Home
Client Resources
Climate Change: The Power of Zero

Climate Change: The Power of Zero

Climate change is transforming the UK’s business landscape. Delivering the UK’s binding commitment to net zero emissions by 2050 requires far-reaching changes in energy, land, infrastructure (transport and buildings), agriculture, manufacturing, resource management and industrial systems.

While the government commits to renewable energy and decarbonisation of heat and transport, the transition to a carbon-free economy is creating new trends in how stakeholders such as consumers, investors, business partners, and regulators make decisions. Customers are rewarding companies for sustainability. Businesses are committing to clean energy and carbon reduction. Investors are demanding climate-risk disclosure and committing to ESG (environmental, social and governance) investment criteria.

Net zero and the wider sustainability agenda presents huge opportunities for businesses in all sectors across the UK where customers, investors and regulators are demanding new low carbon technologies, solutions, products and services. Meanwhile businesses are realising that improving their sustainability can generate long term business value through increased resource efficiency, innovation, resilience, compliance, employee relations, and market share.

Our climate change specialists can help businesses recognise the opportunities and plan for the challenges of climate change, net zero and sustainability. Download our free NetZero eBook here .

1. What is Walker Morris doing?

Recently we announced our own commitment to positively respond to the impact of climate change through the launch of our staff climate change competition. Walker Morris employees were asked for their thoughts on how we could be more sustainable as a business. The overwhelmingly positive response revealed a number of initiatives which will be implemented in the coming months including carbon footprint measurement, car sharing, switching to 100% renewable energy and installing more EV charge points. In the last 12 months Walker Morris has:

achieved 25% reduction in paper
achieved 95% reduction in plastic water bottles
saved 28,000 plastic cups and 24,000 plastic lids
switched to 100% biodegradable pens
pledged our support to the Sustainable Recruitment Alliance.

Our commitment to these initiatives was confirmed at the Climate Action Dinner held in association with Deloitte and the University of Leeds. 38 businesses including local councils, regional and national companies committed to contributing to further the conversation surrounding climate action and begin to implement positive, practical solutions. Following this, Walker Morris, Deloitte and a number of other businesses from across our Region formed the Yorkshire Climate Action Coalition. This is a business-led group which aims, through collaboration, to help businesses define and accelerate their own pathways to NetZero, and at the same time help companies embrace the opportunities arising from the future green economy.

Ben Sheppard, our Head of Energy & Infrastructure, was also part of a cohort of a dozen mayors, business leaders and NGOs who joined forces to urge the Prime Minister to commit to tougher air pollution targets in an open letter coordinated by UK100. Read more here.

2. The effects of climate change on your business

Climate action is happening now. The minimum energy efficiency standard (MEES) sets out standards for energy efficiency in commercial properties. The Future Homes Standard introduced proposals for new energy efficiency standards in new homes. The “diesel tax” imposes higher levies on diesel-vehicles. New energy and carbon reporting standards for companies were introduced in 2019. Smart meters are being installed in residential and commercial properties across the UK to minimise CO2 emissions.

3. How Walker Morris can help

The business and regulatory landscape is rapidly changing in response to climate change. Our specialists have extensive expertise in environmental law, renewables, green energy, low-carbon infrastructure.

With a portfolio of high-profile clients in the energy and infrastructure sectors and recognised for its expertise by leading independent legal guide, Chambers, Walker Morris’ Infrastructure & Energy team can advise businesses in all sectors to respond positively to the challenges of climate change and opportunities of the low carbon economy.

For insight into how climate change could affect your business, please contact one of our specialists below.

Judith Pike, Ben Sheppard, Jules Harbage.

A new focus on employee and stakeholder engagement[...]

Businesses are revolutionising the way they think about and do their business. Many employers recognise […]

Businesses are revolutionising the way they think about and do their business. Many employers recognise that companies have a crucial part to play in environmental, ethical and social challenges. The idea is that engaging with stakeholders in a meaningful way on such matters will create shared and sustained values – and will ultimately lead to greater success (and therefore profits) for the company. This concept is known as “stakeholder capitalism”.

Businesses will have already implemented a significant amount of change due to the coronavirus pandemic and the associated economic consequences – but many have recognised that now is the time to embrace further challenges and continue the conversation with employees, customers and suppliers. We’ve identified three themes which have a key role to play in the overarching concept: employee engagement; equality and diversity; and environmental and ethical commitments.

Employee engagement

There’s been an increased focus on meaningful consultation with staff at every level in seeking to save jobs and make workplaces “Covid-secure”. How can this be developed further?

Recognition and retention – What does fair remuneration and reward look like for those who have been key in keeping the business running during the pandemic? There have been calls for a culture shift in the way we think about the use of the National Minimum Wage and the value of certain roles, which will likely form part of the wider discussion about the future world of work. But it is also the softer-side of employee engagement that is key, particularly in difficult economic times. An increased focus on employee recognition, mental health and wellbeing, and embracing the ideas of staff members, can lead to greater job satisfaction. Many businesses, such Company Shop Group, are using LinkedIn and social media channels to regularly share positive stories about staff members’ contributions and thank their #hiddenheroes – which can go a long way to making employees feel valued.
Employee shareholdings – To date, employee share ownership and share incentives have typically been reserved for senior management. As we move forward, more companies may choose to extend employee ownership to the wider workforce. Offering share incentives as an alternative to cash incentives can offer significant cash flow advantages to companies whose finances may have been significantly impacted by lockdown. John Lewis and, more recently, Richer Sounds, are leading examples of the total employee ownership model. With proper thought, a share incentive proposal can be designed to meet the needs of most employers – while also demonstrating commitment to long-term investment in employees.
Board representation – Despite a pledge in 2016 to make it mandatory for companies to include worker representation on boards of directors, the government backtracked and announced that it would not be compulsory. The UK Corporate Governance Code, which came into effect for financial years from 1 January 2019, instead gave companies three options: invite an employee to sit on the board; designate a non-executive director as the workers’ champion; and/or create an employee panel – however, compliance is not mandatory. While there are some exceptions such as FirstGroup, UK companies have generally been reluctant to embrace worker representation – in direct contrast to most other European countries, where employee representation on boards is commonplace. The pandemic and resultant changes may well encourage directors to re-evaluate the structure of their companies, to find innovative ways of including employees in strategic decision-making.

Equality, diversity and inclusion

Part of the conversation is being driven by a commitment to equality in the workplace. In the wake of recent events in America and resulting protests and campaigns for equal rights across the world, many brands and companies globally have expressed their commitment to equality and diversity, including, for example, Kraft Heinz’s CEO Miguel Patricio, who has implemented a new value: “We demand diversity“. Businesses will now be working on putting those commitments into action. How can that be done?

