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Sustainability at Greenwich in 2012

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As work gets under way in 2013 we take a moment to look back on 2012 and see what the University of Greenwich has achieved in the last 12 months by looking back at some of the highlights of the year. So in chronological order:

Green Week & Fairtrade Fortnight

Avery Hill Green Week fayre

The Dome at Avery Hill plays host to Green Week

February and March was action packed with Green Week and Fairtrade Fortnight giving everyone at the university a chance to find out more about sustainability and how they can get more involved at home and at the university.

ISO14001 Accreditation

In March our sustainability management system was accredited with the ISO14001 international standard. This was a huge achievement for a lot of staff working in the Facilities Management department and recognition for work that had been ongoing for a couple of years.

Community Garden

Harvest

Harvest from the Community Garden

In April we started work on the community garden at the Avery Hill Campus. It has been a tremendous first year and the garden is now well and truly starting to take shape with a polytunnel, shed, rainwater harvesting and a harvest of fruit and veg with the biggest parsnips and pumpkins I have ever seen. A huge amount of help has come from the volunteers and with a forest garden planting session planned for early this year it is going to continue to grow and flourish.

Emily Joins the Sustainability Team

In April last year we were blessed with a new team member as Emily Crockford (now Mason) joined us from the University of Kent. Emily has been a great asset to the team working really hard to get the Carbon Culture tool up and running and has been instrumental in the development of the community garden.

1st in the People & Planet Green League

The 28th May was a proud day for the University of Greenwich as we topped the People and Planet Green League for 2012. This was a reflection on the hard work that has been taking place across the university for a number of years and continued progress on sustainability projects across campus. We were absolutely delighted with the result especially considering that we were positioned 103rd in the same league table just three years ago!

Sustainability Awards

We celebrated the end of the academic year with our annual sustainability awards. A brilliant year for sustainability at the university capped with an enormous effort from our sustainability champions who tripled the number of Green Impact tasks completed to over 1500 and 8 departments ended up receiving the Gold Award whereas only one managed this the previous year.

The Meridian Envirobin

Meridian Envirobin

Meridian Envirobin

A partnership between the University of Greenwich and Leafield Environmental resulted in the Meridian Envirobin. A brand new concept for recycling by designing a bin to encourage the end users to recycle more and throw less into the not-recyclable waste stream. The bin has now been installed at the Avery Hill and Medway Campuses and although we are still waiting for the official figures from our waste contractor we are noticing a rise in the recycling rates on those two campuses.

Carbon Savings

A lot of work going on across the university is starting to pay off as the University’s carbon emissions have begun to fall. The introduction of the Carbon Culture Tool is a particularly exciting development and one that will hopefully lead to further savings in 2013 but the stars of the show our the photovoltaic solar panels on the Avery Hill Campus which exceeded expectations and generated 46,796 kWh in their first 12 months bringing the payback period under 10 years.

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Green Impact Launch 2012-13

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This week saw the launch of the Green Impact project for the third consecutive year. Staff Sustainability Champions and interested students gathered at the Greenwich Campus to hear from the Vice Chancellor David Maguire and his vision for sustainability at the University and to learn more about what is in store for sustainability at the University over the coming months. Over the last two years the sustainability champions have produced some brilliant results using Green Impact as tool for embedding sustainability at a departmental level. In the first year the project ran the champions managed to undertake 561 positive sustainability actions, last year it was over 1500, it will be quite a challenge to continue that momentum but the enthusiasm in the room was palpable as we relaunched the project for this academic year!

Green Impact

Green Impact

The champions were introduced to the new Green Impact workbook, received an update from the Sustainability Team and collaborated to create behaviour change programmes using a specific planning model created by Action for Sustainability. With several new staff members joining the staff sustainability champions network this year John ran an induction session to kick off the days events before being joined by the returning champions and Sophia Perkins from the NUS for a general update on Sustainability.

At lunch everyone had the chance to quiz our new caterers Baxter Storey on their sustainability credentials and find out about how the food served at the University is sourced by their suppliers. M&J Seafood brought along a selection of fish that would be finding their way on to the University menu the following day including salmon, gurnard and sole. They gave us tips on how to tell how fresh a fish was, and told us about their sourcing, fishing and farming methods designed to ensure the long term sustainability, not only of the fish they sell but of their business as well. We were joined by Chegworth Valley, who had a wide range of different juices for us to try including, apple & beetroot, apple & elder flower and pear. The high quality of the juice was evident from the tasting session and the representative from Chegworth Valley explained to the group about the different varieties of apples they grow and the process that converts their fruit to the juice that ends up in the glasses of University of Greenwich staff and students.

