CLIMATE CHANGE:

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CLIMATE CHANGE IMPACT ON CHANGE
Assisting Business in Deliveringa Low Carbon
Economy
ANDY TOGHER
Director of Business Relations, Carbon Trust
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The Carbon Trust Assisting business in
delivering a low carbon economy

• NWDA November 2008
• Andy Togher Director, Business Relations

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Investor and business assumptions are not yet
aligned to a low carbon economy
Global GHG emissions projections
Scenario
2100 CO2e(1)
Business-as-usual
1000 ppm (6C)
Current range of market belief
Global GHG emissions (GtCO2e)
Stretch market belief
700 ppm (4C)
Scenarios tacklingclimate change
550 ppm (3C)
The trend needs to reverse - Deep cuts in
emissions are required
Year
Note Equilibrium temperature projections using
the 5-95 climate sensitivity ranges based on
the IPCC TAR Source Oxera and Carbon Trust
analysis
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Temperature is estimated to increase in range
1.1-6.4C by 2100
CO2e (ppm)
ºC
Environmental Change
Human Impact

• Abrupt, run-away change

• Mass loss of life

1000

• Serious acidification of oceans
• Loss of most glaciers

• Flooding of major cities e.g. London, New York

800
700

• Risk of change to atmospheric circulations e.g.
  the monsoon

• Entire regions no longer producing food (e.g.
  Australia)

• On-set of collapse of Amazonian rain-forest

• 500m people at risk of hunger

550

• 15-40 species extinct (incl. mammals e.g. polar
  bear)

• 10m people flooded at coasts
• Sharp declines in Africa crops

450
350

• 10 species extinct
• 80 coral bleaches/ dies

• 300,000 people die of climate related diseases

Scale and timing of impacts is uncertain
280
Note Not to scale Source Intergovernmental
Panel on Climate Change, Third Assessment, Stern
Report, analysis and approximations of median
point by Bruce Duguid
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Our activities cover 5 complementary business
areas
Insights Explain the opportunities surrounding
climate change
Innovations Develop lowcarbon technologies
Investments Finance clean energy businesses
Solutions Help reduce carbon emissions now

• Enterprises
• Create lowcarbon businesses

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Carbon Trust Insights
What it doesCarbon Trust insights explains the
issues and opportunities surrounding climate
change and carbon reduction, developing low
carbon strategies that engage government and
business Why its neededBy cutting through the
complexity surrounding a low carbon economy,
Carbon Trust insights helps businesses and
government make better decisions and take action
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Carbon Trust Innovations
Research Development

• 166 Applied Research projects over 6 years
• Strong track record of follow-on funding and
  patents raised
• Directed research projects to drive commercially
  focused research in key areas

• Developing innovative new low carbon technologies
  with clear potential route to market

Business Incubation

• 70 incubator companies
• Over 70m of private sector funding raised to
  date
• 3 have achieved AIM listings

• Supporting development of low carbon companies
  and helping them attract private investment

Technology Acceleration

• 8 major accelerator projects
• Focus on large scale field demonstrations
• Track record of influencing industry development
  policy
• Over 35m committed to date

• Working with industry to accelerate low carbon
  technology markets by addressing major barriers

• Across all our Innovations activities we have
  Committed 100m and leveraged a further over
  120m of additional private sector investment.

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We now have experience in most of the critical
low carbon technology areas
Biomass Heating
Marine Energy
Micro-CHP
Increasing Experience
Low Carbon Buildings
Smart Metering
Advanced PV
Offshore Wind
Fuel Cells
Small Wind
Biofuels
Industrial Energy
Networks
Solid State Lighting
Carbon Capture Storage
Building Materials
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Offshore Wind Accelerator

• Aims to cut the cost of energy from offshore wind
  by at least 10
• Provisional commitment of 30m (up to 10m from
  Carbon Trust)
• Public launch planned for 20 October

• Areas of focus
• Offshore foundations novel foundations with
  potential for lower costs
• Wake effects improving the optimisation of
  offshore wind farm layouts
• Access, logistics and transportation reducing
  access costs novel for wind farm construction and
  operation
• Electrical systems improving efficiency of
  offshore wind farm electrical systems

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Carbon Trust Enterprises
What it doesCarbon Trust enterprises creates
new, high growth, low carbon businesses by
identifying opportunities and bringing together
key skills and resources Why its neededCarbon
Trust enterprises accelerates the development of
new low carbon markets and provides opportunities
for private sector investment

Revenue m
Connective Energy
Insource Energy
Carbon Reduction Standard Co
Partnershipsfor Renewables
Carbon Label Company
Assisting companies to communicate with their
customers on climate change
Brokers best of breed partners and suppliers to
utilise waste heat
Integrated carbon and waste management solution
Captures public sector renewable asset
development opportunity
UKs leading emission management accreditation
scheme
Carbon Mt
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Carbon Trust product label initiative
To build a globally accepted initiative to
measure, reduce and communicate the lifecycle GHG
emissions of products and services inc food and
drink

