CRC and the Energy Efficiency Legislative Landscape: The Road Ahead

The deadline for Phase 2, Year 2 of the Carbon Reduction Commitment (CRC) Scheme is tomorrow! Here at EVORA, we are helping our clients to submit their CRC annual reports by tomorrow’s deadline. However, there are many challenges to come.

What’s happening with the energy efficiency legislative landscape?

It has been announced that the Department of Energy and Climate Change will close and energy will be incorporated into a new Department for Business, Energy and Industrial Strategy. This has raised many questions, one of which is: Does this Governmental move indicate a reduced focus on energy efficiency, or a move towards true integration of energy for the benefit of all?

For now, we have to consider CRC, which itself is due to be scrapped after the end of Phase 2 (the 2018/19 year). Incidentally, revenue generated by CRC will be replaced by an increase in the climate change levy.

I can understand the scrapping of CRC. It sits within a disjointed and confused legislative landscape made up of many elements, including the Climate Change Levy (CCL), the Energy Savings Opportunity Scheme (ESOS) and mandatory GHG reporting, with more to come in the form of Minimum Energy Efficiency Standards (MEES). The Government has promised a simpler energy policy focused on delivering change.

We will have to wait and see how this pans out.

How can business manage its way through compliance requirements and drive improvement?

At EVORA, we recommend that consideration is given to the development of a systems approach to energy and environmental management as a convenient and effective way to achieving performance improvement and minimising risks. Our Director, Paul Sutcliffe, recommended in his recent UK-GBC article that further consideration is given to the roll out of ISO 50001 systems.

If you have any further questions, please do not hesitate to get in touch for more information.

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GRESB Data Automation – Ensuring Seamless Does Not Result in Senseless

Sacha van Tuijn, an Analyst at GRESB, recently posted a blog highlighting the anger and frustration that completion of the GRESB Performance Indicators evokes. I don’t think many will argue with that!

The complexity in pulling together the varied data elements every which way can be enough to want to make you pull your hair out. But there is no doubt GRESB is mobilising many organisations to take action to collate and better understand their environmental data, which should lead to performance improvement. That can only be a good thing… despite the pain!

So what is being done to save us all from pulling our hair out and keep our blood pressure at sensible levels?

Well, quite a lot. As Nils Kok, CEO of GRESB says in his blog, ESG, Real Estate and the Six Stages of Grief, “One of the exciting developments is that GRESB is slowly moving from manual entry of information to seamless data flows between many different data management platforms and our Portal”.

Well our proprietary software, SIERA, is one of those sustainability data platforms he refers to, so what’s our take on this?

The original – and still widely used – approach is where participants manually aggregate their consumption data and then enter it per sector, line-by-line, in the standard GRESB Portal. This is time consuming, requires a lot of manual calculations and is subject to human error.

For the last couple of years, a semi-automated approach has been made available, the GRESB Asset Spreadsheet, which provides an Excel template of 159 columns – yes, 159 columns – of required data by asset, which once completed, can be uploaded directly into the GRESB portal saving manual data input. Now this is obviously not for the faint hearted but it does give a good indication of the data collection and analysis requirements to meet the GRESB reporting requirements and achieve a good score. But let’s not write this method off just yet, we’ll come back to it later.

The third option is the latest development from GRESB to achieve seamless transition of data direct from data management software systems such as SIERA, directly into the GRESB portal using clever mapping tools, known as an API or Application Programme Interface. This sounds great, and of course, in many ways it is. But as with any system, dodgy data in means dodgy information out. So the big risk is to make sure ‘Seamless’ does not equate to ‘Senseless’ through lack of visibility of data flowing directly into GRESB.

As soon as data automation gets involved, audit trail clarity can be lost and this is the potential risk here.

Which brings me back to the second option of the 159 column Asset Spreadsheet. The beauty of this approach is that the spreadsheet model can actually be auto-generated in software platforms, an approach SIERA has taken, and swiftly interfaced into the GRESB portal through an uploader. This process takes less than a minute and populates the Performance Indicator questions for all sectors reported by a portfolio. Although a hefty spreadsheet, it is clearly structured and provides a great audit trail and visual clarity of all the data before it heads off into the GRESB machine. And it certainly didn’t reduce EVORA’s efficiency in delivering GRESB for our clients, with SIERA processing more than 40 submissions in 2016.

We’re happy to implement the clever mapping tools into SIERA but, as both professional sustainability consultants and software providers, visibility and clear audit trails to ensure quality of data is our number one priority for our clients. We have even replicated the full GRESB Performance Indicator report at fund and sector level to provide additional visibility, SIERA being the only software platform to do this according to Luc van de Boom, Analyst at GRESB.

Call me belt and braces, but although I run a professional sustainability consultancy I am a chartered accountant by profession and old habits die hard!

To find out how SIERA completely transforms your data capture and reporting, speak to our experts today and request a demo.

