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

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

The Economic Case for Low Carbon Development in Rapidly Growing Developing World Cities: A case study of Palembang, Indonesia.

Where costs or risks are higher, evidence is lacking or supporting institutions are less developed, policymakers can struggle to make the case for low-carbon investment. This is especially the case in developing world cities where decision-makers struggle to keep up with the pace and scale of change. Focusing on Palembang in Indonesia, this paper considers the economic case for proactive investment in low-carbon development. We find that a rapidly growing industrial city in a developing country can reduce emissions by 24.1% in 2025, relative to business as usual levels, with investments of USD405.6 million that would reduce energy expenditure in the city by USD436.8 million. Emissions from the regional grid could be reduced by 12.2% in 2025, relative to business as usual trends, with investments of USD2.9 billion that would generate annual savings of USD175 million. These estimates understate the savings from reduced expenditure on energy subsidies and energy infrastructure. The compelling economic case for mainstreaming climate mitigation in this developing country city suggests that the constraints on climate action can be political and institutional rather than economic. There is therefore a need for more effective energy governance to drive the transition to a low-carbon economy

To what extent can China’s near-term air pollution control policy protect air quality and human health? A case study of the Pearl River Delta region

Following a series of extreme air pollution events, the Chinese government released the Air Pollution Prevention and Control Action Plan in 2013 (China's State Council 2013). The Action Plan sets clear goals for key regions (i.e. cities above the prefecture level, Beijing-Tianjin-Hebei Province, the Yangtze River Delta and the Pearl River Delta) and establishes near-term control efforts for the next five years. However, the extent to which the Action Plan can direct local governments' activities on air pollution control remains unknown. Here we seek to evaluate the air quality improvement and associated health benefits achievable under the Action Plan in the Pearl River Delta (PRD) area from 2012 to 2017. Measure-by-measure quantification results show that the Action Plan would promise effective emissions reductions of 34% of SO2, 28% of NOx, 26% of PM2.5 (particulate matter less than 2.5 μm in diameter), and 10% of VOCs (volatile organic compounds). These emissions abatements would lower the PM2.5 concentration by 17%, surpassing the 15% target established in the Action Plan, thereby avoiding more than 2900 deaths and 4300 hospital admissions annually. We expect the implementation of the Action Plan in the PRD would be productive; the anticipated impacts, however, fall short of the goal of protecting the health of local residents, as there are still more than 33 million people living in places where the annual mean ambient PM2.5 concentrations are greater than 35 μg m−3, the interim target-3 of the World Health Organization (WHO). We therefore propose the next steps for air pollution control that are important not only for the PRD but also for all other regions of China as they develop and implement effective air pollution control policies

Cities and climate change mitigation: Economic opportunities and governance challenges in Asia

Cities are central to the fight against climate change, but the IPCC recently noted that many cities — and particularly those in the developing world — lack the institutional, financial and technical capacities needed to switch to low emission development paths. Based on detailed case studies of three Asian cities, this paper finds that the adoption of low emission development strategies (LEDS) at the urban level could be economically attractive. However, it also argues that without a coordinated multi-level, cross-sectoral governance framework these opportunities for low carbon urban development are likely to be left unexploited. As these governance conditions are frequently not in place, we argue that these case study cities, and cities in similar contexts, are likely to miss even the economically attractive low carbon development opportunities and become increasingly locked in to higher cost, higher carbon development paths. Due to their growing size and importance, we conclude that the presence or absence of governance arrangements that enable the adoption of low carbon development strategies in Asian cities will have global implications for climate change