Download UK climate change policy and legislation

UK climate change policy and legislation
This briefing note reviews the most current and relevant legislative measures and policies being taken in the UK to tackle climate change
which could affect operators.
Climate change policy timeline
1997
Kyoto Protocol adopted
First UK climate change targets announced
2006
UK Climate Change Programme published
Stern Review
2008
UK Climate Change Act
Reduction targets and carbon budgets announced
Launch of Renewable Transport Fuels Obligation
Launch of Department of Energy and Climate Change
Formation of the Climate Change Committee (CCC)
2009
Low Carbon Transition Plan published including DfT’s Low Carbon Transport strategy to
‘decarbonise’ road and rail by 2050
Defra voluntary guidelines for greenhouse gas recording and reporting published
2010
CRC Energy Efficiency Scheme started
DfT Transport Carbon Reduction Delivery Plan published
Defra’s review of the value of greenhouse gas emissions recording and reporting published
Specific voluntary guidelines for freight on recording and reporting greenhouse gas emissions launched
2011
Changes made to the CRC Energy Efficiency Scheme
Government consults on mandatory greenhouse gas reporting obligations
Government adopts CCC’s Fourth Carbon Budget (2023–2027)
Coalition Government publishes Carbon Plan with targets for all governmental departments
2012
Aviation included in EU Emissions Trading System
Mandatory greenhouse gas reporting obligations could be introduced
DfT to review freight’s contribution to reducing carbon emissions from transport
End of First Carbon Budget
CCC recommends that UK incorporates international aviation and shipping into reduction targets
EU consults on introducing a tax or carbon scheme to curb shipping emissions
Government to review CRC Energy Efficiency Scheme
UK bioenergy strategy published
Green Deal starts
Background
Over the last 15 years, there has been increasing action by the UK Government to tackling
rising greenhouse gas (ghg) emissions. The
country was an early signatory to the Kyoto
Protocol in the 1990s. In 2006, the Labour
Government laid out its Climate Change
Programme as well as commissioning Sir
Nicholas Stern to conduct a major review to
assign an economic cost to the consequences
of climate change. Following the Stern Review,
it has largely been the introduction of the UK
Climate Change Act at the end of 2008 that
has produced an increasing wealth of policies
and legislative measures to curb emissions.
More recently the Coalition Government has
declared itself to be the ‘greenest government ever.’These commitments are impacting
on the way businesses operate, resulting in
pressure to reduce levels of carbon emissions
emitted from distributing goods.
Climate Change Act
The Climate Change Act forms the backbone
of policy to move the UK to a low carbon
economy and to ensure that the country
contributes to reducing global greenhouse
gas emissions. The act, passed in December
2008, is the first of its kind in the world. It
gives the Government power to introduce
measures necessary to achieve greenhouse
gas emission reductions.
Key features of the act are:
• UK targets set to reduce greenhouse gas
emissions through domestic and international action by at least 80 per cent by
2050 and at least 34 per cent by 2020,
against 1990 levels
• five-yearly carbon budgets to be set to
bind limits on carbon dioxide emissions
ensuring every years’ emissions count
• Government powers to implement
emission cutting policies such as trading
schemes, for example the CRC Energy
Efficiency Scheme
• Government to enhance the operation of
the Renewable Transport Fuels Obligation
(RTFO) which increases the percentage of
biofuels blended into conventional diesel
and petrol
FTA Briefing Note
UK climate change policy and legislation
• plans for international aviation and shipping
emissions to be included in carbon budgets
in 2012
• Government requirement to issue guidance
on 1 October 2009 on how companies
should report their greenhouse gas emissions. The contribution reporting could make
to reducing emissions was reviewed on
1 December 2010
• Government must decide by 6 April 2012
whether companies should be legally obliged
to report on their greenhouse gas emissions or
explain to Parliament why this decision has not
been taken (see p6)
• formation of an independent Committee on
Climate Change to advise Government on
targets and related policies
UK climate change reduction targets*
• To reduce ghg emissions by 34 per cent by
2020 against 1990 levels
• To reduce ghg emissions by 60 per cent by
2030 against 1990 levels
• To reduce ghg emissions by 80 per cent by
2050 against 1990 levels
* Note that Scotland has separate climate change targets, 42 per cent
reduction in ghg emissions by 2020 and 80 per cent reduction by 2050,
both against 1990 levels
Carbon Plan
The Carbon Plan is the lynchpin that holds all
UK climate change policies together.
On behalf of all Government departments, the
Department for Energy and Climate Change
(DECC) published a Carbon Plan in December
2011. The plan brings together all individual
Government department work on reducing
UK greenhouse gas emissions. A draft version
of the plan was published in March 2011. The
publication sets out the progress made to date
in reducing UK greenhouse gas emissions whilst
presenting the next steps to meet the fourth
carbon budget equivalent to a 50 per cent cut in
ghg emissions by the mid 2020s. Current carbon
policies labelled in the plan as ‘easy wins’ put the
UK on track to meeting a 34 per cent reduction in greenhouse gas emissions by 2020 based
on 1990 levels in accordance with the Climate
Change Act.
The plan states that over the next 10 years,
technology will need to be developed and
deployed within areas such as transport and
buildings to meet the 50 per cent reduction target and ultimately put the country on the path
to an 80 per cent reduction in ghg emissions,
by 2050. Currently transport makes up 24 per
cent of ghg emissions. Within the transport sector, cars contribute to 58 per cent of emissions
whilst hgvs make up 17 per cent and vans 12
per cent.
2 An FTA Briefing Note
The decade ahead for freight
Over the next decade, the plan identifies a range
of measures that will help to reduce the carbon
impact of freight.
Role of industry
• These include interventions that will contribute to future emission cuts such as eco-driving techniques, better management of logistics
supply chains, improved vehicle design, using
lower carbon fuels and making best use of
other modes such as rail
• Industry is recognised as already taking a
range of actions to drive down emissions
from freight and the plan notes Government
endorsement of the FTA led Logistics Carbon
Reduction Scheme (LCRS) and the upcoming 2012 review which will assess the success of an industry led approach to reducing
emissions
• In the longer term, the sector will require
alternative technologies and fuels to deliver
more substantial carbon reductions. The
Government believes that initial market takeup of some of these low emission technologies, such as gas-fuelled lorries and hybrids, is
challenging but achievable during the fourth
carbon budget (2023-2027)
Role of Government
• Government will continue to provide the
Mode Shift Revenue Support and Waterborne
Freight Grant schemes in England and Wales,
to support modal shift. Government is also
facilitating provision of infrastructure, such as
improved capacity at UK ports by consenting
for major container terminal developments
• The plan reports that the launch of trials for
longer semi-trailers will enable industry to
remove vehicles off the road, whilst an £8 million fund announced in the Logistics Growth
Review will pump prime investment in low
emission hgvs and supporting infrastructure
• Emissions from aviation will be capped as part
of the EU Emissions Trading System (ETS)
from 2012. International aviation and shipping emissions are not currently included in
the UK’s reduction targets. Government must
decide whether to include them by the end
of 2012 or explain to Parliament why it has
not been done
• Network Rail is funded to deliver over £200
million in Strategic Freight Network enhancements through to 2014, with an additional
£55 million funding being made available in
the Logistics Growth Review to improve rail
connectivity to the port of Felixstowe. The
rail industry is due to publish a second Rail
Technical Strategy assessing how technology can help to deliver a more cost effective,
higher capacity and lower carbon railway
• Sustainable biofuels remain part of the
Government’s strategy for decarbonising
transport. The Government has committed
to the target of five per cent use by volume
by 2014 but has not yet decided on an appropriate level of biofuel ambition post 2014,
pending further consideration of sustainability
issues. Government will consult during 2012
on the approach for biofuels to 2020
Where will we be in 2050?
According to the Carbon Plan, the freight sector will have found lower carbon ways of working such as modal shift to rail and water, more
efficient driving techniques, and adopted the
necessary ultra-low carbon technologies and
sustainable biofuels to service UK industry and
consumers while cutting back carbon emissions
dramatically.
