A Guide to Low Carbon Energy

The energy that we use is changing. The environmental damage caused by fossil fuels is well documented, and we only have so long to change our ways or face irrevocable consequences. The good news on this front is that there is a lot that we can do. By moving away from fossil fuels and towards low carbon energy, we can speed up our transition to a more sustainable future. This guide will give you an overview of low carbon energy, why it’s so important, and how your business can be part of this revolution. 

What is Low Carbon Energy?

Low carbon energy is generated from low-carbon sources such as wind, solar, hydro, and nuclear power. These are preferable for the environment in comparison with ‘fossil fuels’ such as oil or natural gas because they release less carbon into the atmosphere. Low carbon technologies are not completely renewable as they may still have associated carbon emissions. However, since they produce far lower emissions than conventional fossil fuel burning technologies, they are still preferable to more traditional ways of producing the energy we need. 

Low Carbon Energy Sources

Low carbon energy is broadly produced from four different sources: wind, solar, hydro (water) and nuclear power. 

The terms "wind energy" and "wind power" both describe the process by which the wind is used to generate mechanical power or electricity. This mechanical power can be used for specific tasks (such as grinding grain or pumping water) or a generator which can convert this mechanical power into electricity.

Solar power works by converting energy from the sun into power. There are two energy sources from the sun for our use – electricity and heat. Both are generated through solar panels, which range in size from residential rooftops to ‘solar farms’ stretching over acres of rural land.

Hydropower, or hydroelectric power, is a renewable energy source that uses a dam or diversion structure to alter the natural flow of a river or other body of water. Hydropower relies on the endless, constantly recharging system of the water cycle to produce electricity, using a fuel—water—that is not reduced or eliminated. There are many types of hydropower facilities, though they are all powered by the kinetic energy of flowing water as it moves downstream. Hydropower utilises turbines and generators to convert that kinetic energy into electricity, which is then fed into the electrical grid to power homes, businesses, and industries.

Nuclear power is the use of nuclear reactions to produce electricity. It can be obtained from nuclear fission, decay, or fusion reactions. Presently, the vast majority of electricity from nuclear power is produced by the nuclear fission of uranium and plutonium in nuclear power plants. Nuclear power is not a renewable source, but it is still necessary because wind and solar energy aren’t always available.

Is Natural Gas Considered a Low Carbon Energy Source?

Liquefied natural gas (LNG) is natural gas that has been reduced to a liquid state through a process of cooling. It’s been part of the UK’s energy mix for many years, and because it’s much cleaner than other forms of gas, it’s widely considered usable as a bridge towards a wholly renewable future. 

Why Adopt a Low Carbon Strategy for Your Business?

Though it can seem daunting from the outset, developing a low-carbon strategy has many benefits. By minimising your business's carbon footprint, you can cut energy costs, increase sales, find new markets, support customers' low carbon goals, improve employee morale, and reduce overheads through efficiency savings. 

Reducing energy costs is one of the most obvious attractions of making this switch for business owners. Transitioning to low carbon energy sources can come with not-insignificant set-up costs. Still, the ROI time is typically short, and some businesses can even earn money back by exporting excess energy produced back to the national grid. In addition to this, both customers and suppliers increasingly consider environmental concerns when deciding who to do business with, and your business can benefit from flaunting its green credentials. 

The Low Carbon Energy Transition

The concept ‘Low Carbon Energy Transition’ refers to shifting businesses (and ultimately our entire economy) which depends heavily on fossil fuels to a sustainable, low carbon economy. 

The first step in this transition is to fully understand your business energy usage. How much do you use, and at what times of the day, week, month or even year? A full energy audit will help you to understand this. 

You’ll also need to consider relatively mundane matters such as the geographical location and even the positioning of your business premises. You may be close to a good source of hydropower, for example. If your building is south-facing, it might be highly suitable for solar panels. 

A 2018 study by Agulhas highlighted "Lessons for a successful transition to a low carbon economy" and presented case studies from around the world, from China to Western Europe, demonstrating how this transition can be successfully managed. In Lausitz, Germany, for example, the central government created a regional management company which provided 20,000 new jobs for the workforce in decontamination and environmental clean-up. In contrast, in the northeast of England, a regional support facility was set up, investing in five regional universities to build enterprise capacity and create new skills, jobs, and even businesses

The Carbon and Energy Fund (CEF)

The Community Energy Fund (CEF) is a £10m grant scheme for urban and rural communities to develop community energy projects, including local renewable and low carbon energy projects such as wind farms, hydropower and rural heat networks, community electric vehicle projects such as electric vehicle charging points and electric car clubs and energy efficiency retrofit and advice projects, where there is local need and a gap in existing services and where there is a business model for a sustainable service.

CEF funds are for community-based organisations developing projects for the benefit of the local community. Funding is for developing projects from concept to investable scheme, including launching approaches to community fundraising. It cannot provide capital funding for the installation of projects themselves. 

Both the applicant and the project are assessed for suitability, and the grants come in two stages. Stage 1 grant funding provides up to a maximum of £40,000 to cover the professional costs of undertaking a feasibility study and producing a report to establish the technical and financial viability of a clean energy project. 

Stage 2 grant funding provides up to £100,000 maximum to cover the cost of developing a project that has demonstrated technical and financial viability. This includes the legal costs of securing a site, an environmental impact assessment, planning and permitting applications, and the development of a business plan. 

