L&p presentation

THE ENVIRONMENTAL MARKET OPPORTUNITY IN LONDON

PRU ASHBY, ENVIRONMENTAL SECTOR SPECIALIST

LONDON & PARTNERS

October 2011

LONDON IN THE NEXT 10 YEARS

� Demand for energy will increase substantially: London is set to grow by one million people in the next 10 years

� 180,000 jobs will be created – 120,000 new homes will be built

GROWTH

Forecasts from the London Mayor’s Office show key area of population growth is East London

For example 10,000 new homes planned for Barking Riverside

� The Mayor of London is developing programmes

on how London can be the world’s low carbon

capital

� Target of cutting carbon output by 60% by 2025

� London Green Fund – to de-risk investment for

private sector

� Waste - target £70million Foresight

Environmental Fund

� Energy efficiency – target £100mill fund

manager Amber Green Consortium

� Carbon markets – UK announcement of carbon

floor price 23rd March 2011 budget

� Decentralised Energy and Smart Grid

� Building retrofit

MAYORAL POLICY

LONDON INITIATIVES

RE:FIT43% of London’s total CO2 emissions are from commercial & public sector buildings

Re:Fit aims to facilitate Energy Performance Contracting across

London’s public sector buildings

Target: 11 million sq m in London, 40% of public sector buildings,

£400million of projects. 400 organisations

Pipeline for London Green Fund – 7 year payback

Framework panel of 12 suppliers in place

• Balfour Beatty

• COFELY (GDF SUEZ)

• MITIE (Dalkia FM)

• EDF Energy

• E.ON Sustainable Energy Business

• Hoare Lea Consulting Engineers (Parkeray)

• Honeywell

• Hurleypalmerflatt

• Interserve

• Johnson Controls

• Schneider Electric - Strategic Building Solutions

• Willmott Dixon Partnerships

RE:NEW

36% of London’s CO2 emissions are from housing

Re:New aims to reduce CO2 emissions from existing homes in

London, help residents to save money on their energy bills and

create ‘green’ jobs.

3 million homes in London, target is 1.2 million by 2015

Framework panel of 12 suppliers in place

• Axis

• Groundwork London

• Breyer Group

• Lakehouse Contracts

• British Gas

• Osborne Energy

• CEN Services

• United House

• Eaga

• Warmzones

• Enterprise

• Willmott Dixon

Subcontract opportunities exist withframework suppliers

Some Private Sector Initiatives

� BT’s Corporate Renewable Energy Programme• BT to build UK's second largest solar-powered roof, largest in

London

• 1440 solar panels covering 2350m2 May 2011

• BT strategy is 25% electricity needs from renewables

� Skanska and GE have formed a strategic partnership• to develop new environmental technologies and processes for the

emerging green retrofit and refurbishment market

• Market estimated to be worth in excess of £10bn per year in the UK.

� Low Carbon Workplace• unique partnership between the Carbon Trust, developer Stanhope

and fund manager Threadneedle

• design, build and manage bespoke and contemporary offices for organisations committed to eco-friendly operation.

GREEN ENTERPRISE DISTRICT

Site opportunities - land for sale and lease

Enterprise Zone announced 23rd March 2011

The Crystal

A sustainable cities initiative by Siemens

- East London Enterprise Zone

- Siemens global centre for infrastructure and cities

- Centre for thought leadership, a knowledge hub and showcasing for energy efficiency, transport and the city in 2050.

- All electric- Rainwater recycled- Connected to smart grid for electric vehicles.

LONDON THAMES GATEWAY HEAT NETWORK

� Heat sourced from Barking Power Station – 400MW per year currently wasted

� Supply 120,000 homes

� 1st phase – 2km

� 2nd phase 67km

Opportunities

� Plant and equipment - £100million

� Investors in infrastructure -£160million

� Build / own / operate - £100million worth of projects

SUSTAINABLE INDUSTRIES PARK

Closed Loop recycling

AD plant

River access

60 Acre site in East London – first of its kind in the UKOpportunities for suppliers and assemblers of renewables

LOW CARBON VEHICLES IN LONDON

� London to become the electric vehicle capital of Europe

� Mayor’s electric vehicle charging network,

Source London, is live. www.sourcelondon.net

� 1,300 public charging points across London by

2013

� 100,000 EVs on London streets as soon as

possible

� London hydrogen buses will form the only

hydrogen bus fleet in the UK and the largest

currently in Europe.

� Future opportunities for low carbon vehicle

manufacturers and charging point technology

DATA CENTRES

London is a key internet exchange and

location for data centres to support the

commercial environment

Major opportunities for companies in:� Energy efficiency technology

� Optimising use of energy and

heat

� Alternative sources of electricity

� Energy conservation

� CHP

OPPORTUNITIES ARISING FROM UK WIDE INITIATIVES

FIT UPDATE 18TH MARCH 2011� The UK government has recently announced cuts in the level of incentives

available to solar photovoltaic installations

� New tariffs will come into effect 1 April 2012 and will affect installations made after 12 December 2011

� Household solar installations with between with less than 4kW capacity will receive 21p/kWh and industrial installations with up to 250kW capacity will receive 15.2p/kWh through the feed-in tariff scheme, while larger installations up to 5MW such as wind farms will attract 8.5p/kWh.

