New research released today by Shell Springboard shows that the challenge of tackling climate change could create a market of up to £30bn for British business over the next ten years.
The research, carried out by independent consultancy Vivid Economics for Shell Springboard, quantifies for the first time the potential size of the market for businesses that develop technologies, products and services that help combat climate change. The findings include:
- A market in the UK created by the government climate change programme which could be worth over £30bn cumulatively over the next ten years. By 2010 the market will be double the current size;
- The cost of tackling climate change in the UK in 2010 will be affordable at 0.3% of the economy;
- Concerted international action to avert climate change could create a global market worth $1 trillion in the first five years alone;
- Clearly identified opportunities for small and medium sized enterprises (SMEs) across all climate change markets, with case studies of nine SMEs in the UK with leading edge products.
Shell Springboard commissioned the research to demonstrate the commercial opportunity that tackling climate change offers to SMEs. Shell Springboard is a Shell awards programme that encourages companies to see climate change as not only a major environmental challenge but a substantial business opportunity.
The research identifies major opportunities for small and medium sized enterprises in a wide range of markets, by both responding to consumer demand for environmentally friendly goods and to demands created by government action. The biggest identified markets for SMEs in 2010 will be:
- Building regulations for commercial and industrial use - £950m
- Renewable electricity - £800m
- Renewable road transport fuels - £500m
- Domestic energy efficiency - £400m
- Building regulations for domestic use - £275m
In addition, the study identifies the UK as a world leader in the international emissions offset market, with UK firms already involved in about £400 million of projects a year, with the market rapid increasing. The UK voluntary offsets market could be worth another £100–200m per year.
The study is launched today with a panel discussion involving former CBI head and Chair of the Carbon Trust Clean Energy Fund Adair Turner, Dr Steve Howard from the Climate Group, Karl Watkin from D1 Oils and report author Robin Smale. It will be chaired by Lord Oxburgh, the former chairman of the House of Lords Committee on Science and Technology.
Lord Oxburgh, said: “The urgent need to reduce greenhouse gas emissions offers opportunities to the nimble. There is now scope for a wide range of devices and services, which a decade ago would have made no economic sense, and for which there would have been no demand.
“Shell has created the Springboard programme to help people to grasp some of these opportunities, and to take the first steps towards turning their ideas into viable businesses and products.”
James Smith, Chair of Shell UK, added: “For business, tackling climate change is both a necessity and a huge opportunity. This creates a huge new opportunity for British business nationally and internationally. We have to step up to the challenge.
“Our small businesses and the scientific depth in our universities are going to be vital contributors.
“The wisdom of the market is a powerful force for tackling climate change. The Shell Springboard programme recognises this by focusing on the market opportunities for small businesses.”
Shell Springboard encourages and celebrates those smaller companies who are making the business of combating climate change commercially viable. In 2007 at least nine awards of up to £40,000 will be given across the UK to small and medium sized businesses that satisfy business and environmental experts that their ideas are both environmentally sound and viable businesses.
