Responding to the First Minister’s announcement today of her Programme for Government 2017-18, Nick Molho, Executive Director of the Aldersgate Group said:
“The First Minister’s proposal to phase out the sale of new petrol and diesel cars and vans by 2032 and the ambitious new targets included in the upcoming Climate Change Bill provide a clear sense of direction to business that investment in all forms of resource efficient infrastructure, renewable energy generation and clean transport will need to increase.
Scotland has a real opportunity to capitalise on its successes of recent years. The Scottish Government’s commitment to renewables has helped create a thriving sector that accounted for a total turnover of £2.7bn in 2015 and energy efficiency in Scotland’s buildings has been improving with a 74% increase in homes being rated EPC Band C between 2010 and 2015.
However, detailed policies are urgently needed if Scotland is to meet its climate targets on time and on budget and continue to grow its low carbon economy. This is especially the case for Scotland’s buildings where clear regulatory standards and well-timed incentives in the Scottish Energy Efficiency Programme and Warm Homes Bill will be essential to ramp up action on energy efficiency.”
Reacting to today’s announcement of Macquarie’s completed purchase of the Green Investment Bank (GIB), renamed the Green Investment Group (GIG), Nick Molho, Executive Director of the Aldersgate Group, said:
“Following the successful completion of the sale of the GIB today, we call on the new Green Investment Group (GIG) to honour their commitment to support investment in the UK’s renewable energy infrastructure. The GIG is ideally placed to lead private sector investment in UK green infrastructure projects and help deliver key government policy commitments such as those that will be set out in the upcoming Clean Growth Plan.”
Nick Molho added: “Delivering the government’s ambitions under the Clean Growth Plan and 25 Year Environment Plan will require supporting novel technologies and business models which may initially struggle to access finance. Now that the sale of the GIB is complete and given that the UK’s access to funds from the European Investment Bank is likely to be more restricted after Brexit, the government needs to develop a clear finance strategy in the near future. This strategy should aim to crowd in private sector investment in the new technologies and business models the UK will need to deliver on its environmental commitments and build a thriving low carbon economy.”
Today, the UK’s building stock is responsible for 19% of annual emissions. Promoting energy efficiency in the UK's domestic and commercial sector is crucial to further decarbonisation in the UK. Energy efficiency mechanisms could generate potential savings of 23.6MtCO2 per year by 2030, which is roughly equivalent to cutting the CO2 emissions of the UK transport fleet by one third.  However, there is a general lack of progress in reducing emissions across the UK’s building stock, insufficient uptake of low carbon heat and insulation and a failure to make any meaningful reduction in non-residential building emissions.  The Aldersgate Group and the UK Green Building Council have produced this briefing to highlight priorities for the government in addressing this issue.
Our briefing argues that reducing energy demand through greater efficiency can help the UK meet its legally binding climate targets, limit increases in energy bills, tackle fuel poverty, and drive economic growth and long-term job creation.
 Cambridge Econometrics and Verco (2015) Building the Future
 Committee on Climate Change (June 2016) Meeting Carbon Budgets: Progress Report to Parliament
Reacting to the publication today of the Progress Report from the Committee on Climate Change, Nick Molho, Executive Director of the Aldersgate Group said:
“If the UK is to significantly cut its emissions and modernise its buildings, energy and transport infrastructure in the next 15 years, the private sector must urgently understand the scale of the UK’s ambitions and the market arrangements under which it can invest in that infrastructure. Greater clarity is particularly needed on the policies that will drive emissions reductions in domestic and commercial buildings.”
“The EU referendum and recent General Election have resulted in some understandable delay in developing such a plan for businesses and investors. However, if low carbon infrastructure is to be delivered on time, at the lowest possible cost and in a way that grows UK supply chains, the government must deliver on the Minister’s intention to publish the Clean Growth Plan when Parliament returns from the summer recess.”
Reacting to the key findings of the Progress Report on the UK’s adaptation to climate change, Nick Molho added:
“The limited progress being made to tackle the degradation of the UK’s natural environment and better protect its infrastructure from the impacts of climate change is concerning. In the coming year, we need to see a concerted effort across government departments to develop a detailed National Adaptation Plan and 25 Year Environment Plan. These plans must attract much greater investment to improve the state of key natural resources such as coastal wetlands, peatlands and soil and ensure the UK’s infrastructure and economy are resilient in the face of more extreme weather events.”
