distributed on-site generation 42 Special feature: The 40% house 43 Sustainable transportation 46 Reducing carbon emissions from transport 46 Special feature: A looming problem in the skies 47 Carbon dioxide sequestration, capture and storage 51 Development and carbon sequestration: forestry projects in Latin America 51 PhD project highlight: Carbon sequestration in agriculture 52 An integrated assessment of geological carbon sequestration in the UK 52 Policy trends, instruments and mechanisms 54 The contribution of energy service contracting to a low carbon economy 54 Special feature: Domestic tradable quotas 55 Key issues for the asset management sector in decarbonisation 59 PhD project highlight: Greenhouse gas regional inventory project 59 Conclusions from Sections One and Two 61

Section Three: Exploring transitions to sustainable energy 63

Publications from the Decarbonising the UK Theme 77 The Tyndall Decarbonising the UK project researchers 82 Endnotes 84 02 Decarbonising the UK – Energy for a Climate Conscious Future Decarbonising the UK – Energy for a Climate Conscious Future 03

Foreword

The Tyndall Centre has produced and continues to produce ground breaking research into climate change and, for a politician keen to encourage my peers to take urgent action on what has been called a worse threat to civilisation than terrorism, I know how vital it is that such calls to action are backed up by solid evidence. I have been impressed by the ‘cool heads’ at Tyndall, who (unlike the occasional politician!) seek to demonstrate their hypothesis before rushing to judgement. No doubt this sometimes leads to dispute, but the role that academia is playing in informing political action is now at its greatest intensity in the debate about climate change. Knowing that the Tyndall Centre is seeking to delineate the problems we face is something of a relief to us politicians, even if the solutions are still very hard to grasp. I welcome this report on the activities of the Tyndall Centre, and look forward with trepidation to its future reports.

Colin Challen MP Chair of the All Party Group on Climate Change, Member of the Environmental Audit Select Committee 04 Decarbonising the UK – Energy for a Climate Conscious Future

Summary for policymakers

The Decarbonising the UK scenarios produced by the Tyndall Centre are the ﬁrst to fully integrate the energy system and include carbon dioxide emissions from air, sea and land transport. The scenarios integrate the perspectives of energy analysts, engineers, economists and social and environmental scientists to provide a whole system understanding of how the UK Government can achieve a ‘true’ 60% carbon dioxide reduction target by 2050.

The failure of governments to account for emissions from international aviation and shipping has led to a serious underestimation of the actions necessary to achieve a true 60% reduction. Within the UK this is particularly evident; whilst the Government’s Energy White Paper emphasises the need for signiﬁcant carbon reductions, the Aviation White Paper supports considerable growth in air travel. Research conducted at the Tyndall Centre demonstrates the urgent need for coherent climate policy across key departments, including DEFRA, DfT, DTI, HM Treasury and ODPM.

The Tyndall scenarios clearly illustrate that even a true 60% reduction in the UK’s carbon dioxide emissions is technically, socially and economically viable. Consequently, it is within our grasp to reconcile a dynamic and economically successful society with low carbon dioxide emissions. Summary for policymakers 05

Decarbonising energy demand internationally, are compatible with the UK’s true 60% target. A higher target will likely Efficiency improvements can dramatically curtail the rate of growth in personal mobility decarbonise many sectors as well as the choice of transport modes and fuels, however it is difficult to envisage a target There is significant potential within many that would necessarily reduce mobility. sectors to reduce their carbon emissions through relatively small increases in the Emissions from international aviation and incremental rate at which their efficiency shipping must be included in carbon targets ‘naturally’ improves. This is particularly the case when these can be allied with similar Aviation and shipping are the two fastest incremental reductions in the carbon intensity growing emission sectors. Failure to include of their energy supply. The net rate of them will lead to the misallocation of decarbonisation must exceed the economic resources earmarked for carbon-reduction growth rate for absolute reductions to occur. measures. The Government’s projected expansion of aviation will force emission Demand-reduction offers greater flexibility than reductions from all other sectors to low carbon supply substantially exceed 60% if the UK is to make its fair contribution to “avoiding dangerous The natural replacement rate of domestic climate change”. and commercial end-use equipment avoids the long term lock-in associated with new and capital-intensive energy supply such as The role of government power stations. Moreover, the costs of end-use technologies are spread amongst millions of To implement and enforce minimum consumers, whilst the initial capital outlay of energy standards supply alternatives are typically borne by a small number of companies (or government). The best available equipment and appliances on the market are often twice as efficient as the typical product sold. Consequently, in Decarbonising energy supply many situations a 50% reduction in carbon emissions is already available. Government Supplying low-carbon energy is both must supplement labels and customer goodwill technically and economically viable with binding and incrementally-improving relative and absolute efficiency standards. Whilst many low-carbon technologies still require considerable development, Equity concerns will demand innovative overcoming technical difficulties is unlikely to policy mechanisms be a constraint on low carbon energy supply. Similarly, given that economies of scale will It is difficult to envisage the public accepting likely reduce the cost of these technologies, policies for achieving large carbon reductions large scale deployment of low carbon energy which require the majority to reduce their current supply is likely to be economically viable. carbon-intensive consumption patterns whilst permitting a significant minority to continue to A society with high energy demand will face enjoy a high-carbon lifestyle. Consequently, future infrastructural challenges more innovative policies that go beyond the simple price mechanism and consider quantity The extensive infrastructure associated constraints directly may be required. with high energy futures, for example, large increases in the number of power stations, All 60% futures require immediate action – transmission networks, airports and roads, may but some require more action than others be problematic for the UK’s small and densely populated mainland. The 60% carbon reduction target can be reconciled with high, as well as low, energy consumption. However, high energy Decarbonising transport consumption futures require immediate action in relation to both energy supply (e.g. R&D Low-carbon futures do not preclude increases and site evaluations for large infrastructure) in personal mobility and energy demand (e.g. stringent efficiency standards and carbon taxes), whilst low energy Substantial increases in the number of consumption futures require immediate action passenger-km travelled, both nationally and in relation to energy demand only. 06 Decarbonising the UK – Energy for a Climate Conscious Future

Summary of the Tyndall integrated scenarios

The Decarbonising the UK programme of research has explored a range of technical, managerial and behavioural options for reconciling a vibrant UK society with a true 60% reduction in carbon emissions by 2050. The Tyndall integrated scenarios project brought together key insights from the breadth of Tyndall projects to articulate a range of carbon-constrained futures. This summary identiﬁes the principal ﬁndings arising from the scenarios described in detail in Section One.

The bottom-up process developed for generating the Tyndall integrated scenarios has resulted in a suite of scenarios that do not lend themselves to simple characterisation, whether in terms of energy supply, demand, innovation, efﬁciency or economic growth. Consequently, to encourage the users of the scenarios to interpret them within a more inclusive context, they have been allocated neutral descriptors. Within this report the ﬁve scenarios are referred to as Red, Blue, Turquoise, Purple and Pink, with Orange representing the present day. Summary of the Tyndall integrated scenarios 07

I At least in any inclusive quantitative Where does the carbon buck stop? the strong correlation between an expanding form. The IAG do make brief economy and growth in both imports and quantitative reference and qualitative comment on international growth is the problem – exports. All the scenarios demonstrate aviation, however, they subsequently proceed to quantify their scenarios guiding growth the answer emissions from shipping matching, if not without the inclusion of aviation. exceeding, those from private road transport. The marine sector is neglected in all current scenario sets. If the annual improvement in both the II A consequence of the aviation efficiency of energy services and the carbon emissions – cardinal not ordinal industry being both very difficult to thermodynamic efficiency of energy supply decarbonise and subject to very high growth rates. were to continue at their historic rates, and Ordering the sectors in relation to their III The figures for aviation within the assuming no increase in demand, our current respective carbon emissions produces scenarios are different from those annual energy consumption would reduce by a ranking that closely matches that for within the aviation project itself. This is because the aviation project did more than 60% by 2050. In other words, at a their energy consumption. However, as a not assume a 60% target (as is the case for the scenarios), but rather simplistic level, if it were not for economic consequence of some sectors being much analysed emissions under various growth, the government could achieve its more difficult to decarbonise than others, growth and efficiency assumptions – based on historical trends, DfT carbon reduction target without recourse such a ranking hides substantial quantitative predictions etc, and compared these with the target. The aviation project to explicit carbon-mitigation policies. differences between sectors. An unequivocal was therefore intended to show the Consequently, our current level of consumption and dominating conclusion in relation to incompatibility of even moderate levels of growth with the 60% target, is of far less significance in terms of carbon carbon emissions is that growth in aviation as opposed to actually fitting air travel within the 60% target, as was emissions than the additional services and must be dramatically curtailed from both the case for the scenarios project. commodities arising from economic growth. its current level and historical trend.II Even when substantial reductions are made within The Tyndall scenarios, all of which achieve a Tyndall scenarios (Purple, Pink, Turquoise and 60% reduction in carbon emissions and all Blue), aviation was still found to be responsible of which assume moderate to high levels of for between one and two thirds of the UK’s economic growth, exemplify a range of options permissible carbon budget.III In only the Red for reconciling increased economic prosperity scenario, where the percentage in aviation with low carbon emissions. In essence, both growth was constrained to match the sector’s the endpoint scenarios and their associated percentage improvements in efficiency, pathways illustrate the scope for providing did emissions from aviation permit a more carbon boundaries within which the economy equitable distribution of the constrained carbon can grow. Whilst such boundaries do not budget between aviation and the other sectors. necessarily dictate the specific direction that growth should take, they nevertheless guide it within an acceptable low-carbon limit. Efficiency, growth and consumption It is the role of all tiers of government, in collaboration with both the private sector the impact of energy efficiency is sometimes and wider civil society, to determine what counterintuitive form these boundaries should take. The Tyndall scenarios demonstrate that there is no simple and direct correlation between Who are the main carbon culprits? energy efficiency and actual energy demand. Consequently, the scenarios with lower aviation and shipping – energy demand are not necessarily those in emissions scenarios must be inclusive which energy efficiency improvements have been most vigorously pursued. Within the The exclusion of emissions from international Tyndall scenarios, the rate of energy efficiency aviation and shipping from both the suites of improvement is more closely correlated with existing scenario setsI and the Government’s economic growth than with final energy 60% carbon-reduction target has led to highly demand. For example, the Red scenario with misleading conclusions. The Government, and its very low energy consumption and high the expert community on which it ultimately economic growth rate, has the lowest energy relies, must include all significant sectors as intensity; however, the scenarios with the a matter of urgency if they are to genuinely joint second lowest energy intensity are the address the issue of climate change. Purple and Pink scenarios, in which energy consumption and economic growth are In relation to aviation, all the Tyndall scenarios, both very high. The Blue scenario achieves with the exception of the Red scenario, where a doubling of the economy by 2050 with an aviation growth is 80% lower than today, show energy consumption of only 75% of today carbon emissions from aviation dwarfing those (i.e. a reduction of a quarter). However, whilst from all other sectors, despite assumptions this may initially give the impression of a about the availability of low-carbon fuels. society driving the energy efficiency agenda, Turning to shipping, the scenarios illustrate it is actually the most energy intensive of all 08 Decarbonising the UK – Energy for a Climate Conscious Future

IV Within the relatively wide range the scenarios – with its associated annual By contrast, even at very high sectoral included in the Tyndall scenarios. reduction in energy intensity little removed growth rates (e.g. up to 6% p.a in some from the historical trend. scenarios) public administration (inc. hospitals, schools etc), domestic aviation, rail, public The important message to be derived from road, coastal/inland shipping, agriculture this is that characterising energy scenarios and construction all are individually of little as high energy supply or low energy demand, significance in terms of the energy they potentially belies more significant structural consume. However, whilst their respective factors of central importance to policy direct energy consumption is low, several makers. For example, whilst the Red and of the sectors are highly significant in terms Purple scenarios may differ by a factor of almost of their impact on the energy consumption four in their energy consumption, they are of other sectors. For example, the higher much closer in relation to their respective rates energy consumption associated with a 10-fold of energy efficiency improvement and hence increase in public transport will be more than their energy intensity in 2050. By contrast the compensated by the very substantial reduction Red and Blue scenarios, though very similar in energy consumed as passengers substitute in terms of 2050 energy consumption, have a the private car for the train, tram and bus. four fold difference in their respective energy intensity. Put another way, within the Tyndall scenarios both the very low and very high Low-carbon supply – technically possible energy demand scenarios have embedded within them a dynamic and innovative agenda innovation is needed to overcome institutional, of energy efficiency improvements. economic and social barriers

energy consumption patterns The Tyndall scenarios project began with a relatively detailed supply portfolio, including Within all the scenarios energy consumed diverse fuel choices, various options for within a sector is an important driver of that generating electricity and, to a lesser extent, sector’s carbon emissions. However, the different scales of supply. However, what spread of carbon intensities associated with emerged as the scenario process progressed different electricity generation and fuel options was that providing society with low-carbon gives rise to substantial differences in the energy supply is technically feasible and relationship between energy consumption not economically prohibative, even in high and carbon emissions for each sector. energy consumption futures. Certainly, those Nevertheless, even for those sectors with scenarios with higher energy consumption moderately high levels of decarbonised energy demanded more innovative management supply, their actual energy consumption often structures, flexible customer expectations and remains a significant carbon-driver. a different relationship between the public and various tiers of government in relation In reviewing the demand characterisation of the to planning, than those scenarios with lower scenarios, it is evident that regardless of the net energy consumption. However, such issues, energy growth rate considered for any sector,IV along with technical challenges associated a pattern of relative energy consumption with supplying low-carbon energy, were not emerges. Such a pattern offers useful lessons considered insurmountable by the experts for policy, irrespective of the Tyndall scenarios. contributing to the supply assessment during The principal message stands out clearly either the three workshops or more specific – the most intractable sectors in terms of one-to-one discussions. energy demand reduction are International aviation and the household – these sectors centralised or localised are the highest energy consumers in all the Tyndall scenarios. Whilst there exists a vibrant debate as to the merits or otherwise of centralised Another pattern emerges in relation to a group and distributed energy supply systems, in of sectors which, unless ascribed considerably developing the Tyndall scenarios an element lower economic growth than currently of centralised supply emerged, to varying experienced or subject to very substantial degrees, as an important facet in all of improvements in energy efficiency, are also them. However, the relative dominance of significant energy consumers. The sectors centralised supply is reduced from that in this group are: private road, shipping, of today in all the scenarios, through the commercial, industry (non-energy intensive) penetration of differing levels of onsite and road freight. renewables across various sectors. Summary of the Tyndall integrated scenarios 09

Carbon-reduction is a chapter of a consensus that the very substantial physical bigger story infrastructure associated with the high energy consumption scenarios could not be sustainability issues question the viability of achieved without significantly compromising high-energy low-carbon scenarios the UK’s position on sustainability. Moreover, there was almost universal agreement that The multi-criteria-assessment (MCA) those scenarios where society had adapted to conducted as part of the Tyndall scenarios live with lower absolute energy consumption process had one very clear message in were likely to be more resilient to forces of relation to sustainability. Whilst all the change. Such forces included, for example, scenarios were explicitly designed to achieve increased scientific understanding of climate a 60% reduction in carbon emissions, the change demanding higher decarbonisation experts who evaluated the scenarios against rates, reduction in the security of non- wider sustainability criteria were in little doubt indigenous fuel supply, and substantial that the lower energy scenarios, including fluctuations in the price of energy. There was the economically-dynamic Red scenario, not, however, any real consensus on whether were preferable to those scenarios with those scenarios with low energy consumption large energy demand (Turquoise, Purple were more or less resilient to wider ‘side- and Pink). It was evident from the MCA swipes’ such as major climatic events or workshop and the subsequent analysis of the natural disasters, though scenarios with transcripts and other written material, that the substantial nuclear supply were considered reasoning behind this decision was multi- more susceptible to events such as war and faceted. However, there did emerge a clear terrorist attack. 10 Decarbonising the UK – Energy for a Climate Conscious Future

The Tyndall Centre extract, process and use fossil fuels. Moreover, for Climate Change Research widespread user acceptance and experience of fossil fuel based systems, significant R&D The Tyndall Centre for Climate Change investment and well understood energy Research was founded in the year 2000 to properties combine to further lock industrial research, assess and communicate the options society into fossil fuel based energy. With for both reducing greenhouse gas emissions this in mind, achieving substantial reductions and adapting to the impacts of global climate in emissions will require new, possibly change, and to explore the sustainability of radical, ways of thinking about the energy these options in the context of sustainable system in addition to enhanced incremental development at the global, UK and local scales. improvements in energy efficiency. Since future In 2001, the work was organised into four major demand is the product of the continuation of themes: Integrating Frameworks, Decarbonising current behaviours, technologies, economic the UK, Adapting to Climate Change and practices and policies, it follows that in order to Sustaining the Coastal Zone. achieve a substantially decarbonised society, a transition in some or all of the demand and This report presents the key findings from the supply-side factors is required. Decarbonising the UK theme. The theme has been managed by a team at the University of Manchester with support from the University of The climate imperative: East Anglia. Research projects were selected from a 60% to an 80% reduction through a competitive process between 2001 and 2003 according to the assessment criteria Article 2 of the United Nations’ Framework of: quality, multi- and/or interdisciplinarity, and Convention on Climate Change (UNFCCC) engagement with appropriate stakeholders states that a key aim of the treaty is and policymakers. The research has been “…stabilisation of greenhouse gas conducted by approximately 70 researchers concentrations in the atmosphere at a level based in 17 universities and research institutes that would prevent dangerous anthropogenic across the UK. This report represents the interference with the climate system”. In culmination of, and key findings from, the its seminal report Energy: the Changing Tyndall Centre’s work on Decarbonising the Climate (2000) the Royal Commission on UK. It is, nevertheless, a summary of a much Environmental Pollution (RCEP) accepted the larger body of work, the full content of which view that a 2ºC rise in temperature represents can be accessed via the Tyndall Centre’s the threshold of a safe level of global website (www.tyndall.ac.uk). climate change. This target implies that the

atmospheric concentration of CO2 should not exceed 550 ppmv (parts per million by unit The problem volume). The RCEP argued that, for the UK,

this represented a reduction in CO2 emissions The UK, like all industrialised nations, is of 60% by 2050. The UK Government currently ‘locked-in’ to a carbon intensive endorsed the 60% ﬁgure as its long-term

energy supply system technologically, target for CO2 emissions reduction in the 2003 institutionally and in relation to the Energy White Paper.1 The Government has, conventional centralised structuring of the therefore, accepted the rationale of its climate energy network. Carbon intensive lifestyles change and greenhouse emissions policy as and consumption patterns have co-evolved being in pursuit of the objective of Article 2 of with the availability of carbon-based energy the UNFCCC. systems. Carbon-based energy systems enjoy signiﬁcant advantages over decarbonised Tyndall’s work on decarbonisation has adopted systems, including favourable economies the Government’s 60% target and focused of scale, a pervasive and well established on how this may be achieved by 2050, with infrastructure and supporting technologies to appropriate intermediate targets such as: Decarbonising the UK – Energy for a Climate Conscious Future 11

Introduction

• Meeting the Kyoto Protocol requirement of a the UNFCCC and changes quite fundamentally V Even a mean global temperature change of 2ºC still implies accepting 12.5% reduction in a basket of six greenhouse the scale of the challenge of decarbonisation some very signiﬁcant ecosystem gases by 2010 (relative to 1990 levels) in the UK context. damage and loss of human life

• Meeting the domestic target of a 20% Section Two then provides a brief resume

reduction in CO2 emissions by 2010 (relative of all the major projects conducted in the to 1990 levels) Decarbonising the UK theme. Because of their large number, project descriptions have had to • Meeting the Government’s target of 10% be brief, but aim to cover the main objectives of electricity from renewable sources by 2010, the projects, the principal findings and the key 15% by 2015 and an aspirational 20% target recommendations. The detailed project reports by 2020 are readily available on the Tyndall website or by contacting the principal investigator. More recent research at the Hadley Centre and elsewhere has suggested that a ‘safe’ Finally, in Section Three, Simon Shackley, atmospheric CO2 concentration may be co-manager of the research, reflects upon 450ppmv or lower, the difference being due the overall findings in Sections One and Two primarily to the inclusion of bio-geochemical in the context of other research and emerging feedbacks in the Hadley General Circulation ideas in the social science literature. This Model (GCM). Indeed, the Department for the is a personal, and somewhat provocative, Environment, Food and Rural Affairs (DEFRA)2 contribution to the report. has acknowledged that a CO2 concentration of 450ppmv rather than 550ppmv relates to a We hope that you find the report stimulating temperature increase of 2°C.V and useful and we look forward to receiving any feedback that you might have to offer.

The corresponding CO2 emissions reduction required for a 450ppmv concentration is some 80 to 90% lower than 1990 levels. Hence, the Acknowledgements decarbonisation challenge for the UK (and other industrialised countries) is even greater We would like to thank all the contributors than that assumed in the analysis we present to Tyndall Theme 2, Decarbonising the UK, in this report. who are listed at the end of this report. We would also like to thank our main funders: the Engineering and Physical Sciences Research Structure of the report Council (EPSRC), the Natural Environment Research Council (NERC) and the Economic Section One of the report presents the findings and Social Research Council (ESRC). of the ‘flagship’ project on Integrated Scenarios of a 60% decarbonised UK energy system. Additional financial or other support is Five quite different scenarios are presented, gratefully acknowledged from: the Department with their final energy consumption ranging of Trade and Industry (DTI), the Sustainable from 90 million tonnes of oil equivalent (Mtoe) Development Commission, Shell, BP, the to 330 Mtoe (today’s value being 170 Mtoe). Environment Agency, the Process Integration A range of supply-side changes, including Consortium, EON, Engelhard Corporation, all the major contending technological and Innogy, Ofgem, Eddison Mission, Alstom and management options, are provided alongside United Utilities. the changes in the demand for energy. For the first time, energy scenarios for the UK have Finally, thanks are due to: Colin Challen MP, included CO2 emissions from international Mike Hulme, Nick Jenkins, Samantha Jones, aviation and shipping to 2050 (allocating 50% Brian Launder, Vanessa McGregor, of these emissions to the UK). The inclusion of Carly McLachlan, Asher Minns, Nick Otter, these sectors is appropriate given Article 2 of Harriet Pearson, Sue Stubbs and Jim Watson. 12 Decarbonising the UK – Energy for a Climate Conscious Future Decarbonising the UK – Energy for a Climate Conscious Future 1311

Section One The Tyndall integrated scenarios

Methodology

Description of the ﬁve scenarios

Carbon dioxide emissions 14 Decarbonising the UK – Energy for a Climate Conscious Future Section One: The Tyndall integrated scenarios 15

The Decarbonising the UK programme has, over the past ﬁve years, explored a range of technical, managerial and behavioural changes which are all options in helping to meet a 60% reduction in CO2 emissions by 2050. To integrate the disparate projects, and ensure that their insights extend beyond their individual boundaries, the Tyndall integrated scenarios project developed a new set of UK energy scenarios which articulate alternative carbon- constrained futures.

