UK Climate Change Programme 2006 - JNCC - Defra

110
Public sector
24. The Government is working with representatives
of the Regional Development Agencies to
respond to Recommendation 13 of Ben Gill’s
biomass taskforce report, which recommends that
all RDAs should set themselves targets for carbon
reduction. Initial discussions have been
positive, and the Government and RDAs
expect to bring forward proposals jointly
over the coming year.
Funding schemes for public sector
organisations
25. In the 2005 Pre-Budget Report the Chancellor
announced an increase in funding for the Carbon
Trust by £20m over the next two years to
establish a revolving fund for energy
efficiency work in the public sector, building
on the pilot Local Authority Energy
Financing (LAEF) Scheme. In such a scheme
loan funding for organisations is conditional on
maintaining a ring-fenced energy management
fund, with initial funding supplied by the scheme
and sometimes all or part matched by the
participating organisation.
they plan, invest and save within their portfolio
giving them real reasons to ‘invest to save’ for
the long term. Not only does this improve
environmental and efficiency standards within
estates, but it can also stimulate more
widespread adoption of energy saving and
carbon reduction measures.
27. With the additional funding of £20m, Salix
Finance, which was set up by the Carbon Trust to
administer the new revolving fund, will initiate a
major escalation in funding support for public
sector organisations in 2006-07. The scheme is
expected to deliver additional carbon savings
of 0.1MtC by 2010. Salix will seek proposals
from local authorities with the aim of
increasing the size of its existing LAEF
programme by around 60 authorities and
will begin work on new funding vehicles to
support central Government departments,
higher education and the NHS, with the aim
of supporting at least 20 new public sector
organisations in 2007-08.
28. The experience that Carbon Trust and Salix
Finance have gained through the development of
the Local Authority Energy Finance Scheme has
shown that successful delivery of the fund will
depend on client organisations developing
innovative approaches to overcoming financial
barriers to providing up-front investment in
energy management. Therefore the
Government, with the Carbon Trust, will
establish a high level steering group to
oversee the early development of the fund
and to tackle barriers as they are
encountered.
26. Most energy efficiency measures in public sector
buildings have a payback period of within five
years or less. A scheme which creates revolving
funds would be a net benefit to public
expenditure after around four years, and
continuing for the lifetime of the measures
installed, in many cases, at least another ten
years. Financial mechanisms of this type drive
change by encouraging procurement managers
and decision makers to look again at the way
29. Overcoming financial barriers is important but
they do not exist in isolation. Alongside the
development of a revolving fund mechanism, the
role of advice and support is central to the public
sector achieving its goals. The Carbon Trust’s
Carbon Management programme is tailored
to large public sector organisations such as
Government Departments, local authorities and
higher education organisations. The programme
helps organisations assess how to combat the
risks and take advantage of the opportunities