DD2559 Funding for the Centre for Climate Change Innovation from the Mayor’s Strategic Investment Fund

1.1 This DD sets out further detail on the Centre for Climate Change Innovation Project (formerly referred to as the Centre for Cleantech Innovation) that was submitted to the Mayor’s Strategic Investment Fund in April 2018. It was one of the projects in respect of which the Mayor approved funding under cover of MD2363, September 2018, under which the Mayor also delegated authority for detailed project level approval of the successful strategic projects to the relevant Executive Director.

Project Changes

1.2 The original Centre for Climate Change Innovation (CCCI) project concerned a proposal to build a custom-made ‘meanwhile’ space at Imperial College’s White City Campus to help catalyse growth in London’s low carbon and environmental goods and services sector.  It was proposed that it would support London to make the transition to a low carbon circular economy. The CCCI ‘meanwhile’ space was due to be in place for 10-20 years, with the CCCI workstreams and activities then transferred into a permanent innovation building on the White City Campus.

1.3 Following issues surrounding the development of the White City site, including updates to the site masterplan, encroachment of the operations on the site designated for the CCCI and the temporary nature of the building, Imperial College London decided it was preferrable for all parties to establish a strategic partnership with the Royal Institution (RI) and to house the CCCI in their building. In consultation with funders, including the GLA, there was a strong preference to locate the CCCI in the RI, a permanent central London location.

1.4 The revised CCCI project was launched in March 2021, backed by six founding members: the GLA, Arup, HSBC UK, Octopus Centre for Net Zero, Pollination, and Slaughter and May. A limited amount of activity has already started within the centre to ensure it is establishing its presence within the climate change sector. However, considerable work is needed to retrofit, refit and reconfigure the building to transform the space, its functionality and the experience of users in order to enable it to function as an innovative and ground-breaking ecosystem hub for cleantech businesses and stakeholders in the sector.  The centre aims to bring together a diverse collection of climate change stakeholders; including businesses, entrepreneurs, policy makers, academics and the public, both young and old; from across London, and beyond, to create a focal point for London-based innovators to implement global change through pioneering, practical solutions.

1.5 This new proposal offers everything that the previous proposal did as well as providing a more neutral location, ensuring that the CCCI aligns with the GLA’s London Environment and Economic Development Strategies to establish a Centre for Cleantech Innovation in London to provide workspace, collaboration space and business support. The centre will aim to bring the whole of the London cleantech ecosystem together to simultaneously help tackle the climate and ecological emergencies whilst creating businesses that generate growth and create jobs. This will play an important role in supporting the Green New Deal mission’s target of doubling the ‘green economy’ by 2030.

1.6 The project will improve the functionality and accessibility of the RI, building on its history of climate innovation and revolutionising its offer to cleantech businesses and Londoners. It will build on its existing expertise and activity, by providing a focal point for climate events and exhibitions as well as secure, affordable and flexible workspace for innovators and start-ups, complemented by access to technical facilities and expertise.

1.7 It will provide an iconic, state of the art location for the cleantech sector to play its part in tackling the climate emergency, including:

i. a collaboration and co-location environment for business, academia and the public

ii. support to nurture talent, innovation and the creation of cleantech businesses

iii. a place to meet stakeholders from the sector and inform and debate London’s transition to a low carbon circular economy

Policy Context

1.8 The CCCI aligns with the ambitions of the London Environment Strategy and Economic Development Strategy, for London to be a world-leading city in the transition to a low carbon circular economy. This transition requires London to tackle its environmental challenges whilst catalysing an approach to sustainable economic development and job creation in London. This will help deliver the GLA environmental targets whilst driving good growth and creating high value jobs, both now and in the future.

1.9 In addition, the CCCI will support the Green New Deal mission aims to double the size of the green economy in London to £100 billion by 2030, an ambition that will kick-start greater job growth over the next decade.   

1.10 London’s low carbon and environmental goods and services sector (its ‘green economy’), was worth £48 billion in 2019/20, employing 317,000 people across 14,000 businesses. The sector has grown from £24 billion in 2010/11 when it employed 164,000 people across 9,000 companies[1].

1.11 London wants to create and nurture businesses capable of addressing the pressing environmental challenges, such as climate change, air quality, water resources and resource consumption, that it and cities across the world are facing.  These businesses will be able to exploit local market opportunities that are emerging whilst developing their solutions for export to similar markets around the world. 

1.12 A programme of activity is being developed to create these markets and to support London’s businesses to compete successfully in them.  The CCCI forms an integral part of that programme.