Reacting to the publication today of the final recommendations by the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), Nick Molho, Executive Director of the Aldersgate Group said:
“The publication of the TCFD’s industry-led recommendations cements the importance within the investment and business communities of disclosing the physical, regulatory and commercial risks linked to climate change. There is growing recognition that understanding how this information may impact company or asset performance is essential to enable businesses to make sensible long-term strategic decisions and to give investors the information they need to shift their investments towards more resilient and lower carbon business models.”
Nick Molho added: “These recommendations on standardised voluntary disclosure will act as an influential guide for investors and businesses across the economy. However, in light of the urgency of tackling climate change, mandatory regulations remain essential to ensure that climate-related disclosure is widely adopted in the near future and is consistent and comparable between companies of a same sector. Given the UK’s aim to become a hub for green finance, the government should take note of the ambition of these recommendations and strengthen the breadth and scope of its own mandatory carbon reporting regulations in line with the industry standard.”
Reacting to the Queen’s Speech today, Nick Molho, Executive Director of the Aldersgate Group, said:
“It is encouraging to see the government’s desire to make the UK a leader in new industries and enhance its role on the world stage. If the government is to do this successfully, it will need to commit to an ambitious environmental and low carbon agenda. With the global low carbon economy growing fast and international action on climate change gathering pace despite the US withdrawal from the Paris Agreement, this will require the publication this year of a detailed clean growth plan to deliver the UK’s climate targets under the fifth carbon budget and a framework for a 25 year plan to enhance the state of the UK’s environment. In incorporating EU environmental legislation in UK law and determining its future, the government should focus on delivering environmental improvements on the ground that are as good as or better than what is currently legislated for.”
Nick Molho added: “The government is right to seek the “broadest consensus possible” in determining the UK’s negotiating terms on Brexit. In order to deliver the UK’s climate and energy policy ambitions in the most efficient and cost-effective way, the UK must maintain close collaboration with the EU after Brexit in key areas of mutual benefit, such as through continued participation in the internal energy market.”
Following the results of the General Election, the Aldersgate Group urges the new government when it is formed and MPs from all political parties to build on their support for the UK’s Climate Change Act and the Paris Agreement by backing the growth of the UK’s low carbon economy.
The Aldersgate Group, whose business members represent a wide range of economic sectors and a collective turnover in excess of £400bn, calls on the new government when it is formed and MPs from across the political spectrum to recognise the important role played by the low carbon economy in delivering widespread environmental, economic and social benefits, and in strengthening the UK’s international competitiveness.
The UK’s low carbon economy was already worth £77bn in 2015 and employed 432,000 people. With UK strengths in the offshore wind, ultra-emission vehicle, construction, ICT and legal and financial services sector, stable and long-term policies could help increase the size of the UK’s low carbon economy from 2% of GDP today to 8% by 2030. Despite President Trump’s recent decision to withdraw the US from the Paris Agreement, the global low carbon economy is rapidly growing, as shown by the $240bn invested in a record amount of renewable electricity capacity in 2016, the slowdown in coal consumption in India and China and increased collaboration between the European Union and China on tackling climate change.
Nick Molho, Executive Director of the Aldersgate Group said: “All the main parties have shown support during the General Election campaign for the UK to put in place an ambitious climate and environmental policy agenda and seize the industrial opportunities that this represents. We therefore look forward to working with the new government and MPs from all parties to put in place ambitious policies that will help grow the UK’s low carbon sector, improve resource efficiency, enhance the natural environment and strengthen the competitiveness of the economy.”
Nick Molho added: “As made clear in the Aldersgate Group Manifesto, this is a crucial time to establish policies that will improve the health of the UK’s environment and the future prospects of its economy. An important first step should be the publication in 2017 of a detailed Clean Growth Plan to attract low carbon investment and meet climate targets and a framework for a 25 Year Environment Plan to improve the state of the UK’s natural environment."
