Did all of Accelar’s 2022 green transition wishes come true? Clare Ollerenshaw finds out…
Accelar hopes that all our clients, collaborators and fellow sustainability professionals have had a great start to 2023. For sure there’s plenty for us to do this year as ever…
As part of our festive message in 2021, we made five Christmas wishes to support organisations in their green transition. I’ve spent some time reflecting on these wishes, how the UK has progressed towards them in 2022 and how Accelar is supporting them, both last year and in 2023.
Wish number 1: For an influx of innovative projects to test and validate how green finance models can be scaled up and replicated to unlock private investment in nature positive solutions, bridging the ~£56 billion finance gap, and decarbonising the built environment.
With funding always a key issue for green transition projects, I was interested to see how this area had developed in 2022. For sure, it is critical to the transition that we rapidly establish innovative ways to fund and finance the progress required.
My first find was the second edition of the State of Finance for Nature report published by UNEP. The report reveals that nature-based solutions (NbS) are still significantly under-financed. If the world wants to halt biodiversity loss, limit climate change to below 1.5C and achieve land degradation neutrality by 2030, current finance flows to NbS must urgently double by 2025 and triple by 2030. Current investments into NbS are USD 133 billion (using 2020 as the base year). A substantial amount of funding required…unsurprising then that climate finance was a major topic of conversation at COP27, for both NbS and wider. Finally, as 2022 came to a close, COP15 was held, closing with the announcement of a Global Biodiversity Framework to preserve and protect nature. Is this the Paris Agreement for nature?
At a UK level, I note that 2022 saw a further round of Natural Environment Investment Readiness Fund (NEIRF) with £4.6 million allocated to 50 projects, receiving DEFRA, Environment Agency and Natural England support. The second round of funding was targeted at further developing ecosystem services, alongside supporting greater involvement from local authorities and agricultural-based organisations, building on the first round in 2021 that saw 27 projects receiving a share of the £2.4 million pot. The round two grant funding is mainly centred around projects focusing on the most well-developed ecosystem services; biodiversity creation (15), carbon banking (11) and flood alleviation (6).
With green finance being seen as a key enabler for accelerating the green transition, Accelar has got stuck in at the sharp end providing consultancy advice, training and digital analytics for many different clients. For example, the team has been helping to deliver two of the round two NEIRF projects ‘Farming for Carbon & Nature’ led by Students Organising Sustainability UK and ‘Revitalising our Estuaries: Investment Model for Estuary Restoration’ led by Groundwork North East.
We also developed and grew Accelar’s Nature Finance Impact Hub, launched late in 2021. The Impact Hub now showcases impact metrics for projects across 28 countries and 15 different ecosystem services. It aims to pinpoint the financial and environmental benefits of nature-positive projects and helps to build confidence and business cases for buyers of and investors in ecosystem services.
On the built environment side I remembered that in November 2022, the UK Government launched the ECO+ scheme that aims to make homes more energy efficient and bring down people’s energy bills by helping them to insulate their homes. In response to the current energy crisis, ECO+ includes those on the lowest incomes but also those living in the least energy efficient homes in lower council tax bands. ECO+ has £1 billion in funding, start in April 2023, and it will run for three years. The ECO+ scheme is designed to be complementary to the current ECO scheme, which is known as ECO4.The initial ECO scheme launched in 2013 and has helped 2.4 million people make their homes more energy efficient.
Accelar has continued to support trailblazing local and combined authorities to understand how green finance opportunities can work alongside public funding schemes for retrofit to support decarbonisation and fighting fuel poverty. The sectoral opportunities for green finance do not end there though and in 2022 my colleagues were also busy helping clients to explore and crystallise green finance in other sectors like transport and climate adaptation.
Wish number 2: In pursuit of net zero, for 100,000 EV charging points to be installed and a significant increase in Environmental Product Declarations to help the built environment sector to reduce carbon.
The Zap Map app provided me with some useful data on this particular Christmas wish. At the end of December 2022, there were 37,261 electric vehicle charging points across the UK, across 22049 charging locations. This represents a 31% increase in the total number of charging devices since December 2021. In December 2022, 923 new EV charging devices were added to the Zap-Map database. It’s useful to note that these figures show how many electric charging points in the UK there are that are part of the country’s public EV charging infrastructure. However, they do not include the many charge points installed at home or at workplace locations, which are estimated to be more than 400,000. Some of these EV charging points are available to the public in some form via community or visitor charging.
Our colleagues at the Alliance for Sustainable Building Products (ASBP) provided us with data on the growing number of Environmental Product Declarations (EPDs). At the start of 2021, there were 360 EPD using EN 15804 for UK produced products, from over 60 manufacturers and UK trade associations, covering a wide range of construction products. At the start of 2022, there were over 450 manufacturer specific EPD from over 80 manufacturers and 12 UK Trade Association EPD. The number of construction product EPD has grown steadily since 2012. In 2019 there were over 7000 downloadable EPD to EN 15804 within EPD Programmes. The largest number are in France (inies, PEP ecopassport), Germany (IBU) and the USA (UL Environment).
Sustainability within the built environment remains a core business focus for Accelar. We continue to work with private, public and third sector organisations to support them in calculating their carbon footprint. We are also supporting colleagues from across the built environment sector to work with their supply chains, to understand where they are on their net zero carbon journey.
Wish number 3: For all local authorities to establish and gain experience with applying biodiversity no net loss/net gain regimes via planning applications.