If you believe your organisation might be eligible, you can send an ‘expression of interest’ form so they can assess you. There’s further information on the Consumer Energy England website. 

What are the Differences Between Renewable and Low Carbon Energy?

Wind, solar, and hydro are all considered renewable energy sources because we have an indefinite supply of them. The rivers will not stop flowing, the wind will not stop blowing, and the sun will not stop shining. 

Low carbon energy may come from renewable sources, but it will also have some form of dependence on more traditionally sourced fuels. Despite the infinite aspect of the power we can generate from wind, solar or hydro, the sun doesn’t shine in one place 24 hours a day. The wind isn’t always blowing, and the batteries available to store excess power produced aren’t always sufficient. 

Heat pumps are a good example of low carbon energy. While the heat from the ground is free and renewable, it still requires an electric pump to operate the system, so some emissions are produced, but this is at a far lower rate than from using fossil fuels. 

What Does a Low Carbon Energy Assessor Do?

Low Carbon Energy Assessors are energy specialists who can help clients minimise the carbon emissions of their buildings, both in design and operation, by doing more than simply ‘counting carbon’. 

One of their main roles is to provide Energy Performance Certificates (EPCs) and Display Energy Certificates (DECs). The requirement for EPCs was introduced in April 2008 for any non-domestic buildings bought, sold or rented. The requirement for DECs was introduced in June 2008 for buildings occupied by public authorities. Certified energy assessors who are members of an approved scheme can only provide energy certificates. 

How to Assess the Carbon Impact of Your Business

You can assess the carbon impact of your business by calculating its carbon footprint. A carbon footprint measures the total greenhouse gases (GHGs) produced directly or indirectly by an organisation, person, product or service. 

A corporate carbon footprint measures all GHG emissions related to your business activities. This includes energy for heating and lighting, company transport, and industrial and commercial processes. Some businesses also include their supply chain emissions. 

Calculating Your Carbon Footprint

To measure your carbon footprint, you must examine three types of emissions, which the Green House Gas Protocol (GHGP) labels 'scopes'. Your business's processes, actions, and employee behaviours generate essentially three categories of GHG emissions.

Scope 1 – emissions created directly by your organisation through actions such as running heating systems and fuelling company vehicles.

Scope 2 – indirect emissions caused by your company, such as energy bought from external sources.

Scope 3 – indirect emissions that occur because of your business activity, such as transportation of office supplies or employees travelling to and from work.

Because scope 3 covers such a wide range of sources at such a number of different levels, it is often the most significant category for businesses. The Greenhouse Gas Protocol identifies 15 categories of scope 3 emissions, including emissions from purchased goods and services, processing of sold products and transportation of purchased fuels.

Next, you'll need to convert your records into compatible units. DEFRA offers a useful guide on measuring and reporting your GHG emissions. Once you've calculated your business's carbon footprint, you can use this information to set targets and develop a strategy for reducing your GHG emissions.

Setting Carbon Reduction Goals

These goals will depend entirely on the results of your research. If your data shows that a high quota of scope 3 emissions comes from transporting supplies, for example, it might be worth researching alternative suppliers within a limited radius. If your heating primarily contributes to your scope 1 emissions, consider reducing your usage, such as insulating the building.

Quantify your progress by setting targets for reductions within a specified timeframe. Communicate your goals with employees and stakeholders to highlight your company's commitment to tackling climate change.

Combatting Greenwashing

Some companies use deceptive advertising or marketing tactics to boost their environmental credentials. Examples range from using product names or labels that sound more natural, even if they contain harmful chemicals, to instituting campaigns that portray polluting companies as eco-friendly. This is not only harmful towards the move towards renewable or low carbon energy but can also be highly damaging to your business reputation because it is essentially considered a form of deception. Make sure that you only market honestly, substantiate any claims that you make, and do so in a way that is easily accessible to your customers and suppliers. 

What is Carbon Offsetting?

Carbon offsetting involves reducing or removing carbon dioxide or other greenhouse gas emissions from the atmosphere to compensate for emissions made elsewhere. It generally involves companies paying other entities to reduce carbon emissions they cannot currently reduce. The company may then count the emissions reductions it has paid for towards its own climate targets.

After verification, they are sold as carbon credits or units that represent a certain volume of emissions reductions. The money received from the sale of this unit provides an incentive for the offsetting project developer to reduce emissions, and the purchase and subsequent retirement of this credit give the offset buyer a measurable reduction to claim. Credits that are traded in this manner are often referred to as making up voluntary carbon markets.

What is the Future of Low Carbon Energy?

The transition to a low-carbon energy future is complex and challenging, but momentum is building. Technological advances, growing public awareness of climate change and political commitments to reduce emissions are driving the shift toward a sustainable energy future.

The pace of this transition is likely to accelerate in the coming years. Renewable energy technologies are becoming more efficient and affordable, and the potential for energy storage technologies, such as batteries and hydrogen, is being realised.

But this transition is not just about technology. It also requires a cultural shift in how we think about and use energy. The choices made by individuals, businesses, and governments will all be instrumental in determining the speed and success of the transition.

How we both produce and use energy is changing, and that change will only accelerate. Your business can get ahead of this curve by switching toward renewable or low carbon energy, and Switchpal can help! We can find the best deals for gas & electricity for your business by comparing multiple trusted UK energy suppliers across the market to ensure that you get the best price for your energy. Switch today, and you can contribute towards a more sustainable future for all of us.