The Energy White Paper (EWP), published in international agreements and frameworks 2003 was informed by a number of energy and are therefore not included in National scenario studies, beginning with the work Greenhouse Gas Inventories reported under of the Royal Commission on Environmental UNFCCC. For this reason, international aviation Pollution in 2000.3 Energy scenarios were also and emissions from shipping have not been developed by the Performance and Innovation included in previous scenario studies of the

Unit (PIU) in its Energy Review as an input to 60% CO2 reduction target. Although these the EWP, based upon the Foresight scenario sectors are by no means currently the largest framework.4,5 Limited quantification of these in terms of their overall energy consumption, scenarios was undertaken and used as an and hence carbon emissions, they are two of input in the analysis and modelling undertaken the highest growth sectors in the economy by the Government’s Interdepartmental and therefore must not be ignored given that Analysts Group (IAG) for the EWP.6 At first the ultimate objective of climate change policy glance, therefore, the UK energy landscape refers to a target atmospheric CO2 stabilisation appears to be already well populated with level. The Tyndall aviation project illustrates that energy scenarios raising the question of why should the aviation sector continue to grow at the Tyndall Centre decided to develop a new rates similar to those experienced today, then approach to energy scenarios for the UK. There without a step change in technology, aviation are five reasons why Tyndall has developed is likely to become the single most important these new scenarios: emission sector by 2050. Similarly, in a world with increasing international trade, carbon 1 To integrate the findings from a wide range of emissions from international shipping will Tyndall decarbonisation projects also represent a significant proportion of the permitted level of emissions. 2 To explore what the inclusion of hitherto ignored demand sectors means for a According to our research, future international 60% target negotiations must include emissions from international aviation and shipping if they

3 To consider the transition to a substantially are to genuinely address atmospheric CO2 decarbonised UK concentrations and it therefore is essential that they should be included in our analysis

4 To provide an end-point scenario-generation of the UK’s long-term CO2 reduction policy. tool for the UK energy research community Analysis which excludes these emissions which permits the construction of a large substantially distorts the policy message number of scenarios, rather than being and significantly underestimates the changes limited to predefined scenario types (as in needed to achieve a sufficient level of previous work) decarbonisation. The IAG scenarios do flag up the exclusion of international aviation, making 5 To investigate less constrained approaches an estimate of the likely emissions by 2050,7 to scenario development than the ubiquitous but it is not included as part of the overall twin axes structure that informs the majority energy demand in the modelling work. The of the current energy scenarios exclusion of the UK’s international aviation and shipping emissions from the modelling A key motivation has been to incorporate renders the Energy White Paper at best a demand sectors which have not, to date, been partial and, at worst, a misleading assessment explicitly included in UK energy scenarios, of the problems and policies associated with namely international marine and aviation achieving the UK’s contribution to a transport. These sectors are omitted from 550ppmv future. 16 Decarbonising the UK – Energy for a Climate Conscious Future

None of the current UK energy scenarios make values with a disengagement with society an explicit consideration of the transition from (i.e. low community values), or to combine the present day energy system to one which consumerist values with environmental is substantially decarbonised and this is a concerns. Furthermore, political systems can further important motivation for the Tyndall be, and often need to be, both autonomous work. In line with the backcasting approach and interdependent.12 Another limitation of to scenario building proposed and developed the Foresight scenarios is that they tend to by Amory Lovins, John Robinson and Kevin over-polarise futures: World Markets or Local Anderson,8,9,10,11 pathways to alternative futures, Stewardship, Global Sustainability or National

all of which achieve a 60% reduction in CO2, Enterprise, rather than the more realistic, have been articulated. This is in contrast to complex and ‘messy’ world in which we live, prospective scenarios which look forward which entertains elements of all of these ways and outline futures based on current trends, or of organising.13 Hence, in the energy domain, a extend forward a number of key drivers, usually frequent real-world tension is that which occurs in some relationship to one another. between policies driven by environmental objectives, those driven by competitiveness The most popular approach in the UK to date, and cost-reduction objectives, and those that of the Foresight programme, has been to driven by social equity objectives. The real- combine two axes to generate a typology. One world challenge is to try and accommodate axis represents social values (from community these potentially conflicting policy objectives values to consumerist values), whilst the within scenarios, rather than to assume that other represents spatial scales of governance one will win-out over the others. (from autonomous to interdependence). Yet this typology is theoretically problematic Whilst the Tyndall Centre has constructed a because the axes are composed of more specific range of new energy scenarios for than a single variable. ‘Community values’ are the UK, the methodology and tools developed not at the opposite end of an axis which has in the project can be used to generate an ‘consumerist values’ at the other end and it is infinite number of future energy scenarios. possible for an individual or collective to hold The underlying spreadsheet can be used both sets of values concurrently. The presence as a scenario-generation tool through the of high or low environmental values are user defining their own input assumptions frequently equated in the Foresight typology and parameters. Elements of the tool have with the community to consumerism axis, already been adapted by the GRIP project but this simplifies the complex relationship (Greenhouse Gas Regional Inventory Project) between environmental values and social as a scenario-generator at the regional scale values. It is plausible to combine ‘deep green’ (see Section Two and www.grip.org.uk).

Figure 1 illustrates the research design of the integrated scenarios project ��

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�� Section One: The Tyndall integrated scenarios 17

Methodology

Based on the work of Robinson, and the energy backcasting steps deﬁned by Anderson,14 the project consisted of three stages:

• Deﬁning a set of end-points (stage 1)

• Backcasting to articulate alternative pathways to the 60% reduction in CO2 emissions (stage 2)

• Multi-criteria assessment exercise exploring the trade-offs which are implicit in alternative means of achieving the target (stage 3)

This account principally focuses upon the ﬁrst two stages of the project, the ﬁnal stage of the project - the multi-criteria assessment - having only recently been completed and, therefore, only used to inform more general conclusions.

Stage 1: Deﬁning the end-points For any given sector, the energy consumption in 2050 is calculated on the basis of an annual The backcasting methodology requires the change in energy consumption compounded development of a comprehensive picture of over the 48 years from 2002 to 2050. the 2050 energy system. The only explicit constraint imposed on the system is that a The energy supply system is matched to the

60% reduction in CO2 emissions must be pattern of consumption envisaged within each achieved by this date. In order to characterise of the demand components of the scenarios, the energy system, the project team developed on the basis of matching energy from different an ‘end-point scenario generator’. Essentially, fuel sources to the most appropriate end this is a spreadsheet model which enables a use. Whilst the team accepted that new and detailed picture of energy consumption and innovative supply technologies were likely to its associated supply system to be built up. be available in 2050, the scenarios do not rely The model uses 2002 as the baseline year on such advances to achieve the emissions and contains historical information going reduction. This is to ensure that policymakers, back to 1970, allowing the energy future to and others, can engage with the scenarios be placed in the context of the energy past.15 and not consider them too far-fetched and Energy demand is divided into 15 sectors: dependent upon highly speculative technology. households; six business sectors (energy On the other hand, it must be recognised intensive industry, non-intensive industry, that many technologies which are now firmly public, commercial, agriculture, construction); established within the energy supply system, seven transport sectors (road, passenger and such as the combined cycle gas turbine freight; air, domestic and international; rail; (CCGT), were used for completely different marine freight, domestic and international), and end uses less than 50 years ago, underlying the energy industry itself. A distinction is also the need to be open-minded regarding future made between electricity and other energy technological innovation. since these have different implications for the supply system. A number of other parameters In accepting that decisions made now will are included as follows: influence innovation, it was decided to focus on current technologies operating at state- • Household sector: population, the number of-the-art efficiencies and to include those of households, the percentage change in potential technological options which are firmly number of households by 2050, the change established ‘on the horizon’. in per capita affluence, the change in efficiency with which energy is used in the The available options include: household and the change in energy intensity of economic activity • Grid electricity sources: highly efficient coal

combustion (with and without CO2 capture • Industrial, commercial, agricultural, and storage CCS), gas (combined cycle gas

construction and public administration turbines with and without CO2 capture and sectors: change in economic activity, change storage), biofuels and renewable sources in energy intensity and change in efﬁciency (on and offshore wind, hydro-energy and with which energy is used marine sources)

• Transport sectors: change in mobility (i.e. • Combined heat and power (CHP) fuelled by passenger km or tonne km), change in coal, gas, biomass and nuclear. mobility intensity of economic activity, change in energy intensity of mobility and change in • Hydrogen production: produced by the efﬁciency of fuel use electrolysis from renewables, nuclear power 18 Decarbonising the UK – Energy for a Climate Conscious Future

or coal gasification. The later iterations of the themes and these clusters taken forward as scenarios have explored the use of thermal key variables in relation to the economy and decomposition of water using heat from energy consumption that would be explored nuclear power stations within the scenarios. In terms of the demand- side, the four key variables were centred • Direct use for heat and motive power biofuels, around specific demand sectors, namely coal, gas and oil households, transport (land and aviation), international shipping (and the influence of A carbon emission coefficient for each fuel globalisation) and structural changes to the

is specified (CO2 emissions per unit of economy (such as an industrial renaissance fuel combusted). and growth in new industries such as nano- technology). At this stage, the impact of A 60% reduction in carbon emissions from specific policies was not considered as the a 2002 baseline (165 MtC) necessitates that backcasting process is specifically intended to final carbon emissions generated by the UK’s determine what policy and other mechanisms primary energy demand are in the region would be needed to arrive at a particular end- of 65 MtC. Devising the end-points was an point, rather than what outcomes would result iterative process with a certain amount of from current policies. adjustment of sectoral energy consumption and associated supply mix to ensure that the On the supply-side, eight key variables end-point supply system matches the pattern emerged. These were: of energy demand specified within the carbon constrained end-point. • Availability of fossil fuel

To decide the range of scenarios to be • Success of carbon dioxide capture and developed, the first step considered various storage possible levels of energy consumption in 2050. Taking into account consumption levels • Role of nuclear power in other UK scenario sets, the project team chose a low energy consumption future (90 • Penetration of renewables Mtoe), a high energy consumption future (330 Mtoe) and two medium levels (130 • Availability of hydrogen (for transport and and 200 Mtoe). Current UK consumption is stationary applications) in the region of 170 Mtoe, so these levels represent a range spanning a near halving • Availability of biofuels (for transport and from current levels to a near doubling. The 90 stationary applications) Mtoe lower limit was considered challenging from a demand reduction perspective and, • Localised versus centralised generation whilst the scenario team could envisage future consumption rising higher than 330 Mtoe, this Initially eight end-point scenarios, two of upper limit was considered to be socially and each of the four different levels of energy politically credible and feasible. Overall, the consumption, were developed. For each of range chosen gives rise to scenarios requiring these scenarios, the end-point was described significant reductions in energy consumption, in a qualitative sense in terms of the four others requiring a low-carbon supply and yet identified demand-side variables and the other scenarios with significant elements of rate of economic growth was specified. The both demand and supply changes and broadly qualitative description was then considered in consistent with the boundaries of other UK terms of a number of parameters contained scenario studies. (The energy consumption within the spreadsheet tool, such as the rate in the IAG’s scenarios using the Foresight of annual change in efficiency of energy use, approach ranged from 86 Mtoe to 280 Mtoe). change in mobility, change in the number of households, etc. The spreadsheet tool was Using brainstorming techniques, the project then used to calculate the energy demand in team devised a list of issues which they 2050 for each of the demand sectors. considered would drive the future of the UK’s energy system to 2050. These were based A similar procedure was used to devise in part on the output of Tyndall projects: for the energy supply system for each of the example, results from the 40% house project scenarios. Hence for each scenario the informed the validity of choosing a low energy relevant supply technologies that would form consuming household sector; from the low part of the mix were chosen and a qualitative carbon transport project came transport futures description written. Using the spreadsheet in which demand for private terrestrial transport tool, the energy supply system was matched remained relatively high; and from the aviation to the pattern of consumption envisaged project came futures entertaining a range of within each of the demand components of the levels of growth. In addition to these demand- scenarios, on the basis of matching energy side ideas, a number of projects provided from the specified fuel sources to the most information and data on supply technologies appropriate end use. Once both the demand and efficiencies which were incorporated into and supply-sides have been specified within the spreadsheet model. the spreadsheet tool, the carbon emissions are calculated. A certain amount of iteration is The issues generated through the necessary to ensure that the end-point is in brainstorming were clustered around emergent line with the carbon constraint. Section One: The Tyndall integrated scenarios 19

The scenario literature emphasises that Stage 2: Backcasting VI Space precludes more detailed discussion here of the potential scenarios should include a variety of socio-political features of the perspectives, knowledge and disciplines to The selected four end-points were used as the end-point scenarios. make them as ‘rich’ as possible.16,17 For this basis for the backcasting workshop. This was VII A non-nuclear version of this high energy consumption scenario could reason, much of the literature and accepted once again an interactive stakeholder process also have been developed. methods of scenario building deem the but with a different set of invited participants. involvement of stakeholders to be an essential Given that this workshop was intended to part of the process. However, due to the inform the development of a set of socio- technical nature of this scenario building economic and policy pathways, or backcasts, process, the end-points were devised by the the stakeholders were recruited from the policy project team rather than in an explicitly open community and from those with expertise and participatory manner. That said it was vital in policy formulation and implementation. that the eight initial end-points underwent a The backcasting was structured into a process of cross-checking and confirmation series of steps so that participants initially in order to ensure their validity, credibility thought about the critical factors required for and usefulness. To this end, a stakeholder a particular end-point to be achieved and workshop was held where 20 or so invited subsequently elaborated these to define how experts from the fields of energy, sustainability they might be achieved. A critical factor was and scenario methodologies scrutinised the taken to be a level of change in technologies, first draft of the Tyndall end-point scenarios. values, behaviours, infrastructure, or other physical or social variables, excluding policy Participants were asked to critically examine instruments, necessary to bring about an end- the credibility of the methodology and of the point scenario. The pathways were set out actual end-points, to check that the scenarios over defined time periods and drew, to some encompassed a sufficiently wide range of extent, upon the socio-economic and political potential futures, and that the end-points characterisation. The scenario descriptions and could be considered different to, and more a number of key indicators are set out below. challenging than, existing scenario sets. The For the purposes of this project, a scenario is feedback generated through this workshop defined as the end-point and the pathway by resulted in the selection of four end-points which it is achieved. (one of each of the energy consumption levels) for further development. The bottom-up process developed for generating the Tyndall integrated scenarios has Up to this point, no mention has been resulted in a suite of scenarios that do not lend made of the socio-economic and political themselves to simple characterisation, whether characterisation of the scenarios. In the early in terms of energy supply, demand, innovation, stages of scenario development, the team efficiency or economic growth. Consequently, decided not to define the socio-economic to encourage the users of the scenarios to context too explicitly so as not to overly interpret them within a more inclusive context, constrain thinking about the end-points. they have been allocated neutral descriptors. This highlights one of the major differences Within this report the five scenarios are referred between the backcasting approach employed to as Red, Blue, Turquoise, Purple and Pink, and the alternative prospective method (which with Orange representing the present day. requires social trends and trajectories to be taken forward into the future). Nevertheless, The Pink scenario was developed following the a sketch of the socio-economic and political backcasting workshop to demonstrate that a features was inferred from each of the end- high consumption future need not have a high point scenarios. It was found that a variety reliance on nuclear technology. Essentially, of coherent sketches were consistent for this is an alternative supply mix which meets each end-point scenario and therefore two the pattern of energy demand set out in the alternative storylines were developed. purple (high energy consumption) scenario. The supply mix for the purple scenario includes One strong feedback from the end- hydrogen, there is no carbon capture and point scenarios workshop was that some storage or use of gas for grid electricity but participants felt the need for a more detailed instead substantial renewable and nuclear description of the socio-economic/political capacity. In the pink scenario, hydrogen is not context. A number of key tensions were used and the supply-side is more diverse with therefore identified (in part arising from the nuclear, CCS (coal and gas generation) and discussion at the workshop) which interact to renewable technology.VII shape the direction of future socio-economic, political and policy developments. The tensions considered were strong government, public sustainability values, the energy security concerns, the level of global conflict, extent of climate change impacts, high technological innovation, strong liberalism within the UK, strong liberalism internationally and energy prices and strong regionalism/localism.VI 20

Description of the Five Scenarios

Decarbonising the UK – Energy for a Climate Conscious Future

Table A

Red Blue Turquoise Purple Pink

Growth in UK GDP 3.3% 1.6 % 2.6% 3.9% 3.9% (per year)

Dominant commercial commercial commercial commercial commercial economic sectors public admin construction non-intensive non-intensive industry industry non-intensive public admin industry

Energy 90 130 200 330 330 consumption (Mtoe)

Number of 27.5 25 30 27.5 27.5 households (million)

Energy use large reduction very large reduction small reduction similar to current similar to current per household

Supply mix coal (with and coal (with CCS) gas (with and nuclear nuclear without CCS) nuclear without CCS) renewables CCS (coal and gas)

renewables CHP biofuels H2 renewables H2 biofuels nuclear biofuels biofuels biofuels H2 renewables

Decarbonisation innovation and collectivist similar to today with strongly strongly policies technology driven approaches to focus on supply market- focused market-focused demand-side policy government government

Transport low growth medium growth large growth in very large growth very large growth in aviation in aviation aviation in aviation in aviation

reduction low growth no growth large growth large growth in car use in car use in car use in car use in car use

very large increase large increase in small increase in large growth in large growth in in public transport public transport public transport public transport public transport

Transport fuels oil oil oil oil oil electricity electricity biofuels biofuels biofuels

H2 H2 electricity electricity electricity H2 H2

Hydrogen stationary and transport uses all sectors stationary and no hydrogen transport uses including aviation transport uses

production from production from production from production from gasification with gasification with gasification with renewables CCS and CCS, nuclear CCS, nuclear and nuclear renewables and renewables and renewables

no pipelines no pipelines pipelines and extensive pipeline

H2 by wire system Section One: The Tyndall integrated scenarios 21

Descriptions of the ﬁve scenarios are set out over the next few pages, derived from the output of the backcasting workshop and the project team’s own analysis. Table A, opposite, summarises the pertinent features of the scenarios. The electricity supply characteristics and primary energy demand mix for today are illustrated for comparison purposes in ﬁgures 2 and 3.

Today

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�� Figure 2 Electricity supply characteristics �� for Today

��

Figure 3 Primary energy demand mix for Today �� 22 Decarbonising the UK – Energy for a Climate Conscious Future

The Red Scenario

The Red Scenario is a high economic growth and low energy demand scenario in which the level of economic growth is slightly greater than today and results in a 2050 economy nearly ﬁve times larger than that of today. The UK remains primarily a service economy, with the commercial sector contributing approximately three quarters of GDP, though there has been a gradual expansion of manufacturing, particularly in the non energy-intensive and chemical industries. There has been conspicuously slow growth in the public administration sector, and its importance within the economy has declined as a consequence. Overall, signiﬁcant energy demand reduction and moderate low carbon supply measures have been achieved by a mix of market-mechanisms operating within a ‘joined-up’ and sophisticated regulatory environment.

Demand-side characteristics in the fulﬁlment of low-carbon activities and services. The greater focus upon long-term In this scenario, extensive demand reduction investment assisting low-carbon lifestyles and is combined with a high rate of technological the inclusion of external costs in the pricing innovation in sustainable energy technologies of goods and services has stimulated a large- (especially for demand management and scale shift towards the use of public transport, reduction). The relationship between economic a curbing of aviation growth and a reduction of growth and carbon emissions has been energy demand from households. The modal uncoupled through innovation in the demand shift towards public transport has been brought and supply technologies and operational about primarily by two developments: approaches. This innovation has been driven by various mechanisms encouraging high levels of • Providing a comprehensive public transport short and long-term investment in new enabling infrastructure. In urban areas the planning technologies, the alleviation of fuel poverty and framework is used to prioritise public and

Figure 4 Demand characteristics for the Red Scenario ��

��

� �� Section One: The Tyndall integrated scenarios 23

��

�� Figure 5 Figure 6 Electricity supply characteristics Primary energy demand mix for the Red Scenario for the Red Scenario

other modes of transport such as cycles over • Improving the energy consumption of the cars. New inter-urban transport networks are housing stock through increased information focused on public, not private, transport. and ultimately through stringent building energy standards which drive demolition and • In line with increasing public transport rebuild where refurbishment is not possible. networks, the ‘attractiveness’ of the private car has been reduced through policy Moderate decarbonisation of the supply measures such as personal use charging, system is achieved within this highly innovative

congestion charging and commuter plans. By society through the implementation of CO2 2050, a shift in values has taken place such capture technology linked to hydrogen that the private car is perceived as being production. much less acceptable within urban areas, though it remains a signiﬁcant transport • Until 2010, CCS is strongly promoted as the mode for longer journeys. answer to the climate issue: government and industry invested in basic R&D and by Whilst passenger kilometres travelled by plane 2020 had implemented Carbon Capture & have doubled, annual growth in passenger km Storage Obligation Certiﬁcates (which require in aviation has reduced from 8% in 2004 to generators to capture and store a percentage

1.4%. Changes include a reduction in business of their CO2 emissions), a favourable tax travel as a consequence of innovations in virtual regime and a public awareness campaign to technology and a reduction in short haul flights promote CCS. However, lower than anticipated with people mainly flying longer distances. The emissions reductions, and the need to link in reduction in short haul flights has been driven with new post-Kyoto targets, means that in by the availability and relative cost of quality 2015 there is a drive towards a more diverse high-speed rail links within Europe. portfolio of supply solutions. This focuses innovation on the step changes in end-use technologies, such as fuel cells, needed for Supply-side characteristics the use of hydrogen as an energy carrier.

Energy consumption in the home has more • Policies to encourage the production of than halved through: hydrogen are in place in 2020 ensuring signiﬁcant amounts of hydrogen production • Regulating the energy consumption of from both coal with CCS and renewables appliances, initially through standards applied by 2030. Canals and road freight are used across the supply chain and ultimately to move liquid hydrogen around the country through regulation of the energy consumption (the emissions from freight being offset of domestic appliances. Stringent product by the switch in private cars from oil to

standards have implications for international hydrogen). Pipeline construction for H2 begins competition and international trade in 2040 but is not fully functioning by 2050. agreements to prevent trade-disputes arising Dismantling of gas pipelines starts in 2045.

from the prohibition of the import into the H2 supply to more remote locations is either EU of appliances with energy consumption through road freight or by wire (electrolysis at above levels set down in regulation. fuel stations). 24 Decarbonising the UK – Energy for a Climate Conscious Future

The Blue Scenario

The Blue Scenario is a modest economic growth and modest energy demand scenario in which the contribution to national wealth of the commercial sector is almost matched by the expansion of the public sector. Moreover, the non energy-intensive industries have undergone moderate growth, now representing almost 15% of the economy.