Structured approach – Much in the same way that employee representation should feed in at board level, creating a working group to champion equality and diversity will likely be the first step in implementing a Diversity Action Plan. Employees can then share ideas and concerns with that working group and encourage a review of company practices such as recruitment processes, availability of apprenticeships and accessible advertising campaigns. While a zero tolerance approach to discrimination, bullying and harassment in the workplace must of course continue, it is clear that this alone is no longer enough.
Mentoring, training and grass-roots initiatives – There is an acknowledgement that change is not instant but will require energy and time. A lack of representation of BAME individuals at board level cannot be addressed without encouraging school-age children to develop career aspirations. Companies should consider grass-roots initiatives such as mentoring programmes and careers talks at schools across a range of communities, with a focus on disadvantaged backgrounds. Similarly, equality and diversity training, which should educate staff about the full range of protected characteristics, should no longer be a once-a-year, tick-box exercise. This can be bolstered with meaningful sessions to promote understanding and inclusion of those from ethnic minorities, the LGBQT+ community, and individuals with disabilities – perhaps by hosting a series of events with speakers from diverse backgrounds, to share experiences and ideas.
Data and transparency – We have already seen a focus on the Gender Pay Gap, which UK companies have been required to report on since April 2018 (albeit there has been a temporary pause on this requirement in light of the pandemic). The government has undertaken a consultation in respect of Ethnicity Pay Gap reporting, which closed in January 2019, but this has yet to be actioned into policy. However, some companies such as PwC already voluntarily report on their Ethnicity Pay Gap; with the importance of transparency on such issues growing, others may follow suit. In addition, while a number of employers such as Lloyds Bank have already signed up to The Race at Work Charter, it should now be widely recognised by businesses that racial and ethnic diversity in the workplace is advantageous and should be actively supported.

Environmental and ethical commitments

Increasingly, consumers want to buy from and employees want to work for companies which are environmentally conscious and committed to sustainability and ethical programmes. Many are calling this the “Greta Thunberg” effect. How can this benefit businesses?

Reducing the carbon footprint – The home-working experiment resulting from the pandemic has already shown huge benefits in terms of the reducing carbon emissions. As a result, many companies have revised their policies to promote agile working in the long-run, with Twitter announcing it would be allowing staff to work from home forever. Businesses have also proved that there isn’t necessarily a need for significant work-related travel in the future to see clients and customers, with the use of technology to conduct meetings and social events being more successful than expected.
Sustainability – There are already many examples of companies investing in environmentally friendly programmes and low carbon commitments. Lucozade Ribena Suntory’s “Growing for Good” initiative is one such example – and they have recently invested to extend a partnership with researchers to develop new varieties of climate-resilient blackcurrants. Such initiatives are only set to increase, particularly given the UK’s commitment to implement the single use plastics directive and its planned tax on plastic packaging that does not contain at least 30% recycled plastic: as a result, sustainability programmes are likely to be high up on the agenda.
Ethical considerations – Many consumers (and employees) have a growing concern regarding matters such as meat and dairy farming – and we have seen this play out in the increased trend towards plant-based diets and veganism. This movement is only set to grow in the food and drink industry, with an increasing number of challenger brands producing plant-based choices, including The Meatless Farm, which is the UK’s fastest growing meat alternative brand. Companies will also want to ensure that ethical considerations are feeding through their supply chains, which will require a review of existing relationships and the implementation of due diligence exercises when considering future partnerships.

While change can be difficult to implement, it is evident there are only positives to be gained from businesses making environmental, ethical and social challenges a priority – with the ultimate goal of long-term and sustainable success.

Watch our recent webinar on the topic of employee engagement and future HR trends.

World Environment Day

5 June – Time for nature 5 June is World Environment Day – the United […]

5 June – Time for nature

5 June is World Environment Day – the United Nations day for encouraging worldwide awareness and action to protect our environment. To celebrate we’ve produced a short video below.

Watch our short video

Whilst COVID-19 has changed our world, it’s also shown us that now more than ever we have an opportunity to take action in the clean energy revolution. It’s also shown what can be achieved when government, businesses, civil organisations and individuals pull together for a common aim.

Read more about our response to Climate Change and how we can help businesses here.

Climate Action

100% commitment following Climate Action Dinner Whilst COVID-19 has changed our world, it’s also shown […]

100% commitment following Climate Action Dinner

The video below was produced following the Climate Action Dinner, held in association with Deloitte and the University of Leeds, on 23 February 2020. The dinner was attended by 38 businesses including local councils, regional and national companies. The attendees were all 100% committed to contributing to further the conversation surrounding climate action and begin to implement positive, practical solutions.

We will be posting further updates about the actions which follow.

Read more about our own response to Climate Change here.

Keep business moving: What the Single Use Plastics[...]

In light of the current Coronavirus (COVID-19) outbreak, the UK Government has postponed the ban […]

In light of the current Coronavirus (COVID-19) outbreak, the UK Government has postponed the ban of single use straws, cotton buds and beverage stirrers, that was due to take effect this month, until October 2020. The postponed implementation does not, however, give much scope for businesses to take their foot off the pedal as the new legislation is only a small part of an EU-wide drive to curb single-use plastic. Forward planning to secure future compliance remains critical.

In May 2019, the EU adopted the Single Use Plastics Directive 2019/094 (“the Directive”). However, as this Directive was adopted before the end of the current transition period for departure from the EU (due to end in January 2021), its provisions are still directly applicable to UK businesses. Though the UK Government will be able to amend provisions of the Directive after the end of the transition period, given the increasing public pressure for the government to take a strong stance on environmental issues it is unlikely that the UK will move too far from Directive provisions.

The Directive aims to address the unprecedented levels of marine pollution caused by plastics, which currently account for 85% of marine litter.^[1] The Directive imposes outright bans and decreased availability of certain single use plastic products and also imposes increased producer responsibility.^[2]

The Directive applies to plastics that are most frequently found on beaches as well as lost and abandoned fishing gear. The Directive is concerned primarily with those items that are intended to be used once (or only a few times) before they are thrown away, including single-use paper items with plastic lining, such as conventional ‘takeaway’ coffee cups. Plastics that are covered by the Directive can be split into three categories.[3] Different measures apply to different plastic products:

Products with alternatives readily available:
- The Directive imposes a complete ban on plastics for which there are already suitable alternatives by mid-2021. Such products include plates, sticks for balloons and cutlery.^[4]
Products with currently less widely available alternatives:
- The Directive imposes an obligation to reduce consumption of products such as beverage cups and food containers by 2026.[5]
Products already covered by existing EU legislation:
- The Directive aims to strengthen and complement measures already imposed by other EU legislation for these products. Measures such as market restriction, product design, marking/ labelling requirements and awareness raising are all stipulated under the Directive.

The Directive also limits the use of products that have been found to pollute marine environments, but do not fall into any of the three categories, through marketing/ labelling requirements, awareness raising measures and extended producer responsibility schemes.

With such far reaching scope, the Directive will have a significant impact on a wide range of businesses including manufacturers, retailers and importers. It will also impact on smaller businesses delivering food and drinks to consumers, for example, which (in the absence of cost effective replacements) will find themselves without access to products which are essential for their day to day operation.

Market wide bans of some single use plastics and extended producer responsibility in particular will necessitate innovation and adaptation in order to enable businesses to operate without increased cost: UK businesses must be aware that switching to ‘biodegradable’ or ‘bio-based’ single use plastics will not offer a solution to the restrictions under the new Directive.^[6] UK businesses must also consider measures that will mitigate against reputational and legal risk that will arise from both domestic and EU legislation. Careful planning now, including a full review of existing supply chains and product alternatives, to prepare for the introduction of the ban will place businesses in the best position to adapt to the pending changes.