2012 DfT Review
FTA understands that DfT’s review will assess
whether the freight industry is delivering sufficient carbon savings against the UK’s carbon
targets. It will cover:
• the action that is currently being taken by
the freight industry to reduce emissions
• the effect this action will have on
emissions
• the action that is likely to be taken in the
future by the freight industry
• what effect this expected future action
will have on emissions
The Logistics Carbon Reduction Scheme,
endorsed by the Department for Transport
in 2011 as a key initiative to reducing carbon emissions from freight transport, will
contribute to the review which is expected
to be completed by late summer 2012
Committee on Climate
Change
The Committee on Climate Change (CCC)
is an independent body established under the
Climate Change Act to advise the Government
on greenhouse gas emissions targets. The
Committee’s key priorities are to:
• provide independent advice to Government
on setting and meeting carbon budgets and
targets
• monitor progress in reducing emissions and
achieving carbon budgets
• conduct independent research and analysis
into climate change
• engage with representatives interested in climate change from across the UK in order to
share research and information on climate
change
Additionally, the CCC has set up an Adaptation
Sub-Committee to provide expert advice
to Government on preparing the UK for the
impacts of climate change.
The reports in the table below are available at
www.theccc.org.uk
UK climate change policy and legislation
CCC key reports
Publication
Building a Low Carbon Economy including advice on levels of first three carbon budgets
2008–2022
December 2008
First progress report
September 2009
UK Aviation report
December 2009
Second progress report
June 2010
Advice to Government on the CRC Energy Efficiency Scheme
September 2010
How well prepared is the UK for Climate Change – from the Adaptation Sub Committee
September 2010
The fourth carbon budget – Reducing emissions through the 2020s
December 2010
Renewable Energy Review
May 2011
Third progress report
June 2011
Review of UK shipping emissions
November 2011
Bioenergy Review
December 2011
International Aviation and Shipping Review
April 2012
How local authorities can reduce emissions and manage climate risk
May 2012
Views on surface transport
The CCC reports that 22 per cent of the emissions produced in the UK, and 92 per cent of
domestic transport emissions, are from surface
transport (road and rail).
Almost all UK surface transport is from road
transport, with 60 per cent of emissions coming
from cars alone. To meet carbon budgets, deep
cuts in emissions from surface transport are
required by the 2020s.
The Committee’s analysis shows that a 26 per
cent reduction in surface transport emissions
from 2008 levels is possible by 2020, with a
reduction of 44 per cent by 2030. By 2050 the
Committee estimates that emissions will need
to be reduced by 91 per cent from 2008 levels
(90 per cent from 1990 levels).
Emissions from transport can be reduced by
improving the fuel efficiency of vehicles, and by
encouraging people to change the way that they
choose to travel.
While voluntary agreements in the EU to reduce
new car CO2 levels have resulted in annual
increases in the fuel efficiency of new vehicles, a
target for vans is only just being developed, and
no such agreement exists for hgvs.
Breakdown of UK transport ghg emissions by mode
in 2009
18%
• ensuring that the UK can meet EU targets
for improving CO2 efficiency of new cars and
vans and work towards stronger targets in the
2020s
• work towards a target for improving the CO2
efficiency of new hgvs
• ensuring that there is widespread roll-out of
electric cars and vans across the UK by 2020
by providing the right financial support and
required charging infrastructure
• ensuring that the Smarter Choices programme is rolled-out across the country to
ensure that more people use public transport
and plan their journeys more effectively in
order to reduce emissions
• developing an integrated planning and transport strategy which can manage the impacts of
transport emissions from new developments
• provide support for hydrogen technologies as
a viable option for the use in niche market
with potential roll-out in buses
Decarbonising freight
In the Fourth Carbon Budget report, the
Committee suggests the following abatement
possibilities for freight.
Modal shift – from high emitting road travel to
rail or water.
Supply chain rationalisation – optimising distribution centre locations, sourcing produce locally
and greater use of consolidation centres.
13%
60%
The CCC recommends that Government
should support this process by:
4%
2%
1%
2%
Hgvs
Domestic shipping
Light duty vehicles
Domestic aviation
Passenger cars
Buses
Rail
Source: Department for Transport, Transport Statistics 2009
Vehicle utilisation – increasing load sharing,
backloading initiatives and software for routeing
and load consolidation (evidence suggests that
backloading vehicles can achieve 4–20 per cent
vehicle-km savings).
These scenarios for freight emissions suggest scope for significant reduction, however
the Committee believes further evidence is
required on:
• long-term potential for transfer of freight
from road to rail and water transport and
cost-effectiveness of further network/infrastructure investment
• availability of backhauls and load sharing
opportunities which could be taken up by
hauliers in the 2020s
• abatement potential from changes in business
practice such as just in time delivery, vendor
managed inventories and supply chain event
management
International Aviation and
Shipping Review
In early 2012, the CCC recommended that
international aviation and shipping emissions
should be formally included in carbon budgets
and the 2050 greenhouse gas reduction target. These recommendations have been made
to Government who are required under the
Climate Change Act to make a formal decision by the end of 2012. In the report ‘Scope of
Carbon Budgets – Statutory Advice on Inclusion
of International Aviation and Shipping’ the CCC
argues that by including these sectors, this will
provide the most transparent, comprehensive
and flexible accounting framework for all greenhouse gas emissions.
The CCC also published a further technical
report setting out scenarios for how the 2050
target to reduce emissions by 80 per cent relative to 1990 levels can be achieved with international aviation and shipping included.
Bioenergy Review
The report published in December 2011 concludes that bioenergy will need to account for
around 10 per cent of total UK energy (compared to the current 2 per cent) in order to
meet the overall 80 per cent reduction in greenhouse gas emissions by 2050 based on 1990
levels.
Headline
following.
recommendations
include
the
• There is a crucial role for bioenergy (combusting solid, liquid or gas fuels made from
biomass feedstocks) in meeting carbon budgets but within strict sustainability limits
• Carbon capture and storage should be utilised in order to capture carbon from the
conversion stage of biofuel feedstocks
• Biofuels will play a role in reducing carbon
emissions from surface transport but in the
longer term (2040 onwards) advances in
electric and hydrogen technology are likely to
overtake the use of biofuels
• The aviation and shipping sector should utilise
biofuels since there are few alternatives for
decarbonising otherwise
• Biogas is seen as a cost-effective low-carbon
option and should form part of the UK’s low
carbon strategy in both the near and longer
terms
An FTA Briefing Note 3 UK climate change policy and legislation
The findings of the bioenergy review were fed
into the Government’s new bioenergy strategy
in early 2012.
Next steps
How local authorities can reduce
emissions and manage climate risks
This report was published in May 2012 and
emphasises the crucial role councils have in helping the UK meet its carbon targets and preparing for the impacts of climate change. It outlines
specific opportunities for reducing emissions
and recommends that a statutory duty and/
or additional funding is needed to ensure local
authorities have stronger incentives to act.
Hydrogen for hgvs
Work is in progress to produce a technical
and economic assessment of hydrogen hgvs, to
assess whether they could be cost effective over
the next three decades.
Further evidence is also sought for the freight
scenarios laid out in the fourth carbon budget
report.
2010 UK greenhouse gas
emission figures
According to the Department for Energy and
Climate Change (DECC), UK greenhouse gas
emissions increased in 2010, the first rise since
2003, with CO2 emissions up by nearly four per
cent. The Department reported that this was as
a result of a significantly colder winter which led
to a spike in gas use for heating homes. Figures
show that emissions from the residential sector
increased by nearly 15 per cent in 2010 compared with 2009. Government also blames a fuel
switch away from nuclear power to coal and gas
for electricity generation.
CO2 emissions accounted for about 84 per cent
of the UK’s total greenhouse gas emissions in
2010. In 2010, UK net emissions of CO2 were
estimated to be 495.8m tonnes (Mt). DECC
does not believe that the increases will knock
the UK off track from meeting national greenhouse gas reduction targets due to the move
towards alternative greener energy.
