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Section 1 Sustainability

Section 2 Impact of Sustainability

Section 3 Ways to Facilitate Sustainability                                           


Description: The purpose of this unit is to enable you to explore the impact of sustainability on the relationship between the utility provider and the customer. 

Author:  Gates MacBain Associates

Section 1  Sustainability

Aims and Objectives

At the end of this section you should be able to:
  • Define sustainability. 
  • Recognise the need for inter-governmental actions.
  • Identify the relevant legislation.

To understand sustainability start by considering a simple system or process and describing the qualities by which it could be defined as sustainable. This may suggest that a sustainable system or process is one that:

is based on resources that will not be exhausted over time


does not generate unacceptable pollution

This suggestion however concentrates on qualities that emphasise environmental sustainability but over the last decades sustainability has more generally been applied to ‘maintaining life on Planet Earth’.  But then Planet Earth itself sustains innumerable eco-systems on which life depends . The International Union for the Conservation of Nature (IUCN), the world’s oldest global environmental organisation, offered the following definition, “Sustainability is about improving the quality of human life while living within the carrying capacity of supporting eco-systems”.  

It has to be recognised however that human life is constantly evolving. It is on a path of continuous growth and development and this brings with it social and economic challenges. Accordingly, later definitions concentrate on sustainable development and the universally accepted definition was offered in 1987 by the Brundtland Committee to the United Nations, “Sustainable Development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs”.

The 2005 World Summit further clarified this statement by noting that “Sustainable Development requires the reconciliation of environmental, social and economic demands” which they termed the ‘Three Pillars of Sustainability’.

Why Sustainability is Important

The Earth’s eco-systems are being stressed by the effects of human inhabitation. The exploitation of fossil fuels was inextricably linked with the development of the industrial world, particularly in the 18th, 19th and early part of the 20th centuries.  But the stark reality is that these resources are finite and they pollute. 

The depletion of the ozone layer, with global warming and climate change its consequence, has been the principal focus of inter-governmental strategies. They have given commitments to reduce greenhouse gas emissions and to help developing countries make similar commitments but without damaging their economic development and future living standards. See web reference ‘Climate Change’

It is clear that action is required across a broad front. The continued rise in global population and the unsustainable consumption of the Earth’s resources present serious challenges. These include: 
  • Reducing the emissions of greenhouse gases whilst preserving the Earth’s forests that absorb much of them. 
  • Improving the efficiency in use of energy and natural resources  whilst developing renewable sources of energy and renewable resources. 
  • Maintaining bio-diversity, which considers all living things and their habitats, whilst reducing pollution to land and water. 

Legislation Relating to Sustainability

The legislative framework regarding sustainability in the UK has emanated from the Government’s legally binding commitment to three tiers of sustainability policies. In other words, those commitments have been given at global, European and domestic levels.  

Inter-governmental (global) Legislative Framework

Kyoto Protocol

The Kyoto Protocol was established under the United Nations Framework Convention on Climate Change, 1992. It was forged after taking key scientific input from the Intergovernmental Panel on Climate Change (IPCC) that was created by the United Nations in 1988. The Kyoto Protocol committed developed countries, including the European Union, to targets for reducing greenhouse gas emissions between 2008 and 2012. It also committed them to helping the developing nations through the provision of funds. 

The Kyoto Protocol was adopted in 1997 and became legally binding in 2005; essentially ratified by nations responsible for 55% of the world’s CO2 emissions.

European Policy and Strategy

EU Emissions Trading Scheme created a mandatory cap on CO2 emissions by energy intensive operations. It requires large CO2 emitters to monitor and report on emissions and to return to the Government an amount of emission allowances equivalent to the CO2 emissions produced. Its requirements have been applied over two trading periods, Jan 2005 – Dec 2007 and Jan 2008 – Dec 2012. The third is planned for 2013 – 2020 and is likely to be extended to include other greenhouse gases. 

Carbon Reduction Commitment Energy Efficiency Scheme created a mandatory CO2 emissions cap and a carbon trading scheme on non-energy intensive organisations; generally defined as organisations with electricity bills in excess of £500 000. It required organisations to register by 2008 and to commence trading from January 2010.

