Innovation UK > News > Innovation UK Vol6-1 > Carbon emissions - Growth opportunities in a low carbon economy

One of the strongest drivers of innovation in the coming years will be finding ways to reduce our carbon emissions as a society ? and we have compelling reasons to do so.

There is now 40% more CO2 in the atmosphere than before the industrial revolution. It is predicted that continuing carbon emissions at current levels will lead to a rise of up to 6?C in average temperatures by 2100, contributing to more extreme weather events in the UK - floods, winter storms, high summer temperatures and droughts. In 2006, the Stern review concluded that the costs of dealing with uncontrolled climate change could be 5%-20% of GDP each year, but reducing carbon emissions to avoid the worst effects would cost only 1%-2% of GDP.

The Government has committed the UK to cut carbon emissions by 80% from the 1990 level by 2050. Achieving this will mean transforming the UK economy - leading to major new commercial opportunities for UK business needs.

Total emissions of all greenhouse gases in the UK are about 638 million tonnes CO2 equivalent; the chart shows the breakdown by end user. The big emitters are:

• The energy industry emits about 35% of the UK?s carbon emissions in supplying energy to end-users.
• Most of the business carbon emissions are from buildings. Residential and non-domestic buildings together account for 45% of total UK carbon emissions
• Transport is about 24% of total carbon emissions, and 80% of those carbon emissions come from road transport. For these vehicles, although fuel efficiency is improving, the number of miles driven is increasing faster and therefore overall carbon emissions are actually rising.

The numbers highlight three big targets: reducing carbon emissions in energy generation and supply, making buildings more energy efficient, and cutting the carbon emissions from road transport. In these three areas, the challenge is at least recognised - and industry, academia and government are working on solutions. In energy, the UK is investing in low carbon technologies for power generation and energy supply. Funding for development is provided by the Technology Strategy Board, the Carbon Trust, DECC, the Energy Technologies Institute and private sources. Energy innovation is covered in more detail elsewhere in this publication.

In the buildings sector, Government has set targets for ?zero carbon? new homes from 2016 (so no carbon emissions), with other buildings to follow suit from 2019. Existing homes will also need to be refurbished. Low carbon emissions transport is also rich with innovation opportunities. Apart from the obvious scope to develop vehicle technology, transport can be made more efficient by better integration of different types of transport, using better information systems. These are challenging goals, but industry is already working on how to deliver them. The real conundrum is how to get low to zero carbon emissions and do it in a commercially viable way ? and for this, new and innovative approaches are needed.

What are the opportunities - and the obstacles?

To become mainstream, new solutions need to perform well enough, be cost-effective and fit efficiently into the technological system or ecology. Technologies must be reliable, available and maintainable. Public perception and opinion of low carbon emissions technology can also be a blocker, as can concerns about environmental impact, lack of available investment, and planning barriers. To build confidence, demonstrators are often needed.

The construction market amounts to about £120bn p.a. A great part of this market will be transformed by the drive to low-impact buildings. From 2016 up to 300,000 new homes a year will be built to zero carbon emissions standards; from 2019 all non-domestic buildings will be zero carbon emissions; and the Government proposes that all existing homes should have draughtproofing, cavity wall and loft insulation by 2015. To make this possible we need ways to reliably and cost-effectively deliver high efficiency building envelopes, new design strategies, better control systems for operating buildings, and a cost-effective way to upgrade the existing building stock.

In transport, within five years travel is likely to be more seamless, with the focus on the total journey rather than specific sectors or modes of transport. The way we power our vehicles will also have to start changing.

But again, in transport there is a consumer perception of poor performance and short range for electric vehicles, a lack of infrastructure for car charging (or fuelling hydrogen vehicles), and a need for travellers and businesses to change their transport choices towards greater sustainability. We need new ways of thinking in integrated transport, including new business models and greater collaboration across the sector. We also need products and services that people want to use and are prepared to pay for, that help to encourage change in behaviour towards sustainable transport choices which will lower carbon emissions.

What is the Technology Strategy Board doing?

The Technology Strategy Board has established ?innovation platforms? in a number of key areas : low impact buildings, low carbon emissions vehicles and intelligent transport systems and services. Innovation platforms involve working closely with business to met market requirements that are driven by government action . To support innovation in the right areas, at the right time, to enable industry to meet future needs.

For example, last autumn we announced a £17m programme to deliver nearly 200 design studies on retrofitting social housing to dramatically cut carbon emissions. In March, 87 of these were selected to be built, and their performance in use will be monitored in detail over two years. In transport, Technology Strategy Board initiatives include a low carbon emissions vehicle demonstrator programme putting 340 electric cars into real life trials, and a £100m Integrated Development Programme (co-funded by the DfT, EPSRC, and a number of regional development agencies) which will deliver up to £200m worth of projects in areas including ultra-efficient systems for electric and hybrid vehicles. Low carbon emissions is also linked to many of our other innovation development areas including environmental sustainability, materials and advanced manufacturing.

The Technology Strategy Board is not the only body working to deliver the changes needed, but it is a vital part of the jigsaw, working in partnership with others to create a step change in innovation -which in the years to come will see business contributing to the future low carbon emissions economy on a grand scale.

For more information on the Technology Strategy Board?s programmes please visit www.innovateuk.org