Energy Demographics: the role of demographic data in understanding UK's demand for energy

Lead Research Organisation: University of Leeds
Department Name: School of Earth and Environment

Abstract

It is important for the Government to be able to predict the future energy needs of UK industries, homes and transport to ensure sufficient supply. At the same time, the UK needs to plan to reduce energy use in order to meet climate change reduction targets. At the moment the UK Government uses an Energy Demand Model which makes future energy predictions based on estimates of economic growth, the price of fuel and the number of households there will be in the future. This technique for predicting future energy needs is deficient, because it fails to take account of the fact that household demand for goods and services is the major driver of the economic performance of industry, and that the way households spend today is likely to be very different in the future.

My fellowship takes a 'whole systems' approach to understanding the UK's demand for energy. The link between household spends and industrial energy use can be determined by quantifying the total energy required in the supply chain of producing a product. It is also possible to capture the energy that is embedded in goods exported abroad and goods imported to the UK from other countries with very different energy efficiency standards in their factories. I will develop a new indicator of energy demand: 'the UK's Energy Footprint' which shows the full amount of energy associated with products bought by UK consumers between 2005 and 2015. I have met with the Department for Business, Energy and Industrial Strategy (BEIS) to ensure that this new indicator will be reported alongside the Carbon Footprint.

Instead of simply looking at the changing goods and services bought by an average household, this fellowship will consider the differing expenditure profile of up to 60 different household types between 2005 and 2015. For this, I will use geodemographic expenditure profiles developed by CallCredit, a credit reference company. The main user of geodemographic data is the business sector understanding their consumers, so it is important that the data is current and constantly kept up-to-date. Producers of this type of data do not keep previous years' profiles as a readily available product. This means that their data has never been used to understand the changing geodemographic profile in the UK or elsewhere. I have made an agreement with CallCredit to exclusively acquire a decade's worth of expenditure data from their archive. This means that it will be possible for the first time to determine whether the energy needs of the UK have altered due to households buying different types of products or whether the change is due to the mix of households in the UK changing.

I will use mathematical analyses to calculate the drivers of the change in UK energy demand. The research will be able to determine what effect the recession had on the energy demand of different households. I will then focus on using predictions of the changing household types and predictions on how lifestyles may change in the future to estimate what the UK's demand for energy will be in 2030. There is uncertainty as to how the UK's infrastructure might have to change in order to cope with an aging population or the trend for homeworking. This fellowship will address this by determining the energy requirements of these futures by forming scenarios which calculate the UK's energy needs when there are greater proportions of these types of household present in the UK's demography. Outputs from this research will also be used to verify the BEIS's future energy demand scenarios and provide new inputs to their Energy Demand Model. This work therefore has great importance in ensuring the UK can meet the energy needs of its businesses and people, and become more sustainable, now and in the future.

Planned Impact

This fellowship will address several key societal challenges facing the UK. Firstly, for the first time, the UK Government will have a record of the complete energy needs of UK society. Within year one of the project, I will generate a new Energy Footprint dataset for the UK to be reported by either the UK Government's Department for Business, Energy and Industrial Strategy (BEIS) or Department for Environment, Farming and Rural Affairs (Defra).

I already calculate the UK's Carbon Footprint, which is used by organisations such as the Green Construction Board in assessing the full impacts of construction and WWF in their online footprint calculator. The Energy Footprint will have similar outreach and use. The dataset will trace energy extraction, through intermediate use by industry, to the energy embedded in products bought by households and government. The Energy Footprint dataset shows the portion of the UK's energy consumption-based account that is sourced from energy extracted abroad. This will help UK energy resilience and assist BEIS and UK Energy Companies to face energy scarcity and security challenges. In addition this contributes to the EPSRC 'Resilient Nation' prosperity outcome.

The household expenditure dataset used by this fellowship covers the period 2005-2015. This means that the research can quantify the effect of the recession on spending patterns by household type. By year two of the fellowship, I will start to discover whether some households buy less of certain products when disposable income is scarce, and whether in some households spend is unaffected. In the future, increases in energy prices may be passed to the consumer. The recession analysis work will help to predict how price increases may affect spending behaviour because I will have discovered how different households respond to budgeting. I will have produced further evidence to help achieve energy resilience and this will be of interest to poverty action groups such as National Energy Action, New Economics Foundation and Joseph Rowntree Foundation who will use the findings as evidence in their lobbying work.

The 2008 Climate Change Act commits the UK to reducing greenhouse gas (GHG) emissions by 80% by 2050 based on 1990 levels. Since the burning of fossil fuel is the largest source of GHG emissions, understanding and managing the UK's changing demand for energy is important. This fellowship will use data on the future spending patterns of households and the forecasted numbers of households of different types to predict future energy demand for the UK. This will help to verify the scenarios of future energy demand which are currently calculated using BEIS' Energy Demand Model. The research will aid BEIS' modelling capacity. It will also help the Committee on Climate Change in its role providing advice to the UK Government on whether the UK needs to do more to meet its Climate Change targets. In producing future scenarios of the energy needs of the UK, This fellowship will explore how future populations can live well for less. This is one of the ambitions of the 'Productive Nation' prosperity outcome.