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SIERA Features and Benefits [Infographic]

With its many advanced capabilities, it’s not a straightforward task to summarise the SIERA features and benefits to just five apiece… But we’ve tried anyway!

SIERA (Sustainability Intelligence Environmental Reporting & Analysis) is our proprietary sustainability management software that has been developed specifically for the commercial real estate investment market. It is already managing billions of pounds worth of real estate, and is being rapidly adopted by large organisations across the globe.

This year alone, SIERA has delivered the automation of data transfer into GRESB for 23 submissions and more than €20bn of assets, with clients including Deutsche Asset Management, Schroder Real Estate, Rockspring, and AEW.

Explore the infographic below to see SIERA’s 5 Key Features and Benefits. (Click the image to zoom in.)

To find out how SIERA completely transforms your data capture and reporting, speak to our experts today and request a demo.

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Recapping The Energy Institute’s ‘Energy Management-Meeting the Standard’ Conference

Attending conferences can sometimes be a hit and miss affair in this industry. After frequenting a few of these events, both in my current role as a sustainability consultant and in my previous career as an environmental manager in the construction sector, I am all too wary of how easily these events can turn into a series of sales pitches provided by various companies presenting.

I needn’t have worried, the conference, run by the Energy Institute, involved a series of half hour talks from various sectors on a wide variety of energy related topics, all of which were 100% relevant to EVORA and more importantly, our clients.

The talks provided valuable snapshots of the great work being undertaken under the umbrella of energy efficiency and also provided some solid information on the impacts of regulations and policies.

Here is a summary of key points.


Article 8 Across Europe

Dr Martin Krusker of Siemens was asked, “who has implemented the requirements of Article 8 the best across Europe?”

Answer, the UK. The opinion of ESOS across the UK varies widely (some organisations considered it a pure legal compliance requirement whilst others saw a real opportunity to drive improvement) and, as a result, I was not expecting this response. From my experience, I felt that many of the smaller organisations just captured by the scheme found it a burden. There is also the issue, the white elephant in the room, that nobody has to action anything identified within ESOS audits….

The Environment Agency were consistently vocal in their opinion that thousands of businesses were going to be non-compliant – even though, as far as I’m aware there have been no penalties served, as yet, on these businesses.

However, it seems that in comparison to the remainder of Europe the UK did a stand-out job. Nevertheless, it is clear we should not rest on our achievements, there is plenty to improve upon during the next compliance phase.


Progression with ISO50001

The ISO50001 Standard is to undergo review to align with the high level structure of other recently revised standards (ISO14001:2015 and ISO9001:2015). The expectation is that this will be issued in January 2019 with a three-year implementation period.  If you want to get involved in the process of re-drafting the ISO50001 Standard, keep your eyes peeled for further updates on the EVORA website.

In Germany there is a tax incentive scheme for businesses which introduce ISO50001. Take-up of ISO50001 in Germany is therefore much higher than the rest of the world, Germany on its own accounts for more than 50% of all ISO50001 certifications. With Germany already being ahead of the UK in terms of renewable energy and pro-active energy policies it is yet another example of innovative policy making that results in German companies taking more responsibility in managing their energy consumption. I hope someday that the UK government will take as positive a stance as their German counterparts.


Energy Markets and Private Wire Systems

Talking about energy market costs culminated in a discussion on the potential of private wire systems to negate the continual rise of energy cost ‘add-ons’.

Historically, energy costs were made up of 60% the actual cost of a unit of energy with 40% added on for extras such as availability charges, demand charges, feed in tariff, climate change levy, distribution costs and so on. However, we are now moving to a point where this proportion is reversed, with 60% of energy costs being from ‘add-ons’, therefore the fluctuation in the actual cost of energy is making up less than half of the total cost of energy.

A private wire system removes these ‘add-ons’. Although only generally applicable to large demand energy users located in feasible areas, the opportunity to tap into local renewable energy projects in order to save costs and use a renewable supply is becoming an attractive option to some. This could become a viable option for some businesses if the proportion of ‘add-ons’ in energy costs continue to grow towards an unsustainable level.


Thoughts for the Future

These were just three of many talking points of the day. Although the next ESOS compliance deadline may seem like a distant worry, this event served as a reminder of the importance in determining how you can get the best out of a proactive energy management strategy (and value for money!)

However, as sustainability professionals we must lead by example and the venue was a timely reminder that there really is a long way to go before sustainability is naturally embedded. The conference room included multiple large halogen lights giving off vast amounts of heat combatted by huge industrial fans for cooling leading to a stuffy energy intensive bubble. A considerable faux pas for an energy management conference! Additionally, the travel information provided prior to the event listed detailed car directions, car parking facilities and airport links (with details of taxi journey lengths) before even mentioning train or bus options. Without joined up thinking and understanding, sustainability will never become the norm.

The event lasted for a day, but the topics discussed will be key themes in the sustainability arena for years to come.

For information on the services EVORA can provide please do not hesitate to get in touch today.

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