locus oxford 29 march 2011

Landlords and Tenants:Working Together to Reduce Costs & Carbon

An event for commercial property Owners & Occupiers

Welcome

Oxford, 29th March 2011

Agenda

• Welcome & housekeeping• Scene setting: Why Landlords & Tenants? • Sustainability & the Commercial Property Sector.• A Landlord’s story• A Tenant’s story• Overview of Fiscal Incentives• LoCUs - Solutions For Owners & Occupiers• Closing comments• Refreshments & Networking

Commercial Property CO 2

Commercial Property Carbon

Cost Effective Carbon & Energy Reduction Measures

Landlord: Tenant Divide – A Circle of Inertia

Commercial Property sector carbon emissions are INCREASING

I’ll change the 

bulbs but not 

the light fittings. 

Its not my 

energy bill, and 

it won’t increase 

rental

Property is just a 

long term 

investment for 

me.

Energy efficient 

buildings are 

expensive and 

difficult to 

build.

Commercial Property Lease Agreements

Landlord Tenant

Rent

Lease Obligations

Service Charge

Service Obligation

Quiet EnjoymentTenant CSRObjectives

Landlord CSRObjectives

A:Traditional Lease

Source: Cardiff University Centre for Research in the Built Environment

Angela Langley & Lara Hopkinson 2009

Landlord Tenant

Rent

Lease Obligations

Shared building related CSR objectives

Service Obligation

Quiet Enjoyment

Tenant external CSR

Objectives

Landlord external CSR

Objectives

B:“Green Lease”

Source: Cardiff University Centre for Research in the Built Environment

Angela Langley & Lara Hopkinson 2009

Shared cost / benefit

Commercial Property Lease Agreements

Drivers for change Presentation to

LoCus

29 March 2011

Martin Gibbons MRICSVital Energy

Running order

• Mega trends – Population and Energy

• EPCs – building energy label

• Drivers for change

• Free offer!

Oil - Price Volatility• January 1999 - $17 a barrel• May 2007 - $65 a barrel

• July 2008 - $144 a barreland Goldman Sachs predicts$200 a barrel by summer 2009

• July 2009 - $65 a barrel!• March 2011 - $103 a barrel

Britain’s new ‘best friend’

EPC Implementation• As at March 2011

• 26% of all residential stock now assessed• 14% of all commercial stock now assessed

• Differential Business Rates/Stamp Duty......?

Residential dwellings 6,078,000

Commercial buildings 230,000

Getting the very best Grade

• Liston Court, Marlow – B Grade

• Highly efficient building services• Good air pressure test• High level of insulation

How to get a G Grade

• Single brick construction, detached• Single glazed• All electric heating• Poor loft insulation

• Hitherbury House, Guildford

Lord Foster buildings – could do better

Kingswood, AscotGrade D – 84

2000 Hillswood Drive, ChertseyGrade E – 108

270 Bath Road, SloughGrade F - 139

Impact on value

• RICS paperSeptember 2009 by Professor Sarah Sayce

• Investmentbench-marking

Impact on lending

Impact on reputation

Heritage buildings – no problem

Renewables - we’ll have everything!

Renewables – an idea for UK business parks

Recent UK Legislation• November 2008 The Climate Change Act

CO2 reduction of 34% by 2020CO2 reduction of 80% by 2050

• Department for Energy and Climate Change formed. Former Secretary of StateEd Miliband

Carbon Reduction Commitment (CRC)• Compulsory CO2 emissions allowance

• League table to name and shame

• Substantial costs to 5,000 energy users

• 6,000 MWh – approx £500,000 pa spend

• April 2010 kick-off

Energy Saving & Tenant Retention

Keeping up with the competition

Building Regulations Part L - 2010

• 2002 reduced CO2 emissions by 25%

• 2006 reduced CO2 emissions by further 28%

• 2010 reduced by another 25%

• Creative design solutions required for allnew build and refurbishments

Display Energy CertificatesCould do better ................

FREE OFFER!

Thank you for your attention

Questions please

Martin Gibbons MRICSVital Energy

0845 111 7700martin.gibbons@vitaldirect.co.uk

Mike Jennings Jennings of Garsington Ltd

Reducing organisational footprints in partnership

Jacob WallaceJacob.wallace@bestfootforward.com

February 2011 ©Best Foot Forward

This presentation

• About Best Foot Forward

• Keeping our own house in order

• Success stories with our landlord

• Where we’re heading next.

