Business is responsible for less than 50% of UK emissions

Source : The Guardian

In “Zero Carbon Our Choice”, I argued that while many people think that achieving zero carbon is the responsibility of government and business, in fact it is impossible without a change to the choices which we as consumers make.

Using the 2018 final statistics as summarised in “2018 UK Greenhouse Gas Emissions, Final figures 4 February 2020 National Statistics” as the basis for this. “In 2018, 28% of net greenhouse gas emissions in the UK were estimated to be from the transport sector, 23% from energy supply, 18% from business, 15% from the residential sector and 10% from agriculture. The rest was attributable to the remaining sectors: waste management, industrial processes, and the public sector. The land use, land use change and forestry (LULUCF) sector acted as a net sink in 2018 so emissions were effectively negative.”

My argument is that we need to analyse these figures to look at who is responsible for the emissions by the choices they make?

On this basis, the emissions of energy supply (23%)  – mainly electricity generation – are decided by government decisions and regulations. It was government dictat which stopped coal use in power generation by imposing a cost penalty on coal burnt in power stations. These emissions are not business emissions as although business is an end user, like we the consumer, they do not determine the power mix of power generation, it is government regulation and pricing mechanisms which do.

18% from business is business’s responsibility.

28 % from transport. “Road transport is the most significant source of emissions in this sector, in particular passenger cars; and the changes which have been seen over the period were heavily influenced by this category. Figure 5 shows how the volume of traffic on the roads has changed over time in Great Britain, which reflects the trend seen for the UK. Motor vehicle traffic volumes have generally increased throughout this period, other than a fall seen between 2007 and 2012 following the recession.”

56% of transport emissions relate to passenger cars, so even if one assumes that all the other transport emissions are business then 12% of total UK emissions are business transport emissions but 16% are public emissions, from our choice to drive ICE vehicles.

15% from the residential sector “The residential sector consists of emissions from fuel combustion for heating and cooking, garden machinery, and fluorinated gases released from aerosols and metered dose inhalers. It is estimated to have been responsible for around 15% of UK greenhouse gas emissions in 2018, with carbon dioxide being the most prominent gas for this sector (96%). The main source of emissions from this sector is the use of natural gas for heating and cooking.”

These are not business emissions. Again, these are emissions from our choice to use carbon fuels in our homes. There are roughly 27 million homes in the UK, the government has a target to install 600,000 heat pump systems per annum. At this rate, we will still have carbon heating in 2066 and nearly 10 million UK homes will still have carbon heating by 2050. To put this in perspective in 2017, 20,000 heat pump systems were installed.

10% Agriculture. If one considers agriculture to be a business, then these emissions are business emissions. But half these emissions arise from the production of meat products. One can argue that again these emissions arise as a result of the choice which we the consumer makes to eat meat and therefore that “business emissions” in agriculture are 5% of the total.

2% from industrial processes is a business responsibility.

2% Public sector is not a business responsibility.

5% Waste management (mainly landfill). At least half of this is from food waste in landfill. So, I would suggest business is responsible for 2% of these emissions at most.

Land use is negative 2-3% mainly from forestry.

Using this basis, business is responsible for the emissions from total UK emissions of business 18%, business transport 12%, Industrial processes 2%, waste management 2% , a total of 34%. If agriculture is included this increase to either 39% or 44% (depending on how meat production emissions are treated).

Consumers are responsible for emissions from private transport 16%, residential 15%, waste 3%, a total of 34%.

Government is responsible for Energy supply 23% and public sector 2%, a total of 25%

This doesn’t allocate the negative land use of 2-3%.

Using these UK numbers, business is responsible for (and can control and reduce) under half of the UK emissions. It does not control the emissions of Energy Supply, (even if it is a part end user like consumers) nor of the public sector nor of consumers themselves.

A recent poll showed that 67% of UK respondents thought the government should do more about zero carbon. What these figures show is that those respondents need to do more about their own emissions if net zero carbon, is to be achieved. Buying electric cars, using non carbon heating for their homes, minimising food waste in land fill and probably eating a lot less meat are all decisions we need to make. And I haven’t included emissions from flying.

