THE 25-nation European Union is planning to reduce its CO2 emissions by 20 per cent by 2020.

Global cities are responsible for 80 per cent of greenhouse gas emissions, making them, in carbon terms, a highly inefficient way to live.

London has set an even more ambitious target to reach in 2025. The city, which spews 45 mega-tonnes of CO2 annually, aims to reduce emission by 60 per cent. And experts say it is possible.

A major economy by itself, accounting for 18 per cent of Britain's GDP, London is home to some 13,510 foreign companies, not to mention a myriad local businesses.

This translates to a large number of buildings and commuting workers, which use tremendous amounts of energy.

The city, however, has set a target that can be achieved, says Siemens, Europe's largest engineering conglomerate.
Collaborating with top management consultant McKinsey & Company it has studied the city, offering a comprehensive portfolio of technical solutions for reduction of C02 emissions.

The study was unveiled at the Siemens Media Summit 2008, themed "Answers For Sustainability" in London recently.



According to the study on sustainable infrastructure, cities are responsible for a disproportionate share of the world's greenhouse gas emissions --some 80 per cent of the world's total emissions.

The findings showed that London could meet international greenhouse gas reduction targets without a dramatic shift in lifestyle, said Siemens CEO Peter Loscher.

The study noted that while new technology and practices could reduce London's carbon footprint by 60 per cent in 2025, adopting currently available technology could reduce annual emissions by nearly 44 per cent -- almost 20 megatonnes.

McKinsey analysed more than 200 technological levers that reduce greenhouse gas emissions, water usage and waste disposal in the city.

The study showed investments in these technologies made good economic sense and almost 70 per cent of the identified saving potentials could be achieved with technologies that would pay for themselves, largely by reducing energy cost.

The biggest saving potential lies in buildings -- which generate about 75 per cent of the city's CO2 emissions.

Investments of about E20 billion would be necessary and nearly 90 per cent of this investment could be recouped through energy saving lighting and improved insulation to cut down on heating.

Energy-efficient lighting for households is the single most cost-efficient measure and would cut CO2 emissions by 0.4 mega-tonnes.

The study found that investing E12.5 billion in the transport industry could see carbon emissions reduced by 25 per cent by 2025.

Fuel efficient engines offer by far the greatest saving potential.

Recent studies have shown transport to be a significant contributor to London's carbon emissions, accounting for 20 per cent of all CO2 generated by the capital.

Buses account for about 5 per cent of all the transport emissions and experts say some 0.4 megatonnes of C02 could be reduced with measures such as fitting hybrid engines in buses.

After exploiting all technological levers in buildings and transport, C02 emissions from energy supply could be reduced by a further 6.2 megatonnes.



At the local level, the use of combined heat and power systems offers, by far, the greatest savings potential of 2.1 megatones a year by 2025.

An additional 3.7 megatonnes of C02 could be eliminated if more gas is used for national power generation.

For example, increasing the share of power generation with gas instead of coal would cut the city's emissions by 1.2 mega-tonnes of CO2.

The increased use of renewable energy sources above and beyond previously defined targets would reduce London's CO2 balance by another 800,000 tonnes.

Other key areas include savings on water supply and waste treatment.

All cities, not just London, says the report, can promote greater adoption of these technologies by consumers, through changes in regulation, taxes, subsidies, access to reliable information and increased public awareness.

"With the help of technology available these days, London can not only fulfil its international obligations, but come close to meeting its own ambitious climate goals," said Loscher.

Siemens has the figures to prove that its methods work, and the environmental portfolio is a major growth driver for the company.

According to Loscher, eco-friendly products and solutions from its environmental portfolio reduced customers' CO2 emissions by 114 million tonnes last year.

The comprehensive portfolio includes solutions for nearly every environmentally relevant field of power generation, transmission and consumption -- buildings, lighting, transportation and industry -- as well as environmental technologies such as water purification and air pollution controls.

Gas turbines, energy efficient lighting systems, the modernisation of old power plants, wind power systems and eco-friendly trains were the biggest contributors to Siemens CO2 savings last year.

The portfolio also includes products from the company's healthcare sector.

For example, its "Somatom Definition" computed tomography scanner consumes 30 per cent less energy per examination and contains 80 per cent less lead than its predecessor.

Its renewable energy products such as wind turbines have earned respect, driving Siemens to be the largest supplier of offshore wind farms.

In three years time, the CO2 savings from its products and solutions is projected to total 275 megatonnes, an amount equal to the current emissions of six major cities, including the likes of London, New York and Tokyo.

Richard Lambert, director-general of the Confederation of British Industry, said the study reinforced the government's need to take urgent action if it is to meet carbon reduction targets.

He said the solutions must be known, be deliverable and affordable.

There was also a need for a new relationship between the government, businesses and consumers.

The current combination of an economic slowdown and rising energy costs, presented an opportunity to restructure the British economy.

This can be done by changing consumer and business behaviour for the long-term, as opposed to just a short-term reaction to current economics.

In this context, he said the British government should be considering a package of policies around information, standards and incentives such as tax rebates to encourage change.

"The Confederation of British Industry needs to help communicate these messages across the business community."

Implementing these solutions will also shift Britain away from fossil fuels, and increase reliance on home grown energy sources such as wind and tidal-assisted technologies, Lambert added.

"With increasing oil prices, we also have an opportunity to move the British economy towards a low carbon future, although these come with with tough decisions."

McKinsey London director Jeremy Oppenheim said despite their attractiveness, many technological levers were often not implemented.

Some of the arguments brought up against implementation circled around financing issues such as upfront investment, budget constraints, investment returns, risks and lack of awareness.

Oppenheim said the race towards a low carbon economy was a fundamental one, with society expecting its governments to implement good environmental practice and regulations.

In the next 30 years, trillions would be invested in low carbon sustainable models in a "second world economy", which is worth almost the size of today's global economy, he said.

The investments in technology to lower greenhouse emissions may be a bit costly, but Oppenheim said that in the long run, they will result in huge savings in cost.