Climate Change Levy (2001) introduced a tax on industrial and commercial (non-domestic, non-charity) energy bills and is intended to encourage the pursuit of renewable sources of energy and energy efficiency. It was introduced under the Finance Act 2000 and effectively replaced the Fossil Fuel Levy.

Climate Change Agreements enable significant discounts on the Climate Change Levy for energy intensive sectors that meet targets for energy efficiency or reducing carbon emissions. The agreements cover ten main energy-intensive sectors, as defined by the Pollution Prevention and Control Regulations 2000, and over 30 smaller sectors. 


UK Domestic Policy

To give effect to EU directives the following legislation was introduced in the UK:

Renewables Obligation came into effect in April 2002 under the Utilities Act 2000. It placed an obligation on licensed electricity suppliers to source an increasing proportion (updated annually by Statutory Order) of electricity from renewable sources; currently 15.4% by 2015/16. 

Sustainable Energy Act 2003 requires energy conservation authorities (local authorities with housing responsibility) to take measures for energy efficiency in residential accommodation and for reducing fuel poverty. It also requires Ofgem (Office of the Gas and Electricity Markets) to continuously consider the reliability of energy supplies in relation to any significant new policies. Under the Act, targets were set for the amount of central government electricity that must be sourced from combined heat and power generation plants.

Water Act 2003 reviewed licensing for water abstraction (including water for irrigation) and required water companies and public bodies to take measures to conserve water.  Water companies were also required to submit Water Resources Management plans and Drought plans that outline how supply and demand will be managed over the next 25 years.  

Climate Change and Sustainable Energy Act 2006 encourages heat and electricity micro-generation installations (with corresponding Building Regulations amendment) and imposes carbon emissions reduction targets on gas and electricity suppliers.  It encourages parish councils and community groups to promote micro-generation, bio-mass production, bio-fuels and energy efficiency measures.  It also requires the Secretary of State (DEFRA) to formally report on greenhouse gas emissions and measures to cut them. 

Energy Act 2008 enables private sector investment in off-shore gas supplies, carbon capture and storage projects and extends requirements on energy from renewable sources through to 2037. It also requires gas and electricity distribution and supply license holders (utilities) to install smart meters to different customer segments, including private households.

Climate Change Act 2008 established the world’s first legally binding long-term framework to cut carbon dioxide emissions from a 1990 baseline (26% by 2020 and 80% by 2050). It includes provisions for measures on bio-fuels, incentive schemes for household waste and charges for single-use carrier bags. It included powers for extending the Carbon Emissions Reduction Target (CERT) scheme that requires gas and electricity suppliers to reduce combined energy savings by assisting domestic consumers to take energy efficiency measures.

Planning Act 2008 established an Infrastructure Planning Commission to take over the planning review responsibilities of nationally significant energy and fuel developments including gas, oil, nuclear, water supply, waste treatment, fossil fuels, renewable energy and electricity networks.

Planning and Energy Act 2008 placed in law the principles of the Merton Rule by enabling local planning authorities to set local energy requirements for new housing and commercial developments. Under this act Local Plans can specify the proportion of energy for any new industrial, commercial or housing development to come from ‘on-site’ renewable sources. It can also specify requirements for on-site low carbon electricity and stipulate energy efficiency levels that exceed the standards in the Building Regulations.

Energy Act 2010 enables the construction of pilot carbon capture and storage projects in relation to the decarbonisation of electricity generation in the UK. It includes further measures for tackling fuel poverty by lowering the energy bills of the most vulnerable consumers. The energy companies will be required to make funds available for these measures by 2013-14. 

CRC Energy Efficiency Scheme Order (2010) tackles CO² emissions not covered by the Carbon Commitments Agreement or EU Emissions Trading Scheme.  It is enacted under powers in the Climate Change Act 2008 and is a mandatory greenhouse gas emissions trading scheme for large private and public sector organisations that are consumers of large amounts of electricity (greater than 6000MWh per year). It also includes other public sector organisations that are mandated to participate.  It imposes a cap to limit the total number of carbon emissions by participants and will publish a league table on their energy-efficiency performances. It will be operated in 7 phases; seventh starting 2036.

Further information can be obtained from the constructionsite units listed below.