Today the Financial Times published a letter by Aldersgate Group Executive Director, Nick Molho, commenting on Republican US states' growing economic activity around renewable energy. See full text below:
Sir, Many of the US states that are joining the coalition to press ahead with their commitments to cut carbon emissions under the Paris agreement are indeed under Democratic leadership (“Trump Paris deal pullout faces US states’ backlash”, June 5). However, some key Republican states that haven’t yet joined this alliance are witnessing growing economic activity around renewable energy and it is in their interest to continue supporting the growth of the sector.
For example, just under $7bn was invested in renewable energy projects in North Carolina in 2015, while Texas has more than 100,000 people working in the sector. This is one of the reasons some of the federal incentives that facilitate the deployment of renewable energy, such as the wind and solar tax credits, have bipartisan support and were recently renewed for another five years.
When one adds to this the ambitious emissions reduction commitments of a major state like California, the world’s sixth-largest economy before France, it becomes clear that US states and cities could deliver significant emission cuts in the years to come despite an unsupportive federal government.
Today the Guardian has published our letter, signed by 11 businesses, highlighting the importance of the UK's low carbon economy and calling on the next government to put in place ambitious and stable environmental policies. See full text below:
Despite the US withdrawal from the Paris agreement on climate change (Anger at US as Trump rejects climate accord, 2 June), the global market for low carbon goods and services is rapidly growing and the UK must make the most of this opportunity. Spurred in particular by major investments in low carbon technologies by countries such as China, India, Mexico and South Africa, the Paris agreement could open up $23tn (£18tn) worth of opportunities for low carbon investments in emerging markets between 2016 and 2030. The commitments made by six world leaders at the recent G7 summit and the decision by China and the EU to collaborate more closely on climate change support this trend.
The UK is well placed to benefit. Its low carbon sector employed 432,000 people and produced a turnover in excess of £77bn in 2015. The UK’s strengths include manufacturing ultra-low emission vehicles and offshore wind turbines, piloting innovative ideas in energy, water and resource efficiency and providing financial and legal services for clean energy projects worldwide. The focus on developing low-cost, low carbon infrastructure is gaining momentum across all key economic sectors.
The low carbon economy could grow from 2% of UK GDP today to 13% by 2050. However, stable policies to grow the UK’s low carbon market will be essential to turn this potential into reality and ensure our economy remains competitive on the global stage. We therefore call on the new government to put in place ambitious and long-term policies to tackle climate change and improve the state of the environment at the heart of its industrial strategy and vision for the UK.
Nick Molho Executive director, Aldersgate Group, Chris Newsome Director of asset management, Anglian Water, Steve Waygood Chief responsible investment officer, Aviva Investors, Nigel Stansfield President, Interface Europe, Middle East and Africa, Pierre Woreczek Chief customer officer, Kingfisher, Jens Tommerup CEO, MHI Vestas Offshore Wind, Matthew Knight Director of energy strategy and government affairs, Siemens UK, Alistair Phillips-Davies Chief executive, SSE, Julia Barrett Director, Willmott Dixon Re-Thinking, David Symons UK Director of Sustainability, WSP, Piers Guy UK country manager, Vattenfall, Paul Greensmith UK country leader, XL Catlin
Reacting to President Donald Trump’s announcement that the United States would withdraw from the Paris Climate Change Agreement, Nick Molho, Executive Director of the Aldersgate Group said:
“Donald Trump’s decision won’t result in a U-turn on climate action in the US or globally. Several US States have made clear commitments to continue investing in low carbon technologies  and major US businesses such as Walmart have set ambitious targets to cut carbon emissions and increase the use of renewable energy .
Globally, the shift to a more efficient, low carbon economy is gathering pace, the cost of clean technologies is rapidly falling and coal use in China and India is slowing faster than anticipated . Over $240bn was invested in record levels of renewable energy capacity in 2016, 40% of which was driven by developing economies including China, India, and Brazil . Following the commitments made by six world leaders at the recent G7 summit  and the news of greater co-operation between China and the EU on climate change, major global players like the UK must continue to build competitive, low carbon economies and honour their commitments under the Paris Agreement.”
 A bipartisan group of 17 US state governors representing almost 40 percent of the US population recently agreed for example to co-operate on the deployment of clean energy and transport solutions.