Looking at individual sectors, in 2010, 35 per
cent of ghg emissions were from the energy
supply sector, 21 per cent from transport, 15
per cent from both the residential and business sectors and 9 per cent from agriculture.
Since 1990, emissions from the energy supply
sector and from business have reduced by 25
per cent and 21 per cent respectively. Emissions
from transport were around the same level in
2012 as they were in 1990. However, according
to the statistics, emissions from hgvs have been
recorded as increasing in the last year by around
10 per cent.
CRC is measured on electricity consumption.
If an organisation in Great Britain has at least
one meter settled on the half-hourly market or
in Northern Ireland, at least one 70 kilo VoltAmpere, and it exceeds 6,000 MWh, it qualifies for the scheme. In general, organisations
including any parent company and its subsidiaries, spending more than £500,000 a year in the
UK on electricity are likely to be included in the
CRC. Although companies that have half-hourly
meters, but use less than 6,000MWh, will have
been required to disclose information on their
electricity consumption to rule out inclusion.
The CRC covers large business and public sector
organisations including local authorities, retailers,
water companies and logistics companies providing warehousing and cross docking services.
Companies covered by the CRC will be required
to purchase carbon allowances equivalent to the
level of carbon they expect to emit from fixed
energy points including electricity, gas, gas oil,
petroleum and heat. A company’s performance
is published in a league table showcasing the
best and worse performers in terms of reducing
carbon emissions.
CRC Energy Efficiency
Scheme
In November 2010, DECC sought feedback on
making changes to simplify the CRC after the
controversial move not to recycle payments
back to CRC participants in the Comprehensive
Spending Review. This effectively made the
scheme a carbon tax.
The CRC Energy Efficiency Scheme (CRC) is
a mandatory emissions trading scheme, which
started in April 2010, and covers large nonenergy intensive businesses and aims to reduce
carbon emissions from energy usage. Transport
emissions are not included. Inclusion in the
In April 2012, DECC launched a consultation on
simplifying the CRC as a result of stakeholder
feedback. The simplifications proposed in the
consultation will generally take effect from the
beginning of phase two of the scheme (April
2013). DECC reports that the simplified CRC
Latest DECC policy
Green Deal
Government is due to introduce the ‘Green Deal’ to improve the energy efficiency of British properties. DECC is establishing a framework to enable
private firms to offer consumers energy efficiency improvements to their homes, community spaces and businesses at no upfront cost, and recoup
payments through a charge in instalments on the energy bill. The Green Deal will be open to both residential and commercial properties. It is expected
to be in place by autumn 2012.
Carbon Floor Price
In the March 2011 Budget, the Chancellor announced formal plans to make the UK the first country to set a carbon floor price for energy. The price,
following a consultation, will start at £16 a tonne of carbon dioxide in 2013 and move to a target price of £30 a tonne by 2020. The move is designed
to force suppliers of energy to buy a certain amount of their raw power from low-carbon sources. However, commentators on the plans believe that in
practice, like the current CRC Energy Efficiency Scheme, it will be another form of tax. Utilities companies are expected to pass the cost of the carbon
price directly onto the consumer.
Climate Change Agreements and Climate Change Levy
The Chancellor announced in the Budget that Climate Change Agreements (CCAs) will be extended to 2023, whilst the Climate Change Levy discount
on electricity for CCAs will also be increased from 65 per cent to 80 per cent from April 2013. The CCL is a tax on the use of energy in industry, commerce and the public sector. CCAs recognise the need to give special consideration to energy-intensive industries with regards to climate change, given
their energy use and their need to compete internationally.
Energy Efficiency Deployment Office
The Energy Efficiency Deployment Office (EEDO) has been set up to drive a step change in energy efficiency. EEDO will be the Government’s centre
of expertise on energy efficiency, support delivery of existing energy efficiency policies and develop the Government’s energy efficiency strategy (to
be published by the end of 2012).
4 An FTA Briefing Note
UK climate change policy and legislation
will deliver its energy efficiency and carbon
reduction objectives whilst making compliance
easier and less burdensome for participants. The
proposals include the following.
Qualification
Companies will now only qualify for the CRC if
they have settled half-hourly meters. Previously,
a company qualified for the CRC if electricity
consumption from both settled and unsettled
half-hourly meters exceeded 6,000 MWh. This
had led to some companies being reluctant to
install unsettled half-hourly meters as this would
bring them into scope of the requirements of the
CRC. Government will retain the current 6,000
MWh threshold instead of potentially lowering
the threshold which would have brought more
companies into scope.
Carbon allowances
There will be two fixed price sales a year (one
forecast and one retrospective) in phase 2
(2013-2018). Allowances will be cheaper in
forecast sales and more expensive when paying
retrospectively. All sales in phase 1 (2010-2013)
will be retrospective. The first sales of allowances have been delayed from April 2011 until
June 2012.
In phase two, Government wishes to move
away from the original intention to impose a
cap on allowances that can be issued, removing
the requirement to have auctions, which should
lower administrative costs. Government proposes that there will be two fixed-price sales of
allowances per year (one forecast at the beginning of the year and one buy to comply).
Fuels
The fuels reported within the CRC will be
reduced from 29 to 4 – electricity, gas, kerosene
and diesel, where the latter two are used for
heating purposes only. Government had considered focusing on core electricity and gas supplies.
However, stakeholder feedback indicated the
need to include gas oil and kerosene in order to
avoid unequal treatment for heating supplies in
Northern Ireland and rural communities.
Reporting
Currently, participating organisations have to
prepare a footprint report showing energy used
from all sources, of which at least 90 per cent of
this energy must be covered by the CRC. DECC
now proposes to remove the requirement for
the footprint report and the 90 per cent threshold. Instead, participants will be required to
report on 100 per cent of their consumption
but on a much shorter list of fuels.
Businesses covered entirely by Climate Change
Agreements will no longer need to register as
part of the CRC.
DECC will adopt Defra’s for greenhouse gas
reporting purposes, as opposed to fixing separate emissions factors for each phase.
The Performance League table will be retained
as the reputational driver for the scheme.
However, the detailed rules on the nature of
the reputational driver, and the metrics used, will
be removed from the legislation and placed in
guidance.
The consultation also highlights Budget 2012
reaffirmation of the Government’s commitment
to deliver significant savings in the administrative burdens imposed by the CRC. Should significant administrative savings not be deliverable,
the Government will bring forward proposals in
the autumn 2012 to replace with CRC revenues
with an alternative environmental tax.
The guidelines are based on the GHG protocol, the internationally recognised standard for
the corporate accounting and reporting of ghg
emissions.
The voluntary guidelines advise that all six main
greenhouse gases covered by the Kyoto protocol must be measured. These are carbon dioxide (CO2), methane (CH4), hydroflurocarbons
(HFCs), nitrous oxide (N2O), perflurocarbons
(PFCs) and sulphur hexafluoride (SF6). These
gases should be reported by scopes (direct
emissions, indirect emissions and third party
emissions).
• Continue with current CRC reporting obligations and await decision in autumn 2012 on the
scheme’s continuation
The voluntary guidance is designed to support
UK organisations in reducing their contribution
to climate change by helping them to measure
their emissions and set targets to reduce them.
Its premise is that the first step to reducing a
business’s carbon footprint is to measure it.
• Members will be updated via FTA e-news and
Carbonfta e-news (if subscribers) once a decision has been made by DECC
Businesses are advised to report emissions
within scopes 1, 2 and 3.
The consultation closes on 18 June 2012.
OPERATOR ACTION
Greenhouse gas emission
reporting
Businesses are facing increasing pressure from
customers, shareholders and contractors to
report their greenhouse gas emissions from
their activities, as well as understanding and taking responsibility for the impact they are making
on climate change.
Voluntary guidance for
businesses on measuring and
reporting greenhouse gas
emissions
On 1 October 2009, the Department for
Environment, Food and Rural Affairs (Defra)
in conjunction with the Department of Energy
and Climate Change (DECC) published a voluntary guide for businesses on how to measure and report greenhouse gas emissions (ghg).