Constructionsite Units

Self-Assessment Task

  • List the different customer groups identified by EU and UK legislation and explain which customers are required to reduce carbon and which are required to improve energy efficiency under each piece of legislation.

Section 2  Impact of Sustainability

Aims and Objectives

At the end of this section you should be able to:
  • Recognise the different actions expected of each customer type and their corresponding costs and/or benefits.
  • Recognise the actions expected of utility companies and the corresponding benefits to customers.

Sustainability and sustainable development have been described as achieving a better standard of living while:
  • Using the resources of Planet Earth efficiently
  • Realising continued social progress
  • Enabling continuous economic growth and removing poverty
  • Protecting the environment

It is clear from this description that if the inhabitants of Planet Earth wish to benefit from its aspirations then all must take actions towards the sustainability goals it outlines. These actions and benefits are considered in terms of the users of the energy and resources (Customers) and the providers of the energy and resources (Utility Companies) in the following text. 

The effect Sustainability has on the Customer

Customers per se aspire to a better standard of living and the inter-governmental commitments set out the corresponding global consequences. In terms of understanding specific customer effects it is necessary to consider their customer categorisation, the source(s) of their sustainable energy and the actions required of them for introducing energy and resource efficiency.  

Customer Categorisation

Governments of developed countries have accepted that the attainment of the global aspiration on sustainability requires action at home combined with assistance for developing countries. In the UK the action at home has required the introduction of primary legislation and incentives to encourage investment in new and renewable technologies. 

Primary legislation (EU and UK) has identified different grades of consumers or customers:
  • Energy intensive organisations
  • Non-energy intensive organisations
  • Large public and private sector organisations
  • Industrial and Commercial (non-domestic) organisations
  • Private households
  • Residential accommodation

These customers are either regulated by the legislation to reduce carbon emissions or encouraged through taxation or higher energy bills to improve energy efficiency. Their applicability or influence depends on a customer’s categorisation but in both cases the Government’s immediate aim is for all to benefit from lower energy costs, a better standard of living and an environment that is better protected.

Renewable Sources of Energy and Electricity

The Government has charged energy suppliers with sourcing an increasing proportion of their demand from renewable sources. Targets are expressed against total supplies of energy and electricity.   


There are three principal sources of energy; fossil fuels, nuclear and renewable.  In 2008 the proportions of globally consumed energy produced by these means was fossil fuels 78%, nuclear 2.8% and ‘renewables’ 19%. In the UK only 2.2% of energy is being realised through ‘renewables’ though the UK has a target to raise this proportion to 15% by 2020.



The production of Electricity is a similar story to that for overall energy production. There are four principal sources and their production proportions are fossil fuels 69%, nuclear 13%, hydro 15% and ‘renewables’ (non-hydro) 3%. In the UK in 2008 the production of electricity from renewable sources was 5.6% but it has targets of 10.4% for 2010/11 and 15.4% for 2015/16.

Energy and Electricity Users

Major domestic and industrial-scale supplies from both renewable and traditional sources are managed by the major utility companies and the current adequacy in capacity enables them to deal with peaks and troughs in demand. Thus the UK customer is able to rely on consistent power and continuity of supply; not all nations can give their customers the same reassurance. As a further reassurance to UK customers, Ofgem has been charged with monitoring reliability and protecting customers from the effects of market speculation.


The Government is also encouraging the development micro-generation technologies and enabling Parish Councils and Community Groups to invest in local suppliers of energy.      

Micro-generation is defined as ‘the local or small-scale production of heat and/or electricity by homes and businesses from low-carbon sources’. It encompasses the energy sources and technologies defined in the Sustainable Energy Act 2003 and is limited by the capacities defined in the same Act.  

Micro-generation Customers

Whilst technologies are still developing, the Government allows some micro-generation plants to be hooked up to the national electricity grid which can deliver supply certainty and decreased costs to the customer through financial re-compensation schemes. 

For an introduction to the different renewable sources of heat and energy including guidance on their supply and installation, follow the website reference to ‘the renewable energy centre’.  

Energy Efficiency

Low-carbon energy from ‘renewables’ and micro-generation plants will have a major impact on the UK’s commitment towards climate change. Between a quarter and a third of UK emissions are associated with housing and so there is a clear need for energy saving by domestic customers as well as those in industry, commerce and government. The clear message is that energy efficiency helps counter the on-set of climate change and reduces individual energy bills.


