carbon limited final event

www.carbonlimited.org

Matt Prescott, CarbonLimited director

This evening’s format

Matt Prescott, director, CarbonLimited

Introduction from Matt Prescott, Project Director, CarbonLimited

Peter Jones OBE discusses the origins and importance of personal carbon trading

Matt Prescott, RSA, presents main CarbonLimited research findings

Michael King, Atos Origin, outlines the key findings from the ‘carbon card’ trial

Matt Prescott, RSA, describes the next steps

Q&A

Open discussion and networking

Close

18.30

18.35

18.50

19.00

19.10

19.20

19.30

20.30


Peter Jones, CarbonLimited advisor

Origins of CarbonLimited

Meeting with Colin Challen and the Tyndall Centre for Climate Change Research

Peter Jones proposals to RSA Council/ Trustees

Criteria for new programmes – Innovative, Inclusive, Pertinent, Wide ranging

Tyndall Centre report

Project and steering group formed, January

Launch by David Miliband, former Environment Minister, October

2005

2005

2005

2005

2006

2006


Arctic ice melts at record levels

This satellite image shows the Arctic sea ice spread on September 21, 2005, when it dropped to the lowest extent yet recorded. The yellow outline indicates where the concentration of ice was as of September 21, 1979.

Source: AFP


Government and resource efficiency: The delivery landscape

GOVERNMENT

TASKS

Parameters/LCABest scienceIPPC/planningTechnology footprintsLicensingDataBPEO

CARBONCOMMISSION

Improved resource efficiencyLower carbon footprintingData capture transparency

Economic growthMinimal inflationary impact

Improved R&D/innovation strategySkills and employment issues

Light touch regulationEfficient local government

implementation

POLICIES

Data capture systemTraded Permits

structuresEconomic frameworks

Public educationRegional strategies

R&D/innovation policiesSkills and employment

supply

RESOURCESCOMMISSION

TASKS

Carbon obligations framework

10% renewable energy target

4.5% achieved

12.5% reduction from offices relative to 1999

Carbon Reduction Commitment on road vehicles and corporates

Local authority pollution permit trading

Closure of 35% electrical capacity from 45 year old plants

Community Carbon Reduction Commitments on Local Authorities

20% CO2 reduction; 16% energy/35% electricity from renewable sources

50% / 60% / 80% CO2 reduction

2010

(2008)

2010-11

2011

2012

2015

2016

2020

2050


Local Authority challenges


Landfill Allowance Trading Scheme

Carbon Footprint from the Community Nottingham Agreement

Renewable energy assistance and Energy Savings Trust support

2011-12

2010

ongoing

Carbon and biomass to landfill 2007

Plastic 5%Paper & card

10%

Household carbon/garden

& kitchen & DIY 30%Food chain,

pubs & restaurants 25%

Timber 30%

Source: Biffa estimates


Source: DTI

The interest from government

All embracing inclusivity

Egalitarianism

Involving

Inter-active


Questions remain

Communication

Rural poor

Propertied pensioners

Transparency and complexity

Buy in

“But it’s a tax!”


Providing the right lifestyle signals?

Matt Prescott, Director, CarbonLimited

Decarbonising the economy?


The question of equity


The question of public acceptability

Don’t want to get stitched up

High cost to delivery?

Complicated

Price volatility

Positive about the allowance as a normative signal

Don’t believe a carbon tax would be hypothecated

Feels fairer – more effective


A question of economics

In practical policy making, the response to these [behavioural]

barriers has been the imposition of multiple economic

instruments on the same unit of energy or along the

same energy consumption chain, precisely because

politically expedient application of upstream instruments

do not appear to provide sufficient rationale for

organisations or individuals to change behaviour

downstream.

Dr Andy Kerr

www.rsacarbonlimited.org



…Supplier Obligation that will create an absolute emissions or

energy cap on household energy suppliers. Whilst the details

have yet to be agreed,

a key challenge for the policy is to avoid a

misalignment between liability and responsibility:

suppliers will hold the liability for capping emissions/energy,

whilst the responsibility for emissions lies in the activities of

householders.

Dr Andy Kerr




For a personal carbon trading scheme to be

more effective, it must break down the

barriers to the efficient functioning of these

economic instruments

Dr Andy Kerr



Real-time Personal Carbon

Michael King, Atos Origin

Locating this research within Personal Carbon Trading

The creation, division and allocation of the carbon budget

The utilisation of this allowance – capturing carbon emissions and updating a carbon account

The trading of surplus and additional credits on the market

Capturing the utilisation of carbon – 5 options were researched…

The ‘Miliband carbon card’

Credit and debit cards

Pre-pay cards

Loyalty card schemes e.g. Nectar, Clubcard

Fuel cards

The strengths and weaknesses of the 5 options – an example with road fuel (1)