[1] Commission Staff Working Document, Impact Assessment, Reducing Marine Litter: action on single use plastics and fishing gear. European Commission May 2018. Available at: https://ec.europa.eu/environment/circular-economy/pdf/single-use_plastics_impact_assessment.pdf

[2] Article 3(1) of the Directive defines ‘single-use plastic product’ as a product that is made wholly or partly from plastic and that is not conceived, designed or placed on the market to accomplish, within its life span, multiple trips or rotations by being returned the producer for refill or re-used for the same purpose for which it was conceived.

[3] Policy briefing, Unfolding the Single-Use Plastics Directive. Zero Waste Europe May 2019. Available at: https://zerowasteeurope.eu/downloads/unfolding-the-single-use-plastics-directive/

[4] A full list can be found in Part B of the Annex to the Directive.

[5] A full list can be found in Part A of the Annex to the Directive.

[6] Recital 11 of the Directive states that single use plastics labelled as bio-based and biodegradable are covered by the Directive.

Budget 2020: Key points for the Energy &[...]

Ben Sheppard, Partner in the Energy & Infrastructure Group at Walker Morris summarises some key […]

Ben Sheppard, Partner in the Energy & Infrastructure Group at Walker Morris summarises some key points for the Energy & Infrastructure Sector from the 2020 Budget.

Taxes on pollution

From April 2022, the climate change the levy is to be frozen on electricity and increased on gas
Support for the most energy-intensive industries to transition to net zero, by extending the climate change agreements scheme for a further two years
A new plastics packaging tax from April 2022: manufacturers and importers will be charged £200 per tonne on packaging made of less than 30% recycled plastic

Natural habitats

£640m for a new nature for climate fund to protect, restore and expand natural habitats like woodlands and peat bogs – also capturing carbon
Over the next five years, to plant around 30,000 hectares of trees – a forest larger than Birmingham – and restore 35,000 hectares of peatland

Flood defences

£120m available immediately to repair defences damaged in the winter floods
£200m of funding directly to local communities to build flood resilience
Doubling investment in flood defences over the next six years to £5.2bn

Low carbon transport

Promise to spend £500m to support the rollout of new rapid charging hubs for electric cars
Invest £300m in tackling nitrogen dioxide emissions in towns and cities
A package of tax and spend reforms to make it cheaper to buy zero or low emission cars, vans, motorbikes and taxis

Carbon capture and storage

£800m to be invested to create two more carbon capture clusters

Infrastructure

Announcement to build broadband, railway, roads
£5bn to get gigabit-capable broadband into the hardest to reach places
£510m of new investment into the shared rural mobile phone network
£2.5bn to repair 50 million potholes

Housing

Extension of the Affordable Homes Programme with a new, multi-year settlement of £12bn
Cutting interest rates on lending for social housing by one percentage point to support local authorities to invest in their communities
More than £1bn of discounted loans available for local infrastructure
Nearly £1.1bn of allocations from the Housing Infrastructure Fund to build nearly 70,000 new homes in high demand areas across the country

Read more about Net Zero and our e-book, ‘The Power of Zero’ which serves as a guide for business leaders. Download your free copy here.

Planning lawyers act on successful appeal for renewable[...]

Specialist planning lawyers at Walker Morris have successfully advised Holme Bioenergy Limited on an appeal […]

Specialist planning lawyers at Walker Morris have successfully advised Holme Bioenergy Limited on an appeal for planning permission for an anaerobic digestion plant in East Riding

Andrew McCormack, an Inspector appointed by the Secretary of State for Communities and Local Government, granted planning permission for the proposed development in Holme-upon-Spalding Moor, East Riding.

Anaerobic digestion plants are used to generate clean energy and produce biofertiliser for farmland. Both of which contribute to reducing greenhouse gas emissions. Through utilising renewable energy sources such as AD plants, significant reductions can be made in both the UK’s fossil fuel dependence and the country’s carbon emissions.

Initially, planning permission was refused by East Riding of Yorkshire Council on the basis that the plant would have an adverse visual impact on the local, open countryside. It was argued by the Council that this negative impact on the intrinsic character of the surrounding landscape would outweigh the green energy potential and benefits of the plant.

However, in light of a submitted Landscape and Visual Impact Assessment, it was acknowledged that the plans would have only a ‘slight adverse’ impact on the surrounding landscape. Further it was found that the plant would only be visible from a small number of distant viewpoints meaning the character of the landscape would not be affected. Consequently, McCormack found the proposed changes would have no substantive detrimental effect to the visual surroundings of the countryside.

Holme Bioenergy was advised by Andrew Williamson, Consultant at Walker Morris. Alison Ogley, Partner, provided legal and specialist strategic advice. Speaking about the decision, Alison said:

“We’re delighted with the outcome of the appeal for Holme Bioenergy. The decision reinforces the Walker Morris’ Team’s ability to offer specialist legal advice. Specifically, in the commercially relevant context of clean and renewable energy sources.”

This news closes out a successful year for the Planning Team after Alison Ogley recently acted as one of the first solicitor advocates to appear in the Supreme Court.

The Walker Morris Planning Team is recognised nationally as Tier 1 by leading independent guides within the legal profession, Legal 500 and Chambers. The Team is consistently ranked in the top 10 of the UK’s highest rated planning firms and was last ranked 9^th in 2019.

Major soft drinks manufacturers tackling plastics and packaging

The soft drinks industry is worth £7.7 billion a year for the British economy [1]. […]

The soft drinks industry is worth £7.7 billion a year for the British economy [1]. As sustainability and environmental considerations, such as greenhouse gas emissions and plastic packaging rise up the social and board-room agenda, the industry has come under fire for its use of plastics in bottles and packaging.

While the British Soft Drinks Association has indicated the industry’s intent to be proactive and improve the use of recycled materials, some of the biggest names in the industry are working on ways to improve recycling, improve resource efficiency and the reduce environmental impact of their products.

Innovative recycling technologies

Lucozade Ribena Suntory (LRS) is leading the way in the soft drinks industry’s efforts to reduce the use of plastic in manufacturing and improve the use of recyclable materials. The drinks manufacturer has set itself an ambitious target of achieving 100% recyclable packaging within the next decade and to use 50% recycled content by 2025. This is part of LRS’s wider initiative to move towards using only “sustainable plastic bottles”.

The company recently made a statement that by 2030 it:

“will aim to use plastic that has been previously used or biosourced (plant-based) to reach its 100% sustainable plastic packaging target.”

Peter Harding, CEO of LRS’s parent company Suntory Beverage and Food Europe, commented that the company’s priorities are: “limiting our impact on natural resources, eliminating waste, and reducing our carbon footprint.” And that “The changes and innovations we are making are massive – they are set to remove thousands of tonnes of new plastic made from fossil fuel from our manufacturing operations every year.”

To achieve this ambitious goal LRS plans to invest in new technologies as well as using established mechanical recycling processes. LRS also plans to implement a bottle redesign across its core drinks range to enable automated sorting machines in UK recycling centres to identify better packaging [2].

Government consultations

Earlier in 2019 Government ran a consultation [3] on the introduction of a plastic packaging tax to take effect from April 2022, which will encourage greater use of recycled plastic and help to tackle plastic waste. The tax will complement reformed Packaging Producer Responsibility regulations, which were considered in a separate consultation [4]. These reforms will encourage the design and use of plastic packaging that is easier to recycle, and discourage the creation of plastic packaging which is difficult to recycle. Government believes that, together, the tax and Packaging Producer Responsibility regulations will provide business with the right incentives to recognise the impact of their plastic packaging decisions and drive the development of more sustainable packaging.