Introducing Best Foot Forward…

Our building

Best Foot Forward: footprinting experts

14 years experience

over 3,500

footprint analysesmore than

300 footprint clients

over 2,500

footprint tool usersoperate across

25 sectors

Queens Award-winners

About Best Foot Forward

• Metrics: Dedicated consultancy. Market leaders.

• Insight: Thought leaders. Innovation. Wrap-around support.

• Tools: In-house developers. Proven. Existing platform.

Insight Through metrics

Established in 1997, Best Foot Forward is a specialist sustainability consultancy focussed on delivering an evidence base for decision making. We have completed well over 1000 analyses for more than 200 organisations.

Experience counts. 

Keeping our own house in order…

Key goals

1. Measure our own annual greenhouse gas emissions.– Using Footprinter – our SME footprinting tool.

2. Track how we perform over time.– To ensure we stay on top of our impact as we grow

3. Strive to minimise our impacts across the business.– Both things we control + those we can influence

www.footprinter.com

We perform well in-house…• BFF’s utilities Footprint compared to typical clients…

but…

Last year, we grew…

• More activity, more staff = more challenge to manage your footprint.

• We needed to innovate to keep our in-house footprint under control.

Success stories with our landlord

What can we do…

• So we have identified a range of actions that we can pursue internally in the 2010-11 FY.

• Starting with utilities…as a key component of our footprint, and an area over which we have direct control

The process…

• Previously unsuccessfully lobbied our landlord to install additional roof insulation.

• Landlord unwilling to pay for the installation.

• However, on this occasion took a different approach.

• Agreed that we would fund the insulation through our lease:– effectively a 0% financing arrangement– landlord gets the benefit of enhanced facility– tenant gets benefit of reduced energy bills

Grants available• £500 grants available for small businesses

Net result

• Only installed at Christmas• Approx. 27% reduction in gas consumption vs last winter.• Plus…a much more comfortable office environment for our staff.

Before After

Before

After

Payback periods

• Our insulation payback period is long (>20 yrs) and exceeds the terms of our lease (7yrs)

• However, was ‘well worth it’ on balance for staff comfort.

• It is useful however, to consider paybacks on infrastructure changes.

Identifying the most cost-effective option• The NHS England’s MAC Curve:

1.Packaging 2.Teleconferencing 3.Hibernation system for stations 4.Improve the efficiency of chillers 5.Voltage optimisation 6.1 degree C 7.CHP installation

0.02

0.05

0.010.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.02 0.02

0.010.00

0.04

0.00

0.01

0.02

0.03

0.04

0.05

0.06

tCO2/£

Abatement cost 

zerocost

zerocost

Considering carbon‘bang for buck’…

• Case Study: Tubelines• Micro-level analysis

• Provided carbon cost- benefit analyses for 19 new and emerging technologies and possible interventions that could reduce energy use at stations. Everything from slowing down escalators and raising equipment room temperatures to new auto lighting control systems and more efficient hand driers.

• Case Study: Tubelines• Micro-level analysis

• Provided carbon cost- benefit analyses for 19 new and emerging technologies and possible interventions that could reduce energy use at stations. Everything from slowing down escalators and raising equipment room temperatures to new auto lighting control systems and more efficient hand driers.

Where we’re heading next

Further phases

• Currently have a new bicycle shed in for planning approval…match funding grants available through sustainable routes up to £1000. WE have also ‘rentalised’ this capital cost with landlord.

• New server – thin clients…rather than desktop computers: 90% reduction in energy consumption.

The goal

• In partnership with our landlord and, and with the assistance of some small grants, we’ve managed to make a significant dent in our footprint in a short time, despite already efficient practices.

• The goal is an absolute reduction in our carbon footprint, while growing the business, and expanding our range of influence.

Two client experiences for context…

Importance of good measurement

0

500

1,000

1,500

2,000

Rehearsal, pre-production

Internationaltravel

Equipment -whole tour

Travel & energyfor 19 shows

Merchandise &catering for 19

shows

Fans Travel

tCO2 EF

…to get your priorities right

Radiohead Nth America tour

Allocating responsibility to achieve results

IT team

Travel team & SMT

FM

HR

‐

500 

1,000 

1,500 

2,000 

2,500 

3,000 

tCO2e

Updated 06/07 Footprint 08/09 Footprint

15% reduction (aiming for a further 23%)

Questions.