Card company (Individual’s

bank or building society)

Individual purchases fuel

Credit / Debit card presented

Loyalty Card presented

Carbon Card presented

Transaction data

Cash / cheque presented

66%1

Note: process flows derived from APACS1. Source: Payments Council Consumer Payments Survey

32%1

Transaction data

Loyalty company

Card scheme (e.g. Visa,

MasterCard)Acquirer (retailer’s

bank)

Transaction data


Card company (Individual’s

bank or building society)

Individual purchases fuel

Credit / Debit card presented

Loyalty Card presented

Carbon Card presented

Transaction data

Cash / cheque presented

66%1

32%1

Transaction data

Loyalty company

Card scheme (e.g. Visa,

MasterCard)Acquirer (retailer’s

bank)

Transaction dataCredit, debit pre-pay, fuel cards

Loyalty cards Carbon card


Loyalty cards

Credit cards etc.

Point of Sale

changes

Retail staff training

Retail “opportunity

costs”

Transaction process

costs

Carbon card costs

Notes: Absolute figures are not presented here. This approach seeks to show the different cost profiles of each option

Carbon card

The Pilot – an automated real-time Personal Carbon Calculator

Demonstrate the real-time capture of an individual’s actual fuel purchases.

With accepted limitations

Objective

Not simulating a UK-wide personal carbon allowance and trading scheme.

If people are unable to use BP stations or want to ‘hide’ their emissions bypurchasing fuel elsewhere then we accept that as a limitation of the project.

We did not seek a demographically representative sample of the UK – our sample of volunteers was randomly self-selected and we accept that the group may or may not represent the wider UK population.

The Pilot Solution

(2) For RSA Carbon pilot volunteers fuel transaction information (volume and grade) is extracted. (3) Fuel transaction

(fuel volume and grade) is passed back to CarbonDAQ.

(1) Volunteer registers for the pilot by entering their Nectar details on CarbonDAQ.

(4) Fuel data is converted to emissions for presentation to users

Lessons learnt – anecdotal

“Sounds terrific. i'm [sic] realistic about limitations, it's really about being able to come clean about the full footprint. Any step is a good step in my book.”

The green segment is real and it welcomes the support.

“I drive 30k+ miles a yr [sic] and regularly fill up at BP as I collect Nectar points.”

Participation doesn’t just come from the usual suspects

“Went to fill up with diesel at the local BP today and at 131.9 just could not bring myself to do it. That's 7p more than Tesco's in Warrington …”

No-one is being naïve – price is still a key factor

Lessons learnt (2)

Individuals are not just economic actors responding to price signals from upstream policyAll carbon is personal

Make carbon personal: the individual must be involved in the response:

Individuals as members of organisations contributing to CRC targetsIndividuals contributing to LA targets like N186

Our level of thinking needs to move to individuals as members of communities and organisations:

Reward Individuals who help to achieve community goals – day’s leave, ££, etcStill the challenge of verification – self-assessment with random audits etc?

Incentives and WIIFM:

www.carbonlimited.org.uk


Local climate and energy solutions popular

Many see the value in trading within communities of interest

Energy Services model could apply

Potential for fuel security improvements

Local and community cohesiveness and creativity


Carbon credits could be saved …

by switching to these…

by not doing so much of this…

by doing more of this…

Trading creates an incentive for participants

The lower your footprint, the more carbon credit you can sell, which could mean:

1 being paid for your efforts to cut emissions, or participation in a virtual policy experiment

2 gaining more voting rights to secure funds for projects you want to support

3 receiving annual leave, entry into prize competitions or other incentives

A CarbonDAQ network might elect for carbon credit to be used to support local projects, such as this wind turbine in Swaffham.

Those with carbon credit to sell gain extra voting rights to support the project. The money comes either from a sponsor, or from those needing to buy credit to balance their account.

CSR possibilities

Local climate and energy solutions popular

Many see the value in trading within communities of interest

Energy Services model could apply

Potential for fuel security improvements

Local and community cohesiveness and creativity


Taking the idea forward

Low carbon local authority

Profits from the trading scheme

Itemised carbon cost imposed on households that exceeded carbon

target

High carbon local authority

Costs to comply in trading scheme

Revenue recycled as council tax

discounts for households exceeding

carbon target

Community scale

Household scale



Low carbon local authority

Profits from the trading scheme

Local authority provide

information and support to

households to reduce costs of

compliance

High carbon local authority

Costs to comply in trading scheme

Revenue recycled as

community-scale benefits to local

sustainable energy

networks/ climate change

Community scale

Community scale


Voluntary


Opt-in

Opt-out

Mandatory



mandatory

Local authority participation



Local authority participation

Fuel poor

Inefficient homes

Voter decides


Community carbon trading


Dr Andy Johnston

Centre for Local Sustainability


carbon limited final event

Education