 Walmart recently joined the global science-based targets initiative and committed to cut its emissions of greenhouse gases by 18% by 2025 relative to 2015 levels, source half of its energy from renewables by that date and work with its supply chain to reduce emissions by a further 1 Gigatonne.
 Excluding large hydro. Renewable energy investment in 2016 added 138.5 gigawatts capacity, an 8% increase from 2015 with average costs for solar and wind dropping by 10%. Bloomberg New Energy Finance, April 2017 https://about.bnef.com/blog/bang-buck-record-new-renewable-power-capacity-added-lower-cost/
 In a communique on 27 May, the governments of France, the UK, Japan, Italy, Germany and Canada as well as the presidents of the European Council and European Commission reaffirmed “their strong commitment to swiftly implement the Paris Agreement”.
Today the Aldersgate Group publishes a manifesto report, A healthy environment, a competitive economy, setting out policy priorities for the new government. The report highlights the growing importance of the low carbon economy to the UK’s competitiveness and urges the new government to put ambitious environmental and climate policy at the heart of its programme as the UK leaves the EU.
The UK faces several environmental challenges from the growing impacts of climate change on its infrastructure to the degradation of key parts of its environment such as soil. Tackling these environmental challenges effectively will provide economic as well as environmental benefits for the UK. The Aldersgate Group manifesto therefore calls for the next government to:
Policies such as the Climate Change Act have already helped to cut carbon emissions, reduce household energy bills in real terms , reduce the cost of new technologies like offshore wind and deliver growth in new industries. The Office of National Statistics estimates that the UK’s low carbon and renewable energy economy employed some 432,000 people in 2015 and delivered a turnover of more than £77bn.  Critically, a lot of this growth is taking place in parts of the country that need it the most such as the North of England and the Solent area. 
UK businesses have strengths in numerous areas of the low carbon economy such as the manufacturing of ultra-low emission cars and wind turbines, expertise in energy efficiency services and engineering, leading cutting edge pilots in resource efficiency and natural capital and the provision of legal and financial services for clean energy projects worldwide. Going forward, the export potential for UK businesses is significant, with estimates that the low carbon economy could grow from 2% of the UK’s GDP today to 8% by 2030. 
Nick Molho, Executive Director of the Aldersgate Group said: “As the new government negotiates the UK’s departure from the EU, it should not neglect the importance of putting forward an ambitious low carbon and environmental policy. The UK has significant strengths across the low carbon economy, a market which is already worth over $5.5tn globally  and is rapidly growing following the Paris Agreement on climate change. The next five years are a unique opportunity to consolidate the UK’s competitive advantages and put its businesses in the best possible position to tap into growing export opportunities.”
Steve Waygood, Chief Responsible Investment Officer at Aviva Investors said: “We are calling for the creation of public league tables, ranking the performance of companies on a range of sustainability issues, including climate change. Providing ambitious and clear low carbon policies in the next parliament and improving the disclosure of corporate information relating to climate risks will be essential to increase affordable private investment. We need policies to direct capital towards the resource efficient and low carbon infrastructure that the UK so urgently needs to build in order to maintain a globally competitive and resilient economy.”
Jens Tommerup, CEO at MHI Vestas Offshore Wind said, “We support the Aldersgate Group in their calls for a broad political consensus in the UK around the need for a renewed focus on the transition to a low carbon world, and the great opportunities this presents a new Government after 8th June and the people and businesses of the UK. Offshore wind in particular is demonstrating a compelling proposition, accelerated cost reduction - on track to be the lowest cost large scale generating technology by the early/mid-2020s-, whilst at the same time delivering industrialisation and valuable jobs the length and breadth of Britain.”
Chris Newsome, Director of Asset Management for Anglian Water and member of the Green Construction Board said: “As highlighted in the Infrastructure Carbon Review, infrastructure is responsible for over half of the UK’s carbon emissions. We fully support the Aldersgate Group’s manifesto released today, and their aligned efforts to reduce carbon and cost within infrastructure through innovation and collaboration with the supply chain. The manifesto will undoubtedly drive the sustainability agenda and influence future policy."
"It’s through coalitions such as the Aldersgate Group that Anglian Water aims to provide leadership, practical advice and engage with other companies looking to deliver reduced carbon and reduced cost in sustainable growth.”