This publication was in line with the requirements of the Climate Change Act. The main
objectives of the guidance are to encourage
emissions management and remove the inconsistencies of reporting, as previously there was
no established method in the UK for recording
total greenhouse gas emissions from a company.
It was anticipated at the time of publication
that the guidance could be used as the basis for
mandatory reporting standards in the future.
Note that the guidance does not include sectorspecific advice and instead provides broad general principles for how to measure and report
greenhouse gas emissions. Defra also does not
concern itself with double counting. Neither
does it provide standards for the verification of
greenhouse gas emission reports.
Carbon reporting from freight
Defra published voluntary guidance on reporting greenhouse gas emissions for the freight sector in December 2010. This is the first piece of
guidance written specifically for a particular sector. This guidance was produced jointly by Defra,
DfT and key freight industry trade organisations
including FTA and businesses as part of DfT’s
Low Carbon Supply Chain Steering Group.
The guidance supplements the Government’s
existing voluntary guidance whilst outlining the
most up-to-date techniques for measuring and
reporting fuel consumption and greenhouse gas
emissions for the freight and logistics industry.
A quick reference users’ guide accompanies
the guidance and both can be downloaded via
www.fta.co.uk/carbonreduction
Climate Change Act requirements on greenhouse gas reporting
Requirement
Deadline
Voluntary greenhouse gas reporting guidelines for companies
1 October 2009
Complete a review evaluating the contribution that reporting on greenhouse gas emissions is making to achieving UK climate change objectives
31 December 2010
Introduce mandatory reporting of greenhouse gas emissions for businesses
under the Companies Act 2006 or submit a report to Parliament explaining
why this has not happened
6 April 2012
An FTA Briefing Note 5 UK climate change policy and legislation
Definition
Examples
Scope 1 (direct emissions)
Scope 2 (indirect energy
emissions)
Scope 3 (other indirect
emissions)
Direct emissions from
activities owned or
controlled by an organisation
that release emissions
straight into the atmosphere
Indirect emissions being
released into the atmosphere
as a consequence of an
organisation’s activities which
occur at a source not owned
by the organisation
All other activities that
release emissions into
the atmosphere as a
consequence of an
organisation’s actions, which
occur at sources that are
not owned or controlled
and which are not classed as
scope 2 emissions
Fuel combustion, owned
Consumption of purchased
transport, process emissions electricity, heat, steam and
(cement, aluminum, waste
cooling
processing), fugitive emissions
(air conditioning, refrigeration
leaks)
Defra review
In accordance with the Climate Change Act,
Defra presented a report to Parliament on
the contribution that reporting of ghg emissions makes to the UK meeting its climate
change objectives. The report was a review
of evidence from large businesses and investors, further supplemented by a study from
PricewaterhouseCoopers (PwC) on the contribution of reporting ghg emissions and associated costs and benefits. Key findings included:
• measuring and reporting ghg emissions is considered to be an important tool for encouraging companies to reduce their climate change
impact. However, reporting in isolation is not
enough to drive real emissions reductions,
instead the reporting must trigger behaviour
change
• measuring emissions is an important first step
in helping businesses to understand where
their emissions come from and identifying the
biggest areas to tackle
• measuring emissions enables targets to be set
and to track progress in reducing emissions
• market forces such as a company’s reputation,
brand value and getting ahead of competitors
tend to be the key reasons for measuring and
reporting ghg emissions
• current reporting is often inconsistent and
it is difficult to make comparisons between
companies
• some companies will look to their supply
chains to help manage their emissions putting
suppliers under pressure to measure and
report ghg emissions
• the costs of reporting ghg emissions vary
widely from company to company. PwC
found that costs quoted for external reporting generally range from less than £25,000
up to £40,000, but there are instances where
costs can be over £100,00
• investors consider climate change to be
important to investment decisions and
would welcome improved reporting from
companies in order to better understand climate change risks and opportunities. This is
6 An FTA Briefing Note
Purchased materials and
fuels, transport-related
activities (commuting,
business travel, distribution),
waste disposal, leased assets
particularly relevant for companies who participate in the EU Emissions Trading System. In
some cases, some investors were dissatisfied
with the current available sources of company
environmental information (including carbon
emissions data)
The report’s findings were intended to inform
the decision on whether the Government will
introduce mandatory reporting obligations
under Climate Change Act regulations.
Consultation on mandatory
greenhouse gas reporting
obligations
In May 2011, Defra began an eight week consultation on whether mandatory greenhouse
gas reporting obligations should be introduced.
Businesses would be required to report their
greenhouse gas emissions adhering to Defra’s current voluntary guidance.
Within the consultation, Defra presents four
options for reporting (see table opposite). If
mandatory obligations are introduced, requirements will be laid out in the Companies Act and
businesses affected will be required to report
emissions via their Directors’ reports. A decision
was expected in autumn 2011.
In March 2012, Defra submitted a report to
Parliament requesting more time to analyse the
evidence provided by stakeholders. At the time
of writing, a decision is still awaited. FTA believes
that the introduction of mandatory ghg reporting at this time is premature and has not allowed
voluntary reporting sufficient time to bed down
within businesses.
OPERATOR ACTION
• Members are encouraged to voluntarily record
and report ghg emissions using Defra’s guidance
documents available for download at www.
fta.co.uk/carbonreduction and/or to join the
Logistics Carbon Reduction Scheme to capture
their contribution to transport emissions
• Members will be updated via FTA e-news and
Carbonfta e-news (if subscribers) once a decision has been made by Defra
Greenhouse Gas Protocol
Initiative product life cycle and
scope 3 reporting
The World Resources Institute and World
Business Council for Sustainable Development
have recently published two new greenhouse
gas accounting and reporting standards for
product life cycle and corporate value chain
(scope 3). These standards provide methods to
account for emissions associated with individual
products across their life-cycles and of corporations across their value chains. The new standards form part of the existing Greenhouse Gas
Protocol Initiative and offer the first standardised
approach to scope 3 reporting, allowing companies to measure and manage their greenhouse
gas emissions throughout their supply chain.
Meanwhile, the European Commission is partfunding COFRET, a project to develop and test
a methodology and a framework for the accurate calculation of carbon emissions for all transport modes within the supply chain. COFRET
will draw upon existing initiatives already being
developed by various stakeholders in the supply
chain so that it is aligned with the needs of those
responsible for shipping and transporting goods
by whatever means. For further information, visit
http://www.cofret-project.eu/
Local authorities
In order to reduce administrative burden on
local authorities, the requirement to report on
National Indicators were discontinued in 2011
and replaced by a single data sheet which central Government completes by collecting data
from local authorities.
DECC advises local authorities to follow the
same voluntary guidance that was published for
organisations by DECC and Defra in September
2009. Each local authority is required to produce
a greenhouse gas report in accordance with the
Defra guidelines in July every year.
Annual Defra conversion factors
Defra and DECC publish annual greenhouse gas
emission conversion factors. The last publication
in August 2011 made changes affecting diesel
and petrol.
The purpose of the conversion factors is to help
UK businesses convert existing data sources (eg
fuel usage) into carbon dioxide equivalent emissions. Defra provides spreadsheets where fuel
usage can be inputted and the relevant emissions automatically calculated.
In the latest publication, new conversion factors
have been provided for fuels supplied at public refuelling stations with the national average
proportion of biofuel blended into them. Note
these conversion factors also apply to bulk
and bunker fuel. These new conversion factors
incorporating biofuels are intended to supplement the existing conversion factors for 100 per
cent conventional petrol and diesel.