Net zero carbon is about our choices as well as government action.

© Chris Lenon and  2020-2021. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Chris Lenon and with appropriate and specific direction to the original content.

Can the poor afford zero carbon?

A number of reports have come out claiming that zero carbon can be achieved at little cost, recently for the EU. Many of the advocates of the Green New Deal are on the left. I’m not sure that these advocates have resolved the dilemma of how the poor afford zero carbon technology. There is no magic money tree for new zero carbon technology, either the government funds it through taxation or borrowing, consumers pay or investors in the new technology receive lower returns to reduce the cost to the consumer.

A number of stories about the cost of green technology for the poor, question this. The Independent has reported that 1/3rd of UK adults have no savings, other reports show over 40% of UK adults have less than £1000 savings. So how are these people going to make the investment in an electric car or an air source heat pump? And if not they, who?

Although the price of green technology is falling, it is still a large capital outlay. So, financing this investment for the poorer half of the population is a big issue. A report by the RAC in November 2020, claimed that 30% of the UK population could not afford even the cheapest electric cars. This is regardless of the fact the running costs are lower, the barrier is buying the electric car.

When I posted on the zero carbon Britain Facebook group about air source heat pumps, more than half the comments were about them being too expensive, from a group which supports zero carbon! All this suggests that financing zero carbon technology is a major issue. This may be why the Finance Industry is such a strong advocate – they will make significant returns on the investment cost of zero carbon technology.

For domestic heating and hot water, this problem is aggravated for poorer 50% of the population, by their probable lack of control over their housing. They are more likely to be renting from social housing or private landlords. So, it is those landlords who will need to make the investment in zero carbon domestic heating. But will they without regulation?

The question is who will fund the investment in zero carbon technology for the poorer 50%? How will the landlords. letting to this group be persuaded to invest in zero carbon heating? What will be the effect on their returns? How will the acquisition of electric cars be affordable for the poorer 50%?

© Chris Lenon and  2020-2021. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Chris Lenon and with appropriate and specific direction to the original content.

Is propping up airlines the right thing to do after Covid 19?

The international shutdown of airlines as a result of Covid 19 is causing havoc with the viability of the business model of airlines. Reports of the scale of rescue plans needed to keep these businesses in operation abound, Airlines for America representing the five largest in the US has asked for over $50bn, Virgin Atlantic £500m.

Already, some commentators have questioned how much support should be provided for airlines and whether the lessons of the global financial crisis bailouts have been learnt? I have previously written about the levels of government borrowing which will arise from the expenditure on Covid 19 by governments, the question of how this debt will be repaid and the impact on expenditure to reduce emissions.

The queue of business sectors asking for bailouts is lengthening as the recession deepens and lockdown reduces economic activity. Any bailouts will add to the level of government debt and the cost of both financing this and repaying it.

The question that needs to be asked as the economy recovers from Covid 19 is what sort of economy should it become? Should we revert to business as usual or adopt a different approach? If governments take climate change seriously, and the emission reductions required, then their expenditure to reboot the economy should be consistent with this policy aim.

Bailing out airlines to either maintain or expand current levels of flying is clearly inconsistent with emission reduction. The difficult policy question to answer is what is the right level of flying, to achieve emission reductions and what are the measures needed to achieve this?

In addition, the major aircraft manufacturers – Airbus, Boeing and Comac – will also be affected. The order books of these businesses will fall, if airlines fly fewer flights due to financial measures which are introduced to reduce flying. Some businesses in the supply chain will be directly affected, as for instance some engine manufacturers are paid based on the miles flown by their engines.

This poses real policy challenges, the environment against existing jobs (Airbus employs over 130,000 people, BA 45,000, US passenger and cargo airlines 750,000). How steadfast will governments be in prioritising emission reduction where the consequence is job losses in carbon sector jobs such as aviation? That will show how serious governments are about emission reduction.

© Chris Lenon and  2020. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Chris Lenon and with appropriate and specific direction to the original content.