WM Comment

Sustainability and other Environmental, Social and Governance (ESG) measures are an increasingly important consideration for our Food & Beverage and other manufacturing clients as they start to play a bigger role in consumers’ buying decisions. Whether it is focused on tackling plastics, reducing carbon emissions or sourcing clean energy solutions, sustainability is no longer just a nice-to-have. There is growing recognition that sustainability can add value to a business in many ways such as brand image and reputation; attracting and retaining customers; employee engagement, attraction and retention; cost savings through resource efficiency; resilience and preparedness for carbon reduction targets; and improved regulatory compliance.

At Walker Morris we have expertise in advising clients in the food and drink and other manufacturing sectors on a wide range of energy efficiency, carbon-reduction and sustainability projects – both from the commercial and the regulatory perspective – to help clients meet their sustainability goals while creating long-term value in their business.

__________

[1] https://www.britishsoftdrinks.com/Soft-Drinks-Sustainability-Roadmap
[2] https://www.letsrecycle.com/news/latest-news/lucozade-commits-to-100-recycled-2030/
[3] https://www.gov.uk/government/consultations/plastic-packaging-tax?utm_source=27592944-d03c-459c-b5d0-52487d499d2a&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate
[4] https://www.gov.uk/government/consultations/packaging-waste-changing-the-uk-producer-responsibility-system-for-packaging-waste?utm_source=0305ea6e-2e8e-4d2e-9cbf-4ab97ec1c628&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

Carbon reduction targets for new homes from 2020[...]

The Ministry for Housing, Communities and Local Government (MHCLG) has published a consultation (available here) […]

The Ministry for Housing, Communities and Local Government (MHCLG) has published a consultation (available here) on how it plans to achieve the “future homes standard” announced in the Chancellor’s Spring Statement.

The future homes standard is to be introduced in 2025 and is part of the Government’s plan for meeting its legally-binding target to reach net-zero emissions by 2050, as housing stock is thought to account for around 20% of the UK’s greenhouse gas emissions.

It is proposed that from 2020 all new homes must be able to demonstrate carbon reduction savings of 31% over the life-span of the development. Energy efficiency measures such as heat pumps, waste water heat recovery system, triple glazing and minimum standards for insulation of walls, floors and roofs are expected to enable homes to meet the standard.

This is the first stage of a two-part consultation about proposed changes to the Building Regulations, which closes on 10 January 2020. The second part, due in coming months, will deal with non-domestic buildings and building work to existing homes and buildings.

Are you keeping up with the plant-based revolution?

The food and drink industry has always been a hot-bed of innovation and 2019 is […]

The food and drink industry has always been a hot-bed of innovation and 2019 is proving to be no different. Two areas which are currently evolving very quickly are the search for plastic-free packaging and the growing trend to eat less meat. The answer to both could lie with plant-based alternatives.

Plant-based meat substitutes

Numerous food companies, ranging from start-ups to global players such as Nestlé, are currently looking at ways to produce meat substitutes from plants. For various reasons, such as health concerns and the environmental impact of animal agriculture, more people are choosing to eat less meat and the food industry is keen to tap into this lifestyle.

Plant-based meat substitutes are made from mixtures of pea protein isolates, rice protein, mung bean protein, coconut oil, and other ingredients like potato starch, apple extract, sunflower lecithin and pomegranate powder, with a range of vitamins and minerals. With some clever science, plants can be turned into meat substitutes.

The Meatless Farm Co, a British start-up which produces plant-based fresh mince, burgers and sausages is one of the market’s front runners alongside Impossible Foods and Beyond Meat. Morten Toft Bech, the founder, started the company after being inspired by his wife, a vegan who was struggling to serve up quick, easy and tasty meals that the whole family could enjoy.

Toft Bech, a flexitarian, argues that plant-based meat alternatives aren’t aimed at vegans, they are aimed at meat-eaters who are looking to reduce their meat consumption.

“We’ve all faced the dilemma of having to cook different meals at home for guests or family members depending on their eating habits. We wanted to create a plant-based meat alternative that unites meat eaters and vegans.

There is a global need, especially in developed economies, for everyone to look at how they can reduce the amount of meat they eat. Intensively farmed meat contributes a huge amount of environmental burden. Our research showed that the biggest barriers for consumers who are making the swap was being able to replicate the taste and texture of meat, alongside bettering the nutritional benefits and environmental impacts. Our fresh plant-based mince contributes 94% less environmental impact than its beef equivalent and looks, cooks and tastes just like meat. In many cases retailers are positioning it in or near the meat aisle.

At the Meatless Farm Co, we wanted to develop products that could help people make the swap easily. Our first innovation was our fresh plant-based mince, it took two years to perfect. Unlike Impossible Foods and Beyond Meat, who both focus heavily on indulgence moments with burgers through restaurants, we wanted first to tap into the everyday meat-eater through retail channels. Mincemeat is one of the most common items bought by UK families, whether it’s to make spaghetti bolognaise, lasagne or chilli-con-carne. Helping people swap their family favourites to plant-based is where we are winning, and it is driving significant volume. Our research with Dr Joseph Poore calculated that if UK families made the swap to plant-based just one more time each week it would cut over 8% of the UK’s total greenhouse gases.

Since our launch in Sainsbury’s, October 2018, we’ve seen exponential growth, securing multiple major UK and international listings. In August we launched into the US with our mince and burgers in 450 Whole Foods stores. The global meat market is worth approximately $1.7trn and Barclays Bank expects that a combination of environmental and health concerns could make the market for meat substitutes worth more than £110bn within a decade.”

Plant-based packaging

In 2017, the UK alone produced 1.85 million tonnes of plastic which was used in the production of plastic packaging. In light of this, and the fact that a reported 72% of soft drinks are packaged in plastic, it is easy to see why there are such strong social, governmental and political pressures on stakeholders in the soft drinks industry and other sectors within food and drink where plastic packaging is widely used.

Both governmental concern and an aspiration to change the way in which the industry approaches its obligations towards reducing the use of non-biodegradable packaging can be seen through the implementation of a number of governmental regimes including the Resources and Waste Strategy. The Strategy aims to invoke the ‘polluter pays’ principle and increase producer responsibility for packaging, ensuring that producers are on the hook for the full costs of disposal for any packaging they place on the market.

In April 2018, signatories from 42 businesses who are collectively responsible for more than 80% of the plastic packaging on products sold in UK supermarkets, signed up to a new programme, the UK Plastics Pact, tackling the use of unnecessary single-use plastic packaging. Current signatories include Coca Cola European Partners, Lucozade Ribena Suntory, Arla and Highland Spring Group. A report by the University of Cambridge Institute for Sustainability Leadership, commissioned by an industry-led working group including high profile members such as Lucozade Ribena Suntory and Harrogate Water Brands, highlights a number of workable actions designed to eliminate plastic packaging waste (the Report). The report suggests that research and development will play a significant role in transforming the way in which companies both think about and produce their packaging. The report includes a number of aims which companies should be striving for in their approach to reducing the amount of plastic used in drinks packaging. These aims include undertaking comprehensive research in order to investigate the optimal material for drinks packaging that eliminates plastic waste whilst ensuring the lowest net environmental impact.

