Energising business parks on the path to net zero

There is no doubt the requirement for the UK to substantially reduce all CO2 emissions over the next three decades represents a considerable challenge for every sector.

YLEM UK based, industry leader in energy generation solutions

The outdated design of many business parks, largely unchanged since they began life in the ‘50’s when clusters of commercial buildings relocated to areas beyond the increasingly consumer focused city centres, leaves them in danger of being left behind on the journey to net zero.

And yet the same factors present an opportunity. Today’s business parks, with their diverse range of buildings and operations, have the potential to redevelop their infrastructure and flexibility to repurpose buildings. Many warehouses for instance are ideally suited to the adoption of solar energy systems as well as battery storage systems, and sustainable buildings with lower associated emissions are known to generate significant savings over the term of the lease for individual business owners. At the same time, extensive on-site parking provides clear opportunities for the installation of electric vehicle charging points.

This is an important consideration for any business park of the future – the reality is that most will charge their car at home and at work. And while the new car market fell by almost a third in 2020, it was a bumper year for battery and plug-in hybrids (up by 185%), which now account for 10% of total sales. Driven by emissions targets, it is a trend that is only going to increase, and for a rapidly growing number of drivers, a quick stop at the garage to refuel will become a thing of the past. EV charging points will therefore be an essential part of the infrastructure for any business park and this all means greater consideration will need to be given to the power supply – charging points will be of little use if there is insufficient power to enable their effective use.

In short, there is enormous potential for business parks not only to embrace a low carbon future, but to achieve significant cost savings by doing so.

An increasingly popular option for major energy users in every sector, on-site generation is ideally suited to business parks. Driven by factors such as the electrification of heat and transport, demand on the grid is greater than ever and beyond the large reduction in energy costs it can secure, as well as a credible path towards net zero, on-site generation offers greater resilience. Indeed, it is a proven solution through which businesses can negate the challenges of an increasingly constrained grid, but importantly, it also provides budget certainty for power.

Adaptation and innovation have been key for every business in the last year and as the country continues on its one-way path out of lockdown restrictions, these factors will be increasingly important for business park owners as they seek to attract long term tenants.

Today, with millions promised in funding for low carbon energy solutions, and many sectors making significant progress against emissions targets, a green energy revolution appears to be around the corner. Despite this, more than 30% of the largest public companies in the UK are currently responsible for carbon dioxide emissions at a level which is consistent with a global temperature increase of at least 2.7C by 2050, according to analysis recently published by Arabesque, the firm which provides climate data to investors.

Announced by the Prime Minister in December 2020, the overall UK target is to reduce the UK’s emissions by at least 68% by 2030, compared to 1990 levels. This was the first target set following the UK’s departure from the EU and is a key milestone in the country’s legally binding targets to become carbon “net-zero” by 2050, signalling the government’s commitment to this agenda.

As environmental issues come into wider focus once more, there is therefore an opportunity for business parks to lead the way on the path to net zero, facilitating the adoption of electric vehicles while making impactful changes through on-site energy generation.

The reality is that energy from the National Grid is forecast to become significantly more expensive, driven not only by increased demand but by a whole range of non-commodity charges. And these third-party charges are unavoidable unless a business can generate its own energy or significantly reduce consumption.

Effectively shielding businesses from future energy price increases, the additional savings for sites moving to on-site generation could be significant, up to a 30% reduction in energy costs.

Additionally, on-site natural gas fuelled generation can be supported by use of green gas certificates or off set with carbon credits, ensuring it is also an effective means of reducing overall carbon emissions and importantly, the technology is hydrogen ready. Many businesses are in fact already using systems that are ready for the future introduction of hydrogen into the fuel mix.

Renewable energy sources will also play a key role for business parks in the years ahead. In addition to solar power generation and battery energy storage systems, well suited to larger warehouses and other similar buildings, the situation of business parks means that wind and heat pumps are also viable options. These will complement gas and hybrid generation systems that can either part or fully-operate on hydrogen fuel, supporting the UK’s legally binding targets for tackling climate change and decarbonising the grid.

Providing a stepping stone to a low carbon future, the adoption of on-site generation and the savings it creates also makes strategic investment in new technology to decarbonise further, increasingly viable. Indeed, rather than paying unavoidable charges applied to energy bills for grid connected renewables, on-site generation creates an opportunity for business park owners as well as individual businesses to invest in their own on-site renewables in the future.

And of course, all of this will underpin increasingly important sustainability targets for business parks and their tenants as we head towards a renewable and sustainable, carbon neutral future.

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