Demand-side characteristics A scientiﬁcally, technically and culturally educated population embrace diversity and Energy demand has reduced by a quarter recognise the need for differing and evolving compared with today, which, with an economy approaches to issues. Since climate change over twice the size of today’s, represents a is an important policy issue with wide public slight increase in the historical trend in the support and understanding, sophisticated energy intensity reduction of goods and regulatory structures for the electricity industry, services. In addition to demand reduction, innovative market mechanisms for explicit there has been a moderate decarbonisation of carbon management and more collectivist the energy supply system. Politically, a strong approaches to public transport co-exist within central government establishes targets and a reﬂective and dynamic policy arena. policy goals, but instructs appropriate tiers of local and regional government, or other Society, whilst culturally outward looking, has accountable bodies, to develop the means established a series of environmentally and for meeting or implementing them. This takes ethically driven trade restrictions, that has place in a society which has progressed resulted in something of a minor renaissance beyond the free-market rhetoric of unfettered for several domestic manufacturing industries. competition, isolated cost-centres and narrowly-focused league tables that came to Reductions in energy consumption across the dominate the disjointed policy developments built environment, for both users and the fabric of the early 21st century. of buildings themselves, have been enabled by

Figure 7 Demand characteristics for the Blue Scenario ��

��

� �� Section One: The Tyndall integrated scenarios 25

��

�� Figure 8 Figure 9 Electricity supply characteristics Primary energy demand mix for the Blue Scenario for the Blue Scenario

the emergence of Energy Service Companies In urban areas the planning framework is (ESCOs). used to prioritise public and other modes of transport such as cycles over cars. New • ESCOs aim to achieve long-term inter-urban transport networks are focused on improvements in energy performance and public, not private, transport. carbon reduction targets and are regulated by an independent regulator whose remit includes social and environmental as well as Supply-side characteristics economic criteria. Climate change has been an overarching • A reduction in energy consumption from policy issue which has driven policy in other appliances, both within the home and the areas, particularly transport, where there has workplace, has been driven by strong, been an expansion of the public transport internationally accepted standards. The network and high penetration of low carbon growth of ESCOs with responsibility for a fuels. Driven by local air quality concerns, broad provision of services, such as sound hydrogen is promoted as a transport fuel and moving images, ensures that only within niche markets supported by local appliances with high energy standards are authorities which subsidise hydrogen buses used and updated according to agreed and offer preferential licensing agreements for replacement cycles. hydrogen taxis. Meanwhile the low cost of coal encourages the construction of gasification • A reduction in energy consumption from the with CCS plants for hydrogen production, provision of services such as heating and and an infrastructure for liquid fuel purchased lighting within buildings is achieved within at ‘Hydro-stations’ is in place by 2020. A a strong building regulation framework. campaign to dispel concerns over the safety Measures to reduce energy consumption of hydrogen fuelled cars, combined with are implemented by ESCOs and include technological advances in hydrogen storage responsibility for improvements to building and fuel cells, and preferential fuel taxation and fabric and integrated renewables within congestion charging, results in strong market buildings. In the domestic sector, housing growth for hydrogen fuels with a 75% share of performance standards are required as part road transport by 2050. of the sale and rental of property, with low cost finance in place for homeowners to Energy utilities have been complemented implement improvements. by, or even restructured within, an Energy Service Companies (ESCOs) framework. This • Whilst this is in many respects a society is facilitated by the implementation of CHP at in which the essence of community is the neighbourhood scale (within new build and important, the interpretation of community retro-fitted) in most urban areas. is less geographically constrained. By 2030, the price of buildings with integrated Consequently this is a highly mobile society renewables has fallen, and strong building with growth in private and public transport. A regulations ensure these technologies are comprehensive public transport infrastructure incorporated into all new homes. Similarly is in place, facilitated by a highly integrated micro-CHP units are installed whenever policy and planning approach to transport. conventional boilers are replaced. 26 Decarbonising the UK – Energy for a Climate Conscious Future

The Turquoise Scenario

The Turquoise Scenario is a medium economic growth, medium energy demand scenario with the economy growing at a rate similar to that of today. By 2050 the economy is three-and-a-half times bigger, with an accompanying growth in energy consumption of only 17%. Three sectors are economically dominant, the commercial, construction and public. The remaining productive sectors collectively contribute the residual 8% of GDP, primarily from the non energy-intensive and chemical industries.

Demand-side characteristics picture of what is happening in terms of different programmes, regulations and incentives, and Energy efficiency is an important factor in who is responsible for their implementation achieving the 60% target. Whilst efficiency and evaluation. Nevertheless, there is some improvements across most sectors are similar to strength in diversity, and over time, evidence- those of today, collectively they have the effect based policy begins to select the more effective of reducing the nation’s energy intensity by policy instruments. Markets are used selectively, over 60% by 2050. Decarbonisation has been e.g. for electricity generation and delivery, and achieved through a mix of efficient, end use for providing incentives for decarbonisation technologies/practices and low-carbon supply in construction, private vehicle transport and options with measures implemented through a aviation. Other energy-related activities are taken governance system similar to that of today. back into the public sector, such as railways and trams/light railway. The public sector also takes Overall, the political context for this scenario is on a bigger role in commissioning and planning somewhat similar to today’s political governance new energy supply. There is a wide range in the with many different departments and agencies decarbonisation performance of local authorities, involved in attempting to deliver decarbonisation both in terms of strategies implemented and

through low-carbon energy supply, energy actual area-based CO2 reductions achieved, with efﬁciency and energy security.Since there is little some having introduced congestion charges, close co-ordination of policy measures and their local energy strategies and even new energy implementation, there is a somewhat confusing taxes in a few of the devolved regions.

Figure 10 Demand characteristics for the Turquoise scenario ��

��

� �� Section One: The Tyndall integrated scenarios 27

��

�� Figure 11 Figure 12 Electricity supply characteristics Primary energy demand mix for the Turquoise Scenario for the Turquoise Scenario

There are moderate increases in distances • R&D and a national debate into a new travelled across terrestrial passenger transport, nuclear build programme begins in 2007. but the modes showing growth are actually a The nuclear industry is supported financially reverse of those growing today – no growth through the introduction of favourable in private road transport and a shift to rail and financial instruments (e.g. a carbon tax). By public road. This shift has been brought about 2015, the government kicks-off the nuclear through a variety of mechanisms: build programme with a policy of strategic site evaluation. Between 2015 and 2040, • The prioritisation of public and other modes one nuclear station is built per year, of transport over private cars through beginning with existing sites, resulting in 25 development control and planning regulations by 2050. The private sector risk is reduced through long-term power purchase contracts, • Strong local authority control of traffic in a comprehensive nuclear waste policy and urban areas with congestion charging to underwriting of project investment reduce urban congestion, tighter regulation of by government. bus companies and the taking over of non- compliant operators by local authorities • From 2010, the CAP is revised to offer land- use incentives to promote production of Passenger distances travelled by air are more energy crops and help regenerate the rural than eight times greater in 2050 than today and economy. By 2015, central government this, along with the increase in rail transport, establishes a renewable fuels obligation implies a significant but manageable growth in on fuel distributors and biofuelled vehicles infrastructure. By 2015, the decision has been receive a favourable congestion charge rate. made for large-scale, centralised infrastructure Research focuses on increasing crop yields, planning since only limited increases in the possibly through genetic modification. By railway network and runway capacity can be 2030, decentralised biofuel stations achieved through devolved management are widespread. systems. Use is made of military runways and brown field sites for new airports, and there is • Hydrogen R&D is boosted by investment from a large-scale reinstatement of former railways. airline and plane manufacturers as they seek Compensation and planning gain are used as to maintain growth in mobility. As oil prices mechanisms to impose new infrastructure on continue to rise and government imposes local communities without inducing excessive, taxes on aviation fuel, airlines work with the politically-damaging opposition. energy industry to develop hydrogen-fuelled

planes. The ﬁrst H2 planes are available in 2030. Hydrogen pipeline construction begins Supply-side characteristics in 2030, transporting hydrogen from both nuclear and coal-CCS power plants. Hydrogen is widely used as a road transport fuel

and in the aviation sector. By 2020, H2 end-use • Public-private partnerships are established technologies are well-developed, licensed and between research groups and the energy fully commercialised and public concerns over industry to develop a series of pilot carbon

the safety of H2 as a transport fuel have been capture experiments to test the viability for addressed. Innovation in the aviation sector has both gas and coal-ﬁred stations. By 2015, been driven by the linking of expansion plans the success of the demonstration plants with the need for low carbon fuel in order for the has encouraged investment by the energy industry to keep within strong emissions limits. industry to fund several large coal-ﬁred and

gas-ﬁred power stations with CO2 capture Within this scenario, the 60% carbon reduction equipment and pipeline infrastructure to off- target is achieved through a diverse portfolio of shore storage sites. The build programme supply options. continues to 2040. 28 Decarbonising the UK – Energy for a Climate Conscious Future

The Purple and Pink Scenarios

The Purple and Pink Scenarios are high economic growth, high demand supply scenarios. By 2050 the economy is over six times larger than today and energy consumption is approximately twice the current level. The economy remains dominated by the commercial sector, but with signiﬁcant contributions from the non energy-intensive industries and a lesser contribution from energy-intensive industries. Whilst the two latter sectors are small relative to the commercial sector, in absolute terms they have undergone substantial expansion from their position at the start of the 21st century.

Demand-side characteristics Demand for passenger transport has grown across all sectors with an overall six-fold The UK’s economic success is attributable increase in passenger kilometres travelled. to a vibrant and innovative market economy There is a doubling and trebling of private and with a relatively small but supportive and public road transport respectively, a seven-fold market-oriented government. The legitimate increase in rail, a four-fold increase in domestic role of government is limited to three principal aviation and a ten-fold increase in international functions: the strong defence of property aviation. Such large demand for all modes of rights; curbing the more extreme excesses of transport requires the implementation of large the market; and, where necessary, establishing scale increases in associated infrastructure, targets (and the market mechanisms since by 2015 all possible increases in necessary to meet them) in accordance with capacity through management systems international obligations. The drive towards have been implemented. By this date, a a low carbon society arises from two fronts. ﬁnancing framework for a mixture of public Firstly, the UK’s international obligation to and private money is in place to fund the signiﬁcantly cut carbon emissions by 2050 necessary expansion. By 2030, the expansion and, secondly, the increasing concern within programme is in full swing along with strong energy markets over the insecurity associated measures to incentivise high load factors and with a reliance on imported fossil fuels. maximum capacity utilisation.

Figure 13 Demand characteristics for the Purple and Pink �� Scenarios ��

��

� �� Section One: The Tyndall integrated scenarios 29

��

�� Figure 14 Figure 15 Electricity supply characteristics Primary energy demand mix for the Purple Scenario for the Purple Scenario

Supply-side characteristics

Whilst the purple and pink scenarios share the same demand side characteristics, they differ in how that demand is met. Two alternative sets of supply-side characteristics are therefore presented here.

Initially, biofuels were substituted for fossil companies have made large-scale fuels in the land transport sector, though investments in new nuclear and renewable this is being substituted for hydrogen as fuel generating plant. By 2010, government cell technologies diffuse. Electricity is used establishes a nuclear waste policy and begins for trains and urban public transport. Since to address public safety concerns. Coal and hydrogen technology has not been developed gas-focused utilities diversify into renewables for the aviation sector, and growth in demand and nuclear by 2015. These new players fund for aviation has not been substantially reduced, a big public awareness campaign concerning oil use is concentrated in this sector. nuclear power, whilst sites for new plants are chosen and compensation strategies Within this society, consumers have continued implemented. The markets have reduced the to increase their energy consumption risks of such ventures by tending to construct hence carbon reductions are implemented somewhat smaller plants than previously. though significant improvements in end-use efficiency and very substantial The awareness campaign also investigates decarbonisation of the energy supply system. the possibility of community and industrial The economic attractiveness of nuclear involvement in small plant ownership. In a and renewable energy sources have been world where people wish to increase their significantly increased through government mobility and possession of consumer goods inducements to move away from carbon- and services, a majority of the public becomes based energy combined with a recognition strongly in favour of anything with the word of the high economic risk associated with oil ‘new-nuclear’ attached to it. The extensive roll dependence. The intermittency of renewables out of nuclear stations, both large and small, is partially compensated through the use of begins in earnest in 2030. As a result, by hydrogen production to smooth electrical 2050 the UK energy system is dominated by supply output and through more sophisticated electricity from numerous and relatively small metering tariffs and arrangements. The nuclear power plants, complemented by a effect of this has been that private energy range of renewable energy designs. 30 Decarbonising the UK – Energy for a Climate Conscious Future

��

�� Figure 17 Figure 18 Electricity supply characteristics Primary energy demand mix for the Pink Scenario for the Pink Scenario

Supply-side characteristics by 2030 the fossil fuel industry is booming with coal imports at an all-time high. Within this society, consumers have continued to increase their energy consumption hence It is soon recognised that within this high carbon emission reductions are implemented consuming society, mobility will continue to solely through the energy supply system. rise, and alternatives to petrol and kerosene are needed. By 2010 R&D, funded by the large In this market-led society, the dominant energy companies, demonstrates that biofuels fossil fuel companies reject the idea of a are the most viable low carbon transport fuel. A hydrogen economy due to the slow pace new CAP of 2015 provides incentives to farmers of R&D and instead invest heavily in CCS to grow energy crops and new partnerships for electricity production. By 2010, a public- between farmers and an airline industry wishing private partnership leads to an industry-led to continue its expansion lead to the new ‘biofly’ public awareness campaign about CCS in initiative. By 2020 the first commercial bioplane conjunction with a boost in privately funded enters the market, though sales rise relatively university research. Between 2010 and 2020 slowly. A new international agreement on a all the major storage sites are identified by the carbon tax on flying boosts sales and, by 2040, industries/universities involved, with new coal many duel-fuel planes are in operation. As and gas power stations under construction in imports of both coal and biofuels increase, new the vicinity. The construction of a new major innovation within the shipping sector sees the gas pipeline from Russia is also complete and first wind/solar-oil ships in operation. Section One: The Tyndall integrated scenarios 31

Carbon dioxide emissions

All of the Tyndall integrated scenarios achieve the UK government’s 60%

2050 CO2 target. For today and each scenario, the sectoral CO2 emissions are illustrated below. The main conclusions from the analysis of the Tyndall integrated scenarios project are presented on pages 6-9.

��

Figure 19 �� Figure 20 �� Sectoral split of carbon emissions Sectoral split of carbon emissions for Today for the Red scenario

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Figure 21 Figure 22 Sectoral split of carbon emissions�� Sectoral split of carbon emissions�� for the Blue scenario for the Turquoise scenario

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Figure 23 Figure 24 Sectoral split of carbon�� emissions Sectoral split of carbon emissions�� for the Purple scenario for the Pink scenario

Acknowledgements The project team has beneﬁted enormously from the involvement of approximately 70 stakeholders and researchers in the three workshops. The team would like to thank all those who have generously contributed their time, ideas and skills to the Integrated Scenarios project. Without their help, this research and its insights would not have been possible. 36 Decarbonising the UK – Energy for a Climate Conscious Future Decarbonising the UK – Energy for a Climate Conscious Future 37

Section Two Main ﬁndings from the Decarbonising the UK projects

The supply of renewable and clean energy

Sustainable energy in the built environment

Sustainable transportation

Carbon dioxide sequestration, capture and storage

Policy trends, instruments and mechanisms 38 Decarbonising the UK – Energy for a Climate Conscious Future Section Two: Main ﬁndings from the Decarbonising the UK projects 35

Tyndall’s Decarbonising the UK Theme has funded 17 projects, with a further ﬁve stand-alone PhDs. The theme was structured around the ideas expressed in the Kaya 18 Formula which states that the CO2 emissions arising from different national energy systems are calculated as follows:

CO2 emissions = carbon intensity x energy intensity x consumption intensity x population Where carbon intensity is the amount of carbon dioxide emitted per unit of energy, energy intensity is the amount of energy used per unit of economic activity and consumption intensity is the quantity of goods and services consumed per capita.

Figure 25 The Tyndall carbonisation �� theme projects in relation �� to the Kaya Formula ��

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The Kaya formula demonstrates that changes In this Section the key findings and in carbon emissions are related to the change implications of each of the Tyndall projects in the efficiency with which energy is used, are described. Three of these, namely the the change in carbon intensity of the energy 40% House, Aviation and Domestic tradable supply system and the change in energy quotas have been covered in more detail due service provided. The latter is itself dependent to their topical focus and particular relevance on changing behaviours and social practices. for specific policy communities. Three PhD Thus, it is apparent that any transition to a projects that have been co-funded via the low carbon future will depend on numerous theme are also described. Project related technical, economic and behavioural factors publications are listed at the end of this report which are themselves influenced by a range and are available from the Tyndall website at of interacting drivers, sometimes reinforcing www.tyndall.ac.uk where contact details for each other and sometimes cancelling each principal investigators may also be found. other out.19 The Tyndall projects have sought to The table overleaf groups the projects within explore each element of this relationship (with the report into related areas, listing the specific the exception of population change). projects and the principal investigators.

Topic Area Project

The supply of renewable and clean energy Integrating renewables and CHP into the UK electricity system

Security of decarbonised electricity systems

The hydrogen energy economy

PhD project highlight: Assessment of decarbonised industrial utility systems

Sustainable energy in the built environment Climate change extremes: implications for the built environment in the UK

Fuel cells: providing heat and power in the urban environment

Micro-grids: distributed on-site generation

Special feature: The 40% house

Sustainable transportation Reducing carbon emissions from transport

Special feature: A looming problem in the sky

Carbon dioxide sequestration, capture and storage Development and carbon sequestration: forestry projects in Latin America

PhD project highlight: Carbon sequestration in agriculture

An integrated assessment of geological carbon sequestration in the UK

Policy trends, instruments and mechanisms The contribution of energy service contracting to a low carbon economy

Special feature: Domestic tradable quotas

Key issues for the asset management sector in decarbonisation

PhD project highlight: greenhouse gas regional inventory project

Project Principal Investigator(s) Afﬁliation

Integrating renewables and CHP into the Professor Nick Jenkins University of Manchester UK electricity system

Security of decarbonised electricity systems Professor Goran Strbac University of Manchester

The hydrogen energy economy Dr Geoff Dutton, Dr Jim Halliday Energy Research Unit, CLRC-RAL

PhD project highlight: Assessment of Petar Varbanov University of Manchester decarbonised industrial utility systems

Climate change extremes: implications for the built Dr Jim Halliday Energy Research Unit, CLRC-RAL environment in the UK

Fuel cells: providing heat and power in the Professor Geoff Levermore University of Manchester urban environment Dr Tom Markvart University of Southampton Micro-grids: distributed on-site generation Dr Brenda Boardman University of Oxford Special feature: The 40% house

Reducing carbon emissions from transport Professor Abigail Bristow University of Loughborough (at ITS, Leeds whilst PI)

Special feature: A looming problem in the sky Dr Kevin Anderson, Dr Alice Bows University of Manchester

Development and carbon sequestration: Professor Kate Brown University of East Anglia forestry projects in Latin America

PhD project highlight: Mike Robbins University of East Anglia Carbon sequestration in agriculture

An integrated assessment of geological Dr Simon Shackley, Clair Gough University of Manchester carbon sequestration in the UK

The contribution of energy service contracting Steve Sorrell University of Sussex to a low carbon economy Dr Kevin Anderson, Richard Starkey University of Manchester Special feature: Domestic tradable quotas

Key issues for the asset management sector in Dr Andrew Dlugolecki, Mark Mansley Independent consultants decarbonisation

PhD project highlight: greenhouse gas regional Sebastian Carney University of Manchester inventory project

Contact details may be found on the Tyndall website at www.tyndall.ac.uk The Tyndall Decarbonising the UK theme projects 38 Decarbonising the UK – Energy for a Climate Conscious Future

The supply of renewable and clean energy

Renewable energy encompasses a wide range of technologies which generate

electricity without emitting CO2. Integrating renewables into the electricity network remains a key technical, regulatory and policy challenge for two reasons. Firstly, the grid is not designed to accommodate small electricity generators and, secondly, the regulatory system is focused on the reduction of costs in a centralised system of generation and control. The Tyndall Centre has supported two projects that investigate the power system aspects of the implementation of renewable energy. The Integrating renewables and CHP project considered the implications of the Government’s 2010 targets, whilst the Energy security project explored the impact of the integration of higher levels of renewables on the reliability of the network.

Hydrogen has been widely promoted as a zero-carbon energy carrier which can be produced by a range of supply-side options (renewables, nuclear or fossil fuels) and has the potential to effect major changes to the energy system. It is the subject of the third project within this section. Finally, we include a short entry on one of the theme’s completed PhD projects which analyses the options for decarbonisation from the perspective of the process industries.

Integrating renewables and CHP to greater penetration by renewables. into the UK electricity system Network splitting techniques are shown to reduce the impact of distributed generators When the project began in 2001, the UK on short-circuit fault levels. Network faults Government had already set a target to deliver are likely to cause instability of large offshore 10% of all electricity from renewable sources wind farms and a very fast clearing time (less by 2010 and to increase combined heat and than 90ms) may be required to prevent the power (CHP) capacity to 10 GWe (electricity) generation tripping off for remote faults. It has by the same date. These targets required that also been shown that renewables and CHP some 14 GW of additional generating plant can be operated in a de-loaded condition to would need to be ‘integrated within’ the UK provide frequency response. system, particularly within distribution networks. This is about 28% of the Great Britain system Overall, the work confirmed that the Great winter peak demand of 50 GW. Britain power system is, in principle, able to accept the 2010 targets for renewables and The connection of distributed generation CHP but detailed technical and regulatory was, however, severely hampered by a lack questions remain to be resolved. The subject of incentives within the existing policy and area is fast moving and the project made regulating framework. The overall problem could a significant contribution to the work of the be seen in terms of a conflict between two Technical Steering Group of the Distributed different but co-existing regulatory systems: the Generation Co-ordinating Group of the DTI. economic-focused system which is dominated The project, together with other similar work, by relatively short-term issues of economic provided supporting evidence that resulted efficiency; and the environment-focused system in significant additional incentives being put which aims to establish incentives for small- in place during the 2005 Distribution Price scale, less carbon intensive technologies in Control Review to encourage the connection of

pursuit of CO2 reduction objectives. distributed generation.

The project developed a set of scenarios outlining the use of low carbon energy sources Security of decarbonised over the next 10 years, and then considered electricity systems both the technical and regulatory changes required for those technologies to be exploited. By 2020, responding to climate change may The scenarios were then applied to a detailed require electricity from a large proportion simulation model of the Great Britain electricity of renewable and other low-carbon energy system, providing a robust understanding of the sources (e.g. wind, PV, marine technologies, potential effects of incorporating new renewable fuel cells). This new generation will displace energy generating capacity. The work has also the energy produced by large conventional provided a better basis for understanding what plant, raising questions about the ability to changes are required in the structure, operation manage the balance between supply and and regulatory framework of power systems due demand, and hence, to maintain the security of Section Two: Main ﬁndings from the Decarbonising the UK projects 39

�� Figure 26 Additional costs and beneﬁts of integrating 25GW of wind energy by 2020 ��

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the electricity supply system. Clearly, meeting should be noted that the additional operating variable demand with intermittent, and/or cost associated with accommodating the uncontrolled and/or inflexible generation will variable and unpredictable output of wind be a major challenge for the secure operation power represents a relatively small proportion of sustainable electricity systems of the future. of the total – 0.05p/kWh out of the total Within this project, modelling techniques were additional costs of 0.61p/kWh. used to quantify the back-up and energy storage requirements for different potential Overall, it is concluded that the system will be future renewable energy scenarios. The able to accommodate significant increases in analysis demonstrated that: intermittent power generation with relatively small increases in overall costs of supply. • In order to accommodate intermittent These additional costs will be driven primarily generation it will be necessary to retain a by the capital cost of wind generation, whilst significant proportion of conventional plant the benefits in terms of the cost of fuel saved to ensure security of supply (e.g. under will be directly influenced by fuel prices. conditions of high demand and low wind). Hence, the capacity value of intermittent generation will be limited as it will not be The hydrogen energy economy possible to displace conventional generation capacity on a ’megawatt for megawatt’ basis; There is a growing international interest in the use of hydrogen as a zero-carbon energy • Intermittent generation is not easy to predict, carrier, particularly for use in the transport so various forms of additional reserves will sector. Hydrogen, derived sustainably from be needed to maintain the balance between renewable resources or from fossil fuel sources supply and demand at all times. with carbon dioxide capture and storage (CCS), can be consumed efficiently in a fuel An assessment was made of the costs and cell. The key to assessing the viability of such benefits of wind generation on the Great Britain a hydrogen economy lies in understanding electricity system, assuming different levels of the complex energy flows required to produce, wind power capacity. Figure 26 summarises store and distribute the hydrogen. Two big the situation in 2020 assuming 25GW of questions facing hydrogen energy researchers installed wind capacity. are whether hydrogen can underpin the large supply-side changes that may be required for

The net additional costs (i.e. costs less a 60% or greater CO2 reduction and how soon beneﬁts) amount to around 0.28p/kWh which such a change could be implemented. is 5% of the current domestic electricity price. These costs should also be viewed in the This project investigated the extent of the context of the recent impact of gas price rises changes needed against a background of on the cost of electricity. The analysis was several different socio-economic scenarios. conducted prior to the introduction of the EU The work was carried out by a multidisciplinary Emissions Trading Scheme (EU ETS) which research team, taking a ’whole systems’ will provide a further beneﬁt for electricity approach that considered all energy demands

generation which does not generate CO2. It (electricity, space heating and transport) within 40 Decarbonising the UK – Energy for a Climate Conscious Future

a single, integrated model. This departure from Recently, the need for climate change mitigation the traditional approach of considering electric has brought forward the question of how new power supply and transport fuels as two isolated utility systems in the process industries can be systems highlighted the increasing amounts cost-effectively decarbonised. of energy being consumed by transport and the developments necessary if carbon dioxide The project developed a new methodology for emissions are to be reduced by 60% by 2050.20 the design of industrial utility systems, so that Notwithstanding the technical hurdles of they reduce greenhouse gas emissions in the achieving robust and reliable fuel cell operation most efficient and economic way. Previous and developing on-board hydrogen storage work in this area has been improved through systems for vehicles, the principal problem to the project’s development of better utility be overcome is the production of sufficient system models, improved optimisation and quantities of low (or zero) carbon hydrogen. integration of the emissions generation and costing into an overall system model. The project concluded that a high utilisation of hydrogen could be achieved within the context Applying these methods to an industrial case of a predominantly low-carbon transport fleet study shows that: over a timescale of 50 years, but that, without major innovations in hydrogen production • Improving the efficiency of process utilities to technology, this would require a massive decrease fuel consumption is the cheapest

expansion of renewable energy (or nuclear) option for CO2 abatement capacity far beyond that currently anticipated. An alternative approach, as in the use of gas • There are obstacles to the use of renewable and coal to produce hydrogen, would require energy in terms of the cost of systems, their the construction of new power plants, and intermittency and the fact that they only

would only make sense from a CO2 reduction produce electricity whereas many industrial

perspective if CO2 capture and storage (CCS) sites also require process heat. The use of were used. biofuels to close the carbon cycle is the second most cost-effective option because it avoids the problem of intermittency and can PhD project highlight: Assessment of be used to produce heat cost-effectively decarbonised industrial utility systems

• CO 2 capture and storage (CCS) could also Production processes on industrial sites be considered in the medium-term. However,

normally require large amounts of heating, mineralization approaches to CO2 capture cooling and power for their operation, hence the from the atmosphere were found to be much

optimal synthesis of utility systems is of central more expensive than capture of the CO2 from interest to engineers in the process industries. process emissions. Section Two: Main ﬁndings from the Decarbonising the UK projects 41

Sustainable energy in the built environment

Buildings and their appliances generate about 50% of the UK’s CO2 emissions with approximately one third of carbon emissions arising from the domestic sector alone. Climate change will have impacts for the built environment as higher temperatures change the heating and cooling requirements of buildings. The impact of temperature extremes on the heating and cooling demands of buildings was explored in a project conducted jointly with Tyndall’s Adapting to Climate Change theme. A number of new technologies may potentially be important in the decarbonisation of the built environment. Tyndall projects have examined the use of fuel cells for combined heat and power and on-site generation using photovoltaics and wind (microgrids). Finally, The 40% house project takes a comprehensive look at options for emissions reduction within the domestic sector and sets out how a 60% reduction in CO2 emissions may be achieved. A special feature on The 40% house project concludes this section.

