Keeping our capital working for the UK

Print this page

London’s energy needs can be met without sacrificing new houses and offices

Business leaders are to propose better ways of meeting the Mayor’s requirement for local energy generation in London. Representatives from the capital’s major property developers, occupiers and planning and energy experts are working with business group London First and the Mayor’s agencies to set out how London’s future energy needs can be best met.

As part of the climate change mitigation agenda, London’s Mayor has set an objective for London to generate 25% of its own energy needs from decentralised energy sources by 2025, thus significantly cutting carbon emissions whilst reducing reliance on the national electricity grid. The new policy, to be announced later this month also sets a target for a fifth of energy for new developments to be produced from renewable sources.

To put this into perspective, for a quarter of London’s energy to be decentralised will require the equivalent of around 170 ‘energy centres’ of the type being built in the Olympic Park.

The Mayor’s policy requires every new development to include on-site generation. However, the cost and complexity of this is feared by developers to be a major brake on the provision of new housing and office space.

London First has commissioned Buro Happold to undertake research into how the Mayor’s objective can be achieved in a strategic fashion: identifying the barriers and how they may be overcome. The research is being over-seen by an expert steering group chaired by Neil Pennell of Land Securities. The project will address engineering and economic feasibility, the role of the public sector, development implications, commercial and funding issues, contractual and legal issues, the supply chain and the role of waste to energy.

Neil Pennell, Project Engineering Director of Land Securities, said:

“No-one doubts the challenge of mitigating and adapting to Climate Change and the Mayor’s sincerity in leading London’s response. Working with London First and businesses who have a major stake in the capital’s property sector, I am confident that we can find innovative solutions which address the overarching objective without discouraging new development which the capital badly needs. London’s energy needs can be met without sacrificing the much needed new homes and commercial development.”

Judith Salomon, Director of Planning and Development at London First, said:

“Site-by-site energy generation would be inefficient financially, environmentally and in terms of land use. It could dramatically slowdown the pace of homebuilding and make it too expensive to build new offices. If we can find innovative ways of achieving the same outcome through district energy supply, we can reduce London’s carbon emissions without diminishing potential housing and commercial property supply.  Local area solutions to energy generation and distribution can benefit existing building stock too – which accounts for the largest proportion of the opportunity.”

– ENDS –

For further information, contact:
Graham Capper on 020 7665 1505 / 07983 611 227
Lauren Preteceille 020 7665 1471 / 07977 297 811

Notes to editors

Flaws of the site-by-site generation approach:

– A piecemeal approach is inefficient financially, environmentally and in land take, and may inhibit application of technological developments or other innovations
– Current technology is better suited to applications which take advantage of scale to deliver more technically and environmentally efficient and reliable systems
– Hugely challenging and expensive on complex, high density developments
– Only addresses new development which represents 1% of the stock per year
– Unattractive to energy service companies, who require greater economies of scale to be sustainable in the long term, and commercially and legally challenging to developers, thereby reducing the attractiveness of development sites and opportunities.

London First Decentralised Energy Steering Group:

Neil Pennell, Land Securities – Chair
Robert Evans, Argent
Jenny MacDonnell, BCO
Peter Jones, Biffa
Nick James, Bioregional Quintain
Rod MacDonald, Buro Happold
Gareth Hughes, Climate Change Capital
Michael King, London Energy Partnership / Combined Heat and Power Association
Wayland Pope, Crest Nicholson
Angus Norman, EDF Energy
Shirley Rodrigues, Greater London Authority
Michael Baker, Grosvenor
Paul Edwards, Hammerson
Malcolm Ball, London Development Agency
Nicholas Pincott, Norton Rose
Stephen Howlett, Peabody Trust
Richard Gledhill, PriceWaterhouseCoopers
Danny Clark, RPS
Nigel Hawkey, Quintain
Paul Levett, Veolia
Judith Salomon, London First

London First is a business membership organisation whose mission is to make London the best city in the world in which to do business. London First undertakes this by mobilising the experience, expertise and enthusiasm of the private sector to develop practical solutions to the challenges facing London. London First also seeks to persuade central and London government to make the investments that London needs in its infrastructure.

London First delivers its activities with the support of 300 of the capital’s major businesses in key sectors such as finance, professional services, property, ICT, creative industries, hospitality and retail. Membership also includes all of London’s higher education institutions as well as further education colleges and NHS hospital trusts. London First members represent 26% of London’s GDP.”

London First Tweets