� Proposals to increase the level of feed-in tariffs available for anaerobic digestion (AD) systems: current feed-in tariffs of 12.1p/kWh for all AD plants with up to 500kW of capacity will be increased to 14p/kWh for installations with up to 250kW capacity and 13p/kWh for AD installations with between 250kW and 500kW of capacity.

THE GREEN DEAL

Will replace Warmfront scheme in late 2012

• Allows householders to improve efficiency with no upfront cost

• The upfront finance will be attached to the building’s energy meter.

• People can pay back over time with the repayments less than the savings on bills

• If 26 million homes are done, this will create 250,000 jobs

• March 2011 – government funding for 1000 apprentices

• Landlords to face minimum energy efficiency standards from 2016: 682,000 rental properties

RENEWABLE HEAT INCENTIVE

Details just been announced - to go ahead summer 2011. First phase large heat users, second phase domestic

• First of its kind in world

• Renewable technologies include household solar

thermal panels to industrial wood pellet boilers

• £850m of investment

• Objective to move from 1% to 12% of all heat

generated from renewable source by 2020.

Key opportunities for companies in RHI technology and manufacturing

CRC – CARBON REDUCTION COMMITMENTS

� Emissions trading scheme for large energy users –

began April 2010

� Government currently meeting with stakeholders to

consider simplifying the system

� Opportunities for energy efficiency solutions providers

Update 23rd March 2011 Budget

� Funding of £3billion is secured for 2012

– borrow money from 2015

� Private capital plus government

injections should boost capitalisation to

£18bn

� Being suggested as a template for

European Union

OPPORTUNITIES FOR INVESTORS

GREEN INVESTMENT BANK

SMART GRID

� London won £35million government

funding for smart grid project – being

managed by UK Power Networks

� Many other projects being created

� Key opportunities for companies in:

• Smart meters

• “beyond the meter” technology

(switch off applications when

on highest tariff)

• network dynamics

• smart grid

OFFSHORE WIND

� £60m from government for port facility upgrades for

offshore wind

� Will help maintain UK’s position as largest

offshore generator in the world

� Funds for R&D into wind turbines

London is key location for UK and European HQ

Vattenfall is Europe’s fifth largest generator of electricity and the

largest generator of heat. They chose London for their UK HQ for

access to policy makers, decision makers, industry associations

and transport connectivity.

“Mayor Boris Johnson is very ambitious with green

technology; more so than his counterparts in New York

or Stockholm. From London’s new bike hire scheme to

its plans for a low carbon Olympics, you can see that

the city is making a real effort to be green.

Having an office in a pioneering green city will give my

business a higher profile around the world.”

ANTHONY PEREIRA, CEO, ALTPOWER

CASE STUDY: ALTPOWER

HOW TO ACCESS THESE OPPORTUNITIES?

Contact London & Partners for help with:

� Understanding the market opportunity and the legislative

landscape

� Accessing connections, networks and decision makers in

government, trade bodies and academia

� Exploring partnerships and relationships across your supply

chain

� Set up a physical presence and recruit skilled people

REGULAR EVENTS ORGANISATIONS

Renewable Energy Association

http://www.r-e-a.net/events

The Guardian Sustainable Business Events

http://www.guardian.co.uk/sustainable-business/events

The Renewable Energy Centre

http://www.therenewableenergycentre.co.uk/events.html

Green Mondays

www.greenmondays.com

The Building Centre

http://www.buildingcentre.co.uk/events/forthcoming_events.asp

eco-Connect – connections hub

http://www.eco-connect.org/

London Electric Vehicle Partnership

To meet once every 6 months organised by Transport for London. Next one is Tuesday 19th

July. Also view www.sourcelondon.net

Green Power Conferences

http://www.greenpowerconferences.com/

Envirotech and Clean Energy Investor Summit9-10th November 2011 Grange City Hotel Londonhttp://www.envirotechinvestorsummit.com/2011/

BASELondon: opportunities in a low-carbon LondonJune 2012 City of Londonhttp://www.baselondonshow.co.uk/

FIND THE PROPERTY

& LOCATIONBUSINESS

CASEYOUR

LONDONEXPAND YOUR

NETWORK

FIND THE PROPERTY

& LOCATION

FIND THE RIGHT PEOPLE

THE EXPERTSON DOING BUSINESS IN LONDON

HOW WE CAN HELP

- Sector Intelligence- Legal Requirements- Corporate/Tax Structure- Cost-effective Set-up

- Specialist Recruitment- Funding & Training- Salary Benchmarking- Employment Practice

- Office Specialists- Market, Clients &Transport

- Labour Pool- Demographic Mapping

- Professional Service-- Events-- Government Contacts-- Policy-makers

- Culture & Social Life- Visas & Work Permits- Schools & Colleges

www.londonandpartners.comEnvironment Sector Specialist Pru Ashby

[email protected]

ANY QUESTIONS?