This approach is already apparent amongst the industry leaders including Lucozade Ribena Suntory. LRS’ Lucozade Sport brand has pioneered the use of seaweed based edible packaging for both sports drinks and energy gels at marathon events. The packaging can either be consumed by the user or discarded, in which case the product will decompose in the same manner and timeframe as a piece of fruit would.

Lucozade Sport has teamed up with materials engineering start-up Skipping Rocks Lab to trial these plastic-free sports drinks. The revolutionary Oohos are made entirely from seaweed extract. Not only are they 100% edible and compostable, they will also naturally biodegrade in four to six weeks.

WM comment

Behind all of this innovation lies strong research and development teams who are working with their legal advisors to ensure that the valuable intellectual property which is being created is suitably protected. By obtaining strong intellectual property rights, these companies can secure a monopoly over their innovation. This monopoly plays a critical role in the process of taking innovative technology to the market, as the exclusivity granted by their intellectual property rights ensures that these companies can establish a solid market position and a competitive edge. Furthermore, as there are many players involved in developing plant-based technology for this sector, it is critical that businesses secure and protect their innovation before their competitors. The effective use of intellectual property can reduce the risk for the businesses and ensure that they enjoy the full benefit of their innovation.

Energy Team to present at Greater South East[...]

Walker Morris to chair session on Developing Investable Projects Walker Morris’ Energy, Infrastructure & Government […]

Walker Morris to chair session on Developing Investable Projects

Walker Morris’ Energy, Infrastructure & Government (EIG) Team, is supporting UK100 and Department for Business, Energy & Industrial Strategy at the Greater South East Energy Hub Workshop on Tuesday 13 June 2019.

The session on ‘Developing Investable Projects’ will be looking at the key challenges faced by Local Authorities in developing local energy projects.

The Workshop is the first of a number of planned regional seminars to promote solutions and enhance project supply in the sector.

It is being run by the Greater South East Energy Hub which is a collaboration of eleven LEP’s who are working together to increase the number, quality and scale of local energy projects being delivered across the South East of the UK, over time.

The involvement of the Walker Morris EIG Team follows support that the Team has provided to the Green Finance Summit in Leeds last autumn and work with the Leeds Climate Commission to produce a report to Government entitled ‘Accelerating Green Finance’.

The report sets out recommendations under 10 themes of how to improve the growth of green finance and improve the UK’s transition to a low-carbon economy. Green Finance covers investment in a range of infrastructure and services – creating new skills and jobs and in turn contributing significantly to economic growth.

Walker Morris supports those delivering the UK’s clean growth the innovators, the developers the finance providers and all those committed, even where it’s not their core business, to a low carbon, circular economy.

To find out more please visit the website here.

Food and Drink: Eco-conscious packaging

Current trends/Pressures Globally, the production of plastic has risen overwhelmingly over the past 70 years […]

Current trends/Pressures

Globally, the production of plastic has risen overwhelmingly over the past 70 years with 1.5 million tonnes of plastic being produced in 1950 to 300 million tonnes today. It is an inevitability that with such mass production of a non-biodegradable material that there will be a similarly vast impact on the environment. If the current trend continues it is estimated that across all sectors 12,000 megatonnes (12 billion tonnes) of plastic waste will make its way into landfill or the natural environment by 2050.

Both the Government’s concern and aspiration to change the way in which the industry approaches its obligations towards reducing the use of non-biodegradable packaging can be seen through the implementation of a number of governmental regimes including the Resources and Waste Strategy. The Strategy aims to invoke the ‘polluter pays’ principle and increase producer responsibility for packaging, ensuring that producers are on the hook for the full costs of disposal for any packaging they place on the market.

Actions from a supply chain perspective

A report by the University of Cambridge Institute for Sustainability Leadership, commissioned by an industry-led working group including high profile members such as Lucozade Ribena Suntory and Harrogate Water Brands, highlights a number of workable actions designed to eliminate plastic packaging waste (the Report). The Report and a number of other working papers suggest that the principal forms of necessary change fall into three broad categories:

1. Innovation

Research and development will play a significant role in transforming the way in which companies both think about and produce their packaging. The Report includes a number of aims which companies should be striving for in their approach to reducing the amount of plastic used in drinks packaging. These aims include undertaking comprehensive research in order to investigate the optimal material for drinks packaging that eliminates plastic waste whilst ensuring the lowest net environmental impact.

This approach is already apparent amongst the industry leaders including Lucozade Ribena Suntory and Carlsberg. LRS’ Lucozade Sport brand has pioneered the use of seaweed based edible packaging for both sports drinks and energy gels at marathon events. The packaging can either be consumed by the user or discarded, in which case the product will decompose in the same manner and timeframe as a piece of fruit would.

Carlsberg have recently brought their “snap pack” beer can product to market. The product, which aims to tackle the traditional six ring can binding, essentially offers a transparent glue which bonds the cans. This product alone could potentially cut the Carlsberg Group’s plastic usage by more than 1,200 tonnes each year once a rollout across each of its 11 markets takes place.

2. A collective approach

In December 2018, the UK Government allocated £60m to supporting a scheme which aims to transform waste into environmentally friendly plastic packaging through technological solutions. This has bolstered the Government’s commitment to the cause having previously invested £140m over the last 3 years in developing sustainable packaging.

The investment is subject to industry entering into partnership with the Government and providing significant co-investment. In line with this, industry heavyweight Nestlé has recently pledged to work towards a “waste-free future”. They have heavily invested in innovation and alternative packaging which has put them in a position to roll out 100% paper packaging for Nesquik in Q2 of 2019 and similarly paper based pouches for the Milo drink brand in 2020. Furthermore, by 2025 Nestlé Waters intends to increase the amount of recycled PET (Polyethylene terephthalate) content in its bottles to 50% for its European brands which includes, Acqua Panna, Buxton, S. Pellegrino and Levissima.

Other examples of collective action include entry into the the UK Plastics Pact (the Pact) mentioned above. The Pact sets out four targets which signatories should aim to achieve by 2025. The targets are:

UK Plastics Pact Targets

On a more local level, the recent #leedsbyexample scheme in the city of Leeds is a good example of the industry coming together to address plastic packaging. Under the scheme, environmental charity Hubbub and recycling compliance scheme Ecosurety developed a unique partnership with all levels of the soft drinks supply chain – including drinks companies like Lucozade Ribena Suntory, Coca-Cola GB, Pepsico and Highland Spring, retailers like Asda and Marks and Spencer, and packaging manufacturers like Ball Packaging and Klöckner Pentaplast. Using a combination of technology, recycling facilities, and communications engagement the scheme is aimed at encouraging the recycling of “food to go” packaging by millennials, who have surprisingly low current rates of recycling.

3. Collective industry-wide feasibility study into alternative delivery models

The Report acknowledges that potential, alternative delivery systems will not suit every company, or, more specifically, every product in the sector. For example, bottle refilling, which has been touted as one method of increasing the sustainability of packaging, still needs further and sustained assessment. For example, legally, spring water must be bottled at source in order to be advertised as such, whilst some carbonated drinks cannot be made using syrup, an issue which current drinks dispensing machines are unable to reconcile.

Although it will not be an easy challenge to overcome this issue, companies need to invest significant time and effort into considering new and innovative ways in which they can bring their products to market in a way that utilises plastics already in circulation.

Conclusion

There is an unquestionable global movement aimed at highlighting and addressing the environmental impacts of plastics. This movement has catalysed a number of far reaching programmes aimed at reducing the use and improving the recyclability of single-use plastics.