Climate change extremes: implications than existing algorithms as they make use of all for the built environment in the UK the daily parameters available.

Hadley Centre climate model data reveals that TRYs and DSYs with generated hourly values maximum temperatures are rising faster than were run on a second order room model minimum temperatures in the UK and that solar specifically developed during this research to irradiance, another important weather parameter provide extra flexibility compared with existing that affects buildings, will rise slightly in summer building simulation programmes. It was found and decrease in winter. This has important that the fall in heating demand is approximately implications for building design which is based equal to the rise in cooling demand as a result on near-extreme data. The data implies that, of climate change up to the 2080s in all four without other building design modifications sites examined and that natural ventilation to encourage natural ventilation and night- alone would not be able to provide summer time cooling, air-conditioning systems will be cooling in the UK in the near future. As the required to maintain occupants’ comfort in heating would be met by gas and the cooling offices while heating is still required in winter. provided by electric air conditioning, the net carbon emissions would increase. Two models (HadCM3 and HadRM3) were analysed against long-term weather Office buildings complying with the Building series data for extreme temperature value Regulations of 2002 in the south of England distributions to assess how well they simulated would require air-conditioning by the 2020s, these extremes. The results suggest that there those in the north of England by the 2050s is a cold running (bias) of the HadCM3 model; and those in Scotland by the 2080s, though that it poorly simulates solar radiation, and that the majority of existing office buildings in the wind speed values in HadCM3 and HadRM3 UK currently met lower specifications. Overall are much higher than real data and the trends this project shows that cooling, particularly of are not in good agreement. existing buildings, and consequent emissions will be a major problem in the future climate. Test Reference Years (TRYs) and Design Summer Years (DSYs) were selected for the 2020s, 2050s and 2080s using data from Fuel cells: providing heat and power these climate models to estimate future in the urban environment energy usage for heating and cooling and the feasibility of using natural ventilation as the Combined heat and power (CHP) plants, in sole means of providing summer cooling in which the heat produced as a consequence future periods respectively. It was found that of electricity generation is used to provide the existing methods for selecting TRYs and local heating, offer significantly enhanced DSYs could be improved for future weather overall efficiencies, and therefore reduced data through the use of hourly, rather than daily, CO2 emissions, compared with conventional data. A number of algorithms were analysed centralised generation. Fuel cell technology and appropriate ones were developed to is ideal for CHP plants as it offers high fuel generate the required hourly weather data for efficiency coupled with negligible impact dry bulb temperature, global irradiation and on local air quality. In the context of climate diffuse solar irradiation from daily data available change, perhaps its most important advantage from the climate models. These perform better is the ability to use low or zero-carbon fuels. 42 Decarbonising the UK – Energy for a Climate Conscious Future

The overall aim of this project was to define Microgrids: distributed on-site the existing scope for fuel cell CHP, identify generation barriers to widespread implementation of small-scale (less than 1 MWe) fuel cell CHP Almost all the electricity currently produced in in a range of urban environments, considering the UK is generated as part of a centralised technical, environmental and socio-economic power system designed around large fossil fuel aspects, and identify the conditions required or nuclear power stations. This power system is for increased future penetration and assess the robust and reliable but the efficiency of power associated social and environmental benefits. generation is low, resulting in large quantities of waste heat. The principal aim of this project This broad, cross-cutting, multidisciplinary was to investigate an alternative concept: study has found that: energy production by small scale generators in close proximity to the energy users integrated • Fuel cell CHP systems may be commercially into microgrids. available and in some cases economically viable by 2009 Microgrids – defined here as decentralised electricity generation combined with the on- • In high density developments (for example, site production of heat – contain the promise around 50 dwellings per hectare), community of substantial environmental benefits, brought heating is likely to be economically about by higher energy efficiency and by viable and efficient, while in lower density facilitating the integration of renewable sources developments (for example less than 25 such as photovoltaic arrays or wind turbines. dwellings per hectare), micro-CHP is likely to be economically attractive By virtue of a good match between generation and load, microgrids have a low impact on • Conventional and fuel cell CHP economics are the electricity network, despite a potentially highly sensitive to electricity and gas prices significant level of generation by intermittent energy sources. The project analysed the • Fuel cells are becoming available with high technical and economic issues associated with overall and electrical efficiencies, and when this novel concept, giving an overview of the combined with CHP systems can result in generator technologies, the current regulatory

reduced CO2 emissions framework in the UK, and the barriers that have to be overcome if microgrids are to make a • There may be signiﬁcant environmental costs major contribution to the UK energy supply. associated with the manufacture of the fuel cells, the magnitude varying with the type of The study developed a model of a microgrid fuel cell. It is therefore critically important to of domestic users powered by small carry out a full life-cycle assessment of the combined heat and power (CHP) generators different schemes in order to minimise overall and photovoltaics (PV). This was used to environmental costs analyse the energy balance in a microgrid powered by micro-CHP and PV with energy The UK Government has published an storage. Combining photovoltaics and micro- implementation strategy for CHP. The strategy CHP and a small battery requirement gives a is aimed at achieving the UK target for CHP microgrid that is independent of the national capacity (10 Gwe by 2010) and the resulting electricity network. In the short term, this has systems are likely to be based on the most particular beneﬁts for remote communities, but economic solution rather than consideration more wide-ranging possibilities open up in

of levels of CO2 or other emissions. The the medium to long-term. Overall, microgrids results of the life-cycle assessment suggest may be able to deliver an appreciable that decision making at the policy level must proportion of the UK’s energy demand, greatly consider all emissions, as well as the potential reducing the demand on the transmission for efﬁciency improvements. and distribution network. Section Two: Main ﬁndings from the Decarbonising the UK projects 43

Special feature The 40% house

The UK residential sector can deliver a 60% reduction in carbon emissions by 2050, in line with the targets outlined in the Energy White Paper. This represents a signiﬁcant challenge that requires some hard, but necessary, decisions since current policy is not taking us to where we need to be.

Many of the constituents of the 40% house scenario for 2050 are challenging, but that demonstrates the scale of change needed. Whilst this represents just one solution to the issues faced, it is clear that the overall target is non-negotiable – if less is done in one area or sector, more will need to be achieved in another.

• The focus is on the role of households in securing emissions reductions, covering the building fabric, lighting and appliances, and building- integrated technologies.

• The aim is market transformation of the total housing stock to the average of a 40% house, with the emphasis on strong regulation and product policy. A proactive rather than reactive approach is taken.

• All four principles in the Energy White Paper are addressed in achieving the 40% house: the 60% target, fuel poverty, security of supply and competitiveness.

• These savings are achievable even with the constraining assumptions made, including a 33% increase in household numbers between 1996 and 2050, a smaller average household size (from 2.4 to 2.1 people per household), stable emissions factors from 2030 and no reliance on unknown technological advances.

Over a span of 50 years, substantial changes will occur – technologies, appliances and housing styles not even thought of today could form part of everyday life. In ﬁve decades from now most central heating systems and appliances will have been replaced at least three times, the majority of power stations replaced twice, and almost the whole of the electrical and gas distribution network renewed. As well as illustrating the level of change that will occur over this timeframe, this also highlights the considerable opportunities for intervention that exist, ﬁtting in with the natural cycles of replacement. Action must be taken now to ensure that the appropriate technologies are available to match these cycles. Focusing on housing, lights and appliances, space and water heating, and consumers and society, the changes required to achieve a 60% reduction, and the means through which these can be achieved, are described over the next few pages. 44 Decarbonising the UK – Energy for a Climate Conscious Future

VIII Standard assessment procedure, Housing conditioning and where cooling is necessary it The government’s energy rating for dwellings. is achieved through passive measures. The efficiency of the UK housing stock is improved substantially by 2050 so that the Policy average efficiency of dwellings is a SAPVIII rating of 75, with a SAP of 51 (the current • A long-term, over-arching UK energy and average) as the minimum standard. Overall the housing strategy is required that covers average space heating demand per dwelling both the rate of turnover in the housing will be 6800 kWh, (compared to 14,600 kWh in stock and the resultant energy use and 1996). This is achieved by altering the standard carbon emissions. of the existing stock, the quality of new-build and the relative proportions of each so that by • The strategy would have a full remit to 2050 two thirds of homes are pre-1996 and consider the implications of location, tenure, one third are post-1996. size and density of housing developments over the next 50-100 years. According to this research, by 2050, the number of households will have increased • The housing strategy would clearly define to 31.8 million, housing a population of 66.8 the role of grants in improving the stock of million, with an average of 2.1 people per dwellings and the extent to which these household. Fuel poverty has been eliminated, should be primarily focused on eliminating with affordable warmth and cooling for all fuel poverty, as at present, and whether households. Smaller housing in appropriate additional resources should be available for locations is provided for single people. encouraging best practice.

Current stock • Local and regional authorities are largely responsible for implementing the energy and Since two-thirds of the dwellings standing in housing strategy. 2050 are already in existence, a substantial programme to upgrade these existing houses • Building regulations set the minimum is required to give an average space heating standard for new build and renovation. A clear demand of 9000 kWh per annum. This requires strategy for standards (and their enforcement) 100% uptake of all currently cost-effective over the next 40-50 years is required measures (cavity wall insulation, loft insulation to identify the necessary technologies to a depth of 300 mm, draught-proofing) and appropriate timescales to ensure plus high performance windows and doors. transformation of the housing stock. In addition, some more costly and disruptive work would have to be done – equivalent to • Providing information to consumers and local insulating 1 million (15%) of solid walled homes. authorities on the energy performance of a dwelling is essential to guide policy and push The aim is to achieve as much as possible the market towards more efficient homes. A through retrofit measures, before resorting universal, address-specific database of the to demolition, which is more disruptive and energy efficiency of individual homes (on an expensive. The worst houses, around 14% established scale), collated at the level of each of the current stock, are removed through a housing authority, would provide this detail. targeted demolition strategy which requires demolition rates to be increased to four times current levels, rising to 80,000 dwellings per Lights and appliances annum by 2016. All households, new and existing, are installed New-build with energy efficient appliances and lighting throughout, representing the best technology Construction rates are increased to replace currently available. Further savings are possible the demolished homes and to meet the rise through new and unforeseen technologies that in demand for housing due to the growing may emerge over the next 50 years, but do not population. New build makes up a third form part of the quantified scenario. of the stock in 2050, requiring an average construction rate of 220,000 per annum. • Household electricity demand for domestic These new homes are built to a high energy- lights and appliances (excluding space and efficiency standard, with an average net water heating) is reduced to 1680 kWh per heating demand of 2000 kWh pa in dwellings annum – almost half current levels and peak built post-1996. Since this standard is not demand is reduced through appropriate currently being achieved, zero demand for appliance design. space heating will have to be the norm in all dwellings built from 2020. Appropriate • The key technologies installed include design and siting limits the requirement for air vacuum insulated panels (VIPs) for Section Two: Main findings from the Decarbonising the UK projects 45

refrigeration and LED (light emitting diode) Consumers and society lighting in all households. Society has been transformed and is more • The rapid turnover of the stock of lights community-minded and environmentally- and appliances means that savings can be aware, providing the necessary framework achieved quickly once appropriate policies and support for successful implementation are implemented. This would contribute of the required policies. Should UK society additional savings to achieve the UK’s Kyoto continue to develop along current trends, no targets for 2008-12. carbon emissions reductions are expected by 2050. In this light, changing social priorities Policy is an important government action as part of meeting its carbon reduction target. • Market transformation is already established as the main policy approach in this sector, but Policy has yet to be used to full effect. The emphasis needs to be on stronger, more focused • Feedback and information are an essential measures, such as minimum standards. part of raising awareness. The design of utility bills, electricity disclosure labels, the tariff • Replacing policy on energy efficiency with structure and the existence of the standing policies on absolute energy demand would charge all need to be considered in terms of encourage downsizing and could reverse the discouraging consumption and improving the present trend towards larger (more energy energy-literacy of society. consuming) equipment. • As an example of an appropriate framework, • Manufacturers must be encouraged to view personal carbon allowances (PCAs) offer an energy-efficiency as a vital component of equitable solution to achieving greater carbon product design to prevent energy-profligate awareness amongst consumers, by placing a equipment appearing on the market. This cap on individual consumption. could be achieved under the European Energy-using Products Directive. Conclusions

Space and water heating Securing a 60% reduction in carbon emissions from UK households is a huge challenge The way in which the space and water that requires a radical shift in perspective in heating needs of the residential sector are the housing, appliance and electricity supply met is revolutionised, with an average of two industries and policy co-ordination across a low and zero-carbon (LZC) technologies per number of government departments. Current household. These technologies are installed policies, programmes and trends are not as a matter of course in all new build whereas sufﬁcient to put the UK on a trajectory that will existing dwellings are retroﬁtted when and lead to this level of emissions reductions by where appropriate. 2050. A clear over-arching strategy addressing both the energy and housing needs of UK • LZCs cover community CHP (combined heat dwellings, with an emphasis on carbon and power), micro-CHP (at the household mitigation, is necessary. level), heat pumps, biomass, photovoltaics (PV), solar hot water heating and wind turbines.

• This would be sufﬁcient to meet total residential electricity demand from low carbon sources and turn the residential sector into a net exporter of electricity by 2050.

Policy

• A complete market transformation to LZC could be achieved over the course of 2005 to 2050, which could be considered as three heating system replacement cycles of 15 years.

• Building regulations specify the minimum standard for LZC technologies in new build and renovations. 46 Decarbonising the UK – Energy for a Climate Conscious Future

Sustainable transportation

The transport sector is the largest source of carbon dioxide emissions in the UK and the only sector where emissions are expected to be higher in 2020 than in 1990.21 The future emissions from terrestrial transport, and how these might be limited, were investigated in the ﬁrst project reported here. Meanwhile, aviation is growing rapidly and, as highlighted by the Tyndall integrated scenarios project, under some growth projections, the lion’s share of the UK’s allowable

CO2 emissions will derive from aviation by 2050 (see Section One). The future of aviation emissions in the context of the Contraction and Convergence policy framework is the focus of the special feature in this section.

Reducing carbon emissions Technology has the potential to deliver large

from transport reductions in CO2 emissions, but the timing and extent of this is uncertain. Two potential This project set out to devise strategies and contributions from technological change were policies for the reduction of carbon emissions examined: a fairly pessimistic 25% improvement from land-based transport which is the largest in efﬁciency and a more optimistic 60%

contributor to CO2 emissions within the UK improvement. Even with supporting measures transport sector and where trends towards and a 60% improvement in efﬁciency, the increased use of personal motorised transport tougher targets prove very difﬁcult to meet.

show little signs of abatement. The only way that a 60% CO2 reduction target can be met without major behavioural The ﬁrst phase of the work involved change is through making very optimistic establishing carbon reduction targets for land assumptions about technological change and passenger transport. Based on two stabilisation the development of new low-carbon fuels. targets (550 ppmv and 450ppmv) and a review There is a genuine uncertainty as to the rate of of ﬁve UK scenario studies, overall emission technological change and the eventual level of targets ranging from 8.2 MtC to 25.7 MtC for delivery. According to some experts, commercial the transport sector as a whole were devised. fuel cell vehicles fuelled by hydrogen from low Current emissions are around 39 MtC. Within or zero-carbon sources are still many years away this, the targets for land-based passenger and may never come to fruition. transport are between 4.9 MtC and 15.4 MtC. These targets cannot be met without Measures to encourage behavioural shift technological advance and behavioural change. can achieve some change. Pricing measures are, in some circumstances, particularly The next phase of the work explored ways in effective. However, using current elasticities which the targets could be met. The literature of demand, it can be shown that encouraging on the behavioural response to a range of people out of their cars onto public transport policy levers, e.g. taxation, congestion charges by using taxation and subsidies is likely to

and subsidy of public transport, was consulted. prove very difficult. The tougher CO2 reduction In some areas knowledge of the effect of target may be met through the use of very policy levers is good, for example, changes in stringent pricing measures, though this would petrol prices, whilst understanding is poor with be dependent upon political acceptance of respect to other policy measures, for example, the necessity of such price rises (above and the net impacts of increases in telecommuting. beyond fuel price rises for purely commercial reasons). Alternatively, or in addition, a The team developed scenarios for the future widespread shift in values could help to based on extrapolation of trends and then change behaviours away from private car use. applied a range of single policy measures to examine the degree to which the targets could An integrated package is required to deliver be met. The review and modelling work was anything close to a 60% reduction in carbon supplemented by consultation with experts in emissions. Trends in growth in transport the area. will offset efficiency and other gains to some degree. Behavioural change will be a Three strategies with differing levels of necessary element of movement to a low technological development were characterised. carbon transport system but is very hard to These were subjected to expert review through achieve in the transport sectors where millions a Delphi survey. The third phase involved of individuals make decisions every day that ascertaining the ways in which households determine the pattern for that day. Moves to could achieve the carbon reduction targets. inform people so that they recognise the need A computer-based survey capable of storing to reduce carbon emissions and moves to information on household trips and generating facilitate change must happen sooner rather the related carbon emissions was developed. than later, alongside measures designed to The survey tool is interactive. As trips are induce change, such as pricing and regulation. amended, the resulting emissions change too, The household interviews showed the value so that households can see how near (or far) of the survey tool in conveying information they are to, or from, achieving their target. This effectively and also showed the ability of some survey tool has been used in an experimental households to make changes even under pilot survey of 15 households. current conditions. Section Two: Main findings from the Decarbonising the UK projects 47

Special feature A looming problem in the skies

“ …it’s not that we need to ﬂy less, but that we cannot ﬂy more!”

The Tyndall Centre’s research clearly demonstrates that unless the UK Government acts to signiﬁcantly reduce aviation growth, the industry’s emissions will outstrip the carbon reductions envisaged for all other sectors of the economy. Moreover, the Government’s own 60% carbon reduction target will be impossible to achieve if aviation growth exceeds just two-thirds of its current rate – even allowing for year-on-year efﬁciency improvements and assuming all other sectors completely decarbonise.

Climate change targets

Since the publication of the RCEP report, Energy – The Changing Climate, the principle of contraction and convergence on which the report’s ﬁndings were based has gained increasing support as a method for apportioning global emissions to the national level. Under contraction and convergence,22 all nations work together to achieve collectively an annual contraction in emissions. Furthermore, nations converge over time towards equal per-capita allocation of emissions. This research demonstrates the paradoxical nature of the UK Government’s self-imposed 60% carbon reduction target, based essentially on contraction and convergence, and their desire to permit, or indeed promote, the high levels of growth currently experienced in the aviation sector. 48 Decarbonising the UK – Energy for a Climate Conscious Future

IX Whilst the DfT has yet to explicitly UK aviation • The extrapolation of historical growth trends accept this approach, it is adopted in the emissions modelling by until 2015, followed by a reduction in growth QinetiQ and Halcrow, both of whose inputs are central to the UK Conflicting white papers as the industry further matures Aviation White Paper. In December 2003, the UK Department for • The UK taking responsibility for half of the Transport (DfT) published the UK Government’s aircraft emissions of flights arriving at or Aviation White Paper, setting out a strategic departing from UK framework for the development of UK aviation. The White Paper supports continued • A mean aircraft fuel efficiency improvement aviation growth, with plans for new runways of 1.2% per annum at Birmingham, Edinburgh, Stansted and Heathrow airports, along with new terminals • The rate at which constraints are explicitly and runway extensions throughout the UK. and implicitly placed on aviation growth Within the earlier 2003 Energy White Paper, remaining similar to the historical trend the UK Government outlined its plans to reduce carbon emissions by 60% by 2050. • The mean kilometres travelled per passenger However, given the absence of an international flight remaining unchanged from the agreement on how to apportion aviation current level emissions between nations, only domestic aviation emissions were included within this In addition to these, all the scenarios include 60% target. Omitting the fastest growing an incremental improvement in overall fuel emissions sector from the target cannot be burn for a typical journey. The value used reconciled with the Government’s claim that throughout is 1.2% per annum, the mean the target relates to stabilising carbon dioxide suggested by the IPCC in their special report concentrations at 550ppmv. In other words, on aviation and in keeping with that adopted international aviation must be included if the by the DfT in their Aviation White Paper. UK Government is to make its ‘fair’ contribution The 1.2% figure results from several factors towards the 550ppmv target. including improved engine efficiency, airframe design and air traffic management. Tyndall UK aviation scenario – background Tyndall UK aviation scenario – results Determining emissions from the aviation sector can be undertaken with various levels of detail. The UK’s aviation industry is currently growing Whilst models that include a range of inputs at approximately 8% per annum, having grown such as specific aircraft designs, engines and at a mean of 6.4% per annum in the decade flight-paths may provide ‘precise’ outputs, they prior to 11 September 2001. The following do not necessarily offer any greater ‘accuracy’ figure contrasts emission reduction profiles for than more simple approaches. Within the 550 and 450ppmv atmospheric concentration Tyndall project a relatively coarse approach of carbon dioxide with growing aviation was adopted for developing ‘what if’ scenarios, emissions in accordance with the assumptions as opposed to ‘precise’ long-term projections. outlined above.