Baxter Storey's Offering

Baxter Storey's tasty offering for Monday's event

Professor David Maguire, the University of Greenwich Vice Chancellor joined the staff champions after lunch to reiterate the university’s commitment to reducing carbon emissions, sustainability in general and offer his support to the champions in the work that they are undertaking. Following David’s visit we got stuck into the workshops. The sustainability champions mentioned positive changes that they would like to see made across their department so the first workshop tasked the champions with developing behaviour change campaign plans for implementing the positive changes. The results were quite impressive and showed a pragmatic path for engaging staff, students, improving heating, encouraging staff and students to switch off and for making the transformation to paperless offices.

Play Your Carbon Cards Right

The Sustainability Champions were delighted by the nation's favourite game show host!

Following the behaviour change workshop the sustainability champions were treated to Bruce Forsyth’s latest game show, ‘Play Your Carbon Cards Right’ where they guessed which university buildings were producing the highest carbon output compared over the first two weeks of October this year. The game show was designed to get everyone in the mood for testing the new Carbon Culture software that the University has invested in. The software allows anyone to monitor the carbon emissions, energy use and financial costs associated with powering the University’s buildings. The champions will be using the software this year to demonstrate carbon savings to their colleagues and students within their department and will be setting themselves some targets for carbon reduction as the year progresses.

Carbon Culture

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University of Greenwich Bees

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This week we are given an update from the various bee hives we have across the  University of Greenwich. Since getting hives at Southwood House on the Avery Hill Campus (looked after by John & Christine Hird) a couple of years ago we have added further hives at Avery Hill, managed by local beekeeper Colin Edwards, hives at Greenwich looked after by Camilla Goddard of Capital Bee and now the Natural Resources Institute (NRI) have installed some hives at Medway too. We here how some of our bees have been getting on this year, starting with the ones at Medway where Jeremy Cooper explains how their first season has gone:

‘After arriving as flat packs, the three bee hives were assembled and installed on the Medway Campus in June, which was later than ideal, but season started slowly and the colonies of bees arrived later than expected. The bees have been busy since then, operating from their hives situated between Hawke and Grenville buildings.

This month saw our first harvest of 37 jars of lovely clear honey, which were distributed to members of the beekeeping group and some NRI managers.

NRI Beekepers group inspecting their hives

NRI Beekepers group inspecting their hives

Since June, we have been learning as we go about bee husbandry. By a happy coincidence, a local bee expert was on the campus when we were making one of our first hive inspections and he (known locally as John the bee man) has been very helpful in training and advising the group of volunteers. All 20 group members have now had the chance to handle frames which are full of bees, and to learn how to tell the queen from workers and drones.

Several people in the group took photographs of bees on flowers, and some have been used on labels for our first harvest. This picture, taken by Mark Parnell’s wife Sue, is one of eight that featured on the labels this first season.

NRI honey bee

NRI honey bee

For the rest of the year there are several jobs to be done, including treating the hives against the deadly mite Varroa, that has been one of the factors to have reduced bee populations in recent years. Other factors as less straightforward, and if we can get the support, members of NRI may do some research in future years to find out more about how to safeguard these important pollinators. In the meantime we are marveling at the way the bees operate (and enjoying the honey!)’

John & Christine let us know how our original hives at Southwood House have fared this year, ‘We extracted [honey] at the end of July, it wasn’t a brilliant yield but better that 2011. As you may have read in the press the weather hasn’t been very kind to bees this year. After extraction it was time for putting the varroa treatment into practice, which takes four weeks.  Varroa is a parasite we cant eradicate but hopefully can keep under control.

After the treatment was complete we then start to feed, we feed the bees as we need to make sure they have enough stores to overwinter.  We feed a solution of white cane sugar mixed with warm water so it dissolves and the bees can then store it.