In global terms approximately 35% of human water use is unsustainable due to depleting aquifers and depleting river flows; a position that climate change will not improve. Indeed it poses a severe risk of water supplies becoming polluted even unsanitary. Therefore, Government strategies have been prepared (Defra: Future Water Strategy to 2030 and EA Water Resources Strategy and Regional Action Plans to 2050) to promote better management of the water cycle.

Consumers are being encouraged through regulation, licensing, metering and tariffs to take measures to conserve water supplies, reduce waste and prevent pollution. The EA Water Resources Strategy entitled ‘Water for People and the Environment’ gave commitments to:
  • Promote incentives to reduce demand
  • Improve water efficiency of fixtures, fittings and appliances 
  • Promote better information on product’s water efficiency
  • Increase investment in technology for all types of use including agriculture and industry

This action will help to secure the quality and quantity of supplies with obvious benefits to the consumer.

Sustainable Housing and Products

The Government strategy for Sustainable Construction 2002 sets out 10 requirements for developments procured through central and local government offices. These were adopted into the OGC Achieving Excellence in Construction: Procurement Guide on Sustainability. In relation to energy, water and waste it requires developers to:
  • Actively contribute to targets on reducing CO² emissions
  • Define targets for energy and water consumption during construction and use.
  • Assess any impact on local water, gas and their distribution networks
  • Assess the impact on local sewerage systems and the risks to water pollution
  • Locate developments in zones with little or no risk of flooding

These requirements bring obvious benefits to the consumer and in addition a great deal of research and innovation is taking place. Modern methods of construction and energy efficient building products are reducing emissions and the carbon footprint during construction and during the building’s life-cycle usage.

Government strategies on energy efficiency and climate change have encouraged changes in housing and construction in general. For example, Part L of the Building Regulations that outlines requirements on energy consumption has been extended by the Code on Sustainable Homes. It introduced a sustainability rating system for homes built after 1 May 2008 and includes minimum standards on energy and water efficiency that correspond to the 9 categories of sustainable design.


The Effect Sustainability has on Utility Provider


The regulatory framework outlined earlier requires energy producers (specifically electricity and gas) to take measures to conserve supplies and seek sources of renewable energy. In 2007 the IPCC (Inter-governmental Panel on Climate Change) scientists declared, “There is a 90% probability that the atmospheric increase in carbon dioxide has been human induced and that is mostly the result of fossil fuel emissions and to a lesser extent changes in land use.”  Reducing greenhouse gas emissions by the commercialisation of renewable energy and developing less carbon-hungry technology is firmly in the lap of the utility providers.

The UK is currently, and is likely to remain for some time, the world’s largest single market for off-shore wind. The Energy Acts 2008 and 2010 have enabled investment in further off-shore gas supplies and research into the development of off-shore carbon capture and storage schemes that are intended to decarbonise electricity generation. The Acts also extended the requirement to supply an increasing proportion of energy from renewable sources to 2037. 

Therefore energy suppliers are at the forefront of development of sustainable energy production. Inevitably, the investments made will be covered, at least in part, by government grant and higher returns from the customer.   

Utilities are also required to act on energy efficiency. Under the Energy Act 2008 the utility companies are required to install 47 million ‘smart’ meters into 26 million households by 2010. These will allow both consumers and utilities to constantly monitor energy use and to take timely actions towards its reduction.  

The Government’s Carbon Emissions Reduction Target (CERT) requires all major domestic suppliers to make savings in the amount of CO2 emitted by low income, vulnerable households. In partnership with local authorities and community groups the utility companies are promoting ‘whole house’ energy efficiency measures under the Community Energy Saving Programme (CESP). This also targets low income areas but offers packages best suited to the individual household. The Green Deal, intended to come into operation in Autumn 2012, will streamline these two programmes into a new Energy Company Obligation to ensure households and businesses can benefit from energy saving. See website reference.  