?www.footprinter.com

jacob.wallace@bestfootforward.com

Fiscal incentives for green energy

LoCus Landlords & Tenants event, Oxford

Gabriel Berry29th March 2011

www.tvenergy.orggabriel.berry@tvenergy.org

Agenda• Introduction: Green energy

• IncentivesFeed in tariff + case studyRenewable heat incentive + case studyCapital allowances

• Issues & opportunities

Introduction – Green energyPOWERSolar electricity

HEAT COOLING

Small windBiogas

Hydro power

Wood boilersWood heaters

Solar thermalHeat pumps

Wood boilers with chillers

Heat pumps

Feed in tariff

• Incentives for small-scale electricity• 18,500 installations by end-2010 • Incl. 14,300 kW commercial capacity

Feed in tariff (2)

• Generation + Export Tariffs• Rates of return 5–8 % • Benefits 325+12+38= £375 /kW/yr

Case study – Conference centre

• Owner: Sheepdrove, a Berks SME• 32 panels, 5.44 kW, 4800 kWh p.a. • Benefits 1814+74+240= £2128 p.a.• Likely cost £18k, payback ~8yr

Feed in tariff (3)

• Wind• Hydro• Biogas• Micro CHP

• PV

Renewable heat incentive

• Renewable heat excl. ASHP/stoves• World’s 1st; from Autumn 2011• Paid ¼ly over 20yrs; RoR 12% (6%)

Case study – Offices on estate

• Landlord: Steljes, a Berkshire SME• 220kW boiler, 12kW solar thermal• Benefits 14.7k+2.7k+14.2k= £31.6k pa• Cost £60k + £20k, payback <3yr

Renewable heat incentive (2)

• Wood pellet boilers• Ground source

heat pumps• Solar hot water

• Wood chip boilers

Capital allowances

• Annual investment allowance• Enhanced allowance: Energy Tech. list• Plant only: not works, fuel, other kit

Issues

• Legislation• Insurance • Tax• State aid• Independent advice

• Site & use specific

Opportunities

• Local & secure• Cash generating • Energy & carbon efficient• Marketing• Innovative finance

Conclusion

Green energy:• Get advice• Select technology• Save & earn

gabriel.berry@tvenergy.org

Green Deal

• Pay as you save funding mechanism• Starts late 2012• Domestic & Small business premises• Covers retrofitting but not renewables• No up‐front costs• Charge applied to energy meter• Installation costs recovered by utility provider

http://www.decc.gov.uk/assets/decc/legislation/energybill/1010-green-deal-summary-proposals.pdf

Assessment Finance Installation Repayment

“Golden Rules”

of the Green Deal. 

Introducing LoCus:Solutions for commercial tenants and landlords

Oliwia MilekLoCus Project Officer

property

landlord tenant

Things you control.

• How you use stuff• 20% savings • Boring to do ……

but effective

• Staff Engagement• Low / no cost

Things you don’t  control.

• Legislation,

• Energy supply issues

• Energy cost/ unit

In the  middle

LoCus Environment Review LoCus One to One / training: 

Legislations update

Cost‐

effective 

energy‐

efficient 

measures

In the middle

Retrofitting building fabric, i.e. -• draught proofing• insulation• lighting & heating controls• replacement windows• replacement boiler• renewable energy

Cost : Benefit – whose?

Define the cost benefits

Years

Cost &

length of

lease

Define the cost benefits

Occupier Owner

Negotiations arena:

Find mutual benefit -• the economic business case• CSR “ticks”• good publicity• seen as modernand progressive

• be reasonable

• be reasonable• acknowledge your rights and duties

LoCus services

Contact  

Neighbours

Create 

Clusters

Reporting

Contact 

Landlord

Site based 

Services

CO2

LoCus

support is free and flexible to your needs  and objectives, but for example:

•

Ideas to save money and realise revenue •

Individual on‐site visit

•

Environmental improvement plan•

Training & events

•

Renewable energy assessment •

Ongoing environmental business support

• no risk• save money• tailored advice• differentiate yourself• gain competitive advantage• let us do some work for you!• prepare for the low carbon tomorrow

Why to take advantage?

Oliwia Milek, Project OfficerOn behalf of Reading Borough Council and the 19 Partners

0118 973 3403oliwia.milek@locusproject.org.uk

www.locusproject.org.uk

Landlords and Tenants:Working Together to Reduce Costs & Carbon

An event for commercial property Owners & Occupiers

Thank You

enquiries@locusproject.org.uk