UK climate change policy and legislation
Defra greenhouse gas reporting options
Options
Why
Proposed coverage
Proposed outcome
Voluntary
62 per cent FTSE companies
already reporting, sector
level initiatives such as the
Carbon Disclosure Project
encourage reporting
N/A but voluntary reporting
would help brand building,
improve investor/stakeholder relations
Defra led activity to promote voluntary reporting
Provision of ghg emissions
information to be of most
interest to investors
Estimated 1,100 companies
Quoted companies would
have to report on their
ghg emissions in Directors’
reports
Regulatory
– quoted
companies
Sector specific voluntary
agreements could offer
alternative ways of reporting
They already report on
environmental issues under
Companies Act 2006
Regulatory –
quoted and
large companies
public/private
To cover businesses that are
likely to be significant emitters of ghgs
Estimated 17,000 to 31,000
companies
Large companies (and
quoted companies) would
to report their ghg emissions in their Directors’
reports
Regulatory
– electricity
consumption
threshold
Similar approach to
the Carbon Reduction
Commitment (CRC), targeting high energy users but
not transport emissions
Would vary depending on
threshold set, estimated
4,000 companies for 6,000
MWh threshold (as CRC)
or as many as 15,000
companies
Companies meeting threshold would have to report
their ghg emissions in their
Directors’ reports
OPERATOR ACTION
• Ensure that the most up-to-date conversion factors are being applied to carbon reports
• Find out more in FTA’s short user guide
on conversion factors at www.fta.co.uk/
carbonreduction
Devolved administrations
The following gives a summary of climate change
policy for each of the devolved administrations.
Scotland
• A comprehensive approach to ensure that
carbon (including the cost of carbon) is fully
factored into strategic and local decisions
about rural land use
In March 2011, the Scottish Government published a further report, Low Carbon Scotland:
Meeting the Emissions Reduction Targets 2010–
2022. This fulfils the duty placed on Scottish
ministers by the Climate Change (Scotland)
Act 2009, to lay before the Scottish Parliament
a report on proposals and policies setting out
specific measures for reducing greenhouse gas
emissions to meet Scotland’s ambitious statutory targets.
In 2009, the Climate Change Act for Scotland
created a framework for the country to reduce
greenhouse gas emissions by 80 per cent by
2050 on 1990 levels. It also established an
interim target of at least a 42 per cent reduction
in emissions by 2020 which includes emissions
from international aviation and shipping. Further
annual targets for 2010-22 were also agreed by
Scottish Parliament in October 2010.
Low Carbon Scotland is structured around the
key sectors of energy supply, homes and communities, business and the public sector, transport, rural land use and waste. For each of these
sectors, policies to reduce greenhouse gas emissions are identified, as are a number of proposals for further consideration.
In June 2009, Scotland published a Climate
Change Delivery Plan describing the four transformational outcomes needed in order to meet
the 2050 target.
• Driving more efficiently (including the extension of eco-driving training/promotion for
car drivers, hgv efficiency improvements, and
further support for low carbon vehicle infrastructure and procurement)
• Widening travel choices (including more
intense delivery of travel planning for schools,
households and businesses, freight modal
shift)
• Reducing the need to travel (via community
hubs, travel planning and advice on flexi/home
working)
• A largely decarbonised electricity generation
sector by 2030
• A largely decarbonised heat sector by 2050,
with significant progress by 2030
• almost complete decarbonisation of road
transport by 2050 with significant progress
by 2030
Proposals for transport are packaged into three
key groups.
A set of transport milestones for 2020 was also
announced including ensuring a mature market
for low carbon cars, average efficiencies of new
cars to be less than 95 gCO2/km and an electric vehicle charging infrastructure in place in
Scottish cities.
For further information, visit www.scotland.gov.
uk/climatechange
In January 2012, the CCC submitted its first
progress report on emission reductions in
Scotland to ministers under the Climate Change
(Scotland) Act. Under the act, there is a longterm target to reduce greenhouse gas emissions
by 80 per cent in 2050 relative to 1990, with an
interim target to reduce emissions by 42 per
cent in 2020 based on 1990 levels. Key conclusions from the report include the following.
• Scottish emissions fell in 2009, mainly due to
the impact of the recession
• However, emissions are likely to have risen
in 2010 given the cold weather and due
to increased use of carbon-intensive fuels
in power generation and energy-intensive
industry
• Progress has been made in energy efficiency
improvement in buildings, purchase of more
efficient vehicles, piloting of smarter choices
programmes, and schemes to encourage uptake of climate change mitigation
measures
• Since 1990, emissions have fallen in all sectors,
except transport where emissions (including
international aviation and shipping) are 4 per
cent higher
The report notes the progress in reducing transport emissions including:
• new car emissions in Scotland are below the
UK average, suggesting good progress towards
reaching the 95kgCO2/km target in 2020
• Scottish Government is funding a £4.2m electric vehicle procurement scheme for the public sector in 2011/12 to invest in 120 electric
vehicles and deliver 120 charging points. This
followed a £4.3m scheme in 2010/11 which
resulted in public services purchasing 145
low-carbon vehicles and in conjunction with
Plugged in Places funding, installing 74 charging points
• work is to be undertaken under the Smarter
Choices Smarter Places demonstration programmes relating to travel planning of businesses and schools
There is no reference to freight transport in the
report, however the Committee believes that to
meet the 2050 greenhouse gas reduction target,
there needs to be almost complete decarbonisation of road transport by then, with significant
progress by 2030.
Wales
Driven by the UK Climate Change Act and
One Wales, the Welsh Assembly Government
published its own Climate Change Strategy in
autumn 2010. The strategy sets out how Wales
An FTA Briefing Note 7 UK climate change policy and legislation
can tackle the causes and consequences of climate change. This includes:
• reduction targets for greenhouse gas emissions; the approach is to reduce emissions in
Wales by three per cent each year against a
baseline of average emissions during 2006–
2010. Plus a commitment to a 40 per cent
reduction in emissions by 2020 against a 1990
baseline
• a climate change charter which organisations
can sign up to in order to show their commitment to greenhouse gas emissions
• regular reports to be presented to the
National Assembly for Wales on climate
change objectives, priorities and policies
required by the UK Climate Change Act
• the strategy also supports the Wales Freight
Strategy (published in 2008) which aims to
encourage measures for moving freight more
sustainably, such as improved vehicle technologies and eco-driving techniques
Specific actions for transport sector emission
reduction include:
• supporting behaviour change and placing
greater emphasis on Smarter Choices. This
includes better transport planning, the provision of personalised travel information and the
development of strategic modal interchanges
• promotion of eco-driving
• promotion and support for walking and
cycling
• investment in bus and rail services
• improved traffic management on the strategic
road network, including average speed cameras and variable speed limits
• active promotion of infrastructure for electric
and hydrogen vehicles
• supporting the freight industry to reduce
emissions
• ensuring that land use planning decisions are
informed by the need to reduce travel
• in the long-term a fully decarbonised transport network.
For further information, visit www.wales.gov.uk/
climatechange
In late 2011, at the Welsh Assembly Govern­
ment’s request, the CCC presented the Welsh
Progress Report with advice on reducing emissions in Wales.The CCC believes that Wales has
ambitious emission reduction targets – more
so than the UK. Its assessment is that Wales is
making good progress developing approaches
to deliver significant emission reductions over
the next decade. However, at the sectoral
level, there may be more scope for emission
reductions, particularly in residential, business,
agriculture and public sectors. There is also an
important role for the Welsh Government in
supporting roll out of energy efficiency improvement, renewable heat deployment, programmes
to encourage transport consumer behaviour
change and to improve farming practice, and to
fulfil its leadership role in reducing public sector
emissions
8 An FTA Briefing Note
Northern Ireland
The Department of Environment (DOE) leads
Northern Ireland in the majority of its climate
change policy including the Carbon Reduction
Commitment. In 2007, the Department published ‘Preparing for a Changing Climate’ examining the potential impacts of climate change
weather patterns. The DOE also pledged to
develop and deliver arrangements to support
the UK Climate Change Act 2008, as well as
calculating and monitoring of greenhouse gas
emissions in Northern Ireland.
In February 2011, the DOE published a crossdepartmental action plan to reduce greenhouse
gas emissions. The plan formally announced a
target to reduce greenhouse gas emissions by
25 per cent below 1990 levels by 2025, however this could be later increased to correspond
with the UK Climate Change Act.
