Environmental sustainability

Climate Change Strategy

A key part of Pennon's climate change strategy is to minimise our carbon emissions. We are actively working to minimise the production of greenhouse gases from the activities of the Group and its operating companies and we are capitalising on the business opportunities that are resulting from the climate change agenda.

Electricity Consumption and Generation

On-site electricity consumed

GWh

South West Water (1)

260

Viridor

19

Total consumed

279

Electricity generation

No of sites

Capacity MW

GWh

South West Water

- Hydro

7

6

14

- Biogas from combined heat and power

7

1

5

Viridor

- Landfill - biogas (2)

30

101

505

Total Generated

524

Generated/consumed ratio

188%

(1) includes Pennon Group Plc and partners' related activity
(2) includes sub-contracted sites in Suffolk

'Green Energy' generated On-site electricity use in Pennon Group Use of electricity on site in Pennon Group 2008/09

Renewable energy generation

Viridor's renewable power generation capacity from landfill gas continues to increase and is now 101MW, enough to meet the domestic needs of around 750,000 people. Viridor captures and uses approximately 70% of the methane arising from its landfills for power generation; most of the remainder is flared, with a residual amount escaping to the atmosphere. South West Water's renewable energy generation capacity is 7MW from hydroelectricity and combined heat and power from sewage gas.

Viridor's Pilsworth landfill gas power generation plant

Waste is a major renewable energy source, accounting for approximately 30% of current UK renewable energy or roughly 1.5% of total UK electricity production; principally this is currently from landfill gas utilisation, which has grown by 600% over the past 10 years.

According to both the Institution of Civil Engineers and the Institution of Mechanical Engineers this theoretically could increase to between 15% and 20%, a very significant potential contribution to total UK energy supplies. The bulk of the increase is likely to come from waste to energy plants, which are particularly energy efficient as part of a combined heat and power system, and from new technologies such as anaerobic digestion.

Net electricity export

Since 1999/2000, the Pennon Group has exported more electrical energy each year than it has consumed. In 2008/09 Viridor and South West Water generated 524GWh from our operations. This is 188% of the Group's electricity consumption of 279GWh.

Carbon Reduction Commitment

From April 2010 Pennon Group will be participating in the Government's Carbon Reduction Commitment (CRC), a mandatory carbon trading scheme aimed at organisations that use over 6,000 MWhs of half hourly metered electricity per year. Initially the scheme will sell carbon allowances valued at £12 per tonne, then from 2013 the Government will cap the amount of allowances available and carbon will attract a market price based on what organisations are willing to pay to obtain their allowances. The CRC is designed to encourage organisations to reduce their carbon emissions by offering financial rewards or penalties dependent on how well an organisation performs relative to all other participants in an annual CRC league table. Pennon Group is currently preparing a strategy for dealing with this new legislation, which will include plans to redouble efforts to find ways of using energy more efficiently in the coming years.

Group transport

Both operating subsidiaries review their transport fleets regularly to meet their operational needs. Environmental criteria such as clean engine technology, fuel efficiency, reliability and end of life recyclability are considered during the selection process.

Pennon Group Environmental Awards

Jon Wood winning the 2008 Pennon Group Environmental award

In 2008, the winning prize in the annual Group internal competition was awarded to South West Water's Conservation team who created the 'Water Calculator'. This unique tool within the water industry helps customers compare their water usage against average water use and provides advice on water efficiency.