As environmental and potential health impacts are further understood, both consumer and regulatory attitudes towards the overuse of plastic packaging are becoming increasingly forceful, which has resulted in industry leaders reassessing their approach to the use of plastics. Of course, as mentioned, in many instances plastic packaging may still be the most viable option until a true workable alternative is available. In any event, in the short and medium term, every effort should be made to move towards a more circular economy aimed at extending the life, reuse, remanufacturing and recycling of plastic packaging. The innovative approaches already initiated by the industry and supply chains shows that progress is possible.

Circular Economy

http://chemicalleasing-toolkit.org/node/64

What the Resource and Waste Strategy means for[...]

The Government published the Resource and Waste Strategy for England on 18 December 2018. Key […]

The Government published the Resource and Waste Strategy for England on 18 December 2018. Key policies affecting food and drink businesses include the following.

A £15 million pilot fund to help reduce food waste

WRAP has identified 205,000 tonnes of food that could potentially be redistributed and that enough food for about 250 million meals a year is edible and readily available but currently is used as a fuel for energy from waste or animal feed. The scheme will be developed in collaboration with businesses and charities for launch in 2019.

Annual reporting of food surplus and waste by larger food businesses

There will be consultation on the following measures applying to “larger food businesses” (not defined):

Annual reporting of food surplus and waste. The Government wants to see businesses of “an appropriate size” (not defined) use data on food waste and WRAP’s Food Waste Reduction Roadmap (which gives guidance on how businesses can cut waste in their own operations and replicate this with their suppliers and consumers) to set a reduction target and to report their food waste transparently on an annual basis.
Legal powers for mandatory food waste targets and surplus food redistribution obligations.

The definition of the appropriate size of a business to be caught by such measures will form part of the consultation.

Environmental permits for food waste storage

In 2019, the Environment Agency will review the rules around permits for food waste storage facilities with a view to supporting further redistribution of surplus food.

Cross sector collaboration through the Courtauld 2025 Commitment

The Government states continued support for the voluntary Courtauld 2025 Commitment, which aims to reduce per capita UK food waste by 20% between 2015 and 2025, and “urges” business to:

Identify food waste hotspots across the supply chain and see how they influence each other.
Understand barriers to reducing food waste and improving resource efficiency.
Agree practicable solutions, within the context of technical or commercial constraints.
Develop best practice for industry-wide adoption, and any associated guidance.

Food waste strategies for the hospitality and public sectors

There is to be guidance for the hospitality sector and the public sector to support in reducing food waste, including best practice examples.
Around a third of hospitality and food service food waste is from catering in schools, hospitals and other public sector institutions. The strategy recognises the Plan for Public Procurement which provides a framework for buying standards for food and catering in the public sector.
The Government promises future work with the NHS to support the creation of a new ‘food standard’ for NHS hospital trusts, keeping sustainability and food waste as key priorities.
To tackle food waste in schools, WRAP guidance will be developed and widely promoted.

Seeking powers to protect food producers

It is estimated that around 2.5 million tonnes a year of food produce, worth around £800 million, is lost in production, in some cases “through unfair contractual practices”. It is proposed to introduce sector-specific statutory codes of contractual conduct to protect producers from exposure to unfair practices such as late changes to product specifications, or order cancellations with insufficient notice for a producer to find an alternative commercial outlet for the produce.
A £10 million collaboration fund is to be developed for groups of producers interested in pursuing joint business models, e.g. funding for joint initiatives seeking alternative commercial outlets for non-specification goods, or support to establish short supply chains.

Packaging waste

Packaging waste legislation reform and the deposit return system for drinks bottles, which are to be consulted on in 2019, could affect the food and drink manufacturing sector.

For advice on what this Strategy means for you, please contact Ben Sheppard or your usual Walker Morris Food and Drink Group contact.

Leeds-based organisations reaping benefits from energy efficiency schemes

Walker Morris Partner, David Kilduff, to present at Leeds Climate Commission event David Kilduff, Head […]

Walker Morris Partner, David Kilduff, to present at Leeds Climate Commission event

David Kilduff, Head of Walker Morris’ Energy, Infrastructure & Government Team, will be presenting at the Leeds Climate Commission’s Board Level Briefing Event for local businesses who wish to learn more about how to identify, finance and deliver cost-effective energy savings and small scale renewable projects.

The event is aimed at medium sized organisations based in Leeds and will explain how low-carbon projects can be profitable, and how they can be financed. The event will guide organisation through examples where businesses have benefitted from transitioning to low-carbon and link them to potential investors.

The Leeds Climate Commission is a partnership with members from 25 of the city’s key organisations in the private, public and third sector, including Walker Morris. The Commission’s objective is to provide an independent voice in the city, providing authoritative advice on steps towards a low carbon, climate resilient future.

The Commission’s analysis highlights enormous potential for Leeds-based organisations to pursue cost-effective, low-carbon measures and shows that exploiting these could cut energy bills and carbon emissions. This analysis has also identified a number of barriers to organisations’ ability to reap the benefits of low-carbon and that many of these opportunities are left unexploited. When faced with other pressures and constraints, organisations can face challenges in terms of identifying and developing project ideas, preparing a business case, linking with investors and securing finance for selective investment.

David Kilduff commented:

“Many organisations are starting to realise the potential of transitioning to low carbon schemes. The benefits can be immediate to the bottom line in terms of energy costs reduction as well as meeting growing customer expectation that business is playing its part in tackling local emissions and climate change. It also makes sense to assure energy resilience and security of energy supply. With some forecasts predicting that energy costs could rise by as much as 25% over the next few years, energy supply and efficiency is an issues that will only increase in prominence in the Board room.”

Andy Gouldson, Chair of the Leeds Climate Commission, said:

“As a city, we want need to develop a pipeline of projects and programmes that can secure investment in the low carbon economy. Businesses want investment, investors want projects to invest in, and society wants secure jobs, a clean environment and a stable climate. This initiative is all about building capacities and strengthening the networks needed to deliver on all of these fronts. If your business is interested in participating and benefitting from low carbon opportunities, we want to hear from you!”

The event will take place on Tuesday 29^th January 2019 8.00am – 9.00am at Merrion House.

To register for the event please book your place at: https://pdfiboardlevelbriefing.eventbrite.co.uk

If you can’t attend the briefing on 29^th January but are interested in attending the workshops, please email leedsclimate@candocities.org

New Resource and Waste Strategy Published

The first change to England’s waste strategy since 2010, it represents an ambitious programme of […]

The first change to England’s waste strategy since 2010, it represents an ambitious programme of reform which will shape the landscape for sustainability to 2030 and with some proposals looking as far ahead as 2050.

Affecting the food, manufacturing and packaging sectors as well as the waste sector, key policies include the following.

Mandatory food waste collections will be welcomed by the anaerobic digestion industry but pose challenges to some local authorities, such as disposal authorities that have committed to long-term residual waste contracts where food waste is commingled with residual waste.

Food businesses are to face annual reporting of food surplus and waste.

For producers of goods the extended producer responsibility (EPR) will apply full cost recovery to producers and will apply to a range of new waste types.

Reform of the duty of care regulation includes mandatory use of digital transfer and export documentation and a requirement for waste carriers and brokers to demonstrate tax registration.