The Department for Regional Development
(DRD) is currently reviewing the Regional
Transportation Strategy (RTS) to put sustainability issues at its core. The strategy aims to
reduce the country’s impact on the environment, particularly on lowering greenhouse gas
emissions from transport, influencing travel
choices and behaviour and making better use of
existing infrastructure and services.
DRD with DOE have also submitted a successful bid to the Office for Low Emissions Vehicles
under the Plugged in Places Scheme to provide
funding to promote the uptake of electric vehicles through the provision of electric vehicles
charging infrastructure.
For more information, visit www.doeni.gov.uk/
protect_the_environment
In November, the CCC published a report
on the appropriateness of a Northern Ireland
Climate Change Act. This report assesses the
appropriateness of a legally-binding emission
reduction targets for Northern Ireland. It considers the current emissions profile in Northern
Ireland and recent trends, the existing legislative
and policy framework and opportunities and
challenges in reducing emissions. The CCC concludes that legislation could be helpful in driving
the emissions reductions in Northern Ireland.
EC strategy for reducing
heavy duty vehicle (hdv)
CO2 emissions
Currently, the EU is committed to cutting ghg
emissions by 20 per cent by 2020 on 1990
levels. However, many European Governments
including the UK are pushing the EU to demonstrate leadership in tackling international climate change by supporting an increase in the
EU emission reduction target to 30 per cent by
2020.
Last year, the European Commission published its
Transport White Paper with a target to reduce
transport emissions by 60 per cent by 2050.
With the introduction of manufacturer CO2
limits, cars and vans are seen as largely targeted
subject to potential revision of policy options.
However, until now emissions from heavy duty
vehicles (defined as passenger transport of
greater than 8 seats including the driver and for
freight transport, goods vehicles with maximum
permissible weight in excess of 3.5 tonnes)
have not been regulated. In February 2012, DG
Climate Action held a stakeholder meeting on a
strategy to reduce hdv CO2 emissions to make
the emission cuts required. Overall, the stakeholder meeting concluded:
• there is no single solution to reducing carbon
emissions
• there is a clear case for alternative fuels such
as gas to make significant cuts
• a labelling scheme or standard for hdvs similar to those for vans and cars might be feasible, but a methodology for recording carbon
data is critical first. It was also accepted that
any CO2 limits would not reflect real time
operations
• eco-driving, ITS and information sharing strategies to reduce congestion are required
• the incorporation of freight transport emissions into the EU ETS was rejected
A further stakeholder workshop will take place
in July 2012 with plans to issue an impact assessment in autumn 2012. In Q2 2013, a Commission
Communication will be adopted and regulation
adopted if required.
Alternative fuels and low
carbon technologies
The following section presents the various programmes and strategies to reduce carbon emissions from road freight transport.
Low carbon truck demonstration
trial
To support the uptake of alternative-fuelled
low carbon technologies, the Government
announced as part of the Logistics Growth
Review that it would invest £8 million to pump
prime the procurement of low emission hgv
technologies. £6.5 million was originally allocated for low emission vehicle demonstration
trials, plus the supporting refuelling infrastructure for trialled vehicles. £1.5 million would
be targeted towards funding public gas refuelling hubs. Technology Strategy Board (TSB) has
been given responsibility to operate the funding
competition and an additional £1.5m has been
provided by them.
FTA believes that there is a need for industry
to influence the allocation of these funds. As
such funding should be allocated to gas refuelling infrastructure rather than to low emission
vehicles. Members believe that if the infrastructure is in place for gas refuelling, companies will
be confident in purchasing these alternative
UK climate change policy and legislation
vehicles rather than conventional vehicles. FTA
has gathered a group of members interested in
utilising fuel powered hgvs to discuss how industry can best influence the use of funding to set
up refuelling gas hubs.
FTA, with members’ support, has also written
to Mike Penning MP urging Government to
re-assess the funding allocation, however the
response although acknowledging that the refuelling infrastructure is important and that the
majority of funding will go towards infrastructure, does not reassure industry that the funding
competition will provide the kick-start to the
gas vehicle market.
The competition opened on 24 April 2012.
Bids for funding must be from two or more
companies (operators or businesses) forming
a consortium with a lead partner. Companies
can bid for up to 50 per cent funding towards
dual fuel/hybrid/electric vehicles and supporting
infrastructure. Potential applicants must register
with TSB to make an application and download
instructions by noon 13 June 2012 at the latest. The competition deadline is noon 20 June
2012.
Timetable
Competition opens
24 April 2012
Competition briefing event
9 May 2012
Deadline for registration
Noon 13 June 2012
Deadline for receipt of full
applications
Noon 20 June 2012
Successful consortia
projects informed
Early August 2012
For more information on the competition,
visit https://connect.innovateuk.org/web/lowcarbon-truck-demonstrator-trial/overview
Low Carbon Strategic Task Force
The Department for Transport (DfT) is taking
forward the work of the Strategic Task Force
which will look at fuel efficient, low emission
technologies for hgvs. Terms of reference have
been published for a project to investigate the
low carbon solutions most appropriate for each
of the main hgv duty cycles.
Specifically, the workstream will:
• consider commercial vehicles of 3.5t gvw
upwards (not bus)
• consider low emission technologies which are
applicable to the commercial vehicles in the
short to medium term by duty cycle
• identify and propose mechanisms to overcome barriers to the take up of low carbon
technologies in the short-term primarily, and
consider barriers relevant in the mediumterm
Whilst carbon dioxide reduction is the main
focus of the work, measures should also offer
gains with regard to air quality.
FTA has proposed that in parallel to this deskresearch based duty cycle mapping, the work is
brought to the operator community through a
series of case studies. These will identify operational and financial considerations, and environmental savings.
allow all charge point manufacturers and infrastructure scheme operators to make data on
their chargepoints available in one place. A first
version is available through data.gov.uk
Government’s plug-in vehicle
strategy
The strategy came amid news reports that the
uptake of electric vehicles by the public has
been poor despite Government funding; and
levels of uptake are much lower than anticipated
by officials. There was only one reference in the
strategy to commercial vehicle fleets. An update
to the strategy will be published in 2013.
Last year the Office for Low Emission Vehicles
(OLEV), a cross-Whitehall team, published its
strategy for a recharging infrastructure in the
UK for low and ultra-low emission vehicles,
namely cars. Road transport is responsible for
over 90 per cent of the UK’s domestic transport
emissions. Forcing people out of their cars to
reduce the country’s greenhouse gas emissions
is impractical, therefore Government is looking
to plug-in vehicles as offering the potential to
reduce emissions but give people the mobility
they want and need.
The strategy reiterates the Government’s previous commitments to supporting market growth
for low emission vehicles.
• Provision of over £300m for the plug-in car
grant to reduce the upfront cost of eligible
vehicles to consumers and businesses
• Plug-in vehicles receive vehicle excise duty
and company car tax exemptions, as well as
enhanced capital allowances
• Plugged-In Places programme has made £30m
available to match-fund eight pilot projects
installing and trialling recharging infrastructure
in the UK to install up to 8,500 chargepoints
• Support for low and ultra-low carbon vehicle
research, development and demonstration
Government believes that in order for plug-in
vehicles to appeal as a viable solution for the
public, recharging infrastructure needs to be targeted and convenient. Rather than simply installing a charge point on every corner, there should
be home recharging supported by workplace
recharging with a smaller amount of public infrastructure available. In particular, Government
expects that plug-in vehicles will be particularly
attractive to fleet purchasers. To help stimulate
interest from business, the OLEV is:
• establishing a permitted development right
that will allow landowners to install plug-in
vehicle chargepoints in car parking areas without the need for planning permission
• enabling businesses caught under the Carbon
Reduction Commitment to discount electricity used to charge plug-in vehicles from this
total electricity consumption
• proposing the inclusion of policy on plug-in
vehicle infrastructure in the National Planning
Policy Framework. This will encourage local
authorities to consider adopting policies to
include plug-in vehicle recharging infrastructure in new workplace developments
An extensive public and recharging infrastructure is expected to be under-utilised and uneconomic and in the longer term a commercial markets needs to develop. However, Government
established a national charge point registry to
Biofuels
The UK Renewable Transport Fuels Obligation
came into force on 15 April 2008 to oblige fossil
fuel suppliers of road transport to ensure that
by 2010, biofuel blends accounted for 3.5 per
cent by volume of fuel supplies on UK forecourts in order to reduce carbon emissions and
the country’s reliance on fossil fuels.