So now we are up to date, we have been down to see the bees and have hefted (lifted to feel the weight) the hives which seem fine for stores. Within the next few weeks we will put the mouse guards on the entrance and a protective cover round each hive to prevent woodpecker damage.’ In total we have received 60 jars of honey from the bees at Southwood house and still have a few leftover – get in contact with sustainability@greenwich.ac.uk if you fancying buying a jar.

John & Christine looking for the Queen earlier this year

John & Christine looking for the Queen bee earlier this year

Colin Edwards, another local beekeeper also keeps hives at the Avery Hill Campus, ‘The Avery hill bees, having had a rough start this season due to weather conditions, the spring crop of honey was zero.  However, after introducing a few new queens Italian and Buckfast, and a few of my own,  all the colonies have built up well, but the second crop was very low due to lack of nectar flow. All the bees are now feeding well and looking promising for the winter season spent on the meadow,  so we are hopefully looking forward to a better honey crop next year!

Lastly I would just like to thank the staff of the Avery hill campus  for all the help and support throughout the year.’

Avery Hill Meadow Beehive

Avery Hill meadow beehive with woodpecker protection

Camilla Goddard’s bees at the Greenwich Campus were removed on the request of LOCOG and they spent a few months on holiday in London Fields in Hackney and Covent Garden in central London. They are being moved back into the hives as we speak and will be looking forward to being back in Greenwich!

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Freshers Fairs at the University of Greenwich

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Last week saw the University of Greenwich welcome thousands of new students to the university, and of course the Sustainability Team was on hand to say hello. At the Avery Hill and Greenwich campuses freshers were treated to a festival atmosphere, with music, food and stands from various different university partners, student services, charities and university departments. The Sustainability Team were there with a wide range of opportunities for new students to get involved with and a lot of information for the students that were interested in how their university had tackled the issues of sustainability.

Avery Hill Fresher's Fair

The Sustainability Stand at the Avery Hill Fresher's Fair

One of the biggest draws to our stand was the display of fruit and vegetables that had been harvested from our community garden that morning – particular the enormous pumpkins that shadowed the pile of lollipops on the next door stand! Students signed up to the sustainability team mailing list to find out news and information from the team, opportunities for getting involved with the garden, volunteering and work placements where they can skill themselves up for life after university.

Pumpkins

Our pumpkins!

There was a particularly large focus of interest from the students on a few new opportunities we have available this year. There is the ‘Halls Champions’ project where students will be able to sign up their flat to compete in a green league table and try to be the ‘greenest’ by completing tasks to reduce their negative environmental impact and encourage positive behavior. The project is based on the same model as the Green Impact project whereby staff encourage and promote sustainability at a local level and work through tasks in a workbook. Similarly students will go through the workbook and implement positive environmental change in their flats, this is aimed to increase energy efficiency, recycling rates and engage the residents with sustainability in a fun and exciting way! The rewards will be plenty, not only will the students be able to save money on their energy bills but they will also get the chance to win prizes and get to attend events and workshops with their peers.

Emily Promoting the Virtues of the Sustainability Team at Greenwich

Emily promoting the virtues of the Sustainability Team at Greenwich

There were plenty more placements on offer as well – students can apply for internships such as the ‘Fairtrade Intern’, ‘Crowd Sourcing Intern’ or ‘Green Impact Project Assistant.’ The full list of opportunities is available at this link: http://greenwich.prospects.ac.uk/index.html

All the students that signed up at the Freshers Fairs will have their names entered into a hat, the first names to be drawn will win a jar of campus honey and a bottle of fine sparkling English wine. A prize certainly not to be sniffed at and will provide the winner with a little taste of some fine local produce!

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Carbon Saving at the NRI Glasshouse and Insectary

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Today Charles Whitfield from the Natural Resources Institute tells us about how they are contributing to carbon saving at the University of Greenwich through upgrading and updating the glasshouses and insectary:

Progress on the Glasshouses

Progress on the Glasshouses

Over the last few months the NRI and Facilities Management in conjunction with the University of Greenwich Sustainability Team have made some huge improvements towards reducing energy consumption in our glasshouses and insectaries. The glasshouses were installed over 20 years ago. Although they were built to a very high specification and have lasted well, they have been due for an upgrade for quite some time. The recent refurbishment project has involved:

