City of Melbourne

MELBOURNE

- TOWARD NET ZERO GREENHOUSE GAS

EMISSIONS BY 2020

What do low emission futures look like?

City of Melbourne

The ‘BHAG’

• A ‘triple bottom line’ vision that challenges the way we think about Greenhouse

• A target that gives focus to the City’s partnerships with authorities and stakeholders

• Strong focus on commercial drivers of mainstream investment with supporting regulations

City of Melbourne

Scope

• 20 year timeframe

• Excludes transport, embodied energy

• Confined to City boundaries - no major new energy intensive industries such as smelters

City of Melbourne

Original concept

• Council purchase of 100% renewable energy by 2020

• 25% renewable energy in the City as a whole by 2020

• 100% increase in efficiency in conventional (brown coal) energy generation by 2020

• 50% decrease in demand via efficiencies & design in commercial sector

• 15% decrease in demand via energy efficiencies in industry

• Sequestration projects to offset remaining emissions

City of Melbourne

Major sources of emission reduction

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

Remaining Greenhouse Emissions

Renewable Energy

Efficiency Increase

Advanced Technology

Sinks

City of Melbourne

Drivers

• Maximising the NPV of buildings:– Productivity in green buildings– Regulations

• Green consumer power and green brands

• Sequestration as a triple bottom line investment

• Champions and alliances

City of Melbourne

Methodology

• Partnership-building to align vision and effort

• Research to establish best practice

• Identify barriers through focus groups, roundtables, surveys

• Develop long term strategies

• Economic impact of regulatory change

City of Melbourne

Maximising building NPV #1

Barrier• Developers believe that energy efficiency is a cost

and has no market value

Strategies Market leadership through public sector purchasing Create a market premium for green buildings through

better productivity, well being and comfort Develop a clear statement of best practice design that

saves energy and money Assist developers to acquire ‘green’ design and

construct skills

City of Melbourne

Maximising building NPV #2

Barrier• Energy efficiency: who captures the benefit?

Strategies• Enforce disclosure of energy costs and CO2 profile

during rent/sale of property

• 5 star regulations for new buildings and major refurbs - 45% reduction in emissions, plus net economic boost

• Possible innovative financial products and growth of energy services contracting

• Tax reform of capital/operating conflict

City of Melbourne

Maximising building NPV #3

Barrier• Energy is not a significant business cost in the CBD

– it’s not on management’s radar

Strategies• Green building productivity - document the ‘well-being

value’ and raise market awareness• Develop credible value parameters for green buildings

with the finance industry to assist market valuations• Exploit the low cost impact - a premium price for green

power is a cheap way to establish a green brand

City of Melbourne

Greenhouse friendlier power

Barrier • Reluctance of power companies to change

Strategies

• Green buying consortia - using consumer power

• Influence through operating licences

• Commercial opportunities from new technology and tapping green investment funds

• International pressure

City of Melbourne

Sequestration

Triple bottom line investment opportunity• Probably timber plantation-based • Rural partnership recognises the City’s

environmental footprint

• 3BL benefits:–Long term economic returns from timber

–Salinity reduction and wildlife conservation

–Employment and community re-building

–Plus greenhouse gas sequestration

City of Melbourne

Early milestones

• Public sector buying power to leverage green building development

• Green power buying consortia trial (2002)• Partnership with rural Council (2002)• Education program for developers and architects

(2002)• New building codes (residential by 2003 and

commercial by 2004)

City of Melbourne

Long term milestones

City of Melbourne

Work in progress

• Clear, well documented statement of best practice to test with developers in focus groups

• Research on attitudes of power retailers and on consumer interest in green power buying consortia

• Identifying lighthouse projects and key points of public sector leverage

• Economic impact of new regulations

• Triple bottom line business case for sequestration

City of Melbourne

Plan format

• Triple bottom line objectives based on balanced scorecard inputs

• Agreements with partners to take on continuing role

• High Level Steering Group to carry plan forward

City of Melbourne

Next steps for APEC Working Group

• Next WG meeting in Australia to coincide with workshop

• Presentation of the final plan to a regional workshop

• Finalisation of template