Volume targets for the RTFO have been set as
follows.
Of total fuel sales
Deadline
2.56%
From April 2008
3.36%
From April 2009
3.63%
From April 2010
4.16%
From April 2011
4.71%
From April 2012
5.26%
From April 2013
In early 2012, Government published a
Renewable Energy Strategy and considered
the options for the use of biomass in transport.
In the short-term, sustainable first generation
biofuels (including bioethanol, biomethane and
waste-derived biodiesel) offer a cost-effective
contribution to reduced emissions from transport. As laid out in the Gallagher Review in July
2008, the strategy reiterates addressing indirect
land use change and ensuring the sustainability
of low carbon feedstocks is a crucial prerequisite in ensuring that biofuels deliver genuine
carbon reductions. In the medium-term, the
development of advanced biofuels from wastes
and wood feedstocks opens the potential for
greater uptake of bioenergy. Advance biofuels
could start playing an increasing role in reducing
road transport emissions in the 2020s. In hgvs,
biofuels and hydrogen fuel cells have the potential to play an important role as pure battery
electrification may be more challenging than for
light vehicles. Aviation biofuel is expected to be
a very important use of biomass by 2050.
The Government’s Carbon Plan recommends
that sustainable biofuels are also part of the
solution to decarbonising transport. However,
operators using biodiesel in concentrations in
excess of national levels face a cost penalty for
doing so, as a result of the removal of the 20ppl
duty differential in April 2009. Those operators
using biofuel solely from waste cooking oil also
lost their 20ppl duty differential in April 2012.
An FTA Briefing Note 9 UK climate change policy and legislation
Meanwhile, DfT has published a report considering the effects of biodiesel from a variety of
feedstocks on the performance of diesel engines
(available on the Department for Transport’s
website). The report, Biofuel effects on diesel
performance, emissions and economy in conventional and advanced technologies, shows
that diesel engines can be effectively calibrated
to run on higher biofuel blends, delivering
greater fuel efficiency and lowering emissions of
a number of pollutants.
Plug-In Van Grants announced
During 2011, DfT announced that private and
business van buyers would be able to receive
20 per cent – up to £8,000 – off the cost of an
electric van. The new grant is an extension of
the Plug-In Car Grant which offers 25 per cent
– up to £5,000 – for a new plug-in car. Funding
has been secured for this grant until 2015. The
grants are designed to help private individuals
and businesses adopt new, cleaner technology
and Government believes that businesses, especially those with fleets, will be a key driver in
increasing the market share of ultra-low emission vehicles. This is expected to help improve
local air quality in cities, reduce carbon emissions
and help contribute to Government greenhouse
gas reduction targets.
Only vans which meet strict performance criteria for range, tail-pipe emissions and safety are
eligible to be part of the Plug-In Van Grant and
manufacturers can now apply to be part of the
scheme. Alongside the grants, a national chargepoint register is being established to make it easier for drivers to locate recharging points and to
track growth in the national charging network.
This is expected to be operational this year.
Hydrogen fuel cell project
launched
The UK Government has announced the launch
of a Government-industry project which aims
to ensure that the UK is well-positioned for the
commercial roll-out of hydrogen fuel cell electric
vehicles. The new programme – UKH2Mobility
– has been set up to evaluate the potential for
hydrogen as a fuel for ultra low carbon vehicles
in the UK before developing an action plan for
an anticipated roll-out to consumers in 2014/15.
The project aims to:
• analyse in detail the case for the introduction
of hydrogen fuel cell electric vehicles as one
of a number of solutions to decarbonise road
transport and quantify the potential emissions
benefits
• review the investments required to commercialise the technology, including refuelling
infrastructure
• identify what is required to make the UK a
leading global player in hydrogen fuel cell
electric vehicle manufacturing
The group brings together Government and
industrial participants from the utility, gas, infrastructure and global car manufacturing sectors
10 An FTA Briefing Note
including the Department for Transport, BOC
Group Limited, Johnson Matthey plc and Nissan
Motor Manufacturing (UK) Limited.
Vehicles
Budget 2012
The recent Budget made the following announcements relating to vehicle carbon policy.
Capital allowances: business cars
first-year allowances (FYAs)
From April 2013, the Government will extend
the 100 per cent FYA for businesses purchasing
low emissions cars for a further two years to 31
March 2015. The carbon dioxide (CO2) emissions threshold below which cars are eligible for
the FYA will also be reduced from 110 grams/
kilometre to 95 grams/kilometre. Leased business cars will no longer be eligible for the FYA.
Capital allowances: business cars
main rate
From April 2013, the CO2 threshold for the main
rate of capital allowances for business cars will
reduce from 160 grams/kilometre to 130 grams/
kilometre. The threshold above which the lease
rental restriction applies will also reduce from
160 grams/kilometre to 130 grams/kilometre.
Capital allowances: gas refuelling
equipment
From April 2013, Government will extend the
existing 100 per cent first-year capital allowance
for gas refuelling equipment for two years to 31
March 2015.
Company car tax rates
From April 2015, the five year exemption for
zero carbon and ultra low carbon emission vehicles will come to an end as legislated in Finance
Act 2010. The appropriate percentage for zero
emission and low carbon vehicles will be 13 per
cent from April 2015 and will increase by two
percentage points in 2016-17.
Van benefit charge
The Government will freeze the van benefit
charge at £3,000 in 2012-13. From April 2015,
the five year exemption for zero carbon vans
from the van benefit charge will expire.
Used cooking oil (UCO)
UCO biodiesel will no longer receive a 20p
duty differential from April 2012, suppliers will
receive double certificates under the Renewable
Transport Fuel Obligation instead.
Tyre labelling
Regulations on the labelling of tyres are being
introduced from November 2012 to promote
improved fuel efficiency and reduce carbon
emissions by encouraging the purchase of tyres
with lower rolling resistance.
The regulation (1222/2009) requires information to be provided, at the point of sale and in
marketing material, on the rolling resistance, wet
grip, and noise of tyres.
The regulation places an obligation on tyre suppliers to provide the end user with the values for
rolling resistance and wet grip in bands running
from ‘A’ (best) to ‘G’ (worst), and will provide a
single numerical value (in decibels) for noise. Wet
grip information would, initially, only be provided
for car tyres since a standard legislative wet grip
test does not exist for other tyre categories.
Tyre labels and information
The regulation includes the specification of a
label, presenting the information in a format
similar to that currently used to indicate the
energy efficiency of domestic appliances, to be
displayed on tyres at the point of sale.
Cars and vans
Manufacturers would be required to supply class
C1 and C2 tyres to distributors labelled in this
format, and tyres on display at the point of sale
should have the labels affixed in a visible position
which is easily readable.
Tyre labelling applies to
Tyre labelling does not apply to
C1 cars
Re-treaded tyres
C2 light and medium commercial vehicles
Off-road professional tyres
C3 heavy commercial vehicles, coaches and buses
(no labels but requirement that tyre distributors
should include information on rolling resistance, wet
grip and noise in printed material/quotations)
Tyres designed to be fitted only to vehicles registered
for the first time before 1 October 1990
T-type temporary use spare tyres
Tyres whose speed rating is less than 80km/h
Tyres whose nominal rim diameter does not exceed
254mm or is 635mm or more
Tyres fitted with additional devices to improve traction
properties, such as studded tyres
UK climate change policy and legislation
Hgvs, coaches and buses
Although class C3 tyres would be covered by
other provisions of the regulation, they are not
required to carry a label indicating their characteristics. However, there is a requirement
for all tyre classes that tyre distributors should
include information on rolling resistance, wet
grip, and noise in printed and electronic catalogues, in quotations, and should provide it, in
addition, with the final invoice. The rationale for
excluding class C3 tyres from carrying a label is
based upon the fact that these tyres are almost
exclusively purchased by professional hauliers
on the basis of published data, quotations and
catalogues.
