3 Meeting the targets
Delivery plans
14. The Government response to the Sustainable
Development Commission's 2006-07 report announced that the Centre
of Expertise in Sustainable Procurement (CESP) would draw up a
delivery plan by summer 2008. In our last report on the matter,
we concluded that:
The departmental delivery plans that the Office of
Government Commerce is overseeing are a major step forward. They
should not be a one-off exercise, but should be done annually,
to set out clearly what progress each department is making, and
a revised series of actions needed to meet their targets in the
light of that progress.[15]
The Government has committed to updating the Delivery
Plan every six months.[16]
15. The Delivery Plan was published by OGC in
August 2008; an Update was published in December of that year.
In some areas they appear to us to be overly optimistic. The Update
announces that the Government is on track to exceed the target
for a 12.5% reduction in carbon emissions from offices by 2010-11.
The Government was not on course to meet this target in 2006-07
or 2007-08. We asked witnesses from the SDC whether they felt
that the statement that "Government as a whole is on track
to exceed the 2010-11 target for carbon emissions" was supported
by evidence. Their answer was unambiguous: "No".[17]
16. The Delivery Plan notes that the achievement
of this target is subject to "the successful implementation
of the initiatives identified". Of these initiatives, by
far the greatest reduction (121,478 tCO2) is expected
to be delivered by "carbon management", though neither
plan explains what is meant by this term. Neither did the SDC
fully understand what the Government meant by "carbon management".[18]
William Jordan, Chief Sustainability Officer, OGC, described it
as:
A kind of activity that departments undertake with
the Carbon Trust when they engage in a carbon management programme.
It involves taking an audit of what they are doing, looking at
what they can do to improve matters. It is very largely a behavioural
change programme.[19]
17. The Government offered a further explanation:
'Carbon management' […] refers to an organisation
developing a strategic framework for managing its carbon emissions
as part of its ongoing business practice. In many cases, this
will involve working with the Carbon Trust through their Carbon
Management Programme to systematically prioritise and implement
projects with the greatest business and carbon impact.[20]
The Government also provided a list of projects that
were expected to contribute to the 121,478 tCO2 of
reductions to be achieved by carbon management. Many of these
were described simply as "Carbon Management Programme".
We do not consider that this document provides a clear explanation
of the meaning of "carbon management" and how the reductions
in emissions it is expected to achieve have been calculated.
18. We are unconvinced by the
claim that the Government is on track to exceed its 2010-11 target
for the reduction of carbon emissions from offices. It is not
sufficient for it to base its projections on unverified figures;
delivery plans are meaningless if they are not supported by evidence.
We recommend that, in the next iteration of its Delivery Plan,
the Government set out in detail the means by which it intends
to meet this target and define what it means by "carbon management".
19. We asked how CESP had arrived at the very
specific figures for the emissions reductions that could be achieved
by carbon management. We were particularly keen to know whether
this figure had been arrived at on the basis of a calculation
based on empirical experience of previous programmes to reduce
emissions, or whether CESP had simply accepted the estimates provided
by departments and added them together. We were disappointed to
learn from Mr Jordan that, "At the moment [departments] give
us a number and we add them up".[21]
He conceded that the plan was not "perfect" and that
"some departments have much more robust plans than others".[22]
20. We welcome the Government's
commitment to revise and update its Delivery Plan on a quarterly
basis, and expect future versions of the plan to be based on robust
and verified data. Every department must produce a credible, evidence-based
plan of how it will make progress against all of the SOGE targets.
The plans must make clear how this activity is resourced.
Finance and investment
21. The Government needs to spend to save. Natural
England, a Non-Departmental Public Body, told us that it had:
[…] set out its target to reduce the carbon
emissions of its estate energy use and its business travel by
50% by the end of 2010. Natural England has further committed
to ensuring that delivering this target will be cost neutral with
all upfront investment paid back in five years.[23]
22. It is not clear that central government as
a whole is taking adequate steps to calculate the costs and benefits
of sustainable operations, and then to invest to save—both
money and carbon emissions. For example, the use of self-generated
renewables on the government estate has the potential to drive
substantial reductions in carbon emissions and large-scale investment
in these technologies has the potential to act as a catalyst for
the development and production of the technologies and the associated
green jobs and skills. But Andrew Lee, Director, SDC told us that
"we had considerable difficulty in trying to get hold of
figures that would give us an accurate picture of what the potential
is".[24] He went
on to tell us:
At the moment those figures do not exist. You cannot
look into one place and see here is the technical potential for
micro-renewables right across the government estate and here is
the cost/benefit analysis of how quickly those measures could
be put in place, how much energy bills could reduce and what the
return on investment period would be. That work needs doing as
a matter of urgency.