Biodiversity Net Gain (BNG) is an upcoming legal requirement for many built environment and infrastructure projects. Under the Environment Act 2021, all planning permissions granted in England (with a few exemptions) will have to deliver at least 10% biodiversity net gain, expected to be from November 2023. BNG is an approach to development, and/or land management, that aims to leave the natural environment in a measurably better state than it was beforehand. This is a new requirement for local authorities, with many currently seeking resources that allow them to understand their responsibilities in this space.
The Planning Advisory Service (PAS), part of the Local Government Association, undertook a lot of work in 2022 to help local authorities to plan for the new BNG requirements. They have developed resources, and run events, to help local authorities plan for their own ‘BNG journey’.
A big challenge for Local Authorities is to get their own Local Nature Recovery Strategy in place, which will help set out how and where biodiversity net gain should be delivered in a specific area.
In 2022, at Accelar we had a focus on the strategic preparations, data and innovative thinking for harnessing the BNG regime for the infrastructure sector. The biodiversity community of practice for the TIES Living Lab project, made up of subject matter experts from Network Rail, Transport for London, National Highways, HS2 and East West Rail, submitted a joint response to the consultation. Accelar was the facilitator the biodiversity community of practice as part of the Analytical Consortium of the TIES Living Lab.
Wish number 4: For public and private sector organisations to recognise and harness the circular economy as relevant to their net zero plans.
I’m interested in all our wishes but here’s the one I’m most passionate about. Having worked in the area of circular economy for the last decade (where have all the years gone to?) it’s imperative that it is seen as a big part of the solution to net zero through re-use, refurb, remanufacturing and new business models. Climate Emergency UK has undertaken a review of all local authority net zero plans to assess progress. The checklist that it developed for this process (alongside Ashden, Centre for Alternative Technology, and Friends of the Earth) includes a section on circular economy. Climate Emergency UK plans to undertake a further review of plans (and for the first time action plans) in autumn of this year. Will be really interesting to see where circular economy sits in local authority action plans.
The West Midlands Combined Authority (WMCA) 5 year plan working towards net zero and the WM2041 document makes reference to the role of circular economy in achieving net zero. Accelar supported the WMCA with early stakeholder engagement in developing their circular economy taskforce and sat on the taskforce as part of the Circular Economy Club Birmingham and West Midlands. Projects coming out of the WMCA circular economy route map are business plans for Zero Waste Construction Hubs and for Industrial Symbiosis projects.
Some interesting research by tax, audit and assurance specialist BDO in July 2022 ‘Investment into the UK Circular Economy’ looked at the changing attitudes of private investors towards businesses leading the move to a more circular economy. Headline outcomes of the research include:
Annual investment in UK circular economy companies has tripled in volume from 2018 -2021.
Investors have deployed over £1.5bn in circular economy companies over the past four years.
Venture capital investors accounted for 50% of 2021 UK circular economy investments.
Industry and Manufacturing is the most prominent sector for Circular Economy investment, accounting for 37% of deal volumes in 2021.
26% of 2021 investments were made into technology-led businesses.
The report states that the UK government needs circular economy to succeed to meet ambitious net zero carbon targets.
COnstructZero is the construction sector’s response to the UK Governments 10 point plan for a Green Industrial Revolution that sets out a path to net zero by 2050. One of CO2nstructZero’s nine priority areas is to ‘Become world leaders in designing out carbon, developing the capability of our designers and construction professionals to design in line with circular economy shifting commercial models to reward measurable carbon reductions’. As explained here, in November Accelar contributed to the 4th quarterly monitoring report launch as an active Business Champion for COnstructZero.
Lots of positive noises but I feel more needs to be done in 2023 to recognise, scale up and replicate innovative circular approaches.
Wish number 5: To help to improve climate resilience, advancement in the reporting of the physical risks from climate change to assets and an increase in the percentage of vulnerable assets/business activities reported by companies.
A huge area to tackle…The Task Force on Climate-related Financial Disclosures (TCFD), established by the Financial Stability Board (FSB), published a 2022 Status Report. As part of its assessment, the Task Force reviewed publicly available reports of over 1,400 companies from eight industries and five regions to better understand current climate-related financial disclosure practices and their evolution. Notably, the average number of recommended disclosures addressed per company has steadily increased each year for the past five years — from 1.4 in 2017 fiscal year reporting to 4.2 in 2021 fiscal year reporting. On average across the 11 recommended disclosures, the percent of companies disclosing TCFD-aligned information increased by 26 percentage points between 2017 and 2021. In addition, over 60% of the companies reviewed disclosed their climate-related risks or opportunities in 2021 fiscal year reports – up from 27% in 2017 fiscal year reports.
And let’s not forget out public sector colleagues in this space who are increasing their understanding of the challenges of climate change. Working in collaboration with SWM and Slingshot Design, Accelar undertook a study for the West Midlands Combined Authority last year to understand the climate scenarios, risks and impacts within the region. It also highlighted what actions could be taken to adapt to climate change, and how to implement and finance the actions. Accelar lead on the climate projections, using UKCP18 to provide a broad range of climate parameters for the region. Accelar also led on the Green Finance aspects of the project, outlining the innovative ways that the required adaptation response could be financed.
In summary…
…progress has been made against all of our 2021 Christmas wishes but there is still a lot more to be done to accelerate this year. So at Accelar, we’re rolling up our sleeves and getting stuck in – and we know that we’re not alone – we look forward to working with clients and collaborators old and new in 2023 to make the progress we so desperately need to make the green transition a reality.