  • Replacing the old 3mm glass panes with tri-walled, high insulating, polycarbonate sheets (24 – 40 % reduction in heating cost). (For the heating geeks, 3mm glass has a U-value of 5.9 and the new polycarb had a value of 3).
  • Installing new doors with better insulation and seals.
  • Adding light sensors to the hi-lux sodium lamps so that can come on automatically if natural light is too low.
  • Removing the FCU heaters from the ceiling which will vastly reduce heat wastage via open ceiling vents as well as allow more natural light into the compartments.
  • Upgrading the control systems to link the heating and cooling systems so that they work together (rather than individually as before).
  • And finally, preventing the disruption of research and saving precious time and energy, we have replaced all the insect screens to reduce incidences of pest outbreaks in the compartments.
  • Improving online BMS access for the glasshouses so they can be monitored and controlled remotely by NRI technicians

At the same time we have also installed new hoses and water guns to reduce water wastage, and work will soon start on repairing and repainting the floors. In addition, the cleaners spent several sweltering days scrubbing 20 years of limescale from the internal glass partitions.

Cleaners working hard at making the glass see through!

Cleaners working hard at making the glass see through

Energy consumption in the insectaries has been reduced by a number of upgrades to the control systems and ceiling lights. We now have the ability to ‘shut down’ rooms that are not in use. Energy efficient fluorescent lighting has been installed in rooms that originally only had high energy lighting. This allows us to switch over to the energy efficient lighting if the room is not currently being used to grow plants. Not only does this reduce energy consumption by the lights but also reduces the amount of cooling required in the roof space (the high energy lights produce a huge amount of heat). Manual light switches have been added to all the CT rooms in the insectary as well as the EAG room, and post room (so the lights no longer need to be left on all the time).

The finished glasshouses

The finished glasshouses

Overall, these improvements should provide a substantial reduction in energy consumption by the NRI facilities and give users more control of their workspace.

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University of Greenwich Tops the People & Planet Green League 2012

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The Sustainability Team are absolutely delighted to announce that we have topped the People & Planet Green League table for 2012. It is a tremendous result that we are extremely proud of at the University!

University of Greenwich Number 1 in the Green league

We were really pleased when we achieved fifth in the table last year and have pressed on working to improve in the areas we were behind in. Since the last table came out we have managed to achieve ISO14001 accreditation for our environmental management system, really gotten under way with some of our biodiversity projects, pushed forward our work to bring together the academics in the University who are teaching and researching sustainability related topics and have seen sustainability finally make its way into the University’s Strategic Plan.

Our Sustainability Champions Network has almost doubled in size since last year and the champions between them have tripled the number of tasks completed as part of the Green Impact project. Last year they completed 561 actions to improve the environmental performance of the university, this year it is over 1,500 – they have also been instrumental in communicating sustainability across the board and embedding it at a local level.

Our Sustainability Champions at last year's awards - this year we are looking for a bigger staircase!

As a result of our good position in the table last year there has been an increase in interest in and knowledge of the work we have been doing, and as the work that we are doing has spread further across the university we have found more and more willing collaborators and innovators.  There are some really exciting research and teaching projects taking place across the schools and offices in the University.

If it wasn’t for all the staff and students at the University who have taken these extra steps and really adopted the philosophy behind our sustainability strategy the result in the Green League would not have been possible.  We owe a lot of thanks to a huge number of people within the institution, a lot of people have played their part people such as our campus Facilities teams including our cleaners and porters dealing with energy, water and waste, the senior managers of the university supporting their sustainability champions, those who get their students involved in sustainability and those in the Vice Chancellor’s Office especially the Deputy Vice Chancellor of Resources- who has supported the ‘positive deviants’ that have been spotted roaming the university’s grounds?!

Positive deviant: a person who does the right thing for sustainability, despite being surrounded by the wrong institutional structures, the wrong processes and stubbornly uncooperative people. And doing it in a way that
brings other people along.
Extracted from: The Positive Deviant: Sustainability Leadership in a Perverse World (Earthscan 2010) by Sara Parkin.

Student volunteers have audited every nook and cranny of the campus, staff champions have got sustainability onto the agenda at hundreds of meetings and not a day goes by without someone at the University contacting us about an idea or an opportunity they have spotted for implementing sustainability in some way across the university.