Nigel Stansfield, President at Interface Europe, Middle East and Africa said: “Our Mission Zero commitment has reduced our greenhouse gas emissions by 98% across our EMEA operations since we started our sustainability journey in 1996. While companies like ours continue to lead the way, governments at both a national and EU level can accelerate moves to reduce our dependence on fossil fuels by encouraging transparency around the environmental impact of products, and introducing measures to change buyer behaviour in favour of those that are low carbon.”
Julia Barrett, Director at Willmott Dixon Re-Thinking Limited said: “The construction industry is willing to invest in research, innovation and skills development to find the solutions for an affordable low carbon future. But, we need to be confident that the government is taking a long-term policy approach that will support spending on resource efficiency, energy efficiency and low carbon infrastructure.”
Mary Thorogood, Stakeholder Relations Adviser at Vattenfall UK said: “Vattenfall supports the Aldersgate Group’s call for the next government to quickly publish a detailed Clean Growth Plan. The publication of a supportive plan will provide certainty for future low cost onshore and offshore wind projects. These long-term market signals will encourage Vattenfall’s continued investment and job creation in the UK.”
David Symons, Director of Sustainability at WSP said: “A low carbon, resilient and prosperous United Kingdom is key for WSP and our business. We look to the next government to deliver world class, ambitious programmes that support our own Future Ready ambitions.”
Sue Riddlestone OBE, Chief Executive at Bioregional said: "Britain's place in the world, and the strength and sustainability of its economy, now depend on how well we look after our environment and the planet. So, too, does the health and long term prosperity of our people. Deep down, more and more of us know that. Voters and politicians must keep that front of mind during this election campaign."
Peter Young, Trustee of the Wildlife Trusts said: “The next 5 years will see coherent and far-sighted environmental policy as an increasing necessity to underpin our future economic success. It is vital that all parties are explicit in demonstrating their commitments to decarbonise, use resources efficiently and enhance our natural capital. Without heeding the importance of these issues to secure a strong UK economy and international trading position, claims to improve UK prosperity and society will be hollow."
: Committee on Climate Change (March 2017) Energy Prices and Bills – impacts of meeting carbon budgets. Improvements in energy efficiency have saved the typical household around £290 per year since 2008 as demand for electricity and gas has reduced, more than offsetting the price of low carbon policies and network costs.
: ONS (6 April 2017) "UK environmental accounts: Low carbon and renewable energy economy survey, final estimates: 2015"
: Aldersgate Group (September 2016) Setting the pace: Northern England’s low carbon economy. In 2013, there were already 136,000 people working in the low carbon economy in the North and this is set to grow with major ongoing investments such as those from Siemens, ABP and DONG Energy at Green Port Hull. On the Isle of Wight, MHI Vestas’ investment in an offshore wind turbine blade factory has created hundreds of jobs on the Isle as well as jobs and other positive impacts across the wider Solent area.
: Ricardo Energy & Environment (March 2017) UK business opportunities of moving to a low carbon economy
: New Climate Economy (July 2015) Seizing the Global Opportunity
Reacting to today’s announcement that Macquarie will be the new owner of the Green Investment Bank (GIB), Nick Molho, Executive Director of the Aldersgate Group, said:
“The GIB has added real value to the UK green infrastructure market through a focus on funding novel green infrastructure projects and crowding in additional private sector investment. We are pleased to see that Macquarie has committed to investing £3bn over three years to grow the GIB’s activities. This is a promising start – particularly combined with its recognition of the skills and expertise of GIB employees in both London and Scotland.
We call on Macquarie to honour these commitments and ensure the GIB plays its part in financing the green infrastructure that will be essential to delivering the UK’s climate and environmental policy objectives in the years ahead. Going forward, we also expect the GIB to continue to engage with stakeholders and report transparently on the impact of its green investments.”
Nick Molho added: “Now that the GIB has been fully privatised and the UK can expect to receive less funding from the European Investment Bank post Brexit, the government must ensure that it has a clear strategy in place to attract private finance to deliver its environmental and low carbon policy objectives. Projects involving new technologies and business models will be required to deliver the UK’s Clean Growth Plan and 25 Year Environment Plan. Targeted government support will be essential to make these projects attractive to private investors such as pension funds.”
