Energy Futures for You - long term strategic planning

16th May 2012

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fundamentally…

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Shaping your operating context

Big Picture trends

Drivers Results

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significant trends for WECC

climate

resources

organisational sustainability

new ways of working

technology

transparency

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Population growth & regional variances

all of this is against a backdrop of, and often driven by… population growth & urbanisation

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resource scarcity

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Since 2000 commodity prices have more than doubled

Source: McKinsey Global Institute

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With oil prices rising nearly 5 fold, hiding huge fluctuations, and expected to keep rising… IMF “The Future of Oil” May 2012

http://www.imf.org/external/pubs/ft/wp/2012/wp12109.pdf

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climate science is stark but politics bumpy

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climate change…good news…

Informing Choices, 2009, UK Met Office

emphasis added

“It is possible to restrict warming to 2C or less during the 21st century with at least 50% probability…...

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climate change…bad news…

“It is possible to restrict warming to 2C or less during the 21st century with at least 50% probability…...

…with emissions reductions of 5% per year but peak emissions would have to

happen by about 2020”

Informing Choices, 2009, UK Met Office

emphasis added

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EU: 20% reduction in carbon dioxide by 2020 (30% if there’s

global agreement), 20% renewables by 2020

India: 24% voluntary intensity target by 2020

US: $80bn green stimulus, and maybe a 17% reduction in 2020 (but on 2005 levels)

China: 40-45% reduction in carbon intensity by 2020

negligible progress on international agreements... but significant pressures from national and regional targets

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and our infrastructure needs to be resilient

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deeper relationships and new investment models

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Progressive investors…small steps into

future proofing and two-tier property market…

Bridges Ventures Sustainable Property Fund £50m – acquire and renovate older buildings to high environmental standards

Climate Change Capital £70m fund and growing – commercial property with emphasis on retrofitting in UK cities

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technology and information

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ubiquity of ICT and a networked world

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transparency… nowhere to hide

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Companies representing 54% total value of

world’s equity markets report climate impact

data through the Carbon Disclosure Project.

top down…

CRC EES league table of all organisations

with an energy bill greater than ~ £500k

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and bottom up…

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rise of organisational sustainability

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Hampshire County Council

• 70% energy reduction

• 70% more staff

• 30% less space required

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Implications

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Sorting out direct impacts is now basic hygiene Compliance should not be enough for leaders and

forward looking organisations

Disclosure and assurance will place increasing

importance upon responsible management

…and in a continuing tough economic climate,

eco-efficiency will become even more important

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Joined up thinking - more effective & meaningful

engagement across organisations,

alignment of sustainability with planning cycles,

closer working between departments and functions

Re-examination of points of engagement with suppliers,

eg. landlord & tenant, FM & designers

Increase capacity through more holistic approach to

training provided to property, FM and energy professions

some cultural challenges…

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Leaders waking up to the “Elephant in the Room”…

will a two tier market materialise with depreciation of poor

performing assets?

Valuing sustainability… linkages between sustainability

and long-term value increasingly clear

e.g. whole life costing and Capex vs Opex debate

some economic…

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and be prepared for systemic shifts…

From an employer to an enabler of health and well-being

From a passive occupier to an informed and empowered consumer

From isolated assets to community service

From property as part of the built environment to part of the energy system

thank you

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