The Tyndall UK scenarios took account of a Figure 27 reiterates the severe implications range of factors and made several overarching of permitting even ‘moderate’ aviation growth assumptions including: for the UK’s carbon reduction obligation, with

Figure 27 �� Contraction & convergence proﬁles to meet 550 and 450ppmv carbon dioxide �� concentrations for the UK compared with project UK �� aviation emissions. ��

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� �� Section Two: Main ﬁndings from the Decarbonising the UK projects 49

50% of the 550ppmv emissions subsumed by implications of aviation growth for different aviation alone by 2050. Furthermore, if the UK stabilisation commitments (e.g. 550 and Government follows the scientific consensus 450ppmv) is of paramount importance. that a 450ppmv stabilisation level is required, the aviation sector will exceed the carbon The Tyndall aviation project highlights the target for all sectors by 2050. conflict between a contracting carbon target and the EU’s expanding aviation industry. In short, aviation emissions are a high-stakes The project developed scenarios of aircraft issue for UK climate policy. More than any emissions for each of the EU25 nations other sector the aviation industry, with its from today until 2050 and compared these continued reliance on kerosene and its high with national contraction and convergence growth rate, threatens the integrity of the UK profiles designed to stabilise carbon dioxide long-term climate change target. concentrations at 550 and 450ppmv.

The EU Tyndall scenarios were based on the EU aviation assumptions outlined earlier in relation to the UK, with the exception that whilst growth within Rapid emissions growth across the EU25 the EU15 nations followed the UK approach (i.e. historical trends to 2015 and 3.3% per In partial acknowledgement of the importance annum thereafter), the EU10 nations were of international aviation, the UK Government assumed to grow at historical rates until 2025 states that it is keen to bring intra-EU aircraft before maturing to 3.3%. emissions into the EU Emissions Trading Scheme (ETS). The ETS is initially due to run Tyndall EU aviation scenario – results in two phases, 2005-7 and 2008-12, with the Government’s intention that aviation joins in The EU25’s aviation industry is currently growing the second phase. Such a scheme assumes at mean of 7.7% per annum, with most nations that the aviation industry would be able to buy lying within a range of 5 to 9% per annum. permits from other sectors or airlines to enable On the basis of this and the assumptions it to continue to grow. It follows therefore that discussed earlier, figure 28 contrasts emission other sectors of the economy would need to reduction profiles for 550 and 450ppmv significantly reduce their carbon emissions to atmospheric concentration of carbon dioxide compensate. However, even if aviation were with growing EU aviation emissions. to be included in the second phase, and this looks increasingly unlikely, it would still only The results clearly demonstrate that the EU25’s account for approximately 30% of emissions, as aviation sector accounts for almost 40% of the it excludes flights to and from non-EU nations. total permissible emissions for all sectors in 2050 under the 550ppmv regime, or as much The UK Government response to the aviation as 80% under a 450ppmv regime. challenge will undoubtedly influence the reaction of other European states. Moreover, NB Europe’s response to aviation emissions will All of the results presented for both the UK in turn influence the framing of any post-Kyoto and the EU are for carbon emissions only. agreement. Consequently, developing an The altitude at which aircraft fly significantly understanding within the UK and EU of the exacerbates the warming created by carbon

�� Figure 28 Contraction & convergence proﬁles to meet 550 and 450ppmv carbon dioxide �� concentrations for the EU 25 �� compared with projected �� EU 25 aviation emissions. ��

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� �� 50 Decarbonising the UK – Energy for a Climate Conscious Future

X Provisional research suggests dioxide emissions. For example, contrails, being unable to achieve substantial levels of that lowering flight altitude could significantly reduce contrail cirrus clouds and greenhouse gases formed decarbonisation in the short to medium-term. formation and hence cirrus production. However, operating by aircraft induce additional warming Indeed, the new airbus A-380 continues to use at a lower altitude would probably effects which amplify the climate impact high-pressure, high-bypass jet turbine engines increase fuel burn and hence increase carbon emissions. Whilst of the aviation industry. Such effects are that contain only incremental improvements in terms of instantaneous radiative XI forcing there would be benefits in omitted here due to both the very substantial over their predecessors. Moreover, a flying at lower altitudes, the small scientific uncertainty associated with the size combination of both long design runs (already increase in long-lived carbon dioxide (100+ years compared of the multiplier and disagreements about 35 years for the Boeing 747) and design lives hours/days for contrails and cirrus) would essentially increase the how, or indeed whether, such a multiplier (typically 30 years), locks the industry into global warming potential. Given should be applied. Where the multiplier is a kerosene-fuelled future. If the A380 were the different time scales, deciding whether the benefits of lower flight used as a simple ‘uplift’ to carbon emissions, to follow a similar path to the 747 it will, in outweigh the disbenefits cannot be a solely scientific decision. it is commonly in the order of 2.0 to 3.5 times gradually modified form, be gracing our skies the impact of carbon alone.X However, strictly in 2070. Consequently, decisions we make XI Given the storage requirements of hydrogen, it is highly unlikely speaking, such a comparison does not now in relation to purchasing new aircraft and that the A380 could be converted to operate with hydrogen-fuelled compare like with like. providing the infrastructure to facilitate their jet engines should a low-carbon operation have highly significant implications hydrogen source become readily available. The use of hydrogen for for the UK’s and EU’s carbon emissions profile fuelling aviation will require a new generation of aircraft designed Conclusion from now until 2070. to store a fuel with very different characteristics and properties from that of kerosene. Given the The aviation industry is a successful, The Tyndall analysis reveals the enormous very long design and regulatory environment associated with new well-established and technically-mature disparity between both the UK and EU aircraft, it is difficult to envisage a sector, contributing significantly to both positions on carbon reductions and their substantial penetration of hydrogen- fuelled aircraft before 2030-2040. the development and culture of the UK singular inability to seriously recognise and specifically and the EU more generally. adequately respond to the rapidly escalating However, whilst this relatively competitive emissions from aviation. Indeed, the UK industry continually pursues technical and typifies the EU in actively planning and operational improvements there is little thereby encouraging continued high levels evidence to suggest that such improvements of growth in aviation, whilst simultaneously will offer more than relatively small incremental asserting that they are committed to a policy of reductions in fuel burn. Hydrogen is often substantially reducing carbon emissions. The mooted as an alterative to kerosene, but research conducted within this project not only foreseeable problems include enhanced quantifies the contradictory nature of these water vapour emissions and the practicalities twin goals, but also illustrates how constrained of both hydrogen production and storage. the responses are. Given that it may be many Biofuel and biofuel-kerosene blends are years before we have a comprehensive possibly more plausible in the medium- term. international emissions trading system tied to However, the land-take implications, though an adequate emissions cap, ultimately the UK still characterised by uncertainty, are likely and the EU face a stark choice: to permit high to be very substantial. Consequently, the levels of aviation growth whilst continuing with aviation industry is in the unenviable position their climate change rhetoric or to convert the of seeing the demand for its services grow at rhetoric into reality and substantially curtail unprecedented rates, whilst at the same time aviation growth. Section Two: Main findings from the Decarbonising the UK projects 51

Carbon dioxide sequestration, capture and storage

In addition to moving to zero or low-carbon energy sources, a further approach to decarbonisation is to remove the CO2 from the atmosphere after it has been released from fossil fuels, be it through carbon sequestration in biomass (e.g. forests and soils), or after or during the combustion of fossil fuels, followed by storage in suitable geological reservoirs. Tyndall has supported two projects looking at the wider implications for sustainable development of the so-called clean development mechanism (CDM) of the Kyoto Protocol, under which

‘carbon sink forests’ can be planted in developing countries and subsequent CO2 emission reductions shared between the organisation from an Annex 1 country and the host country. Although these projects do not address decarbonisation speciﬁcally within the UK, carbon sequestration is one of the mechanisms by which UK-based ﬁrms and organisations can meet some of their CO2 emission reduction needs and many UK-based organisations already use forest-planting in other parts of the world on a voluntary basis to off-set some of their CO2 emissions. The third project in this section is an integrated assessment of the role of CO2 capture and storage in the UK using a case-study approach for three English regions: East Midlands, Yorkshire and Humberside and the North West.

Development and carbon sequestration: Women are often marginalised from key forestry projects in Latin America aspects of projects. This implies that relatively well-off farmers who have private or individual This research examined the sustainable property rights to forest are more likely to be development implications of climate change beneficiaries. Even these farmers, however, mitigation projects in developing countries. are likely to be poorly informed and receive It carried out in-depth analysis of carbon only small increases in incomes. Only some forestry projects, focusing on Latin America forest property rights are legible and fit into with a specific emphasis on Mexico. It aimed formal frameworks imposed by international to assess whether mitigation projects bring global regimes and government. Some broader social, economic and environmental sectors of society, such as poor households benefits to poor people, as is often claimed and women-headed households, depend on by their promoters. And if so, what conditions less formal rights to access forest resources. facilitate this? The research team analysed and interviewed a wide range of actors and The creation of carbon markets may involve stakeholders associated with these projects overturning long-established traditional and examined the emerging institutional and management and property rights regimes, legal infrastructure to support payments for with implications for both local livelihoods and ecosystem services. It found that different sustainable development. actors have different views on what the projects are about; for example, government Even the same project has different impacts personnel prioritise the technical efficiency on different stakeholders in different locations of carbon sequestration, whereas NGOs and because of the micro-politics and diverse local communities view positive impacts on ecology of the region. Clearly no one-size local livelihoods as the most important benefit. fits all and ‘blueprint’ style approaches are not applicable. Whilst investment in carbon Key factors influencing who receives benefits sequestration and market-based approaches from CDM projects include, the nature of are attractive for developed country investors property rights controlling access and use of and developing country governments, the existing forest resources (whether trees are outcomes are far less certain and the prospects on private land or communally managed), less attractive for local people. Marginalised and the dynamics of local institutions such as voices – women, the landless, and poorly farmers’ unions and co-operatives. Projects educated – are seldom given prominence in are drawn to communities where local land the projects, and any venture which involves managers and farmers are well organised, risk, uncertainty and future, rather than present, with robust local collective action institutions. benefits is likely to further disadvantage them. In terms of property rights, clear rights to land This has important implications for local equity and other productive resources are necessary. and sustainable development. 52 Decarbonising the UK – Energy for a Climate Conscious Future

PhD project highlight: An integrated assessment of geological Carbon sequestration in agriculture carbon sequestration in the UK

The Kyoto Protocol allows carbon sinks to Carbon dioxide capture and storage (CCS) partly offset emissions through certified in geological formations has the potential emissions reductions (CERs) which will be to make a significant contribution to the traded internationally as is envisaged under decarbonisation of the UK. Amid concerns the clean development mechanism (CDM). over maintaining security, and hence diversity, There is now research (such as that above) of supply, CCS could allow the continued into how low-income countries might benefit, use of coal, oil and gas whilst avoiding

most of which has been directed towards a large proportion of the CO2 emissions forestry, allowed under Article 3.3 of the currently associated with fossil fuel use. This Protocol. However, whilst agriculture may project has explored some of the geological, have even greater sinks potential through environmental, technical, economic and better management practices, there has been social implications of this technology. The relatively little research into the implications. UK is well-placed to exploit CCS with a large offshore storage capacity, both in disused oil Agriculture is allowed for in Article 3.4 of the and gas fields and saline aquifers. With the protocol and may become eligible for CDM majority of the nation’s large coal-fired power activities from 2012, though soil carbon stations due to be retired during the next 15 may become tradable before that through to 20 years, the UK is at a natural decision joint implementation or more commercial point with respect to the future of coal power mechanisms. Already, carbon trading, although generation, with both national reserves and often speculative, is growing. Farmers are the infrastructure for receiving imported coal involved – especially in North America - where, making cleaner coal technology a realistic despite the USA’s non-compliance with the option. In June 2005 the UK Government protocol, carbon is seen as a ‘crop’ with huge announced a £40 million package for the potential. The CDM may therefore be overtaken industrial development of coal abatement by events. There is also a non-market model technologies, including CCS. under which funds for agricultural development could benefit from the link with climate The project has developed a new techno- change – a factor in the Global Environment economic model which generates costs of

Facility’s funding of rural development CCS at about £30 to £50 per tonne of CO2 projects in Kazakhstan and China. By the end removed. This cost, expressed as a tonne

of the decade, agriculture may be at least of CO2 abatement, is in the same ‘ball- as prominent as forests in the international park’ estimates as the costs of many other

discourse on sinks. This could both increase potential CO2 mitigation technologies such support for agricultural development, and as nuclear, biomass, wave and tidal stream.23 enable very low-income, food-deﬁcit countries, The Tyndall techno-economic model has a which offer nothing else in terms of abatement reasonably detailed representation of the strategies, to enter the world carbon market. pipeline infrastructure (e.g. with respect to its spatial location) and is able to select a suitable Agricultural sinks, however, raise scientiﬁc pipeline route given considerations of costs, and livelihood questions at least as great landscape, protected areas and National Parks,

as those arising from forestry. It is therefore and the location of CO2 sources and potential important to establish whether carbon can storage reservoirs. really be maintained and sequestered by better management practices, whether this would Thus, whilst technically and economically have drawbacks (leakage and distortions of CCS represents a viable option to signiﬁcantly farming systems), and how the carbon can best complement other mitigation options, such as be monetised and traded, if indeed it should be. energy efﬁciency and renewables, is it socially and environmentally acceptable? This research, This research has conducted farm-level using focus group work and a face-to-face surveys in Brazil to determine the constraints survey, has shown that, given an acceptance and advantages of ‘carbon-friendly’ practices in of the severity and urgency of addressing mixed farming and pasture systems in Minas climate change, CCS is viewed favourably by Gerais and Rio de Janeiro states. The intention members of the public, provided it is adopted is to uncover links between carbon, agriculture, within a portfolio of other measures. It is and the broader economy. It is hoped that also generally seen as preferable to nuclear this work will be further developed through power. In terms of environmental implications, work with pastoralists in mountainous areas provided adequate long-term monitoring

of Central Asia, where degradation of winter can be ensured, any leakage of CO2 from a pastures since the break-up of the Soviet storage site is likely to have minimal localised Union may have led to serious losses of both impacts as long as leaks are rapidly identiﬁed soil carbon and good grazing. and mitigated. Given the deleterious effects of Section Two: Main ﬁndings from the Decarbonising the UK projects 53

increased acidiﬁcation of the oceans that have a very long-term perspective (i.e. thousands already been observed, the risk associated of years) in considering the value of CCS with such potential, localised short-term and hence the acceptable leakage rate. So, releases of CO2 into the ocean should be far although there remain uncertainties to be outweighed by the beneﬁts of reduced resolved, our assessment demonstrates that

CO2 emissions. CCS holds great potential for fast and deep

cuts in CO2 emissions as we develop long- Nevertheless, leakage is an important issue term alternatives to fossil fuel use. with respect to the long-term concentration of

CO2 in the atmosphere. If all the stored CO2 The ﬁnal stage of the research has entailed leaked out within a hundred or so years, then the development and testing of a Multi- the problem of atmospheric CO2 concentration Criteria Assessment (MCA) methodology could be made even worse than without applied to a set of future energy scenarios

CCS because of the additional CO2 produced for the East Midlands, Yorkshire and the through the energy penalty entailed in the Humberside and the North West of England, capture process. A further implication of the which demonstrates scientiﬁc uncertainty in leakage of CO2 from reservoirs is that the the geological assessment of storage sites, as long-term costs of CCS as a means of abating well as the wide range of opinions amongst carbon increases compared to renewables. stakeholders on the desirability of CCS relative These considerations underline the need for to other low-carbon options. 54 Decarbonising the UK – Energy for a Climate Conscious Future

Policy trends, instruments and mechanisms

Although some level of decarbonisation occurs for economic reasons (e.g.

energy efﬁciency trends), greater levels are required to achieve a 60% CO2 reduction. Moreover, other economic and social trends, such as growth in energy consumption, are driving emissions away from the target and policies are therefore required to promote increased decarbonisation. There is a huge diversity of policy levers including information provision, regulation, standards- setting, voluntary agreements, taxation, emissions-trading schemes, publicly- funded RD&D and incentives for RD&D funded by the private-sector.

In the light of the wealth of research already conducted on decarbonisation policy instruments and measures for decarbonisation, the Tyndall Centre has focused upon a few selected areas where less research has been conducted. The first project described explores the potential role of energy service companies and is followed by a special feature on one of the most exciting new policy instruments, Domestic tradable quotas. This is followed by a project assessing the role of the financial services industry (specifically the asset management sub-sector) in delivering decarbonisation objectives. The section is concluded with an outline of the development of a greenhouse gas emissions tool for the calculation of regional emissions.

The contribution of energy service with the technical efficiency of the relevant contracting to a low carbon economy organisational arrangements, including economies of scale. Transaction costs, in turn, Energy service contracting involves the are determined by the complexity of the energy outsourcing of one or more energy-related service, the specificity of the investments made services to a third party, thereby allowing the by the contractor, the contestability of the energy client to reduce operating costs, transfer risk services market and the relevant legal, financial and concentrate attention on core activities. and regulatory rules. The study develops these This approach may accelerate the diffusion of ideas into a general framework that can be low-carbon technologies and has the potential used to assess the feasibility of energy service to develop into wider ‘carbon services’, contracting in different circumstances. including carbon offsetting and participation in emissions trading, but despite numerous The results suggest that, while energy service academic studies of outsourcing of other contracting may have an important role to play activities, the energy service market remains in a low-carbon economy, a wholesale shift poorly understood. from commodity to service supply is unlikely to be feasible. Contracting is only appropriate This study describes the purpose, content, for a subset of energy services within a subset structure and implementation of energy of organisations and is particularly unsuitable service contracts and describes the evolution for final energy services at small sites and and status of the market in the US, Europe process-specific energy uses at large sites. and the UK. It classifies individual contracts Despite the attention given to comprehensive according to their scope, depth and method performance, contracting more limited forms of finance and shows how choices for these of supply and end-use contracting may often variables can influence the distribution of be more appropriate. A number of institutional responsibilities, incentives and risks. reforms may encourage energy service contracting, including the standardisation of The study develops a theoretical model both public procurement procedures and the of energy service contracting based procedures for monitoring and verifying energy upon minimising the sum of production savings, but these are likely to be limited in and transaction costs. Production costs their effect. To summarise, energy service are determined by the size and physical contracting can only form part of a broader characteristics of the energy system, together strategy for achieving a low-carbon economy. Section Two: Main findings from the Decarbonising the UK projects 55

John Tyndall

Special feature Domestic tradable quotas

Introduction

Domestic tradable quotas (DTQs) are a proposed policy instrument to reduce greenhouse gas emissions from energy use under which the end-purchasers of energy surrender emissions rights. DTQs were proposed by Dr David Fleming, a London-based policy analyst, who ﬁrst published the idea in 1996.24,25,26

Description of DTQs

DTQs can be broken down into the following elements: (a) setting the carbon budget, (b) surrendering carbon units, and (c) acquiring carbon units. a. Setting the carbon budget

The carbon budget is the maximum quantity of greenhouse gases that the nation can emit from energy use during any given year. Carbon budgets are reduced year-on-year so as to meet nationally and internationally agreed emissions targets. Each budget is divided into carbon units, with 1 carbon unit representing 1kg of carbon dioxide equivalent. b. Surrendering carbon units

Fuels and electricity are assigned a carbon rating based on the quantity of greenhouse gases (measured in carbon units) emitted by the combustion of a unit of fuel and the generation of a unit of electricity. When individuals and organisations purchase fuel or electricity, they surrender the number of carbon units corresponding to their purchase. For accounting purposes, these units are passed up the supply chain and on reaching the primary energy producer or importer are, surrendered back to government. c. Acquiring carbon units

Individuals eligible for units receive them free and on an equal per capita basis. The proportion of total carbon units allocated to individuals is equal to the proportion of total energy emissions arising from individuals’ purchase of fuel and electricity (currently around 40% in the UK.) Individuals may purchase additional units on a national carbon market and organisations are required to purchase all of their units on the carbon market. The carbon market consists of primary sellers, ﬁnal buyers and intermediaries who facilitate trading between them. 56 Decarbonising the UK – Energy for a Climate Conscious Future

Figure 29 Carbon unit ﬂows under DTQs ��

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XII A market maker is a trader in a Primary sellers are the Government and below- the units needed to cover the purchase and goods or securities market who holds a stock of the good or average emitters. charge the customer for them. (Retailers buy security and is willing to buy and sell at pre-announced prices, thus units either from market makers or, if buying “making a market”. • Government: Those units not included within in very large quantities, at the auction.) the entitlement are sold onto the market via a government auction. Eligible individuals and those organisations that buy units from market makers have a • Below-allocation emitters: These are carbon account within an electronic registry. individuals who emit at a level below their Units can be surrendered from a registry initial allocation of units and can sell surplus account in two ways. When paying utility units onto the market. bills, units are surrendered by direct debit, and when paying for fuel at garages, units Final buyers are organisations, above- are surrendered by means of a “carbon card” allocation emitters and overseas visitors. which allows the customer’s account to be debited of units. Figure 29 illustrates how units • Organisations: Organisations requiring are acquired and surrendered. very large amounts of units can buy at the government auction but most will buy from Individuals who do not wish to manage their market makers. carbon account can simply arrange for a market maker (for instance, their bank) to • Above-allocation emitters: Some individuals automatically buy their units as soon as they will wish to emit at a level above their initial receive them. They can then buy all units they allocation. To do so, they must buy further require at the point of sale. Therefore they do units on the market. not have to transact in carbon units but can transact purely in cash, transforming their • Visitors : Overseas visitors are not allocated experience of DTQs into that of a carbon tax. units and must purchase them on the market.

The intermediaries are market makersXII and Equity – are DTQs fair? energy retailers. DTQs and distributive justice • Market makers: The government auction involves a limited number of market makers There is increasing political support for allocating bidding for units. Market makers also buy emissions rights on an equal per capita basis. units from below-average emitters. Units However, rarely is a justification for this position are then sold on to final buyers or energy offered that draws upon the (substantial) retailers. Market makers will buy units at a literature on distributive justice. Whilst it would lower and sell at a higher price, making their be straightforward if support for an equal per profit from this bid and offer spread. (It is capita allocation were found within all of the anticipated that high street banks and post approaches to distributive justice, this does offices would act as market makers.) not appear to be the case. For instance, whilst there is considerable support for this allocation • Energy retailers: Customers without units from liberal egalitarian and from left libertarian (e.g. overseas visitors, eligible individuals approaches, support is not forthcoming from who have surrendered all their units, etc.) the right libertarian approach. Hence, to justify can purchase them from energy retailers an equal per capita emissions system one has at the point of sale. For example, when the ultimately to justify an approach to distributive customer buys petrol, the retailer will provide justice that supports such an allocation. Section Two: Main findings from the Decarbonising the UK projects 57

Who gets carbon units? income deciles to an average or below- XIII There are approximately 48 million people in the UK aged 16 and over and approximately average level, then most households, including 46.5 million people aged 18 and over The relevant considerations here are age, those with children, will be better off (and none residential status and (perhaps) institutional will be worse off) without additional units living. It is argued that children should not being allocated. receive units as they do not purchase energy. However, the age of eligibility for units is not straightforward. Allocating to those 18 and Effectiveness – can DTQs meet above would disadvantage those 16 and emissions reductions targets? 17 year-olds living independently. However, making 16 the threshold age would provide In theory, emissions trading schemes such a windfall for the large number of 16 year- as DTQs are effective as they set the level of olds who live with their parents and don’t buy emissions directly. However, in order for DTQs energy. British citizens and others permanently to be effective in practice, the scheme needs resident in the UK will receive units, whilst to be technologically and administratively those visiting the UK for short periods will not. feasible and acceptable to the public.