Lots of new projects have been taking place including our Orchard planting last autumn

Our internal sustainability awards at the University in June will be attended by well over 50 members of staff and students which is testament to how many people there are working towards improving the University’s sustainability performance. It has been a lot of hard work but knowing we are making a positive difference, not only to the environment, but also for the staff and students that live, work and study at the University is the driving force behind the energy that goes into what we do.

P.S. If you haven’t read it – we thoroughly recommend that you read Leith Sharp’s paper on ‘Green campuses: the road from little victories to systemic transformation’. It’s from 2002 but still very relevant and if you’ve ever tried bringing about organisational change in a university it may ring true and for those of you who haven’t tried it it provides a great insight into the complex challenge!

So after a glass or two of Kent’s finest sparkling wine- please raise your glasses and celebrate all those working in sustainability – it’s back to work for the Sustainability Team here at Greenwich-  we still have a long journey ahead of us……

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Two hives from one! Bees at Southwood House

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Last Friday saw our bees at Southwood House in Avery Hill start a swarm and the formation of a new colony. The building services team spotted the bees gathering in a swarm underneath one of the two hives while doing a walk-round check of the campus. After a couple of telephone conversations with our beekeepers, John and Christine Hird (the beekepers for our Southwood House bees) decided to come and visit the bees and see what ought to be done.

Bees swarming on the bottom of the hive

John tries on some of the protective bee keeping clothing

When John and Christine arrived we donned the protective clothing and had a closer look at the swarm that was forming. Bees tend to swarm when they are looking to replace an older queen with a new one and is part of the reproductive cycle of a hive. The hive will create some queen cells and the queen will lay eggs in these, then the hive will stop feeding the queen so that she is lighter and more able to fly. When the old queen leaves the hive (sometimes taking as many as 60% of the bees with her) she will find a resting place while the scouts look for potential new places to form a hive. The scouts go off to look for new loactions and the new location is determined by the level of excitement the scouts communicate about to the hive. This process normally takes around three days and the bees tend to be non-agressive during this time as there is less focus on defending brood.

When we had a closer look at the bees it was clear that this is what they were doing but rather than let the scouts find a new home and lose the swarm of bees John and Christine decided to capture the swarm and place them in a new hive or a ‘nuc’. This would lead to us getting two hives from the one hive that had started swarming. To do this John opened up the hive and started to look to see if the queen was there and look for queen cells. As expected there were a few queen cells and no sign of the queen bee in the hive, this meant the old queen had left and was looking to create a new hive and the remaining bees were looking after the queen cells and brood inside to get a new queen for the old hive. After the hive had been checked we then went to capture the swarm in the nuc.

Checking the hive to see if the queen bee was still inside

Getting a closer look at the bees working on the cells

Normally bees would swarm in a brach of a tree which would then require a litte shake to get them to fall into the new hive but as they were attached to the bottom of the hive this meant we had to take apart the hive and get the nuc right underneath it – with a couple of bashes and a couple of brushes the majority of the bees were in the nuc. The queen went in and soon enough the remaining bees on the bottom of the hive started to diminish as they followed the queen into it. The nuc was then fitted with a couple of frames so that the new hive could stat to form cells for the queen to lay eggs and the hive to bring up some new brood and of course seal off some honey too!

Moving the bees off the base of the hive into the 'nuc'

The nuc - now with the swarm of bees inside along with the old queen

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New Member in the Sustainability Team: Meet Emily Crockford

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Hello all! I am Emily Crockford and I will be working alongside Kat and John as a sustainability projects officer for Greenwich. It is great to be working for Greenwich and to be back in London and I am excited to be involved with all the fantastic projects happening here.

My love of all things environmental started with my love of the book, ‘The Lord of the Rings’. Amongst my teenage love of Legolas the elf there was one moment that really stuck with me: when the Wizard Saruman orders for the trees of Fangorn to be chopped down to fuel the fires of war I remember thinking that it was all an incredible waste, and so the seed of sustainability was planted!

Legolas hear's Emily calling!

My background is in wildlife conservation after studying my degree with the Durrell Institute of Conservation and Ecology at the University of Kent; and I then went onto an internship and volunteering with the RSPB on their London Parks House Sparrow project. If there was one thing that I learnt from other conservationists and in my time trying to conserve wildlife it was that climate change was probably going to undo all our good efforts! It was this that finally nudged me over into sustainability and back to the University of Kent to run their Green Impact project for two years.