• Developing standards to
• Measure
• Reduce and
• Communicate
• the GHG emissions from goods services

• Product footprinting
• Reduction planning
• Communication (including labelling)

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We are piloting the standards and working on
communications with
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Comparability and Certification Single Standard -
PAS 2050

• Working with the BSI British Standards and the UK
  Department of Environmental Rural Affairs
• Development overseen by two independent Steering
  Groups (SG), Measurement SG and Reduction
  Communications SG, with academics, NGO,
  Government and industry representatives
• Two consultation periods with national and
  international stakeholders
• Technical development supported by working groups
  of experts, market research and pilots with
  companies

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The Carbon Trust Standard - Recognition for real
carbon reduction

• Why
• Stakeholder communication
• Employees, Customers, Government
• Motivation for future action
• CRC Early Action Metric Benefit
• Methodology
• Independent, Transparent, Robust
• Criteria
• Actual footprint reduction over 3 years (Absolute
  or relative)
• Management infrastructure to enable continued
  reductions

www.carbontruststandard.com
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• The Carbon Trust Standard is linked to the CRC

• The Carbon Reduction Commitment (CRC)
• New carbon trading scheme for non-energy-intensive
  organisations
• Starts in 2010
• Fixed price cost of carbon for first 3 years
• Membership determined by electricity usage in
  2008 (gt6000MWh through half-hourly meters)
• Revenue raised is recycled to participants
  based on league table position
• CRC League table
• Year 1 Early action metrics only
• Smart metering 50
• The Carbon Trust Standard 50
• Years 2,3 Reduction and early action metrics
• Absolute reduction 60
• Relative reduction 20
• Smart metering 10
• The Carbon Trust Standard 10

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Carbon Trust Investments
What it doesCarbon Trust investments finances
low carbon enterprises that demonstrate
commercial potential Why its neededIt helps
viable businesses grow and, by delivering
commercial returns, encourages others to invest,
accelerating the transition to a low carbon
economy

• Eleven investments totalling over 9.4m have been
  made, leveraging a further 88.3m of private
  investment into low carbon companies, two of
  which have gone on to list on AIM
• In 2006/07 set up a 2m Low Carbon Seed Fund,
  providing up to 250,000 investment in individual
  low carbon businesses
• In 2006/07 we set up CT Investment Partners LLP
  as a separate FSA regulated business
• Memorandum of Understanding with the Qatar
  Investment Authority to set up a new 250m
  Qatar-UK Clean Technology Investment Fund and to
  investigate the creation of a Low Carbon
  Innovation Centre in Qatar

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Carbon Trust Solutions

• What it doesCarbon Trust solutions delivers
  practical solutions, working with business and
  the public sector to identify carbon emissions
  and find ways of cutting them and providing the
  know-how and resources (including funding) to
  help them do so
• Why its neededUncertainty about the best course
  of action, together with a lack of time, money
  and resources, can prevent businesses from
  cutting carbon
• What are its objectives
• Maximise the implementation of additional,
  long-lifetime carbon savings
• Improve the lifetime cost-effectiveness of our
  delivery
• Deliver Governments Climate Change Programme
  expectation that we will deliver 5.1MtCO2 direct,
  additional savings in 2010 above and beyond
  business-as-usual baseline

• 1.6MtCO2 implemented carbon reductions in 2007/8
• 207m pa cost savings in 2007/8
• Over 17MtCO2 saved to date
• By tracking implementation we achieved KPMG
  assurance over 2007/8 carbon savings

Source CT Annual Report 2006/7, ONS, CT analysis
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Solutions key services offered
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Public Sector Carbon Management in the North West

• Local Authorities
• Oldham Metropolitan Borough Council
• Rochdale Metropolitan Borough Council
• Stockport Metropolitan Borough Council
• Chester City Council
• Manchester City Council
• Sefton Metropolitan Borough Council
• Tameside Metropolitan Borough Council
• Trafford Metropolitan Borough Council
• Wigan Metropolitan Borough Council
• Blackburn with Darwen Borough Council
• Blackpool Borough Council
• Halton Borough Council
• Bolton Council
• Burnley Borough Council
• Carlisle City Council
• Cumbria County Council
• Greater Manchester County Fire Service
• Lake District National Park Authority

• Universities
• Edge Hill University
• Manchester Metropolitan University
• University of Central Lancashire
• Lancaster University
• University of Liverpool
• NHS Trusts
• Salford Royal NHS Foundation Trust
• Wrightington, Wigan and Leigh NHS Trust
• Central Manchester and Manchester Children's
  University Hospitals NHS Trust
• Royal Liverpool Broadgreen University Hospitals
  NHS Trust
• Stockport NHS Foundation Trust
• University Hospital of South Manchester NHS
  Foundation Trust

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Making Business Sense of Climate Change