Reacting to the Prime Minister’s triggering of Article 50 today, Nick Molho, Executive Director of the Aldersgate Group, said:
“Several key environmental and climate change policies are derived from EU legislation. Brexit will open up opportunities to make improvements in certain areas such as farming but the UK’s withdrawal must not lead to any weakening of our environmental protections or ambition. The UK needs stable and ambitious policies that will help improve the state of its environment for the benefit of its economy and society and attract more private investment in innovation and green infrastructure.”
Nick Molho added: “There are many areas of environmental and energy policy where it will be in the interest of businesses and consumers for the UK to continue working closely with the EU. This will be important in areas such as product standards that will still apply to British businesses selling goods in the Single Market and the future of the Internal Energy Market, which is essential to the cost-effective and secure growth of renewable energy in the UK.”
Reacting to the Spring Budget today, Nick Molho, Executive Director of the Aldersgate Group, said:
“It was positive to see lots of focus in today’s budget on supporting innovative businesses and ensuring the UK’s workforce has the skills it needs to benefit from the job opportunities of the future. But despite the fact that some of our key trading partners such as China are investing heavily in renewable energy and other clean technologies, there was no reference to the importance of the low carbon sector to the future competitiveness of the UK economy.
If the UK is to meet the Chancellor’s ambition of being at the cutting edge of the global economy, the Autumn Budget will need to be much clearer about the UK’s environmental and low carbon ambitions and provide a clear business plan to meet the UK’s policy objectives under its Emissions Reduction Plan and 25 Year Plan for the Environment.”
 A record $285bn was invested in renewable energy globally in 2015 – see Global Trends in Renewable Energy Investments 2016 – http://bit.ly/1RAJA8w
 The UK’s low carbon and renewable energy economy was responsible for over 447,000 jobs and a turnover in excess of £83bn in 2014 – see UK Environmental Accounts: Low Carbon and Renewable Energy Economy Survey, total activity: 2014 – http://bit.ly/2mlwIOG
Reacting to the Business Energy and Industrial Strategy (BEIS) Committee’s review of the Industrial Strategy, the Aldersgate Group stressed that supporting the continued growth of the UK’s low carbon supply chains is essential to deliver the government’s objectives of supporting growth across the UK.
The Committee calls for horizontal policies to drive forward the Prime Minister’s ambition of rebalancing productivity and growth the UK. A recent report from the Aldersgate Group showed that the UK’s cross-sector low carbon and renewable energy economy, which was responsible for over 447,000 jobs and a turnover in excess of £83bn in 2014, has seen significant investment in jobs and skills in parts of the UK that have suffered most from under-investment in recent years. The continued growth of low carbon markets such as offshore wind, electric vehicles, ICT and energy efficiency, can have a central role in driving productivity and the government’s objective of delivering an economy that works for everyone.
Nick Molho, executive director of the Aldersgate Group said: “Supporting the continued growth of the UK’s low carbon economy provides the horizontal cut-through that the BEIS Committee demands. The government’s Industrial Strategy must complement its Emissions Reduction Plan (ERP) to maximise growth in UK low carbon supply chains and provide the policy consistency that business needs.”
Reacting to the publication of the Scottish Government’s Draft Energy Strategy today and Draft Climate Change Plan last week, Nick Molho, Executive Director of the Aldersgate Group said:
"The Scottish Government has set out some challenging climate targets but has a great opportunity to capitalise on the progress already achieved and continue growing Scotland’s low carbon economy and supply chain. The bold measures that are being considered are welcome - particularly actions to tackle emissions in the built environment and transport. The proposal for 50% of all energy to be generated from renewables by 2030 will set an important long term signal that businesses can respond to with affordable investment and innovation. Technologies such as hydrogen can play an important role in the decarbonisation of heating, if the lack of progress on Carbon Capture and Storage can be tackled, but continued support should be given to more established technologies such as district heating networks and heat pumps."
Nick Molho added: "It is also positive to see that the Scottish Government’s consultation on improving energy efficiency includes suggestions such as tax rebates and green mortgages. Targeting fiscal incentives at key moments in a building’s life will help drive demand for energy efficiency improvements, with positive knock-on impacts on energy bills, carbon emissions and insulation supply chains. It is essential that the Scottish Government takes concrete measures as an outcome of this consultation."