Emily Litter Picking

Green Impact is a behavioural change projects aimed at staff to increase their pro-environmental behaviours. The same scheme is run at Greenwich so if you have not heard of this before or think you would like to take part get in touch with us and we will tell you all about it.

While at Kent I also took on the role of Environmental Coordinator for nine months which meant I covered a range of sustainability projects from promoting Fairtrade produce to writing procedure for the ISO 14001 environmental management system. Working in sustainability within Higher Education is extremely satisfying as the range of projects available means there is a lot to get stuck into. I have also found that the diversity of people to engage with makes the whole job a lot more interesting.

At Greenwich I will be predominantly working on carbon reduction, especially in regards to engaging staff and students with the carbon management plan. The University of Greenwich has committed to reducing our emissions by 30% (from our 2009/2010 baseline) by 2015/2016 and it will take everyone’s input to hit this target. If you are interested in how you as an individual can help please do get in touch, and I look forward to meeting and working with you all!

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Business School Lectures: Dominic Fry of M&S Talks Plan A

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Sustainability intern Linda takes over the blog once again and tells us what she thought of Dominic Fry’s lecture to the Business School on Marks & Spencer’s Plan A.

On March 7th, the Business School at University of Greenwich had invited Dominic Fry of Marks & Spencer to give a lecture on the company’s Plan A commitments and its 2015 plan of becoming the world’s most sustainable retailer. It was a great opportunity from students across disciplines to learn more about sustainability in retail, how to communicate such initiatives to consumers and get an idea of how corporate social responsibility (CSR) can be implemented in a large corporation. With a special interest in fashion supply chains, I was personally really excited to hear from such a significant and acknowledged UK clothing retailer.

Dominic Fry is the Director of Communications and Investor Relations at Marks & Spencer. Fry has 30 years of experience from PR and communications, and his impressive resume includes past director roles at J Sainsbury plc and ScottishPower plc. At Marks & Spencer, Fry is responsible for all internal and external communications and reports to shareholders and the chief executive.

Marks & Spencer is present in 42 countries and 1/3 of Britain’s population shops with Marks & Spencer once a week. Those are amazing figures, and it is evident that the supply chain of a retailer of such magnitude will have an impact on the environment as well as the people in the value chain. Fry emphasized how the global climate that we currently live in is the fastest it’s ever been: the phone calls made in all of 1998 is the same number of phone calls in 2012 made in a DAY! This fast-paced environment results in plenty of challenges for a big company, including food, health and safety, a growing population and naturally, climate issues such as global warming.

How does Marks & Spencer cope with the accelerating paces of today? Plan A was launched in 2006 to address issues such as climate change, fair trade and environmental issues. The plan comprised of 100 sustainability commitments, and 80 more were added in 2010. Some successes that have come about as a result of plan A include a 28% package reduction in food and clothing, 23% more energy-efficient stores and a 34% total waste reduction across sites and stores.

Sourcing decisions are especially interesting when talking about sustainability and CSR, as the sourcing strategy a company adopts has such a significant bearing on people and environment. We learned that Marks & Spencers suppliers are all accredited factories that have to abide by plan A principles and are audited independently on a regular basis. It even boils down to seemingly small situations like a needle dropping on the floor in a production line. In such an event, all operations need to be stopped to locate the needle so it can be removed! Moreover, having a growing number of ethical model factories in the supply base is also a huge focus for the company.

Plan A is about doing the right thing, but it is also about energy and cost savings. The extensive program was a 200 million pound investment, but has also saved the company 50 million pound resulting from more energy-efficient solutions. This goes on to prove that sustainability really can be hugely cost-efficient! Every Marks & Spencer shop has a “Plan A champion”, whose role includes being an advocate for Plan A, encouraging other staff members to follow correct procedures in for instance handling of waste and recycling and generally being an ethical and sustainable ambassador.

How does Marks & Spencer communicate all of these efforts to the consumer? Fry highlighted the important point of patience in such communications – it does take a really long time to get it across to customers. But as fair trading and sustainable sourcing should be long term commitments, it makes sense that it takes time to build up that trust with the customer as well. Going forward, one challenge is the online community and the potentials, and possible pitfalls, of social media. This is a resource that Marks & Spencers wants to utilize better in the future. Moreover, the company hopes to accentuate that part of its vision is their stand on social good. Just looking at last year’s riots, it is clear that there is a lot of anger in young people, dealing with challenges such as unemployment and rising tuition fees.

