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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 Hermes House St John’s Road Tunbridge Wells Kent TN4 9UZ Telephone: 01892 526171 Fax: 01892 534989 Website: www.fta.co.uk Registered in England Number 391957 05.12/RD