Finally, this research is the first to explore the use of geodemographic datasets over a long timeframe. In the long term, this investigation may help CallCredit, the providers of the dataset used in this fellowship to increase their product portfolio to include consumer trend data. Other credit reference agencies such as Experian will also show interest in this application. By using novel mathematical and statistical techniques with big data analytics to explore trends in consumption behaviour and lifestyles, this fellowship will deliver a product of both academic and commercial value, and help business deliver a 'Connected Nation' - a further EPSRC prosperity outcome.
 
Description Energy Demographics is 14 months into a 36 month project timeline. So far efforts have concentrated on producing a UK focused multi regional input-output database and aligning the model with household expenditure surveys by household type. The most interesting findings have show the differences in energy footprint between households of different ages of household reference person (HRP). Households where the HRP is less than 30 have substantially smaller energy footprints than households where the HRP is over 50. In addition, the research has shown differences in the way these different types of household respond to economic shocks such as the global recession.
Exploitation Route The findings could be used to target certain household groups to help reduce their energy impact.
Sectors Energy,Environment,Government, Democracy and Justice

 
Description Energy Demographics is in month 14 of a 36 month project. So far effort has been concentrated on producing a robust model to assign industrial energy impacts to household demands for goods and services. It is too early to assess the reach of this impact but I am having initial conversations with the Institute for Public Policy Research on issues around delivering a Green Deal for the UK (which would involve reductions in industrial energy use) that is equitable and does not disadvantage the poorest households. Understanding the energy uses of households of different types will be a crucial input to this type of analysis.
First Year Of Impact 2018
Sector Communities and Social Services/Policy,Energy,Environment,Government, Democracy and Justice
Impact Types Societal,Economic,Policy & public services

 
Description C40 cities using footprint data in Climate Action Plans
Geographic Reach Multiple continents/international 
Policy Influence Type Citation in other policy documents
Impact To date, mayors of 35 C40 cities have publically committed to develop and begin implementing ambitious climate action plans by 2020 that go beyond national commitments, in order to achieve the highest goals of the Paris Agreement at the local level. They are using results from the 'carbon footprint of C40 cities' project.
URL http://www.c40.org/press_releases/new-analysis-shows-cities-have-bigger-opportunity-to-reduce-global...
 
Description Trained consultants at Arup in consumption-based accounting techniques
Geographic Reach National 
Policy Influence Type Influenced training of practitioners or researchers
Impact I have worked with consultants at Arup (London) on projects to calculate the carbon footprint of cities. For their latest project, rather than do the calculations myself, I ran a day's workshop on multi regional input-output analysis and trained 3 Arup consultants. This means that Arup can produce analyses and data in house. I used the training material that I have developed for the University of Leeds MSc course Tools and Techniques in Ecological Economics.
URL http://www.see.leeds.ac.uk/teaching-resources/exercise-pages/l4-input-output-tutorial-201617/
 
Title UK's Carbon Footprint 1997-2015 
Description Every year I calculate the UK's consumption-based account for the Department for Environment, Food and Rural Affairs. The Carbon Footprint of the UK is released as a National Statistic. 
Type Of Material Database/Collection of data 
Year Produced 2018 
Provided To Others? Yes  
Impact Press release by Defra 
URL https://www.gov.uk/government/statistics/uks-carbon-footprint
 
Description Collaboration with C40 and Arup to calculate carbon footprint of C40 cities 
Organisation C40 Cities Climate Leadership Group
Country United States 
Sector Charity/Non Profit 
PI Contribution Using the household expenditure methods developed for this fellowship, I calculated the carbon footprint of 80 C40 cities for their project with Arup
Collaborator Contribution Arup helped to provide input data for the MRIO model. C40 designed the project and disseminated the results
Impact To date, mayors of 35 C40 cities have publically committed to develop and begin implementing ambitious climate action plans by 2020 that go beyond national commitments, in order to achieve the highest goals of the Paris Agreement at the local level.
Start Year 2018
 
Description Collaboration with Defra and the ONS to produce the UK's Consumption-Based Account 
Organisation Department For Environment, Food And Rural Affairs (DEFRA)
Country United Kingdom 
Sector Public 
PI Contribution Using the multi regional input-output database developed as part of this fellowship, I provide a detailed set of results to Defra on the UK's Carbon, Energy and Materials footprint.
Collaborator Contribution Defra report these results as a national statistic. The Office of National Statistics provide data and support.
Impact The UK Carbon Footprint is a National Statistic
Start Year 2018
 