23. The cost of climate change and the price
of mitigation are changing the way we look at what we spend. The
evidence we received from NG Bailey, a provider of business services,
explained that "there are insufficient models which factor
in the impact of the regulatory and market changes that are likely
to be demonstrated in a low carbon economy." It argued that
"the development of a universally recognised payback model
may facilitate more investment decisions".[25]
24. It is not sufficient for
cost/benefit analyses to draw on current energy costs in calculating
the savings that might result from investment in measures to reduce
carbon emissions. The Government must assess precisely the future
cost of not making significant investment to reduce carbon emissions
now. Without such an assessment, it is impossible for government
departments to compare accurately the costs of options available
to them. If the Government itself is unable to accurately forecast
the cost of compliance with its own policies, it is difficult
to understand how those in the wider public sector and in the
private sector can be expected to do so.
25. We asked William Jordan, Chief Sustainability
Officer, whether the Government had made an estimate of the costs
incurred in the delivery of the SOGE targets. He told us:
No. We have done no estimate of the cost of delivering
the targets. They are part of "business as usual". They
are also, in my view, part of the pursuit of value for money.[26]
It seems logical that any calculation relating to
value for money should involve, at the very least, an estimate
of the costs incurred. The Government will fail to convince either
the public or the private sector that sustainable operations are
a desirable and achievable goal until the costs and benefits are
communicated more clearly and are supported by solid evidence.
26. Investment based on the
best available information is crucial to the delivery of any programme
that aims to deliver sustainable operations. Many of the changes
needed to meet and exceed the SOGE targets require an initial
outlay that is greater than the "business as usual"
alternative. Such increased up-front costs are in many cases more
than compensated for by the savings that can be realised in the
longer-term. If the Government is to succeed in convincing the
wider world of this, it must be prepared not only to make the
necessary investment in sustainable operations, but also to make
the case for sustainability by publishing clear calculations of
the costs and benefits it entails.
Carbon Reduction Commitment
27. The Carbon Reduction Commitment (CRC) is
an emissions trading scheme that will cover around 5000 public
and private organisations, including government departments, retailers,
banks and local authorities. An announcement from the Department
of Energy and Climate Change (DECC) explains that "The scheme
is due to start in April 2010 and is designed to tackle CO2
emissions not already covered by Climate Change Agreements and
the EU Emissions Trading Scheme".[27]
28. The SDC has welcomed the Government's announcement
that all central government departments and some other public
sector bodies will participate in the CRC, but has nevertheless
expressed concerns about the readiness of central departments.
It warns that "The baseline for the CRC is the same year
as the target year for the interim SOGE target which means departments
may already have achieved many carbon reductions, and may therefore
have a more difficult starting point".[28]
If government departments fail to make the necessary reductions
in carbon emissions, they will have to buy allowances from other
participants in the scheme. This means that poor performance by
government departments could result in their having to pay large
sums of money to the private sector.[29]
29. The SDC underlined the importance of ensuring
that the interaction between SOGE targets and other initiatives,
such as the CRC, was properly understood and managed; it was important
that the delivery plan should take into account "how these
things will link together and the alignment or misalignment issues
that will arise".[30]
30. The update to the Government's
Delivery Plan, to be published in summer 2009, must contain a
detailed explanation of how departments will participate in the
Carbon Reduction Commitment, and of how this participation will
interact with the SOGE Framework. It must also explain how the
Government intends to minimise the risk of large transfers of
public money to the private sector as a result of poor performance
by government departments. We also expect it to contain an assessment
of the possible financial implications, both for central government
and for the wider public sector, of participation in the scheme.
15 Environmental Audit Committee, Seventh Report of
Session 2007-08, Making Government operations more sustainable:
A progress check, HC 529, para 62 Back
16
Environmental Audit Committee, Eighth Special Report of Session
2007-08, Making Government Operations More Sustainable: Government
Response to the Committee's Seventh Report of Session 2007-08,
HC 1126, para 22 Back
17
Q 31 Back
18
Q 33 [Mr Farooq Ullah] Back
19
Q 65 Back
20
Ev 26 Back
21
Q 73 Back
22
Q 74 Back
23
Ev 48 Back
24
Q 17 Back
25
Ev 33 Back
26
Q 90 Back
27
Department of Energy and Climate Change, Carbon Reduction Commitment,
http://www.decc.gov.uk/en/content/cms/what_we_do/lc_uk/crc/crc.aspx Back
28
Sustainable Development Commission, Sustainable Development
in Government 2008: Challenges for Government, p. 14-15 Back
29
Sustainable Development Commission, Sustainable Development
in Government 2008: Challenges for Government, p. 14-15 Back
30
Q 32 Back
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