A decision regarding eligibility would need to Technological and administrative feasibility be made with regard to those individuals who fall between these two ends of the spectrum. The requirements of a DTQs scheme include: And how strong should an individual’s ownership of units be? For instance, should • Building and maintaining a secure carbon a long-term stay in an institution (hospital, database capable of holding carbon care home, prison) mean that an individual accounts for individuals and organisations has to hand over (a proportion of) their units to that institution? • Opening and managing accounts for individuals and organisations Protecting those on low incomes • Issuing and reissuing carbon cards to Whilst equity may demand that carbon units individuals and organisations are allocated between adults on an equal per capita basis, it also demands that allocating • Developing, installing and maintaining units in this way does not make those on systems that enable the surrender of carbon low incomes worse off. If emissions were units by carbon card and by direct debit, directly proportional to income, then allocating that allow both remote and over-the-counter emissions rights on an equal per capita basis trading of carbon units, that enable carbon would, in fact, make all those on low incomes statements to be obtained and that allow the better off, for, as below-allocation emitters, they online and over-the-counter transfer of carbon would have surplus units that they could sell units between accounts onto the carbon market, earning themselves additional income. • Being able to accurately carbon-rate various electricity mixes However, while it is true that emissions rise on average across the income deciles, not Research suggests that the above requirements everyone within the deciles emits at the can be met. Given limits on space just one of ‘decile average’. Work by the Policy Studies these is discussed below. Institute27,28,29 has shown that there is a wide variation in energy use and emissions within Enrolment and identity fraud deciles and that some 30% of households in the lowest two income deciles are currently For a DTQs scheme to operate successfully, above average-emitters. Hence, if DTQs Government must be able to open a carbon were implemented today, these households account and provide a carbon card for over 45 would be worse off as they would have to buy million people while ensuring that fraudsters are additional units on the market to cover their not able to open more than one account.XIII The above-average emissions. planned ID card scheme aims to verify people’s identity to a very high level of assurance. Bringing down the emissions of these Hence, basing DTQs on a successfully households to an average or below-average implemented ID card scheme would virtually level would ensure that they would not be eliminate the possibility of multiple applications disadvantaged by DTQs. This could be done by for carbon accounts. However, given the various building on existing Government programmes uncertainties surrounding the ID card scheme, for fuel poverty and for taking measures to it is important to consider how DTQs could be reduce the need to use private transport in implemented in its absence. rural areas. One option would be to consider using Additional units for parents? electronic veriﬁcation, i.e. allowing people to enrol online or over the phone using existing If children themselves are not entitled to databases to verify identity. This would carbon units, then should parents be allocated dispense with the need for the majority of additional units for their children? We argue individuals to produce relevant documents that if measures are implemented to bring at, say, a local post ofﬁce or post them to a the emissions of all households in the lowest relevant authority. 58 Decarbonising the UK – Energy for a Climate Conscious Future

Public acceptability £19.2bn.30,31,32 Given that DTQs require further technical specification no costing has been A DTQs scheme is more likely to gain public attempted. However, whilst DTQs will have a acceptance if it is (1) regarded as fair (2) significant cost, it is arguably not so large in sufficiently easy to understand and (3) public policy terms. For instance, the scheme sufficiently easy to use. will undoubtedly be less expensive than the Government’s proposed road charging scheme Fairness which has set-up costs estimated at between £10-62 billion and annual running costs The fuel protests of 2000 illustrated the estimated at £5bn.33 public antipathy that can arise in response to even small rises in the price of fuel. DTQs may provide an opportunity to mitigate such DTQs and EU ETS antipathy through the explicit inclusion of individuals in the task of emissions reduction. Even if it was agreed that DTQs constitute the Rather than confronting individuals with ideal cap and trade scheme, the scheme could higher prices, DTQs actively enlist them as not simply be parachuted complete into an environmental stakeholders through the direct empty policy space. Since the beginning of allocation of emissions rights. Moreover, 2005, the European Union Emissions Trading individuals are made equal stakeholders Scheme (EU ETS) has been in operation and, through the equal per capita allocation of hence, if a DTQs scheme is to be implemented, these rights. If the public perceives this equal it is important to explore ways in which the EU allocation to be broadly fair, this is likely to ETS might evolve into a DTQ scheme. contribute significantly to support for DTQs. Under the EU ETS, emissions rights are Understanding the scheme currently surrendered by emitters, whereas under DTQs, emissions rights are surrendered Given that DTQs would take time to implement, by energy end-purchasers. However, there is once a decision had been taken to do so, a considerable overlap between these two there would be a substantial period over groups as it is only in the electricity sector that which government could explain the various end-purchasers are not actually emitters. aspects of the scheme. Over time it is likely that, as a result of learning-by-doing, most Excluding the electricity sector, all emitters in people will come to understand the scheme. the energy sector are included within DTQs. By However, understanding the scheme is not a contrast, excluding the electricity sector, the prerequisite for using it. Those individuals who EU ETS includes only large industrial emitters cannot understand or simply do not wish to and no individual emitters. If the EU ETS were transact in carbon units, can sell all their units to be expanded by gradually including more immediately upon receipt and buy all units at and more emitting organisations and then the point of sale. by including individuals, then (excluding the electricity sector) the participants in the two Using the scheme schemes would be identical. To complete the transformation from the EU ETS to DTQs, it For those who wish to transact in carbon units, would be necessary to change the entities in the process of surrendering units (carbon the electricity sector that surrender emissions card or direct debit) is convenient and familiar. rights from power stations (emitters) to Options for trading units - trading online, over electricity customers (end-purchasers). Hence, the phone or over-the-counter at banks and if DTQs is a sufficiently powerful idea, then post offices – are again familiar. To properly there is an evolutionary route that could be manage their carbon account, individuals will taken to realise the scheme. need regular statements. It is assumed that it would be too expensive for the Government to post out tens of millions of statements Conclusion each month. However, statements could be accessed online and could be obtained over DTQs fare well when assessed against the the counter at banks, post offices and garages. 3 E’s – equity, effectiveness and efficiency. It would also be possible to install terminals in Whilst further research is clearly needed into these locations that printed statements on the the detail of DTQs, the scheme should not be insertion of a carbon card. regarded as simply a blue sky proposal but as a credible public policy option.

Efﬁciency – can DTQs reduce emissions cost-effectively?

What would be the set-up and running costs of a DTQs scheme? Costing large IT projects such as DTQs is not an exact science, even for experts! For instance, the Government’s estimates for the cost of the ID card scheme have recently risen from a range of £1.3–3.1 billion to £5.8 billion whilst some experts are suggesting a range from £10.8 to Section Two: Main ﬁndings from the Decarbonising the UK projects 59

Key issues for the asset management short-term performance and reward. Whilst a sector in decarbonisation stronger input from investors into the policy- making process is desirable, it is seen as too A key area neglected by most policy research speculative to justify their time. is the role of institutional investors in promoting The Tyndall Centre could assist this transition by: decarbonisation. As universal investors with a stake in all sectors, the investment community 1 Collaborating with active investor bodies like has a key role to play because of its dominant the Institutional Investors' Group on Climate position in the equities market, which gives Change (IIGCC) on those aspects where it the right (or even duty, according to some it has insights and expertise (e.g. climate commentators) to guide corporate strategy. science, risk assessment, policy analysis, Previous studies have identified key barriers to energy technology, etc.) action such as confusion about the science, political uncertainty, lack of analytical capability, 2 Engaging in the Government's consultation and inefficient market structures, but none process on strengthening corporate has examined a single national marketplace environmental reporting requirements in detail, nor brought together stakeholders to formulate specific actions. Through 3 Seeking to ensure that any official interview and plenary workshop discussion, communication policy on climate change a preliminary list of eight areas was reduced contains an element relating to the to three issues to review in three parallel investment community stakeholder groups: information, investment process, and asset allocation and appraisal. PhD project highlight: Greenhouse gas Information regional inventory project

Information provision is not a simple issue The Greenhouse Gas Regional Inventory Project because there are various actors in a complex (GRIP) developed a consistent and reproducible decision chain who all require different methodology for estimating greenhouse gas information: trustees are generally unaware of emissions within the conﬁnes of an English climate change and the best strategy may be Government Ofﬁce Region. The resultant to identify champions for the issue; consultants methodology encompasses greenhouse gas need a broad but technical input; brokers (GHG) emissions associated with the energy, are sector-oriented and driven by short-term industrial processes, waste and agriculture considerations, e.g. emissions regulations. sectors. GRIP is explicitly designed to function Generally, the basic quality of corporate data across three levels of accuracy, to account for on carbon emissions is poor. wide variations in the existing data, knowledge and time-availability of prospective users. This Investment process consistent methodology, together with estimates of uncertainty, allows a region’s decision-makers The investment industry has a short-term focus to estimate its greenhouse gas emissions which is not conducive to tackling climate and compare year-on-year reductions against change. In addition, until carbon has a value their own and other regions. The GRIP project as an asset / liability, or socially responsible has focused on the North West of England investment (SRI) is clearly seen to out-perform and, using the developed methodology, has mainstream investment, investors will not be calculated emissions from the region to be: willing to compromise their duty of care to their clients by soft-pedalling hard economic factors. − 65.6 MTCO2 Eqv from the energy sector;

− 6 MTCO2 Eqv from industrial processes;

Asset allocation and appraisal − 2.1 MTCO2 Eqv from waste;

− 3.9 MTCO2 Eqv from agriculture. The critical problem is that Government policy is perceived as being too short-term and From the inventory, a scenario generator tool potentially unpredictable, making investment has been produced, based on consumption around mitigation too risky. At a more technical and emissions associated with the energy level, scenario planning is under-appreciated as sector. In the tool the demand-side is an appraisal tool and brokers have been slow categorised by sector, fuel type and changes to carry out research given the general bear- in levels of energy consumed, with the market conditions. The key was seen to be the supply-side being categorised by technology, impact at sectoral level of Government policy. efﬁciency and fuel type.

The way forward The scenario tool was used as the platform for the construction of a set of stakeholder defined Information flow needs to be improved. This end-points. This process encompassed could be assisted by regulatory guidance two phases. The first phase consisted of that climate change is a material issue in a set of face-to-face interviews with 40 general for all the investment actors and for stakeholders from academia, industry, NGOs corporate reporting. Duties of advisors need and Government departments. In this process to be defined to include long-term as well the interviewee selected numerical values in as short-term issues. The industry should the interface to reflect their own perceptions consider introducing mandates for advice/ of how the energy system might evolve to research that reduce the weight given to 2050. The interview process produced four 60 Decarbonising the UK – Energy for a Climate Conscious Future

general clusters of scenarios, which depicted process produced some interesting results, an approximately 40%, 50%, 60% and 70% showing, for example, that the stakeholders’ reduction in GHG emissions by 2050. The estimates for demand changes in the domestic large variation in predicted GHG emission sector varied by as much as 60%. Perceptions reductions (between 40% and 70%) can be of the future of the energy supply-side also accounted for by both the amount and types showed marked variations, from a nuclear of energy consumed and the manner in which dependent grid to a more complex grid with the respondent believed electricity would be various generation mechanisms. generated. The outputs from phase 1 were then analysed for similarities in fuel choices, The discussions held at the workshop showed demand changes and electricity production that fairly rapid action is required if we are to technologies utilising an eight point scale. achieve the necessary reductions in demand, For the second phase, selected stakeholders implement a secure energy system, and took part in a workshop to establish what ensure that we can meet our own needs. techniques need to be implemented by 2020 This conclusion is a requirement of all of the to meet the relevant reduction by 2050 for produced end-points including the one with a each one of the end-points. The scenario 40% reduction in carbon dioxide. Section Two: Main ﬁndings from the Decarbonising the UK projects 63

Summary

In this section short accounts of the projects within the Decarbonising the UK theme have been presented, with a few longer descriptions of especially topical issues. The aim has been to provide an overview of the work conducted, including the objectives, principal methods, key ﬁndings and implications for policy-makers and stakeholders. Tyndall has endeavoured to cultivate research which addresses key ‘real-world’ problems, challenges and opportunities, is multi and interdisciplinary, and which involves (and is relevant to) stakeholders and policy-makers. The above projects reﬂect the objectives of our research and represent a range of approaches to such challenges.

Conclusions from Sections One and Two

The theme has built upon the strengths of the existing consortia members in exploring key carbon intensive domains and sectors, using multidisciplinary approaches to combine insights from different disciplines to generate new insights. This approach is well-illustrated by the Low carbon transport and Integrating renewables projects. Because of the interdependencies within the energy system, a systems approach has additionally been required whenever large changes are being explored. Hence, the Hydrogen energy economy project analysed and modelled alternative means of producing hydrogen for applications in transport, domestic and conventional electricity generation. The Carbon capture and storage project has modelled the capture of carbon dioxide from the power station to the reservoir, but has also considered wider energy system changes and risk perceptions of stakeholders and the lay public at the regional scale through scenario analysis. These and other projects such as the 40% house project, have progressed further towards interdisciplinarity, i.e. disciplines come together around a common problem and new methods, concepts and theories emerge.

The integrated scenarios described in Section One represent the meta-level integration, building-up a new framework within which data and insights from the theme projects can be incorporated, though also drawing upon additional data and information from other sources as necessary (e.g. shipping). The scenarios process, including the storylines, expert conﬁrmation, backcasting and multi-criteria assessment, has been an interdisciplinary ‘laboratory’, in which many different disciplinary experts have exchanged and discussed concepts, theories, ideas, knowledge, information and meanings, all focused upon the very real policy, economic, social and environmental problem of reducing CO2 emissions by 60% by 2050. The scenarios and the processes surrounding them therefore represent the culmination of the ambitions set out in the Tyndall Centre’s work on decarbonisation from 2000 to 2005. 36 Decarbonising the UK – Energy for a Climate Conscious Future Decarbonising the UK – Energy for a Climate Conscious Future 37

Section Three Exploring transitions to sustainable energy 60 Decarbonising the UK – Energy for a Climate Conscious Future Section Three: Exploring transitions to sustainable energy 65

The challenge of decarbonisation involves no less than a transition from one set of technologies, practices, habits, regulations, values and perceptions to an alternative low-carbon set of interrelated technologies and practices which fulﬁl the same or equivalent social functions. Because it has yet to happen, it is impossible to know what the future system of energy supply and demand will look like, how quickly such a transition might occur or how it may be brought about. However, evidence from previous transitions from one set of technologies and associated practices to another does provide some useful indications of how change might manifest itself.

The following account draws upon the conceptual framework developed by Dutch researcher Frank Geels and colleagues34,35,36 who have identified three interlocking levels via which innovation occurs and which define the terrain over which transitions to sustainability appear to take place. These are the landscape (cultural and political values and deeply rooted socio-economic trends), the socio-technical regime (specific policies, technologies, institutions, practices and behaviours) and technological niches (emerging new technologies)(see figure 30). Below, each of the three levels is further defined and described with respect to energy.

The energy landscape The subsequent collapse of the oil price in 1986 was a direct result of OPEC’s inability The energy landscape provides the dominant to maintain an internal consensus on assumptions, values and deeply-rooted socio- production levels. Nevertheless, from the economic trends at a given period of time. It 1950s onwards, arguments have raged over also encapsulates the key ‘philosophy’ behind the potential depletion of fuel supplies, and policy-making and in that sense can be said to ‘green’ arguments concerned with exponential reflect the dominant perception of ‘problems’ resource consumption came to the fore in and the ways to resolve those problems (what the early 1970s with the publication of Limits Sabatier37 terms the ‘policy paradigm’ and to Growth. An environmental and moral Hajer38 the ‘discourse coalition’). In our own argument against excessive consumerism society, the landscape is given by a concept and materialism has long featured in energy of economic growth which has relied since debates, though it has remained a minority the industrial revolution on fossil fuels, albeit viewpoint in society more widely, at least in with major shifts from coal to oil to natural terms of behaviours. gas. The 1973 oil crisis, when the oil price quadrupled and remained high until the 1986 The availability of cheap fossil fuels from the oil price crash, resulted in a dramatic upsurge mid-1980s until just a few years ago has of concerns about fuel security. This stimulated literally fuelled the rapidly growing global major public and private-sector programmes economy. During the past few decades the in energy conservation and efficiency and, on dominant perception of energy has been that the supply-side, efforts to identify both new of a commodity which is in abundant supply fossil fuel reserves in non-OPEC countries and and whose continued growth in consumption renewable energy sources. Many of the current is indicative of increased affluence. The set of technologies now being considered in process of globalisation has led to a massive the context of decarbonisation originated from, shift in more energy-intensive manufacturing or at least received an enormous boost during, and heavy-industries out of the post-industrial the period of the oil crises of the 1970s. economies into the newly industrialised economies, to China in particular. This has The oil price crises of the 1970s were the led to carbon emission reductions in the UK consequence of political tension in the through market forces with no deliberate policy relationship between OPEC and ‘the west’. intervention, since the embodied carbon in 66 Decarbonising the UK – Energy for a Climate Conscious Future

imported goods is not deemed to be the ‘domestic functions’ and ‘waste treatment/ responsibility of the UK. The lengthening of removal’. Energy is in turn an underlying supply-chains has an energy and carbon requirement for the fulfilment of all of these footprint, as does the more frequent personal social functions. Hence, it is necessary to look travel that has accompanied globalisation. at the energy needs across all socio-technical regimes. In some cases energy is a more Since the mid-1980s, concerns over carbon evident component of the regime, e.g. aviation dioxide emissions from fossil fuel use have and the built environment, than in others, e.g. grown, with the authoritative Intergovernmental clothing and education. The collective energy Panel on Climate Change (IPCC) producing needs of all socio-technical regimes are its first assessment of anthropogenic climate fulfilled by the ‘energy system’ which, in the

change in 1990. The prospect of global CO2 UK, is characterised by: emissions at anything from one to ﬁve or six times present levels in the current century • A dependency upon fossil fuel based has moved environmental concerns away energy supply from depletion to the adverse consequences of fossil fuel utilisation. From the early 1990s, • An oil, gas and coal extraction, processing the UN Framework Convention on Climate and transportation infrastructure Change (UNFCCC) - and its Kyoto Protocol of 1997 (which came into force in 2005) - has • Large-scale electricity generation technologies emerged as the dominant policy framework in EU countries and hence constitutes the • Connection to a centralised national grid relevant policy landscape (even though other with comprehensive regional and local countries such as the USA and Australia have electricity grids not followed suit in ratifying the Kyoto Protocol). The consequence is that commitment to some • A reasonably comprehensive national gas grid level of decarbonisation is now an integral element of the dominant policy landscape in • A national network of petrol and diesel the UK (and other Kyoto countries). distribution

Socio-technical energy regime • A privatised set of operators who are regulated by Government bodies The next level in the framework is the socio- technical energy regime which consists of • An extensive road network a set of technologies embedded in a social, political and institutional context with its • A moderately comprehensive rail and associated set of rules, procedures, habits aviation infrastructure. and practices. It is at this level that ‘lock- in’ may take place, whereby technological The individual technologies within the regimes emerge alongside institutional and energy system include the various forms of social change (due, amongst other things, to the internal combustion engine, combined increasing returns to the scale of adoption). For cycle gas turbines (CCGT), pulverised coal example, the private car has had a profound fuel boilers with steam turbines, nuclear influence on the structure of the city and reactors, hydroelectric plants and underlying its surrounding region, but it is not a readily network and control technologies (e.g. reversible effect as the mass availability of single AC voltage, high voltage transmission the car becomes part and parcel of everyday and electrical control equipment allowing lifestyles and patterns of social and economic synchronisation). activity. There are signs that modern societies may be about to proceed down a similar route Some of the key historical features of the with respect to aviation, which is expanding system of energy provision in the UK pre- rapidly and around which new lifestyles and privatisation were a centralised organisation of work patterns are emerging. In addition to the growth in consumption, with the use of long- obvious implications of globalisation upon run marginal cost structure in planning new demand for aviation (for business, leisure, supply and centralised control of the network. education, etc.), the expansion of budget Unruh41 has noted that regulatory systems airlines has opened up new opportunities for have sanctioned investment in new electricity cross-European leisure and work patterns, generating plant and, as the system expands, following trends initiated in the USA and increasing returns to scale are exploited. This gradually extending internationally. drives down costs and increases the reliability and accessibility of the system (though it Energy per se does not encompass a may become more subject to external shocks distinct socio-technical regime of its own. and surprises, such as industrial action and Instead, the provision of physical sources sudden shifts in fuel prices). As reliable of energy is an underlying condition for all electricity becomes more widely available, other socio-technical regimes to function. this in turn generates greater demand, as well Gershuny & Miles40 have identified a number as stimulating the innovation of new end-use of ‘service functions’ which are preconditions appliance technologies. The regulatory system for all human existence, including ‘shelter conventionally prioritises a reduction in unit and clothing’, ‘food and drink’, ‘mobility’, price, providing an incentive for investment ‘communication’, ‘education’, ‘recreation and in new capacity rather than energy entertainment’, ‘health’, ‘reproduction’, ‘security’, efficiency measures.42,43,44 Section Three: Exploring transitions to sustainable energy 67