In the early 1990s research showed that humans were using between 40% and 50% of globally available freshwater in the proportions 70% Agriculture, 22% industry and 8% domestic. The Water Act 2003 required the water companies to agree plans to manage this supply and demand for the following 25 years. Defra and the Environment Agency have powers to regulate these plans and have also been given powers to amend abstraction licenses. In relation to future industrial, commercial and housing developments they require the developers to produce measures to support water neutrality, particularly in areas where water supply is under stress.

Being required to encourage water efficiency in domestic and non-household buildings, water companies and the EA are working in conjunction with regional planning authorities, to reduce water consumption. For example, the Regional Spacial Strategy for South East England has a policy commitment to reduce per capita water consumption from 169 litres / day (2003-04) to 135 litres / day by 2016.


Self-Assessment Task

  • Discuss the measures that are being taken by the utility companies in order to promote the use of sustainable resources.

Section 3  Ways to Facilitate Sustainability

Aims and Objectives

At the end of this section you should be able to:
  • Recognise how the Government is encouraging the pursuit of renewable resources and encouraging actions in the efficient use of energy and water.
  • Recognise how sustainability and innovation are being encouraged in new and existing developments.

All providers of energy, heat and water are seeking alternative and sustainable sources and taking measures to conserve supply quality and capacity. Consumers are also acting to reduce consumption not only by improving efficiency of use and reducing waste but also through changes in lifestyle. Developing technologies are providing the alternative sources of energy and their contributions will increase in significance at all levels including industrial, commercial, SME, community and household.

Energy and Heat Supplies

The Government is encouraging the development of a nationwide network of public fuelling stations for alternative fuels. Grants of up to 30% of the cost of equipment, construction and land purchase may be available through the Energy Saving Trust.

Some commercial organisations have developed micro-generation plants using technologies including:
  • Biomass
  • Biofuels
  • Fuel cells
  • Photovoltaics
  • Water (wave and tidal)
  • Wind
  • Solar
  • Geothermal
  • Combined heat and power
  • Any other agreed source that cuts emissions of greenhouse gases

Under the Government’s Enhanced Capital Allowance Scheme they may write off the whole of the capital cost of their investment against their taxable profits in the same period.  SMEs may also benefit from interest-free Energy Efficiency loans of up to £100 000 for the replacement or upgrading of energy related equipment. Applications are administered by the Carbon Trust. 

Legislation has also been put in place for Parish Councils and Community Groups to promote micro-generation projects. E.ON, the power and gas company, is offering grants of up to £30 000 to UK communities with projects that reduce carbon emissions. 

The Government’s Low Carbon Buildings Programme (closed to new applicants in Autumn 2010) provided grants towards the installation of micro-generation equipment as long as energy was not being wasted elsewhere by the user(s). 

Energy Efficiency

The Government is encouraging home owners to introduce sustainability measures by providing grants and supporting the dissemination of information. 

Grant aid for Home Renewable Projects is available to most households and allows such measures as improvements to roof and wall insulation. It also offers further assistance and support for households on income related benefits. A Guide to Home Energy Saving has been produced by the Renewable Energy Centre as an introduction to the subject and the Energy Saving Trust manages 52 Energy Efficiency Advice Centres across the UK; see website references.  

Families in ‘fuel poverty’, defined as needing to spend more than 10% of their disposable income on energy, may be eligible for 100% grants for insulation, lighting or more efficient heating. Free and grant assisted loft and cavity wall insulation may be available to all homeowners and tenants through the Green Project. Information is available through local Energy Efficiency Advice Centres.  


Improving water efficiency, reducing water consumption and the volumes of water going to waste and encouraging water recycling are key themes for Defra and the Environment Agency. They are promoting the dissemination of information and customer guidance to encourage sustainable actions at all stages in the water cycle. 

Water Efficiency

Waterwise, a UK NGO which is the leading authority on water efficiency in the UK, provides information and guidance for all consumers. Two of its reports entitled ’Water Efficiency in New developments’ and ‘Evidence Base for Large-scale Water Efficiency in Homes’ give clear guidance on water savings from water efficiency measures. Many of these measures are an integral part of the requirements in sustainable housing. These can be found at the  web site Waterwise shown below.

The EA are encouraging manufacturers of fittings, fixtures and appliances to provide water efficiency information on their products. In response, the Bathroom Manufacturer’s Association (BMA) have introduced a voluntary Water Efficiency Product Labelling Scheme to allow comparisons of products that meet the industry standards on water efficiency. It also provides information that enables consumers to reconsider how, when and to what extent they should use water. 

