Increased Carbon Offsetting Liabilities Linked to New Calculation Method

London Boroughs are increasingly looking to link development offset contributions to shortfalls in energy balance rather than CO₂ reductions. This is a fundamentally different approach which could lead to larger contributions being owed and a greater adoption of PHPP as a calculation methodology.

Offsetting contributions are required where new major development cannot achieve a standard of zero carbon, usually demonstrable by achieving an aggregated DER/BER of zero (under SAP/SBEM methodology). Offsetting sums have therefore been linked to Part L energy demands and associated CO₂ emissions only.

An energy balance is achieved when renewable power generation (usually PV capacity) is equal to energy demand. Demand in this method is represented by energy use intensity (EUI), which addresses both Part L (‘regulated’) and unregulated energy. The shortfall between EUI and renewable generation on high-density sites can be very large, potentially leading to much greater offsetting liabilities. The shortfall is then translated back into CO₂ emissions to accord with London Plan policy SI2. This approach has already been adopted by RBKC, with Ealing and Tower Hamlets looking to follow suit.

A development’s energy balance shortfall can be reduced in the following ways:

• Paying greater attention to unregulated energy demands and committing to adopting more efficient products earlier in the design (such as white goods);
• Maximising PV capacity;
• Considering the calculation methodology used, such as PHPP instead of SAP.