Privatisation of the energy and public with the introduction of the aeroplane. Clearly, transport sectors in the 1980s and 1990s entirely new markets are likely to be opened- was the consequence of implementing up by technological and socio-political the broader-scale policy principles in the change by 2050. Since all socio-technical landscape such as ‘market-based’ economies, regimes use energy there will be implications ‘freedom of choice’ in resource consumption for energy consumption. The rapid growth in (subject to health, safety and environmental mobile telephony is an example of an entirely standards) and the perceived requirement new domain having been opened-up in the for reliable, comprehensive and cost- last 20 years which has increased demand effective infrastructure. A key aim has been for electricity and stimulated innovation in to stimulate competition, increase choice energy storage technologies. New domains and drive down prices. A further aim, far may open-up which are particularly energy- from achieved in practice, has been to allow intensive, such as sub-orbital space tourism future investment in the energy and transport and rapid inter-hemisphere travel, but such systems to be led by the private-sector. As new domains are impossible to anticipate with time has progressed, increased levels of any confidence. economic and environmental regulation of the energy and transport sectors have The five types of transition are: become necessary because of the failure of a ‘market-based’ approach to deal with the • Reproduction: ongoing processes of change negative externalities of energy production within the socio-technical regime (i.e. not and consumption and the failures of the involving interaction with the landscape or institutional settlement of privatisation itself. technological niche); The user is still largely regarded as a passive agent vis-à-vis energy itself, in the sense • Transformation: processes of change that that what is being consumed is not energy arise from the interaction of an evolving per se, but rather a service such as heat, landscape with the socio-technical regime lighting, comfort, entertainment, and so on. (but not with the technological niche level); The inexorably rising energy needs that have traditionally accompanied the growing • Substitution: replacement of one dominant consumption of services provided across all technology within the socio-technical regime socio-technical regimes have come to be met by another as a consequence of interaction at the appropriate performance standards by between all three levels; the expansion of supply through operators and regulators working together. • Dealignment/re-alignment: interaction between the three levels resulting in Technological niche competition between a dominant technology within the regime and a number of other The final layer in the multi-level framework competing options which have different is that of the technological niche. New performance characteristics, eventually technologies emerge and some develop resolved through emergence of a new within niche environments, protected from the dominant option; full effects of competition with the dominant technologies in the socio-technical regime. • Reconfiguration: replacement of a set of Sometimes these new technologies displace interlocking technologies by an alternative the existing ones and become the new array of interrelated technologies which fulfill dominant technologies within the regime. the same, or similar, functions. Some of the major historical changes in energy technologies have been from charcoal Reproduction pathway production to use of coal in furnaces and boilers with steam engines, to the internal Rosenberg captures well the essence of the combustion engine, including the jet engine reproduction pathway in the following quote: in aviation, and the CCGT. These past technological innovations have involved a “A large proportion of the total growth in combination of fuel types (changing to those productivity [efficiency] takes the form of a fuels with a higher hydrogen to carbon ratio, slow and often invisible accretion of individually i.e. from wood to charcoal to coal to oil to small improvements in innovations. …Such natural gas) and technologies which utilise modifications are achieved by unspectacular those fuels with ever greater efficiency.45 design and engineering activities, but they constitute the substance of much productivity [efficiency] improvement and increased Applying the model to the changes in the consumer well-being in industrial economies.”47 UK energy sector over the past 25 years Reproduction involves incremental technical Transitions typically occur through the improvements in the generation and use of interaction of two or more of the landscape, energy in the context of existing technologies, the socio-technical regime and technological institutions and markets. Ausubel & Langford48 niche. Six types of transition have been have shown that energy efficiency has been identified,46 five of which are described or improving at the global scale in an almost linear anticipated for the energy system. The one type fashion by approximately 1% per year since of transition not identified here is the opening- about 1860. This trend was therefore in place up of a new domain such as was witnessed approximately one hundred years before the 68 Decarbonising the UK – Energy for a Climate Conscious Future

development of environmentally-driven policies would it be possible to re-direct energy for energy conservation and efficiency. If an efficiency savings towards zero and low-carbon annual 1% energy efficiency improvement is energy intensive activities. Such levels of applied to an energy technology which is 30% intervention are currently beyond the perceived efficient, then the efficiency is doubled to 60% role of Government in the economy. over 70 years (assuming this is not limited by physical laws). The efforts to reduce energy Substitution pathway consumption have been reasonably successful in energy-intensive industries, where pay-back The ‘dash to gas’ which occurred in the UK in times have legitimised commercial investment the late 1980s and through the 1990s from the in more energy efficient technologies and combination of technological change, resource management practices. To some extent the availability, policy shifts and the associated routine replacement of domestic appliances and changed context for investment is an example of cars every 10 to 15 years by more efficient of the substitution pathway. Electricity designs is an expression of such reproduction. generation from CCGT grew from 0% to the current value of 38% in not much more than a Transformation pathway decade, in so doing displacing power stations using coal and oil.51 By 2003, approximately 20 Government intervention can be used to GW of CCGT capacity had been constructed focus and encourage the pace of change, in only ten years, representing a quarter of the and these cases of an interacting landscape UK’s total electricity generating capacity.52 The and regime (but with no new technologies) landscape changed dramatically in the early to are instances of the transformation pathway. mid-1980s with the UK’s coal industry facing It is the interaction of landscape and regime political and economic turmoil and subsequent which helps to explain why efficiency decline due to Conservative Party politics, the improvements (the reproduction pathway) are opinions of the then Prime Minister (Margaret unlikely to achieve sufficient decarbonisation. Thatcher) and the changing economics of coal Cultural shifts in the landscape have been production in an international context. Soon towards more ‘individualisation’, meaning, after, the same political dynamic mandated the amongst other things, fewer persons per adoption of ‘market-based’ approaches and the household, more private ownership and use liberalisation and privatisation of the electricity, of cars, more extended mobility patterns and gas and oil industries. Further change in the higher expectations concerning fulfillment perceptions of fuel security at the EU level led of individual lifestyle aspirations, all of which to revision in the late 1980s of a directive which have frequently involved greater overall energy had, since 1975, limited the use of natural gas consumption. These dominant landscape for electricity generation. New controls on SOx effects upon consumption have nullified the and NOx emissions from coal power stations effect of efficiency improvements. through the EU’s Large Combustion Plant Directive were also important, as expensive As the Kaya formula presented in Section Two retrofitting with flue gas desulphurisation illustrates, whilst steady incremental innovation equipment was required if the level of coal use towards efficiency is capable of making a of the 1980s was to be sustained.53,54 major contribution to energy intensity (energy consumption per unit of economic activity) over The newly privatised industries favoured time, this does not equate to a reduction in less capital-intensive developments since overall energy consumption due to an increase they were forced to recoup investment over in affluence (which indicates the quantity shorter time periods than their nationalised of energy services required per capita). predecessors. Privatisation also led to an Voluntary efforts to limit energy consumption in effective halt in expansion of the nuclear transportation, the domestic sector and many power plant programme as the private sector commercial sectors (which have low energy never expressed enthusiasm in investing intensities) have had a poor record of success, in nuclear power. The main reasons for this as ownership and use of appliances such were: a) concern over the risks in the wake of as computers, other electronic goods, ‘white the Chernobyl disaster (1986); b) increasing goods’ and cars has increased. Thus, domestic realisation of the high and potentially volatile electricity consumption in the UK actually costs of decommissioning;55 and c) the high increased by 19% between 1990 and 2002.49 capital costs of nuclear plant construction. A nationalised nuclear programme remained in More recently, ‘market transformation’ has been place, however, through a subsidy mechanism a preferred policy approach, whereby standard (the Non-Fossil Fuel Obligation) reflecting a setting and the labelling of consumer products national policy commitment to continuance (required and voluntary) have been used of Britain’s nuclear capability. This illustrates to accelerate the adoption of more efficient a tension in the way that the modified products. There is, however, good evidence socio-technical regime for energy supply that savings made by energy efficiency in emerged, with high-level political and policy one domain result in increased consumption commitments around national security lying elsewhere in the economy (the so-called tangentially to the market-based focus of rebound effect)50 and, given the pervasive, energy policy. Within a short period of time underlying nature of energy in all socio- landscape changes had therefore radically technical regimes, the result is a corresponding modified the operation of the energy supply growth in energy consumption. Only by far and delivery regimes, with knock-on effects more significant government intervention upon competition, price and consumption. Section Three: Exploring transitions to sustainable energy 69

Figure 30 �� The multi-level model of �� technological transitions (source: Geels39)

��

The combined cycle gas turbine (CCGT) though the rise of international terrorism as emerged as a niche technological innovation, a political issue has heightened fears over developing out of the aerospace industry from energy security. There is little expert consensus the 1950s onwards. It was capable of being over the issue of energy security, however, constructed rapidly with less capital investment some believing for example that gas supplies than coal power stations and able to utilise the will still be plentiful in 2050, others expressing plentiful supplies of natural gas from the North the view that natural gas will long have been Sea ﬁelds which were available from the 1980s depleted by that time. onwards.56 A further factor which helps explain the dash to gas is the particular way in which With privatisation came a more active privatisation of the electricity industry led to the interpretation of the domestic (and business) Regional Electricity Companies attempting to energy consumer as a utility maximiser, reduce their dependence upon the two main ‘shopping around’ for the best deal from generators. The result of these interactions the competing energy providers. However, between the landscape, socio-technical domestic consumer choice has been less regime and technological niche innovation eagerly sought than the market pundits was the dash to gas of the 1990s, during imagined, so that in many respects consumers which thirty CCGT plants were constructed, remain largely passive users. Also related to replacing coal power stations, and natural gas the economic landscape is the importance became the dominant fossil fuel in the UK given to innovation in low-carbon energy (for a more detailed analysis of this transition technologies as a route to economic see Winskel (2002).57 development and wealth creation. The example of Danish wind turbine developers is frequently cited as an analogy of how public- and Landscape, regime and technological privately-funded R&D can be commercialised drivers to 2050 to the beneﬁt of the national economy.58

In this sub-section, the key drivers of change There is clear evidence of a decoupling of now impinging at the level of the landscape, GDP growth and energy consumption in socio-technical regime and technological niche some post-industrial countries, including the are discussed in order that the future potential UK (which has experienced an average 2% transitions can be mapped out in the following decrease in energy intensity per annum since two sub-sections. 1970). There is a more striking decoupling of

GDP growth and CO2 emissions, which for Energy landscape drivers the UK have been generally decreasing since the 1970s.59 It is possible that there may be Globalisation and market liberalisation remain individual energy service thresholds appearing the dominant drivers at the landscape scale, in mature economies, as levels of ownership 72 Decarbonising the UK – Energy for a Climate Conscious Future

Stage of Fossil fuel Nuclear Renewables Demand-side Energy carriers technology based technologies and storage technologies

Mature CO2 capture existing some wind energy efﬁcient batteries (MEA) ﬁssion turbines appliances designs pump storage CCGT passive solar and PV

Early ultra super new ﬁssion some wind low-carbon heat commercialisation critical boilers reactors turbines buildings accumulators

some gasiﬁcation biomass boilers technologies PV fuel cells biofuels

grid modiﬁcation

anaerobic digestion

ground source heatpumps

Development some CO2 capture pebble-bed wave low-carbon hydrogen from gas and and Demonstration technologies reactor buildings electrolysis for energy (D&D) stage tidal integrated gasiﬁcation biofuels combined cycle e.g. gasiﬁcation (IGCC) and pyrolysis

underground coal grid modiﬁcation gasiﬁcation fuel cells

Research stage novel CO2 capture nuclear fusion new materials smart metering hydrogen generation technologies for PV from biomass, waste, nuclear, etc. biomass

marine technologies

Table B Technological niche opportunities Section Three: Exploring transitions to sustainable energy 71

of specific energy consuming appliances and • Increasingly large amounts of public money for devices reach saturation. It is difficult, however, RD&D into low and zero-carbon technologies to distinguish between the effects of ‘energy/ carbon leakage’ (as more energy/carbon • Other possible support mechanisms now intensive industries move to industrialising being discussed (e.g. Heat Renewables countries), energy efficiency improvements Order, a Sustainable Fuels Order, customised and the operation of any possible energy incentive schemes for wave and tidal service thresholds. And it should be borne energy, etc.) in mind that previous apparent consumption thresholds were only temporary, before new, Technological niche opportunities more customised technologies and markets emerged (e.g. for mobile telephones in addition A wide range of competing energy to terrestrial telephones, more than one motor technologies are currently being developed, vehicle for different purposes, more than one reflecting not only the underlying scientific bicycle for different types of cycling, etc.). and technological base but also the perceived opportunities arising from the emerging Climate change has become one of the most low-carbon socio-technical regime. A broad important influences upon the energy policy categorisation of these technologies is shown landscape, with the introduction of the UNFCCC in table B, distinguishing between mature and Kyoto Protocol having led directly or technologies and those that are at various indirectly to the adoption of international and stages of commercialisation, demonstration, national targets by Annex 1 signatories. In the research and development. case of the UK these international developments have laid the groundwork for the highly Shocks and surprises ambitious target of reducing carbon emissions by 60% by 2050 (relative to 1990). This target is Shocks and surprises can impinge upon, beginning to structure the energy landscape in a but may originate externally from, the three longer-term and more open-ended fashion than levels of the multi-level model. An example ever before. What is notable about, and greatly is contingent political events such as the reinforces, the climate change driver is that there outbreak of war or the volatility of oil and gas is an unprecedented level of expert consensus prices in response to complex political, military internationally surrounding the science of and economic circumstances. These external climate change. The adoption of scenario shocks and sideswipes can have a major analysis by the UK Government together with impact upon all three levels of the model. If more stakeholder dialogue has opened up the oil price remains high, for instance, not new ways of perceiving and discussing energy only do other carbon abatement technologies futures, of which Tyndall’s work is a contribution. such as renewables become more attractive Finally, social equity requires that reduction and in economic terms, but the oil industry eventual elimination of fuel poverty be a priority invests more in technologies for oil extraction, and, more generally, that the distributional including from unconventional sources such effects of changes in energy pricing are treated as tar sands and oil shales (with unknown as an important impact of policy. effects on the long-term supply and price). Energy efficiency in oil-using equipment Socio-technical energy regime drivers (such as cars) becomes more of a priority for consumers and producers. Concerns about The landscape drivers are translated at the energy security rise, while the socio-technical level of the regime into numerous policies regime adjusts to the change through policies and support mechanisms, of which the most to enhance supply or refining capacity. important are the following:

• Renewables Obligation (RO): a requirement Types of transitions to a low-carbon that electricity providers source 10% of their society: transformation and substitution electricity from renewable supplies by 2010 In this, and the next sub-section, a range • Climate Change Levy (CCL) and Climate of potential transitions associated with Change Agreements (CCAs): a tax on fossil decarbonisation will be explored. Examples fuel energy consumption and agreements on of the different transitions will be sought from energy efﬁciency targets research conducted under the Decarbonising the UK research theme. It is assumed that • EU Emissions Trading Scheme (EU ETS): reproduction (i.e. incremental improvements

allocation of CO2 emissions permits to energy to existing technologies) will continue in any producers in the EU 25 countries and a given socio-technical regime. market in emissions trading Transformation could assume increasing • Energy Efficiency Commitment (EEC): a levy importance as government and its agencies on domestic gas and electricity consumers to re-double their efforts to engage the public support energy efficiency schemes in social and business in energy efficiency and energy housing and in deprived communities conservation programmes and initiatives (utilising existing technologies). The 40% • Carbon Abatement Technologies Strategy house project illustrated that a 60% carbon (CAT): £25 million available to CCS reduction was feasible in the domestic sector demonstrations with existing technologies. However, since 72 Decarbonising the UK – Energy for a Climate Conscious Future

14% of current housing stock would be characterised by the potential introduction of demolished under the 40% house strategy, many new energy technologies. Some of these there is assumed to be a strong and prominent new technologies will be directly competing, role for the government. Strong government whilst others may well be complementary would also be required to implement the new to one another. Such transitions are farther and more demanding efﬁciency standards and reaching than substitution since they involve to ensure an appropriate and fair regulatory not simply replacing one technology with framework for exporting domestic on-site another, but a far more wide-ranging challenge renewably-generated electricity to the grid. to the existing socio-technical regime, its modus operandi, dominant technologies and Tyndall research suggests that more effective assumptions about users and markets. Geels public engagement in energy efﬁciency and and Schot64 provide an historical example energy demand reduction may require: of such technological challenge between a) a refocus on the local to regional scales,and 1870 and 1930 to the then dominant horse- a concomitant move away from the centralised carriage as a mode of transport in cities in the approach to delivery which has characterised USA. Numerous technological options were UK energy policy to date, consistent, with introduced and competed with each other much thinking on the ‘new localism’ and over this time period, including the bicycle, regionalism; 60,61 b) greater public awareness steam tram, electric tram, the electric car, the of the potential severity of the impacts of steam car and the gasoline car. Many factors climate change in the UK and globally and contributed to the explanation of why the

the recognition of the need for massive CO2 gasoline-fuelled car had, by 1930, become emissions reduction;62 c) greater use of energy the dominant technology for mobility in the efficiency standards and information provision North American city. These factors include in bills and tariffs to enhance ‘energy literacy’.63 technological innovation, public policy and planning, urban restructuring, market and Technological substitution may well describe cultural change and changing values. the potentially rapid advance of wind power in the UK’s electricity generating sector. The Where a pattern of radical change from one Renewables Obligation provides a strong technology to another occurs through a economic incentive for on-shore wind and, process of competition between options with although it is more expensive, off-shore wind. quite different performance characteristics, Developers and investors are preparing to functionalities and socio-institutional impacts, invest heavily in wind farm developments it is termed a dealignment and realignment over the next few years. One developer pathway. Akin to this is the reconfiguration described the current context as a ‘dash to pathway where a system changes through wind’ comparable to what happened with the multiple innovations of interlocking ‘dash to gas’ 15 years ago. The substitution technologies. An example is the agricultural will effectively be a continuation of the removal industry where system transitions rely upon the of coal-powered generating capacity that alignment of technologies including pesticides, began with the dash to gas. The EU’s Large seed and plant breeding, irrigation, fertilisers, Combustion Plant Directive (LCPD) is a further harvesting, land-care and other machinery. influence from the socio-technical regime. The Directive makes use of coal less attractive Society now appears to be entering an era of because of the high capital costs incurred change in low-carbon energy systems which by installing pollution abatement technology is more akin to the dealignment/realignment adequate to the task of making existing, and reconfiguration pathways than the ageing coal power stations compliant with the reproduction, transformation or substitution requirements of the Directive. The Directive is pathways. In other words, it is unlikely that expected to result in the closure of about half a single energy generation technology of the UK’s remaining coal-powered electricity like nuclear power or coal with CCS would generating capacity. Replacement of existing simply replace existing high-carbon supply, coal plant with the less capital intensive and at least not without a considerable period of cleaner technologies of CCGT and renewables competition with many other alternatives. is a more economically-viable prospect, with

a further benefit arising from the fewer CO2 Such a dealignment/realignment pathway permits required under the EU ETS for these might also involve considerable change in forms of power generation. However, the the service functionality of the generating large-scale substitution of coal by wind would sector, for example extending to production of require significant investments in infrastructure energy carriers for transportation or domestic to cope with intermittency as Tyndall projects fuels such as hydrogen. Hence, flexibility of on renewable energy have illustrated. the technologies with a range of potential future changes on the demand-side, and with respect to infrastructure and fuel provision, is Types of transitions to a low-carbon an important element in their favour. If a coal society: technological de-alignment and IGCC or nuclear power plant can be used to re-alignment and reconfiguration produce electricity, hydrogen or a combination of the two, and without major efficiency If the contemporaneous socio-technical regime losses and hence cost implications, then the drivers discussed above continue to hold sway, technology can fit well into a grid electricity- it seems likely that society will be entering an only future, or a grid electricity plus hydrogen- era of change in the energy system which is for-transport future. Section Three: Exploring transitions to sustainable energy 73

The energy consumption market an international protocol, and then implement is becoming more complex a trading system across society as a whole, and not just focus upon energy generators as As the effects of privatisation continue to ripple in the present EU Emissions Trading Scheme outwards, there is some evidence that the (EU ETS). The DTQs approach provides a end-user market may become increasingly much stronger selection environment within complex and fragmented. The service aspect the socio-technical regime but does not have of power (electricity) and heat is being anything specifically to suggest about the increasingly acknowledged by providers, users technological options that might come forward and regulators, with the recognition that not to provide the zero and low-carbon future all end-uses require the same type or quality energy options. DTQs should, however, create of supply. For example the electricity needs a strong incentive to develop experimental of a domestic swimming pool pump are very technologies and other low and zero-carbon different from those of a computer set up in options – not just technologies, but also a home office.65 The pool pump could easily changes in management, practices and use ‘low grade’ electricity from intermittent behaviours. Some change in the landscape sources while this would not suit a computer conditions would be an important prerequisite application which, along with other electronic for DTQs (or indeed any climate change policy equipment, requires a high grade, reliable instrument with a similarly ambitious objective) source of electricity. By differentiating the since it is difficult to imagine that a government quality requirement of energy inputs, it may be would make such a major change in policy in possible that numerous different suppliers can the absence of concerted international action. develop niche supply markets. Reconfiguration of energy consumption The policy measures in place such as the in the domestic sector EU ETS, CCL and RO should, to some extent, encourage the move to differentiated markets Buildings present a complex site for the and energy services, potentially as a means consumption and future production of energy. of accommodating the large quantities of Incremental innovation in the building fabric intermittent, renewable electricity. This could and energy-using appliances are taking place, be achieved, at least in part, via differentiated a consequence of ‘dynamics as usual’, but markets and by the more efficient use of also of targeted Government strategies and appropriate low-carbon energy (reducing the grants for energy efficiency in the home. problem of intermittency through reducing Discontinuous and more radical innovation has demand), though clearly network modification been slow in an industry that is known for its and/or energy storage technologies are also conservatism vis-à-vis technological change.67 likely to be part of the answer. Nevertheless, future innovation directed at integrating renewables into buildings and The commercial and institutional arrangements into the more intelligent use of energy within for delivering an ‘energy services’ future, buildings is likely. Candidate technologies are and its potential for contributing to a low- mentioned in Section Two and include, for carbon energy system, have been explored example, micro-CHP and smart metering for in Tyndall research.66 The research suggests, ‘peak shaving.’ however, that the UK is some way from realising this concept, with existing contracting The existing regulatory system for electricity approaches thought to be only appropriate for distribution operates within the paradigm of a subset of energy services within a subset centralised generation and one-way flow of of organisations, and particularly unsuitable electricity from large power plants to users. for final energy services at small sites and The ‘passive’ user has co-evolved with such a process-specific energy uses at large sites. supply system. The Tyndall microgrids project investigated the use of PV and micro-CHP A more radical change of the user environment technologies to create stand-alone energy ‘islands’ and found this to be a credible option One major uncertainty with the existing policy with energy storage devices. Other experts framework is whether it will provide sufficient consider that there are significant benefits incentives and prohibitions to stimulate from users linking up to a larger-scale network, the desired dealignment/realignment or though not necessarily a national grid.68 reconfiguration transition pathways. At least The microgrids approach has considerable part (but only part) of the answer lies in the advantages in isolated areas to which grid value of a tonne of CO2 abatement within networks do not extend or, where they do, are the context of the EU ETS, which in turn expensive to maintain and replace. Microgrids probably depends upon the future course of can be expected to emerge in such niche international negotiations under the UNFCCC applications, in which socio-technical learning and post-Kyoto commitments. One radical can take place, and from which they may extend approach to making the end-user (and their market reach into other demand areas. thereby intermediate energy users and energy suppliers along the supply chain) include CO2 Microgrids can also be supported in in decision-making on consumption would urban areas that are undergoing extensive be through adoption of domestic tradeable regeneration, and hence where there are quotas (DTQs). This approach would, in effect, opportunities for inclusion of renewables in adopt the 60% (or possibly higher) target as a buildings, district and micro-CHP, and so on. post-Kyoto commitment, perhaps even prior to However, the additional costs incurred by 74 Decarbonising the UK – Energy for a Climate Conscious Future

such experimentation requires some public geothermal), multiple conversion routes (in financing as well as favourable treatment adapted boilers and engines, CCGT, IGCC, from the regulator regarding connection in fuel cells, etc.), and multiple end-use charges and tariffs for the local grid. Such an applications (transportation, stationary in opportunity arises in England where Housing domestic and commercial buildings and Market Renewal schemes are injecting public industrial processes for heat and/or power, money into the redevelopment of substantial in appliances such as mobile phones urban areas. Meanwhile, the regulator Ofgem and laptops, etc.). Hydrogen could cause has developed a scheme called Local Control reconfiguration of the energy system since Zones (LCZs) where distributed sources take-off of demand for one or more major of generation will be favourably treated in end-use applications would stimulate the specified areas through the connection development of one or more supply routes, tariff charges. This creates the appropriate whether renewables, nuclear or fossil with conditions for a ‘bounded socio-technical CCS. There are critical bottlenecks which experiment’,69 through which technical and would have to be overcome prior to the socio-economic learning can occur with take-off of the hydrogen economy, including the potential for cost-reduction and greater the development of sufficient infrastructure, familiarity emerging around the new microgrid developing cost-effective transportation and technologies. Consistent with this prospect, storage technologies for hydrogen, and, the 40% house project concluded that by arguably, the development of cost-effective 2050 there would be an average of two low or fuel cells. Changes in regulations and rules zero-carbon energy generating technologies would be necessary to cope with a large- per household, and that the residential sector scale use of hydrogen and end-users would would be a net electricity exporter. Change probably have to accommodate changes towards local and microgrids could stimulate in, for example, how fuels are delivered and new user/consumer identities as awareness the design of appliances. Public reactions to of energy per se, and of sustainable energy in the use of hydrogen are uncertain and risk particular, rises. perceptions could be a factor in the type, extent and speed of uptake. De-alignment and re-alignment in the coal sector The Tyndall hydrogen project showed that replacing current transport fuels with hydrogen The long-term future of coal is likely to via electrolysis from renewable electricity depend greatly upon whether CCS can be would require a doubling of the electricity cost-effectively and safely implemented. generating capacity of the UK. It also showed While CCS technologies are already proven, that obtaining the hydrogen from natural gas there are competing routes to future, more without CCS was likely to be the more cost- efficient capture, transportation and storage effective route in current circumstances, but

options. There are also alternative designs would actually increase CO2 emissions per at the plant level, with integrated gasification unit of final energy delivered. Clearly these (IGCC) competing with conventional two options have serious disadvantages, and pulverised fuel (PF) combustion, combined sustainable solutions could instead involve a with incremental innovation (e.g. use of ultra combination of sources, with CCS where fossil supercritical conditions). One outcome is fuels are used, as in the Integrated Scenarios that a dominant CCS technology for coal may in Section One, and possibly regional and emerge over time from the current medley localised hydrogen grids. of alternatives (dealignment/realignment), though in all likelihood it will be dependent Past experience of the reconfiguration upon the availability of public sector support for transition pathway suggests that it is likely demonstration plants. that the introduction of hydrogen would occur through the growth of niche applications, The potential fit of integrated gasification which would then permit the technology, technology with CCS and hydrogen production infrastructure, rules and regulations, user opens up the prospect that different needs and expectations to co-develop. coal energy technologies could co-exist, If successful at bringing down costs and providing variable mixes of electricity and building-up sufficient supply and demand hydrogen dependent upon demand. Such a and physical and institutional infrastructures transition would involve a more fundamental for linking-up the two, then hydrogen might reconfiguration of the energy system, bringing expand outwards to capture a larger part of the entire transport sector into the equation, the transportation and stationary energy in addition, potentially, to domestic and use markets. commercial consumption of syngas.