Longer semi-trailers
From January 2012, the Government commenced operational trials of longer semi-trailers.
The trial involves 900 semi-trailers of 14.6m in
length (ie one metre longer than the current
maximum), and a further 900 semi-trailers of
15.65m in length (ie 2.05 metres longer). This
would bring the total maximum length of the
articulated vehicle to 17.5 metres for the first
trial category and 18.55 metres for the second.
The trial will provide the opportunity to establish the impacts of each length. Operators who
have been successful in applications for quota
will need to apply to the Vehicle Certification
Agency (VCA) for Vehicle Special Orders
(VSOs) permitting the operation in commercial
service of the longer semi-trailers.
The longer semi-trailers will be required to
operate within the UK’s existing domestic weight
limit (44 tonnes for vehicles of 6 axles).
Participation in the trial is on a voluntary basis
and at the participants’ own risk; the Department
for Transport will provide no guarantee that the
use of the longer semi-trailers will continue to
be permitted beyond the end of the trial period.
The trial runs for a maximum of 10 years, to
enable participants to recover the costs of their
investment in the longer semi-trailers.
FTA hosted a one-day information seminar on
longer semi-trailers at Millbrook Proving Ground
in April 2012, which provided an opportunity
for operators to hear from DfT officials, VCA,
trailer manufacturers who have developed
trailer designs that meet the technical specification, and peer operators who have begun to
trial and use longer semi-trailers.
As part of their undertaking with DfT, operators are required to submit detailed data on
the use of longer semi-trailers which includes
details on all journey legs and any incidents
(safety or property damage) every four months.
The reporting is now underway for operators
who have longer semi-trailers in service, and
there are two reporting periods planned for the
remainder of 2012.
EU developments on
trailer height limits
European member states remain deadlocked
with the European Commission over its proposals to limit the height of new hgvs and trailers
under European Whole Vehicle Type Approval
rules which will apply progressively up to 2014.
The latest version of the Commission’s draft regulation sets a height applicable to rigid vehicles
and double-deck trailers of 4.95m, which FTA
believes the UK can live with going forward for
these classes of vehicles and trailers. However, a
4m limit for standard trailers remains, which is
completely unacceptable as around 80 per cent
of UK trailers are single-deck and over 4m (the
standard UK specification typically being around
4.2-4.3m). FTA, supported by a number of other
member states and the International Road
Transport Union, argues that that there is no
logic in permitting 4.95m for rigid vehicles and
double-deck trailers, but restricting non doubledeck trailers to 4m, with the resultant increase in
traffic and emissions.
In late December 2011, FTA’s position
received support from Vice President Kallas,
Commissioner for Transport in the European
Commission – namely that changes made to
type approval legislation should remain consistent with existing rules on maximum weights
and dimensions (Directive 96/53/EC), which
allows certain deviations from the standards of
the directive for national transport.
At a meeting of the Motor Vehicle Working
Group in Brussels on 1 February 2012, the
Commission tabled options which could provide
a breakthrough on the 4 metre height limit issue
and maintain national exemptions. One of the
options is to amend type approval legislation to
increase the volumes permitted under National
Small Series Type Approval (NSSTA). Vehicles
can be approved by member states with dimensions which exceed those laid down in the
masses and dimensions legislation under NSSTA
for use in their own territory. The Commission
has proposed to amend the volumes permitted
under NSSTA as follows.
• Trucks: from 250 to 1,200
• Trailers and semi-trailers: from 250 to 2,000
These numbers refer to production volumes
per type, per annum. The Society of Motor
Manufacturers and Traders (SMMT) and DfT
data suggest that these volumes are considered
adequate for the UK market.
The Commission’s Technical Committee on
Motor Vehicles (TCMV) recently adopted the
increase to National Small Series Type Approval,
and it will be passed to the Council and
European Parliament for agreement and subsequently published in the Official Journal of the
European Union.
Policy watch
Summer 2012
Decision awaited on introduction of mandatory greenhouse gas reporting obligations for large businesses
DfT Freight Review assessing contribution freight is making to reducing emissions
Autumn 2012
Decision awaited on the future of the CRC
November 2012
Tyre labelling regulations introduced
January 2013
Publication of third Logistics Carbon Reduction Scheme annual report
An FTA Briefing Note 11 How FTA can help
Information
FTA Logistics Carbon Reduction Scheme
The Logistics Carbon Reduction Scheme (LCRS) is an industry-led approach to recording and reporting carbon emissions instigated and developed
by members of FTA’s Logistics Carbon Working Group. There has already been a great deal of progress in the logistics sector to reduce the industry’s
impact on the environment and, whilst individually members are making efforts to reduce carbon emissions, the scheme represents an opportunity to
bring these efforts together.
FTA is therefore inviting members to submit their fuel data to enable us to combine all the data into one carbon account and give a picture of industry’s
contribution to reducing its carbon impact.This will enable the scheme to set a carbon reduction target for industry, ahead of any mandatory obligations
that the Government may seek to introduce. Without taking action ourselves, FTA is concerned that Government may regulate to cut emissions either
through legislation or tax. Through the LCRS, FTA is able to provide substantive evidence on the progress freight is making to reduce carbon emissions
and to enable the Association to build a case whereby operators are rewarded for making cuts through tax breaks and more sympathetic regulation.
In April 2011, Transport Minister, Mike Penning gave his endorsement for the scheme as a key initiative for industry to meet the challenge of climate
change. The scheme is open to both members and non-members of FTA. Current scheme participants range from 3PLs, hauliers and retailers to utility
companies, builders merchants and local authorities.
For further information or to join up, please email [email protected] or visit http://www.fta.co.uk/carbonreduction
Carbonfta
This unique subscription service provides a simple, straightforward and practical information guide on recording, reporting and reducing carbon emissions with additional support to ensure your transport department understands the implications of climate change and carbon dioxide emissions policies on supply chain activities. The subscription is available in a web-only format, or if preferred an A4 manual. Regularly updated, the website (and A4
manual) contains detailed, yet easy to understand, information and advice and is applicable to both van and light commercial vehicle operators as well
as hgv operators. The service also includes a bi-monthly Carbon e-news bulletin and free telephone advice for any carbon-related questions.
If you are interested in subscribing to Carbonfta, please contact the Member Service Centre on 08717 11 22 22*, email [email protected] or visit www.
fta.co.uk/carbon
Conferences and events
FTA conducts a range of seminars and briefings for members including an annual Logistics Carbon Reduction Conference which provides delegates with
the opportunity to share best practice advice on reducing carbon dioxide emissions as well as hearing the latest information on Government climate
change policy. For details visit www.fta.co.uk/events, email [email protected] or call 08717 11 22 22*.
Auditing
Consultancy
FTA’s experienced consultants are experts within their fields and provide a range of solutions for your business including environmental auditing, examinations and guidance on policies and practices and support with the implementation of new initiatives or the addition of ‘greener’ vehicles. For more
information please call 08717 11 22 22* or email [email protected]
Vehicle inspections and fleet audits
One of the most effective ways of reducing fuel consumption is to ensure a well-maintained and efficient fleet. Our range of vehicle inspections and
fleet audits provides ways of achieving this and our qualified engineers can advise on alternative, ‘greener’ fuels. For more information please visit www.
fta.co.uk/vehicleinspection, email [email protected] or call 08717 11 22 22*.
*Calls may be recorded for training purposes
Freight Transport Association Limited
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Tunbridge Wells
Kent
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Telephone: 01892 526171
Fax: 01892 534989
Website: www.fta.co.uk
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05.12/RD