Innovative financing models for low carbon transitions: Exploring the case for revolving funds for domestic energy efficiency programmes

The IEA has estimated that over the next four decades US$31 trillion will be required to promote energy efficiency in buildings. However, the opportunities to make such investments are often constrained, particularly in contexts of austerity. We consider the potential of revolving funds as an innovative financing mechanism that could reduce investment requirements and enhance investment impacts by recovering and reinvesting some of the savings generated by early investments. Such funds have been created in various contexts, but there has never been a formal academic evaluation of their potential to contribute to low carbon transitions. To address this, we propose a generic revolving fund model and apply it using data on the costs and benefits of domestic sector retrofit in the UK. We find that a revolving fund could reduce the costs of domestic sector retrofit in the UK by 26%, or £9 billion, whilst also making such a scheme cost-neutral, albeit with significant up-front investments that would only pay for themselves over an extended period of time. We conclude that revolving funds could enable countries with limited resources to invest more heavily and more effectively in low carbon development, even in contexts of austerity

ENABLING PLACE-BASED CLIMATE ACTION IN THE UK:RECOMMENDATIONS FROM THE PCAN EXPERIENCE

This is a summary of key findings and recommendations from a report published by PCAN that was presented at PCAN's conference, Local Climate Action: Moving Out of Silos, at The Royal Society on 19 June 2023.We present key findings on: how place-based climate action in the UK continues to grow; the new governance models emerging; the need for (and lack of) political leadership, and how local partnerships can lead to better outcomes.The summary has recommendations for local authorities; communities and stakeholders; businesses, and national government and devolved administrations.Contributing authors to the full report are listed below. Read the report here: https://pcancities.org.uk/report

Climate policy as social policy? A comprehensive assessment of the economic impact of climate action in the UK

Co-benefits are central to the case for climate action but are side-lined in many economic analyses. This paper presents an evaluation of three dimensions of the costs and benefits of climate change interventions in six urban regions of the UK. Findings indicate that meeting the UK’s 2033–2037 climate targets could yield £164 billion in total benefits. Notably, only 13% of these benefits are financial, in contrast to the 79% of which are social benefits. These social benefits include improvements in public health, reduced traffic congestion, and increased thermal comfort in homes. These results underscore the need for economic evaluations to expand their scope and move beyond the narrow financial cost–benefit analysis that predominates. Moreover, the magnitude of the social benefits underscores the need for integrating social and climate challenges in policymaking. Concurrently, the results demonstrate the sensitivity of the social benefits of climate actions to the normative aspects of empirical analysis. Determining whether emissions reductions in the transport sector, for example, should be achieved through the deployment of electric cars, expansion of public transport, and/or increases in walking and cycling requires both technical analysis and value-based decision making. Ensuring that decision-making processes are deliberate and transparent in empirical analysis is therefore critical. We conclude by suggesting that institutions such as the UK Climate Change Committee and Scottish Climate Intelligence Service should take the opportunity to be more explicit in the normative decisions embedded in their empirical work to demonstrate best practice for the wider research community.</p

An international comparison of the outcomes of environmental regulation

Whilst there is much discussion about the stringency of environmental regulations and the variability of industrial environmental performance in different countries, there are very few robust evaluations that allow meaningful comparisons to be made. This is partly because data scarcity restricts the ability to make 'like for like' comparisons across countries and over time. This paper combines data on benzene emissions from Pollution Release and Transfer Registers with data on industrial production from oil refineries to generate normalized measures of industrial environmental performance across eight Organisation for Economic Cooperation and Development countries and the EU-15. We find that normalized emissions levels are improving in nearly all countries, and that there is some convergence in emissions performance between countries, but that there are still very significant variations across countries. We find that average emissions levels are lower in Japan and Germany than in the USA and Australia, which in turn are lower than in Canada and the EU-15, but we note that average emissions in the EU-15 are significantly affected by particularly high emissions in the UK. These findings have significant implications for wider debates on the stringency of environmental regulations and the variability of industrial environmental performance in different countries

The Impact of Domestic Energy Efficiency Retrofit Schemes on Householder Attitudes and Behaviours

Retrofitting existing housing stock to improve energy efficiency is often required to meet climate mitigation, public health and fuel poverty targets. Increasing uptake and effectiveness of retrofit schemes requires understanding of their impacts on householder attitudes and behaviours. This paper reports results of a survey of 500 Kirklees householders in the UK, where the Kirklees Warm Zone scheme took place. This was a local government led city-scale domestic retrofit programme that installed energy efficiency measures at no charge in over 50,000 houses. The results highlight key design features of the scheme, socio-economic and attitudinal factors that affected take-up of energy efficiency measures and impacts on behaviour and energy use after adoption. The results emphasise the role that positive feedback plays in reinforcing pro-environmental attitudes and behaviours of participants and in addressing concerns of non-participants. Our findings have implications for the design and operation of future domestic energy efficiency retrofit schemes