Reconﬁguration pathway for a Policies and tools for transition hydrogen economy “Given the complexity of transition processes Hydrogen is an energy carrier whose there are good reasons to argue that transition widespread use could imply a huge management is merely a contradiction in reconﬁguration of the energy system. terms! Far simpler processes have proven to There are multiple potential sources of be impossible to manage, so how could it ever hydrogen (biomass, waste, micro-organisms, be achieved for encompassing processes like wind, wave, PV, coal, gas, oil, nuclear and transitions and system innovations?”70 Section Three: Exploring transitions to sustainable energy 75

This warning from writers on transitions Promotion of experimentation and learning and sustainability indicates that there are no simple answers for policy-makers and Promotion of experimentation is a vital other stakeholders arising from Tyndall’s ingredient of transitions theory: Decarbonising the UK research theme. There is no ‘magic bullet’ which will, by itself, “An important objective of policy should provide sufficient incentives to provoke system therefore be to stimulate and optimise the innovation, whether it be in the form of a conditions for learning, such as by providing carbon or energy tax, an emissions trading the funds for experimentation and stimulating scheme, a new set of regulations or a new network-building and vision-building processes technology. Indeed, it could be argued that part between actors.”74 of the problem in past policy thinking towards decarbonisation has been an over-reliance Implicit in the theory is the recognition that on a single or a few policy instruments, e.g. many of the technological ‘hopeful monsters’ carbon/energy taxes, or the promotion of new will fall by the wayside and fail to develop in innovative technologies without sufficient the selection environment in operation at a regard for the need for a receptive socio- particular time. Public funders of RD&D have technical regime.71 difficult decisions to make, including support of the ‘hopeful monsters’ that the private sector, A call for strong government to ‘force’ change with its more risk-averse stance, would be towards decarbonisation is a popular leitmotiv unlikely to support. As Elzen et al. put it: amongst advocates of change. Yet such an approach does not guarantee the supply “Stimulating niche development is crucial as of technological experimentation and the it allows the possible seeds for a transition financial and human capital required for (the novelties) to germinate. To continue this, or the active engagement of users and the metaphor, one may say they are other stakeholders, both of which are critical initially grown in a greenhouse. To induce a according to theorists of socio-technical transition, however, they need to go outside transitions. Transitions cannot be steered the greenhouse, survive under ‘real wold’ by a central actor because to do so implies conditions and grow further. This means the that such an actor has knowledge of specific novelties need to grow in an environment that objectives and knows, in advance, which of may be partially friendly to them (by offering the new technologies will be the ‘winners’. This ‘windows of opportunity’) but that will also is not to imply that no command-and-control have hostile elements because an existing measures are necessary, but to point out that regime tends to defend itself against upcoming by themselves they are not sufficient, and novelties in various ways by throwing could even be counter-productive when used up barriers to the novelty, by improving in isolation. performance of the regime or by absorbing elements of the novelty”.75 It is, however, possible to envisage ‘modulation’ of ongoing dynamics so that Such partially friendly environments can be these bend slightly in the direction of created by the financial instruments, incentives generally-agreed objectives.72 (A generally- and PPPs that have been described earlier. It agreed objective would include a commitment is noticeable, and to be expected, that many to a 60% reduction in CO2 emissions by ‘hopeful monsters’ in the energy scene have 2050, whilst a specific objective would set not managed to make the leap from ‘niche out exactly how the 60% reduction is to be experimentation’ to effective challenge in achieved). Even a slight shift in direction the mainstream. Examples include electric can, potentially, result in far-reaching future powered buses, some flagship low or zero- changes because of path-dependency. carbon buildings and one prominent biomass The extent to which modulation can be gasification plant. Nevertheless, more detailed attempted will always be limited by lack of case-studies are required to explore whether knowledge and uncertainty as to the effects effective learning in the wider community has of policies, programmes and projects (PPPs) resulted from the apparent project failures. upon ongoing dynamics. Furthermore, the Trying to identify where and why appropriate desired objectives may themselves change, learning has occurred within PPPs is an area and/or not be clear-cut or generally-agreed where future research might need to be upon amongst stakeholders and wider concentrated if transitions theory is to provide publics. For this reason, transitions theory a body of knowledge which can be used in a promotes a ‘learning-by-doing’ approach, more practical way by policy-makers. Selection in which small steps are taken on the basis of experiments by the extent to which of uncertain knowledge, the effects of PPPs socio-technical learning is more likely to be are documented and investigated and the stimulated could then be envisaged. learning taken into account in formulating future PPPs. Somewhat ironically, system Stakeholders transitions appear to emerge unpredictably, and, for most agents unexpectedly, from Tyndall’s work has been motivated by the incrementalism and mutual adjustment need for cross-disciplinary network building between stakeholders,73 as a result of and more inclusive ‘vision-building processes’, sometimes subtle shifts and realignments e.g. through both the involvement and study in policy, and socio-economic and of stakeholders and the public.76 Yet Tyndall’s technological opportunities. research also suggests that consensus on 76 Decarbonising the UK – Energy for a Climate Conscious Future

general objectives is far easier to achieve than possibly be enhanced by scenario planning consensus on the specific means by which and exploration of potential unexpected events general objectives are to be implemented. and happenings. The Decarbonising the UK research has identified a number of factors that come to influence the perceptions of individual policy- Conclusions makers and stakeholders regarding specific objectives. These include human capital, social This Section has attempted to use some capital,77 subjective values and preferences, recent ideas in transitions theory to help and organisational objectives. Accepting better understand the possible shape of future diverse definitions of ‘the’ problem and ‘its’ decarbonisation pathways for the UK. The solution creates ‘clumsy’ institutions, but there theoretical concepts were applied to the recent are strong arguments why such clumsiness history of major changes in the UK energy is a robust response to social diversity and system and appeared to provide a useful uncertainty and creates a greater collective analytical framework. Most of the changes resource at the societal level to respond to in the past quarter of a century appear to surprises and shocks.78,79 correspond to the transition types known as reproduction, transformation and substitution. Shocks and surprises Decarbonisation pathways, however, may well entail more extensive forms of change, In the above account it has been assumed corresponding to dealignment/realignment and that the contemporary drivers at the landscape, reconfiguration. These more complex types of socio-technical regime and technological transition involve multiple new technologies, niche levels continue into the foreseeable many interrelated and co-dependent, with high future. What is more difficult to imagine is the uncertainty in the selection environment. influence of shocks and surprises. However, complexity theory suggests that it is frequently The findings of the projects within the such shocks which move a system from its Decarbonising the UK theme can, to some current state to a different state. Technological extent, be accommodated within the shocks could include major hazardous transitions theory framework. As such, the episodes (cf. the effect of Chernobyl on nuclear framework provides an alternative, qualitative power), breakthrough in cost reduction (e.g. for form of integration of the research to the PV), a breakthrough in oil and gas extraction quantitative integration of the scenarios from unconventional geological reserves, project described in Section One. The two development of technologies which open up approaches can themselves be integrated in entirely new markets (e.g. in space travel). further research by structuring discussion on Landscape shocks include catastrophes backcasting of end-point scenarios around the which appear to be the consequence of global transition pathways described in this Section. climate change, oil price hikes and volatility, or major political and military conflict, with More detailed work needs to be done in repercussions for availability of fuels globally. applying the multi-level model of transitions A better understanding is required of the to past and potential future changes in the role of such shocks and surprises, operating energy system and in identifying policy at the level of the landscape, regime and implications. Greater analysis of the tools technological niche innovation, in inducing for transitions such as ‘modulation’, ‘vision- change from one system to another. Whilst building processes’, ‘bounded socio-technical such shocks and surprises remain, by their experiments’ and ‘socio-technical scenarios’ definition, unknowable, the resilience of the is required, with specific reference to energy socio-technical regime and wider system can and decarbonisation. Decarbonising the UK – Energy for a Climate Conscious Future 61

Publications from the Decarbonising the UK Theme 60 Decarbonising the UK – Energy for a Climate Conscious Future Publications from the Decarbonising the UK Theme 79

Abu-Sharkh, S., Li, R., Markvart, T., Ross, N., Wilson, P., Yao, R., Steemers, K., Kohler, J. and Arnold, R. (2005) Can microgrids make a major contribution to UK energy supply? March 2005, Tyndall Working Paper 70

Abu-Sharkh, S., Li, R., Markvart, T., Ross, N., Wilson, P., Yao, R., Steemers, K., Kohler, J. and Arnold, R. (2005) Microgrid: distributed on-site generation Tyndall Centre Technical Report 22

Anderson, K., Shackley, S. and Watson, J. (2003) First reactions to the Energy White Paper from the UK’s Tyndall Centre Tyndall Brieﬁng Note 6 (also published in IEE Power Engineer)

Awerbuch, S. (in press) Electricity network restructuring and carbon mitigation: decentralisation, mass-customisation and intermittent renewables in the 21st century Energy Policy

Awerbuch, S. (2004) Restructuring our electricity networks to promote decarbonisation March 2004, Tyndall Working Paper 49

Bathurst, G. and Strbac, G. (2003) Value of combining energy storage and wind in short-term balancing markets June 2003, Electric Power System Research, 1-8

Bathurst, G. and Strbac, G. (2001) The value of intermittent renewable sources in the ﬁrst week of NETA April 2001, Tyndall Brieﬁng Note 2

Boardman, B., Killip, G., Darby, S. and Sinden, G. (2005) Lower Carbon Futures: the 40% House Project Tyndall Centre Technical Report 27

Bows, A. and Anderson, K. (2005) Contraction and convergence: An assessment of the CCOptions model August 2005, Tyndall Working Paper 82

Bows, A., Upham, P. and Anderson, K. (2004) Aviation and climate change: Implications of the UK White Paper on the future of aviation February/March 2004, Climate Change Management

Boyd, E. (2002) Scales, power and gender in climate mitigation policy Gender and Development 10(2), Oxfam

Boyd, E., Corbera, E., Gutierrez, M. and Estrada, M. (2004) The politics of afforestation and reforestation activities at COP-9 and SB 20 November 2004, Tyndall Brieﬁng Note 12

Boyd, E., Gutierrez, M. and Chang, M, (2005) Adapting small-scale CDM sink projects to low-income communities March 2005, Tyndall Working Paper 71

Bristow, A., Pridmore, A., Tight, M., May, T., Berkhout, F. and Harris, M. (2004) How can we reduce carbon emissions from transport? Tyndall Centre Technical Report 15

Brown, K., Adger, N., Boyd, E., and Corbera, E., (2004) How do CDM projects contribute to sustainable development? Tyndall Centre Technical Report 16

Brown, K. and Corbera, E. (2003) Exploring Equity and Sustainable Development in the New Carbon Economy Climate Policy 3, Supplement 1, S41-S56

Brown, K. and Corbera, E. (2003) A Multi-Criteria Assessment Framework for Carbon-Mitigation Projects: Putting “development” in the centre of decision making February 2003, Tyndall Working Paper 29

Cannell, M.G.R. (2003) Carbon sequestration and biomass energy offset: Theoretical, potential and achievable capacities globally, in Europe and the UK Biomass and Bioenergy 24, 97-116

Dale, L., Milborrow, D., Slark, R. and Strbac, G. (2003) The shift to wind is not unfeasible April 2003, Power UK, 17-24

Dale, L., Milborrow, D., Slark, R. and Strbac, G. (2003) Total cost estimates for large scale wind scenarios in UK July 2003, Energy Policy, 1949-1956

Dlugolecki, A. (2003) The Carbon Disclosure Project June 2003, Tyndall Brieﬁng Note 7

Dlugolecki, A. and Mansley, M. (2005) Asset management and climate change Tyndall Centre Technical Report 20

Dutton, A. G., Bristow, A. L., Page, M. W., Kelly, C. E., Watson, J. and Tetteh, A. (2005) The Hydrogen energy economy: its long term role in greenhouse gas reduction Tyndall Centre Technical Report 18 80 Decarbonising the UK – Energy for a Climate Conscious Future

Dutton, G. (2002) Hydrogen energy technology April 2002, Tyndall Working Paper 17

Ekanayake, J.B., Holdsworth, L., Wu, X.G. and Jenkins, N. (2003) Dynamic modelling of doubly fed induction generator May 2003, IEE Transactions on Power Systems, 18, (2), 803-809

Gibbins, J. and Shackley, S. (2004) Carbon capture and storage as an alternative to nuclear expansion Climate Change Management, June 2004, 12

Gough, C. and Shackley, S. (in press) Towards a multi-criteria methodology for assessment of geological carbon storage options Climatic Change

Gough, C., Shackley, S. and Cannell, M.G.R. (2002) Evaluating the options for carbon sequestration Tyndall Centre Technical Report 2

Gough, C., Taylor, I. and Shackley, S. (2002) Burying carbon under the sea: an initial exploration of public opinions Energy and Environment, 13(6), 883-900 (also published in Tyndall Working Paper 10)

Halliday, J., Peters, M., Powell, J. and Ruddell, A. Providing heat and power in the urban environment Tyndall Centre Technical Report 32

Kim, J. (2003) Sustainable development and the CDM: A South African case study November 2003, Tyndall Working Paper 42

Kroger, K., Fergusson, M. and Skinner, I. (2003) Critical issues in decarbonising transport: The role of technologies October 2003, Tyndall Working Paper 36

Levermore, G., Chow, D., Jones, P. and Lister, D. (2004) Accuracy of modelled extremes of temperature and climate change and its implications for the built environment in the UK Tyndall Centre Technical Report 14

Nedic, D., Shakoor, A., Strbac, G., Black, M., Watson, J. and Mitchell, C. (2005) Security assessment of future electricity scenarios Tyndall Centre Technical Report 30

Peters, M. and Powell, J. (2004) Fuel cells for a sustainable future II November 2004, Tyndall Working Paper 64

Powell, J., Peters, M., Ruddell, A. and Halliday J. (2004) Fuel cells for a sustainable future? March 2004, Tyndall Working Paper 50

Pridmore, A. and Bristow, A. (2002) The role of hydrogen in powering road transport April 2002, Tyndall Working Paper 19

Pridmore, A., Bristow, A., May, T. and Tight, M. (2003) Climate change, impacts, future scenarios and the role of transport June 2003, Tyndall Working Paper 33

Purdy, R. and Macrory, R. (2004) Geological carbon sequestration: critical legal issues January 2004, Tyndall Working Paper 45

Shackley, S., Cockerill, T. and Holloway, S. (2003) Carbon capture and storage: Panacea or long-term problem? September 2003, Climate Change Management, 6, 11

Shackley, S., Fleming, P. and Bulkeley, H., (2002) Low carbon spaces area-based carbon emission reduction: A scoping study, a report to the Sustainable Development Commission prepared by the Tyndall Centre for Climate Change Research

Shackley, S., McLachlan, C. and Gough, C. (2005) The public perception of carbon dioxide capture and storage in the UK: results from focus groups and a survey Climate Policy 4, 377-398

Shackley, S., McLachlan, C. and Gough, C. (2004) The public perceptions of carbon capture and storage, January 2004 Tyndall Working Paper 44

Skinner, I., Fergusson, M., Kröger, K., Kelly, C. and Bristow, A. (2004) Critical issues in decarbonising transport Tyndall Centre Technical Report 8

Sorrell, S. (2005) The contribution of energy service contracting to a low carbon economy July 2005, Tyndall Working Paper 81

Steemers, K. (2003) Establishing research directives in sustainable building design Tyndall Centre Technical Report 5 Publications from the Decarbonising the UK Theme 81

Upham, P. (2004) Climate change and the UK Aviation White Paper Tyndall Brieﬁng Note 10

Upham, P. (2003) Climate change, planning and consultation for the UK Aviation White Paper Journal of Environmental Planning and Management, 46(6), 911-918

Varbanov, P., Perry, S., Klemes, J. and Smith, R. (2004) Synthesis of industrial utility systems: cost-effective decarbonisation February 2004, Applied Thermal Engineering, 25, 985-1001

Watson, J. (2004) Co-provision in sustainable energy systems: The case of micro-generation Energy Policy Special Issue on System Change, 32 (17), 1981-1990

Watson, J., Tetteh, A., Dutton, G., Bristow, A., Kelly, C., Page, M. and Pridmore, A. (2004) UK Hydrogen futures to 2050 February 2004, Tyndall Working Paper 46

Watson, J. (2003) UK electricity scenarios for 2050 November 2003, Tyndall Working Paper 41

Watson, J. (2002) Renewables and CHP deployment in the UK to 2020 January 2002, Tyndall Working Paper 21

Watson, J. (2002) The development of large technical systems: implications for hydrogen March 2002, Tyndall Working Paper 18

Watson, J., Hertin, J., Randall, T. and Gough, C. (2002) Renewable energy and combined heat and power resources in the UK April 2002, Tyndall Working Paper 22

Watson, J. and Smith, A. (2002) The Renewables Obligation: Can it deliver? April 2002, Tyndall Brieﬁng Note 4

Watson, J. and Scott, A. (2001) An audit of UK energy R&D: Options to tackle climate change December 2001, Tyndall Brieﬁng Note 3

Wu, X., Holsdworth, L., Jenkins, N. and Strbac, G. (2003) Integrating renewables and CHP into the UK electricity system: Investigation of the impact of network faults on the stability of large offshore wind farms April 2003, Tyndall Working Paper 32

Wu, X., Jenkins, N., Strbac, G., Watson, J. and Mitchell, C. (2004) Integrating Renewables and CHP into the UK Electricity System Tyndall Centre Technical Report 13

Wu, X., Jenkins, N. and Strbac, G. (2002) Impact of integrating renewables and CHP into the UK transmission network November 2002, Tyndall Working Paper 24

Wu, X., Mutale, J., Jenkins, N. and Strbac, G. (2003) An investigation of network splitting for fault level reduction January 2003, Tyndall Working Paper 25 Project Researchers

Decarbonising modern societies: Dr Kevin Anderson, Dr Alice Bows, Dr Sarah Mander, Dr Simon Shackley Integrated scenarios process and workshop Paolo Agnolucci, Professor Paul Ekins

Integrating renewables and CHP into the Professor Nick Jenkins, Professor Goran Strbac, Dr Xueguang Wu UK electricity system Dr Jim Watson Dr Catherine Mitchell

Security of decarbonised electricity systems Dr. Mary Black, Anser A. Shakoor, Professor Goran Strbac Dr. Jim Watson Dr. Catherine Mitchell

The hydrogen energy economy: Its long- term Dr Geoff Dutton role in greenhouse gas reduction Prof Abigail Bristow*, Charlotte Kelly, Matthew Page Alison Tetteh, Dr Jim Watson

Sustainable building form Dr Koen Steemers

Fuel Cells: providing heat and power Dr Jim Halliday, Dr Alan Ruddell in the urban environment Dr Michael Peters, Dr Jane Powell

Climate change extremes: implications Dr David Chow, Professor Geoff Levermore, for the built environment in the UK Professor Patrick Laycock, Professor John Page Professor Ben Brabson, Professor Phil Jones, David Lister, Dr Tim Osborn, Professor Jean Palutikof Dr Koen Steemers Dr Tom Markvart

Microgrids: distributed on-site generation Dr Suleiman Abu-Sharkh, Dr. Rachel Li, Dr Tom Markvart, Dr Neil Ross, Dr Peter Wilson Dr Jonathan Kohler, Dr Koen Steemers, Dr Runming Yao Professor Ray Arnold

The 40% house Dr Brenda Boardman, Dr Sarah Darby, Gavin Killip, Dr Mark Hinnells, Dr Christian N. Jardine, Graham Sinden, Dr Kevin Lane, Dr Russell Layberry, Jane Palmer Professor Marcus Newborough, Dr Andrew Peacock Dr Andrew Wright*, Sukumar Natarajan

Behavioural response and lifestyle change Professor Abigail Bristow*, Professor Tony May, Alison Pridmore, Dr Miles Tight in moving to low carbon transport futures Dr Frans Berkhout, Michelle Harris

Contraction and convergence: UK carbon Dr Kevin Anderson, Dr Alice Bows, Dr Paul Upham emissions and the implications for UK air trafﬁc

Critical issues in decarbonising transport Malcolm Fergusson, Katharina Kröger, Ian Skinner Professor Abigail Bristow*, Charlotte Kelly

Evaluating policy options for the clean development Professor Kate Brown, Dr W. Neil Adger, Dr Emily Boyd, Esteve Corbera-Elizalde mechanism: a stakeholder multi-criteria approach

An integrated assessment of geological Clair Gough, Dr Simon Shackley, Carly McLachlan, Dr Jiri Klemes, Dr Bo Li carbon sequestration in the UK Prof Melvin Cannell Dr Tim Cockerill Dr Sam Holloway, Dr Michelle Bentham, Karen Shaw Ray Purdy Dr Martin Angel

Delivering a low carbon future: Steve Sorrell the transition to energy services

Domestic tradable quotas Dr Kevin Anderson, Richard Starkey

Key issues for the asset management sector Dr Andrew Dlugolecki in decarbonisation Mark Mansley Afﬁliation

University of Manchester Policy Studies Institute

University of Manchester SPRU, University of Sussex Warwick Business School, The University of Warwick

Energy Research Unit, CLRC-RAL ITS, University of Leeds *now at Loughborough University SPRU, University of Sussex

University of Cambridge

Energy Research Unit, CLRC-RAL CSERGE, University of East Anglia

University of Manchester

University of East Anglia

University of Cambridge University of Southampton

University of Southampton University of Cambridge Siemens plc

Environmental Change Institute, University of Oxford

Herriot-Watt University University of Manchester *now at DMU

ITS, University of Leeds *now at Loughborough University SPRU, The University of Sussex

University of Manchester

Institute for European Environmental Policy ITS, University of Leeds *now at Loughborough University

University of East Anglia

University of Manchester Centre for Ecology and Hydrology University of Sunderland (now at University of Reading) British Geological Survey University College London Southampton Oceanography Centre

University of Sussex

University of Manchester

Andlug Consulting Claros Consulting The Tyndall Decarbonising the UK project

Contact details may be found on the Tyndall website at www.tyndall.ac.uk researchers 84 Decarbonising the UK – Energy for a Climate Conscious Future

Endnotes

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