A new report from the Aldersgate Group out today, Amplifying action on resource efficiency, brings forward new business trials showing that greater resource efficiency could deliver significant economic benefits to the UK. To reap these rewards, the UK must outline the future of its resource efficiency policy, much of which currently comes from EU legislation.
The new research published by the Aldersgate Group on behalf of the REBus project is based on the successful delivery of 26 business pilots that have delivered £4.89m in financial savings and reduced materials consumption and greenhouse gas emissions by 62,619 tonnes and 1,953 tonnes, respectively. The work has been conducted across the UK and the Netherlands in a range of key market sectors (including electrical and electronic products, textiles, construction and ICT) that are worth an estimated €350bn to the EU economy.
Based on the results from the pilot projects, the research also finds that adopting resource efficient business models across these key sectors of the EU economy could deliver an increase of up to €324bn of gross value added (GVA) by 2030 to the EU economy. Of this, the UK alone could see up to €88.4bn (approx. £76.9bn) in GVA gains.
The report features learnings from these business pilots as well as several case studies from Aldersgate Group members, including IKEA UK, Sky and Thames Water. The pilots taking part range from small SMEs such as iPower (whose installation of small scale fuel cells in social housing is estimated to save consumers up to 36% on their energy bills, whilst mitigating 3-4 tonnes of CO2 annually) to the Dutch Ministry of Defence (whose textile recovery programme for its military personnel has delivered additional revenue of approximately €750,000 and a savings of over 14,500 tonnes of CO2 annually).
As the UK prepares to leave the EU, the report sets out a range of key policy recommendations for the UK government based on the learnings from these business pilots:
1. Improving the resource efficiency of the UK economy requires the development of government policy that is backed by all key departments across Whitehall and should feature in the upcoming industrial strategy.
2. The government should develop standards that require products sold in the UK to be designed in a way that is resource efficient in order to minimise waste and ensure consumers benefit from better quality products that last as long they expect them to. These standards should be as good as or better than what will be put in place under the EU Circular Economy Package to avoid putting British businesses and consumers at a disadvantage.
3. Government policy should help drive innovation on resource efficiency by helping businesses, especially SMEs, have better access to finance and technical advice.
4. The UK should build on the success of its landfill tax and promote other fiscal incentives to encourage the re-use of materials, such as through variable VAT rates that favour resource efficient goods and services over their counterparts.
5. Waste regulations need to be improved to ensure that secondary materials are not classified as ‘waste’, as long as a safe, alternative use can be found for them.
Other recommendations in the report include leading by example through public procurement practices that favour resource saving goods and services and improving the availability of data on how businesses are becoming more resource efficient.
Steve Wallace, Director of the Aldersgate Group said: “The businesses involved in Rebus have demonstrated that resource efficiency can lead to commercial success. Theirs is an example that others can follow. The pilots demonstrate that resource efficiency makes business sense and that there’s a double-win given the environmental benefits that coincide with the financial gains. The report that we are launching today sets out the critical actions required to encourage and support more businesses to follow this path, leading to a more resource efficient and therefore more prosperous UK economy.”
Nick Molho, Executive Director of the Aldersgate Group said: “As it prepares to leave the EU, the government should urgently develop a resource efficiency policy that will help replicate the benefits of these pilot projects across the UK economy. This policy should be supported by all key government departments and should include fiscal incentives, product standards on resource efficiency that are as good as or better than what is in place in the EU and working with businesses to remove the financial and technical barriers that stand in the way of innovation."
A new report from the Aldersgate Group out today, Amplifying action on resource efficiency, brings forward new business trials showing that greater resource efficiency could deliver significant economic benefits to EU businesses. By encouraging resource efficient design and tackling key barriers such as access to finance, the Circular Economy Package could significantly improve the resilience and competitiveness of the EU economy.
The new research published by the Aldersgate Group on behalf of the REBus project is based on the successful delivery of 26 business pilots that have delivered €5.62m in financial savings and reduced materials consumption and greenhouse gas emissions by 62,619 tonnes and 1,953 tonnes, respectively. The work has been conducted across the UK and the Netherlands in a range of key market sectors (including electrical and electronic products, textiles, construction and ICT) that are worth an estimated €350bn to the EU economy.