Description Collaboration with Scottish Government to produce Scotland's Carbon Footprint 
Organisation Government of Scotland
Country United Kingdom 
Sector Public 
PI Contribution The multi regional input-output model produced for this fellowship is used to calculate the Carbon Footprint for Scotland
Collaborator Contribution The Scottish Government report the results annually
Impact Scottish statistical publication
Start Year 2018
 
Description Collaboration with WWF and SEI on the WWF Carbon Footprint Calculator 
Organisation World Wide Fund for Nature
Country Switzerland 
Sector Charity/Non Profit 
PI Contribution One of the outputs from my multi regional input-output model which I developed for this fellowship is the production of carbon conversion factors by product. These can be used to construct personal carbon footprint calculators. I provided the Stockholm Environment Institute and WWF UK with a new set of 2015 conversion factors to allow for an update to their online calculator
Collaborator Contribution WWF and SEI have constructed a carbon footprint calculator which requires a set of conversion factors in order to calculate a carbon footprint.
Impact A carbon footprint calculator
Start Year 2018
 
Title WWF Carbon Footprint Calculator 
Description The WWF Carbon footprint calculator uses a questionnaire approach to help people to calculate their carbon footprint. I provided the carbon conversion factors for the 2018 update to the tool. 
Type Of Technology Webtool/Application 
Year Produced 2018 
Impact Members of the public are now able to find out their own personal carbon impact and compare it to the impacts of the average person in China, the USA and India. The calculator offers information on how to reduce carbon impacts. 
URL http://footprint.wwf.org.uk/#/
 
Description Article in The Conversation 'Poorest households hit hardest by UK climate change charges despite using least energy' 
Form Of Engagement Activity Engagement focused website, blog or social media channel
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Public/other audiences
Results and Impact I published an article with a collaborator which looked at household energy footprints in the context of a fairer way to tax energy use. The article was in The Conversation and picked up by 13 other news outlets. Over 6,000 people read the article in The Conversation with most views from the UK and the USA
Year(s) Of Engagement Activity 2018
URL http://theconversation.com/poorest-households-hit-hardest-by-uk-climate-change-charges-despite-using...
 
Description EU Sustainable Energy Week (Brussels) 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact Invited to speak as part of a panel of experts at the EU Sustainable Energy Week - Brussels. Presented my work on 'a fairer approach to funding a low carbon energy system'.
Year(s) Of Engagement Activity 2018
URL http://ec.europa.eu/info/events/eu-sustainable-energy-week/eu-sustainable-energy-week-eusew-2018-201...
 
Description Economic Effects of Brexit Seminar 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Professional Practitioners
Results and Impact I invited researchers from Birmingham University's Business school to present their latest work looking at the economic effects of Brexit. I was the session chair for this LIDA seminar. The seminar raised some lively debate on scenario building. I also had a 2 hour meeting with the academics prior to the seminar where we discussed future collaboration opportunities
Year(s) Of Engagement Activity 2018
URL http://lida.leeds.ac.uk/event/continental-divide-economic-exposure-brexit-regions-countries-sides-ch...
 
Description Invited talk at the Leeds Institute for Data Analytics Showcase 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact Presented early fellowship findings to other academics, students and industry partners at the LIDA showcase. As a result, I learnt about new datasets that would be useful for further analysis
Year(s) Of Engagement Activity 2018
 
Description Poster presentation at the 2018 Industrial Ecology Conference 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact Poster
Year(s) Of Engagement Activity 2018
URL http://www.grc.org/industrial-ecology-conference/2018/
 
Description Presentation on Future Applications of Social Accounting Matrices at University of Strathclyde 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach Local
Primary Audience Professional Practitioners
Results and Impact I visited the economics group at Strathclyde to present early fellowship ideas and get advice on how to structure a new UK focused multi-regional Social Accounting Matrix. As a result of this visit, I have organised a special session at the upcoming IIOA conference on novel applications for Social Accounting Matrices.
Year(s) Of Engagement Activity 2018
 
Description Presentation to the Department for Work and Pensions 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Professional Practitioners
Results and Impact I gave a presentation to the Department for Work and Pensions on some early findings from the fellowship. I presented results showing how the energy footprint of households of different age groups had changed over time. This sparked discussion on the role of pension funds in impact assessments and sources of data.
Year(s) Of Engagement Activity 2018
URL https://lssi.leeds.ac.uk/event/linking-leeds-seminar-november/
 
Description Visit to Tyndall Centre (Manchester) 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Postgraduate students
Results and Impact Presented my fellowship initial ideas to the Tyndall Centre at the University of Manchester. We discussed overlapping research interests and collaboration opportunities
Year(s) Of Engagement Activity 2018