We found it to be a really inspiring lecture, and it’s nice to see that it is possible to make more conscious consumer choices on the high street. Next time you step into a Marks & Spencer’s, you might want to pick up a can of sustainably sourced tuna, a fair trade t-shirt or a 100% recycled polyester cushion?

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Julia Raybould: What effect does Sustainability have on a Discount Rate?

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Today Julia Raybould, who has been working tirelessly with the Sustainability Team to help us gain our ISO14001 accreditation for our sustainability management system takes over the blog and gives us an insight into how sustainability relates to economics. Here she focusses on the discount rate, an element from her masters dissertation she did for her MPhil in Environmental Policy at Cambridge.

Julia is leaving the Sustainability Team today and heading for Her Majesty’s Revenue and Customs but in the few months she has been working with us in the Sustainability Team she has been a driving force in getting our sustainability management system up to ISO14001 standards. We wish her the best of luck in her new role and HMRC can be rest assured they are getting an absolute gem!

Sustainable Economics

Sustainability is said to stand on three pillars – environment, society and economics. The Economics Pillar is often forgotten or is only discussed in the context of cost savings. But, as the economy and economic growth features more in the media and society is scrambling to find solutions to debt and growth on a finite planet, the economic pillar is coming into its own. Think tanks such as the New Economics Foundation and RESOLVE are considering alternative solutions to creating a sustainable economy.

One area where economics and sustainability overlap is in the appraisal of potential sustainability projects – whether this is the purchase of renewable energy technologies or investing in biodiversity initiatives.

The all important discount rate

A critical decision in most financial appraisals is the choice of the discount rate, because this little number has a huge impact on whether long term costs and benefits are considered important. Because of its importance, the ‘correct’ value for a discount rate has been a controversial issue for most of the 20th Century.

But what is a discount rate? It is a value multiplied to the costs and benefits at each period in time over the project’s duration. This enables future and present values to be compared. For example, one pound discounted at a rate of 3.5% in 30 years has a net present value of £0.36 today. Thus, very quickly future benefits can become negligible when high discount rates are used.

On the whole, a high discount rate favours projects with immediate or short returns on investment. Any project with a medium- or long-term payback is shown in an unfavourable light. As environmental investments often have high upfront costs with paybacks over long periods of time, when combined with a high discount rate, these projects will appear financially unsound. However, this is not necessarily the case. If a lower discount rate had been chosen, the same project may appear to be a great investment.

If the discount rate is so influential and yet so subjective, shouldn’t more people consider it when making investment decisions??

In the last ten years, the UK government has stepped up to the challenge. The HM Treasury guidance now requires much lower discount rates to be used for long-term project appraisals.

More dramatically, the Stern Review’s Economics of Climate Change argued that due to climate change’s unique characteristics – impacts that last hundreds of years and potentially causing large-scale damage for future generations – meant that an even lower discount rate, close to zero should be used.

Since the Stern Review, HM Treasury has released additional guidance stating that in the evaluation of projects that will involve “substantial and, for all practical purposes, irreversible wealth transfers between generations” and are very long term (in excess of 50 years) a much lower discount rate is advocated (HM Treasury 2008, p.4). This acknowledges that some projects will impact upon the very wellbeing of future generations and the discount rate should reflect this.

How does this affect you?

When considering future environmental projects at your organisation, it is worth questioning the discount rate used, specifically:

  • For any project with a lifetime greater than 30 years, the argument can be made to use a low discount rate.
  • For very long term projects, e.g. climate change mitigation and adaptation, biodiversity or ecosystem services, a discount rate close to zero matches the UK government’s approach.
  • Finally, it is fair to request a sensitivity analysis of the discount rate be completed for all sustainability investment appraisals. This means that the same analysis is undertaken using different discount rates (low and high). Vastly different results will demonstrate that further deliberation is needed regarding the most appropriate value for the discount rate.

For further information on the government guidance discussed, see HM Treasury’s website: http://www.hm-treasury.gov.uk/green_book_guidance_discounting.htm

Carrot Love

Julia insisted on this picture of carrot love being included in her blog post - so here it is!