Aligned to the EU circular economy principles, the following proposals will be consulted on in January for implementation in the next 3 years:

packaging waste legislation reform
deposit Return System
requirement for consistency of household waste in the materials collected for recycling
plastic packaging to be 30% minimum recycled content by 2022

The strategy does not include any clear proposals on changing consumer culture regarding waste and litter (for example through ‘pay as you throw’ policies), or on stimulating investment in UK reprocessing infrastructure in order to combat the UK’s reliance on export markets.

For advice on what this strategy means for you, please contact Ben Sheppard.

Plastics: The Scope of the Single-Use Plastic Directive[...]

The Chancellor of the Exchequer’s autumn budget has outlined the UK’s intentions to address waste […]

The Chancellor of the Exchequer’s autumn budget has outlined the UK’s intentions to address waste by encouraging the recycling of plastic, shortly after the European Commission proposed the introduction of a Single Use Plastic Directive.

Plastics Tax and Producer Responsibility

The Chancellor’s statement outlined the introduction of a tax to reduce the environmental consequences of plastic. Expected to commence in April 2022 the tax will apply to importers and producers of plastic packaging. Although the precise nature of the tax has not been detailed, only plastic packaging that has at least 30% recycled plastic content will be exempt from the tax.

Alongside the plastic tax, the government have announced changes to the current Packaging Producer Responsibility System. The intention is to heighten responsibility for businesses in relation to the treatment of plastic packaging after use, increasing involvement in the recycling and clean-up of their products. The Treasury’s intention is for the system to promote easily recyclable packaging and deter the use of hard to recycle plastics.

Additionally, the government is increasing funding by £10 million for research and development into plastics and a further £10 million for innovation into recycling and minimising waste.

The divergence between the UK and EU approach to reducing waste was highlighted by the Chancellor’s direct rejection of the so called ‘latte levy’, the introduction of a charge to disincentivise the use of, often single use, plastic cups. It was suggested this measure would be inappropriate in isolation and unlikely to generate change. In contrast, the EU’s proposed directive targets specific disposable items that make a disproportionately large contribution to marine and beach waste.

Although support has been shown for the Chancellor’s proposals, concern has been expressed over the available supply of recycled plastic, fundamental to achieving the 30% requirement. It is hoped the increased spending on innovation, research and development and the revenue from the tax will enable a sufficient supply of recycled plastic for suppliers to reach the 30% requirement.

Single Use Plastic Directive

The directive aims to reduce the volume of waste plastic claimed by the European Commission to account for over 80% of marine waste. It focuses on prevalent discarded items including: plastic bottles, straws, food packaging and cotton buds, and has been extended by the European Parliament to include items made of expanded polystyrene and oxo-degradable plastic. The directive updates the existing EU concept of Extended Producer Responsibility by introducing additional obligations on importers and producers to mitigate the consequences of their products upon the environment.

For manufacturers, the implications are varied. The directive outlines specific mechanisms, dependent upon the item, that aim to reduce aggregate plastic waste. For products with renewable alternatives, bans will be introduced, and where bans are inappropriate industries may be required to finance waste management; increase awareness of the implications of plastic; and/or alter labelling to reflect a product’s plastic content, how to dispose of it and its environmental consequences. Additionally, State facing obligations have been proposed, requiring the introduction of reduction and collection targets, one example being the introduction of a 25% reduction in the use of food containers for fruits and vegetables by 2025.

Criticism has arisen regarding the expediency of the drafting and there remains uncertainty surrounding the potentially far reaching implications of the directive. The proposed definition of a single-use plastic product includes items only ‘partly’ containing plastic. The wide-scope of the directive may prove onerous for manufacturers. The European Council have reacted positively towards the directive but seek further clarification on the definition of single use and have requested guidance detailing examples of relevant products.

Whilst uncertainties surrounding Brexit make the implications of the directive indeterminate, the Autumn Statement indicates that the UK is taking a markedly different approach to plastic consumption, addressing plastic packaging more generally but relying on fewer mechanism for change.

Leeds Climate Commission and Green Taskforce come together[...]

On Tuesday (1 May) Leeds Climate Commission is hosting a conference to encourage green finance opportunities. […]

On Tuesday (1 May) Leeds Climate Commission is hosting a conference to encourage green finance opportunities. It is open to the business, investor, developer and advisor community focusing on how sustainable growth can be affordable and good for business.

Walker Morris partner David Kilduff, discusses some of the key themes of the event.

The conference will focus on facilitating a pipeline of replicable good value projects and sources of finance that make them attractive to implement.

Joining representatives of the Commission to discuss opportunities and share insights and experience will be representatives of Iona Capital and Sustainable Development Capital Ltd as well as Abundance which is known more recently for its Bond raising for Swindon Council to deliver carbon saving projects. Representatives of the Green Finance Taskforce, an independent partnership of public and private sector bodies) will also be present to reinforce the messages coming from their recent Report to Government Accelerating Green Finance. This sets out recommendations under 10 themes of how to improve the growth of green finance and improve the UK’s transition to a low-carbon economy. Green Finance covers investment in a range of infrastructure and services – creating new skills and jobs and in turn contributing significantly to economic growth. It is no stranger to the UK economy with over $20 billion having been raised in London alone through Bond issues with much more invested in more traditional investment and lending.

The Taskforce’s message is:

Relaunch UK green finance activities through a new unified brand

The Government and the City of London should set up a Green Finance Institute. The Institute would be a new brand to harness the UK’s existing capabilities and create new business opportunities in green finance. Part of the Institute’s role would be to develop a joint strategy with the Government and set up a Green Fintech Hub to support UK leadership in finance and digital technology solutions in the green finance space; this will help the UK deliver on its clean growth strategy.

Improve climate risk management with advanced data and analytics

Climate change risk is not fully incorporated into business risk management, valuations and decision making practices. For example, high temperatures, increased/decreased rainfall and windstorm intensity are increasingly affecting the insurance market with a greater occurrence of catastrophic events.

Utilising technology, data and analytics to understand climate change impacts will help manage these risks and focus on this area would help the UK to design and sell innovative new products in this space which would further build the UK’s international reputation.

Implement the recommendations of the Task Force on Climate Related Financial Disclosures (TCFD)

Companies and investors need better information to make informed decisions about the impact of climate risks to their business and capital investments. The recommendations from the private sector-led TCFD, provides an internationally agreed framework to help assess, reduce and manage the exposure to climate risk.

Drive demand and supply for green lending products

Buildings (residential, commercial and public) account for 30% of the UK’s total greenhouse gas emissions so tackling this issue and boosting energy efficient renovations should be a major part of the strategy to meet carbon targets.

Promoting green mortgages and a loan market for renovation is an important way of boosting investing in this area. For example, in the Netherlands mortgage lending rules allow households to borrow up to £25,000 extra to purchase/refurbish a home to a net zero energy efficiency level. In the US, offering lower interest rates on mortgages for energy efficient properties is another strategy to promote building efficiency. Expansion and strengthening of the Energy Performance Certificate programme is supported.

Boost investment into innovative clean technologies

Through providing public funds to start-ups in the early stages of their development, which in turn encourages venture capital funds to invest as it reduces the quantity of seed capital required. Furthermore, the collaboration of the public sector working with the private sector can accelerate the speed at which the company’s innovation is commercialised. This is against a backcloth of concern that UK investment in cleantech has declined since 2013.