Water Consumption and Waste Water

The Department of Communities and Local Government have developed the ‘Water Efficiency Calculator for New Buildings’ that is required under Part G of the Building Regulations and the Code for Sustainable Homes. In addition to the calculation of wholesome water consumption it also enables assessments to be made of the value of Rainwater Harvesting and the collection and recycling of Greywater.  See website references.

Waste Treatment

Alternative systems are also available for the latter part of the water cycle. Composting toilets can be installed on a domestic scale to produce waste that can be used as a fertiliser in the garden. On the other hand, Reed Bed sewage treatment systems offer secondary treatment of sewage that can provide very low maintenance, aesthetically pleasing wildlife habitats. See the website reference for Renewable Energy Centre  

Renewable Energy Centre 

Is an industry-sponsored website that provides information, guidance and indicative costs on alternative and renewable sources of energy at both industrial and domestic level. It includes methods of reducing energy use and of improving water efficiency and alternative sources of providing water and space heating.  In addition information is offered on grants and funding along with useful websites for further advice on renewable energy and energy saving. 

In addition to the detailed advice they offer on the practical application of micro-generation technologies, information is also offered on improving the household. Measures such as cavity wall, loft and under floor insulation are outlined along with links for further information and commitment. Other actions are similarly outlined as are options for glazing, under-floor heating and the concept of environmental design.

A further section is included for waste water recycling, sewage treatment and rainwater harvesting. See website reference for the Renewable Energy Centre.

Sustainable Building

All construction projects should be planned and delivered in a way that best promotes sustainable development. The Government responded in 2000 when it established its Strategy for Sustainable Construction that encouraged the construction industry to:   
  • Re-use existing built assets
  • Design for minimum waste
  • Aim for lean construction
  • Minimise energy in construction
  • Minimise energy in use
  • Prevent pollution
  • Preserve and enhance biodiversity
  • Conserve water resources
  • Respect people and the local environment
  • Set targets to monitor and benchmark performance

It also recognised that all decisions within this strategy involve balancing the conflicting needs of the Social, Economic and Environmental aspects of sustainable development. 

Under the Office of Government Commerce initiative ‘Achieving Excellence in Construction’ two high level guides, three core guides and eight supporting guides were offered for use with central and local government construction projects. One of these guides, the Procurement Guide for Sustainability adopted the aims of the 2000 strategy and helps clients to follow an appropriate process towards a sustainable construction. It governs the process of procuring and constructing all significant government (central and local) buildings. See web reference in unit 2.

The Code for Sustainable Homes has been introduced by the Department of Communities and Local Government to reduce carbon emissions and create sustainable homes. Its Technical Guide 2010 sets out the process by which the standards of the Code Assessment can be reached. Its guidance is in 9 sections including Energy/CO2, Water, Surface Water Runoff, Waste and Pollution. See website references.


New technologies and innovative products significantly help the construction industry and the UK in their commitment to reduce greenhouse gas emissions. But the construction industry is very much project led, each one unique and generally involve temporary teams. This allows little time for, or investment in research and development. 

In 2008, the Department of Innovation, Universities and Skills (now the Department of Business Innovation and Skills) backed 5 pilot projects so that UK business could benefit from the specialist expertise of FE Colleges. Within each pilot, projects were identified for research into innovative components and practices and expert advice offered on their use in improving energy efficiency and reducing carbon emissions. In one such pilot, six East Midlands colleges combined to produce ’Innovation in Sustainable Construction’ which gives expert advice on a variety of products and processes. See web references or book.

The ‘Sustainable Construction Innovation Network (iNet)’, part funded by the European Union and the East Midlands Development Agency, is raising the level of innovation in small to medium-sized construction businesses. Its advisers offer assistance in researching, developing and implementing new sustainable services, products and processes. It encourages skills development, networking and can provide access to appropriate grants. See web references.




  • Morledge, R, Ed 2010, Innovation in Sustainable Construction, East Midlands NTI; Leicester 

Self-Assessment Task

  • Discuss the ways that the government is promoting and encouraging sustainability with regard to the provision of building services engineering.

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