Based on the results from the pilot projects, the research also finds that adopting resource efficient business models across these key sectors of the EU economy could deliver:
The report features learnings from these business pilots as well as several case studies from Aldersgate Group corporate members, including IKEA UK and Sky. The pilots taking part range from small SMEs such as iPower (whose installation of small scale fuel cells in social housing is estimated to save consumers up to 36% on their energy bills, whilst mitigating 3-4 tonnes of CO2 annually) to the Dutch Ministry of Defence (whose textile recovery programme for its military personnel has delivered additional revenue of approximately €750,000 and a savings of over 14,500 tonnes of CO2 annually).
The report also sets out a range of policy recommendations for the EU Circular Economy Package based on the learnings from these business pilots:
Other recommendations in the report include EU public institutions leading by example through public procurement practices that favour resource saving goods and services, finalising the changes to the definition of ‘waste’ to incentivise the re-use of materials and improving the availability of data on how businesses are becoming more resource efficient.
Steve Wallace, Director of the Aldersgate Group said: “The businesses involved in Rebus have demonstrated that resource efficiency can lead to commercial success. Theirs is an example that others can follow. The pilots demonstrate that resource efficiency makes business sense and that there’s a double-win given the environmental benefits that coincide with the financial gains. The report that we are launching today sets out the critical actions required to encourage and support more businesses to follow this path, leading to a more resource efficient and therefore more prosperous European economy.”
Nick Molho, Executive Director of the Aldersgate Group said: “The Circular Economy Package is a great opportunity to scale up the benefits of these pilot projects across the EU. By requiring more resource efficient product design, working with businesses to remove the financial and technical barriers that stand in the way of innovation and encouraging the use of fiscal incentives, the Circular Economy Package could significantly improve the resource efficiency, competitiveness and resilience of the EU economy.”
European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "The Circular Economy is an important element to modernise the European economy. If we want to transform the market economy in a more sustainable direction, we must show there is a business case behind the circular way of thinking. To make it happen the Commission's and co-legislators' task is to set the appropriate framework. However, it is eventually companies that bring a more circular and sustainable economy into reality. The REBus project presents valuable evidence that being circular is profitable. At the same time it provides ideas on how to change the regulatory environment to help business get engaged in this transition."
Reacting to the publication of the Building our Industrial Strategy Green Paper, Nick Molho, Executive Director of the Aldersgate Group said:
"The government’s focus on ensuring the UK secures the economic benefits of an affordable and timely transition to a low carbon economy is welcome. The opportunities arising from the low carbon economy extend beyond energy innovation into a wide range of highly productive sectors. This part of the economy was already employing 447,500 people in 2014, with a turnover in excess of £83bn. The global transition to a more decarbonised economy led by countries as diverse as China, India, Brazil and South Africa offers significant economic opportunities in areas where the UK has a competitive advantage, such as in ultra-low emission vehicles, offshore wind, the built environment and ICT.
The government’s forthcoming emissions reduction plan will be key in attracting affordable private investment into energy efficient and low carbon projects in the UK. Through greater co-ordination with Local Enterprise Partnerships, a clear low carbon skills policy and consideration on the future role of the UK’s energy intensive industries in the low carbon economy, the industrial strategy could help maximise growth and employment opportunities in the UK’s low carbon supply chains."
Nick Molho added: "The industrial strategy must also embrace resource efficiency. As seen in two reports launched this morning, the shift to a more circular economy will help deliver financial benefits and carbon emission savings in addition to reducing the UK’s resource dependency."
Reacting to the Green Investment Bank’s completion of its offshore wind fund, Nick Molho, Executive Director of the Aldersgate Group said:
“The completion of the Green Investment Bank’s offshore wind fund shows that the GIB has played an important role in increasing private sector investment in offshore wind and critically, attracting new kinds of investors to the sector such as local authority pension funds. If privatisation of the GIB goes ahead, the government will have to ensure that it has a clear strategy in place to attract private sector investment in the novel green infrastructure projects that the UK needs to decarbonise its economy.”