Clarify investor roles and responsibilities

Clarifying fiduciary duties are an essential way to ensure the UK financial system responds proactively to climate change risk as well as to the opportunities for clean growth. These duties should be framed to encourage appropriate investment behaviour; the aim needs to be to promote good fund governance on environmental, social and governance issues (ESG).

Issue a sovereign green bond

Developing a UK Sovereign Green Bond Framework under which a single sovereign green bond or bond programme could be issued would help secure the UK’s green growth and innovation goals while also signalling a consolidation of UK leadership in green finance. The proceeds raised from green bonds would then be used as additional sources of capital, to be invested in new environmentally friendly projects that may not otherwise get funded or built.

Build a green and resilient infrastructure pipeline

Currently, the UK is delivering less than half of the green infrastructure projects required to meet its environmental targets. The Report encourages the UK to secure major investment to renew and decarbonise its infrastructure but also make sure it is resilient to the impacts of a changing climate. The Government should publish a National Capital Raising Plan explicitly designed to align UK infrastructure planning with the delivery of its Clean Growth Strategy and environmental plan laying out the pipeline of these projects over the next 5, 10 and 15 years and setting out clean infrastructure and regional development priorities.

Foster inclusive prosperity by supporting local actors

Local authorities are well placed to drive emissions reductions through their unique position of managing policy on land, buildings, water, waste and transport. – Therefore a major part of the clean growth strategy needs to involve local authorities embedding low carbon, energy efficient measures across areas like health and social care, transport and housing. The Report recommends the setting up of a Local Development Finance Fund of £100m that would award capital grants to applicants seeking to create new forms of public-private consortia to bridge the development gap and unlock an estimated £30bn of potential clean growth infrastructure projects.

Integrate resilience into the green finance agenda

Ensuring the UK is resilient to the effects of a changing climate would create significant new green finance opportunities that would enable the UK to lead the world in this area i.e. on how to deliver a resilient economy while boosting green finance opportunities. For example, the floods in 2015 cost £1.3bn in damage yet the number of assets in high risk flood areas will increase by at least 50% by 2050 so the Government needs to establish a national resilience unit to meet these challenges and produce an action plan on delivering market resilience.

The Commission’s approach sits in a wider context of progress of the Northern Powerhouse and related industrial Strategy and a recent IPPR Report on the role of the North in becoming a market leader in the new energy economy.

Government Policy on Climate Change: A load of[...]

Without urgent action, the UK’s commitment to tackling climate change will fall dismally short of […]

Without urgent action, the UK’s commitment to tackling climate change will fall dismally short of the ambitious targets set by the government, according to the Committee on Climate Change (the CCC).

The CCC’s report released this month reviews the government’s “Clean Growth Strategy” (the Strategy) and how it stacks up against its climate change targets set pursuant to the Climate Change Act 2008 (the Act). The Strategy, published in 2017, sets out proposals and policies to curtail greenhouse gases in order for the UK to meet the legislated fourth and fifth carbon budgets covering emission periods 2023-2027 and 2028-2032 respectively.

While the government seems outwardly committed to the reduction of CO2 emissions, with approximately 100 policies identified, the report states that the substance behind the Strategy’s proposals needs fleshing out if the UK is to deliver its climate change reduction targets. Chairman of the CCC, Lord Deben, writes: “the Strategy… has set out strong ambitions… However, whilst some new policies are announced in the Strategy, the detailed policies and measures to meet the targets are not, in general, set out…. urgent policy development is therefore required.” We must also remember that the UK is a signatory of the Paris Agreement which demands a commitment to increase efforts and deliver far beyond existing targets.

Set out in four parts, the CCC report examines the Strategy and the government’s obligations under both the Act and the Paris Agreement before setting out its criteria for assessing the Strategy (Emissions, Policy, Timetable). The CCC then analyses the Strategy in view of the government’s policies and proposals and concludes with advice on how to close the policy gap and monitor progress if the government is to have a hope of meeting the carbon budgets.

Some examples of questionable policy-making identified in the report include plans to upgrade as many homes as possible to EPC Band C by 2035; to phase out the sale of new conventional petrol and diesel cars and vans by 2040; and plans for decarbonisation of UK power generation. Despite the fourth budget beginning in only 5 years’ time, the plans to actually turn these proposals into reality are currently insufficient. The government must act and firm up the policies within the Strategy to avoid under-delivery.

The government’s long term goal is to reduce the emissions of greenhouse gases by at least 80% in the period from 1990 to 2050 and the carbon budgets beat a path to this goal. However, on current estimates, the CCC forecasts that on the basis of current proposals and policies “there remains a gap of up to 65MtCO2e to meeting each of the fourth and fifth carbon budgets.” To put this shortfall into context, even if a huge number of homes achieve EPC band C this would only save around 1.5MtCO2e in 2025 and 3 MtCO2e in 2030.

On a positive note, the government’s ambition in the Strategy to deliver 85% of the UK’s electricity from low carbon sources by 2032 with new nuclear power and £557m committed for low carbon generation via Contracts for Difference (CfDs), is estimated to save 17 MtCO2e in 2030 (page 62) which goes some way towards reducing the deficit.

While the Act contains flexibility mechanisms to allow for falling somewhat short of the carbon budgets, the CCC is concerned that this waistband will be used to underfund and ultimately fail to develop leading low-carbon industries and technologies, which will only exacerbate the problem in the future and increase costs to the economy.

In response to the CCC’s findings, the Anaerobic Digestion and Bioresources Association was keen to highlight the positive impact that AD and biomethane could have in helping the UK decarbonise, if only it was prioritised by the government.

Mind the Gap

What is clear is that without rapid and firm policy development, the gap in the carbon budgets will remain. But with challenge comes opportunity for the UK government to put its money where its mouth is and the CCC clearly pinpoints the issues for firm policy development and how to achieve the carbon budgets. These include:

Energy efficiency in existing buildings: we need an action plan for homeowners who can afford to self-fund such initiatives, and either incentivise or mandate these proposals. The report suggests introducing private rent regulations and performance based labelling for commercial properties;
New Buildings: develop standards for low carbon heat and high levels of fabric efficiency;
Public sector: public procurement should drive higher standards in commercial/residential properties and support low carbon supply chains;
Surface Transport: include proposals to incentivise the uptake of ULEVs (ultra-low emission vehicles) including extension and ramping up of government initiatives and schemes;
Deploying carbon capture and storage (CCS) which is crucial to meeting the UK’s climate change targets in the most cost efficient manner;
Agriculture and land use: there has been little, if any, progress on reducing agricultural emissions for years – so further measures on cost effective reduction of these emissions and afforestation are needed;
Waste: the governments need to end food waste going to landfill and support recycling; and
Power Generation: the governments must expand the CfD programme and auction sales to encourage low carbon generation.

The Future

The CCC report drills down into the Strategy and holds the government to account on its vague policies, throwing down the gauntlet for the government to step up, solidify its proposals under the CCC’s guidance and meet its obligations under the Act. Will the UK government step up to the CCC’s challenge and make combatting climate change an area in which the UK leads the pack on the international stage post-Brexit?

Contacts

Judith Pike
Partner
Learn More

Ben Sheppard
Partner
Learn More

Jules Harbage, Partner, Construction & Engineering

Jules Harbage
Partner
Learn More