The Centre for Climate Change Innovation (CCCI)

1.13 This project proposes to retrofit and refurbish the RI to transform the building and create a physical location for the Centre for Climate Change Innovation. It will be the catalyst for the establishment of a cleantech cluster in London that will accelerate the expansion and growth of the low carbon and environmental goods and services sector. The CCCI has already raised over £10m in funds, much of that before it had a physical home, to deliver innovation and business development activities aimed at mitigating and adapting to climate change and there are further funding bids under review. This highlights the support that already exists for the CCCI but it has become clear that to move to the next level of influence and activity and become increasingly visible then it needs to have a dynamic, inspiring and inclusive physical presence and the RI will fill that need. Specific advantages of locating the CCCI in the RI building include the following:

i. The Centre will be based at the RI in Albemarle Street. This makes it a centrally located, prestigious and neutral location to represent the whole of London and catalyse its response to climate change. This provides an opportunity to develop an extensive retrofit plan for a listed and iconic building and start to deliver on that plan, showing the potential of retrofit and setting the standards for other similar retrofits across London, helping to save the embodied carbon associated with demolition and new build development.

ii. The original proposition would have given London 4,198 m² of new space. The RI can provide up to 5,223 m². The net effect is to open up more space for interactions with external guests, visitors and the public as well as being able to provide more workspaces that will accommodate more innovators and entrepreneurs.

iii. The site is historically linked to the science of climate change. It was here, in 1859, that John Tyndall used a collection of apparatus, to measure the absorptive powers of gases in the atmosphere. The result of his experiments was the discovery of Greenhouse Gases and their effects on the earth.

iv. The focus on refurbishment of existing spaces will ensure that the CCCI can be up and running and being able to move to providing a full range of services as quickly as possible. This is particularly important in the context of the green recovery and driving jobs and growth. There is also the potential opportunity for this space to provide a physical link to the Mayor’s Green Skills Academies programme.

v. The CCCI will become the central home for London’s cleantech community, providing diverse, dynamic and accessible co-location workspace for businesses to work, meet and exchange ideas. It will act as a focal point for cleantech clusters and hubs as they emerge across Greater London, strengthening the role of each cluster by bringing their communities together to help develop and grow the sector whilst participating in London-wide, national, and global climate events run out of the RI building.

vi. The Centre will connect London and UK climate change innovation to a global network of cleantech actors. Given this, the Centre should also become the home for Cleantech London, the organisation set up by the GLA and partners (including Imperial College) to develop and grow the cleantech sector.

vii. The Centre’s location is at the heart of London’s impact investment community in Mayfair. The Centre will bring the best of cleantech businesses to the attention of this community, creating opportunities to accelerate and strengthen the flow of investment into new businesses.

viii. London’s Women in Cleantech group will become partners of the Centre, either independently or through Cleantech London. This will provide a community and forum to promote and enable gender equality and the CCCI can provide a venue and co-location for their work. The CCCI would support (through Cleantech London) the creation of a similar programmes housed in the Centre to promote greater diversity in the climate change innovation community.

Changes to the original proposal

1.14 As described in 1.3 the CCCI will now be housed at the RI. The RI building is listed and as such is dated in terms of the energy efficiency of the building fabric, heating and lighting systems as well as in regards to the space configuration and layout for the dynamic and vibrant functionality that is needed from a 21^st Century space with a focus on climate change innovation. The proposed changes will better enable the CCCI to provide stimulating spaces for networking, engagement and co-location, for demonstration and trialling of new technology, for public events and conferences as well as the co-location, workshop and laboratory space needed by cleantech businesses in London.  

1.15 The RI will run a competitive tendering process for the design and retrofit of the CCCI.  The RI will engage with the GLA from the outset on design and specification issues to ensure the project and building is an exemplar of sustainable design and construction, which will include going through the Mayor’s ‘design review’ process and gaining technical advice through the Mayor’s retrofit accelerator - workplaces.

1.16 The retrofitted and refurbished building will provide at least the following facilities and services for Cleantech stakeholders and business from across London:

i. secure, affordable, vibrant and low carbon workspace for innovators and start-ups;

ii. access to support, technical facilities and expertise to help grow Cleantech businesses;

ii.i business support services such as legal, accounting, marketing and IP etc.

ii.ii technology services and clustering facilities such as hackspace, prototyping and technology due diligence, Laboratories, Test Facilities, Skunk Works, and Demonstrators etc.

iii. a dynamic co-location office space and collaboration environment for business, academia and the public to network, inform and debate the shaping of London’s sustainable future;

iv. a focal point from which to raise the sector’s profile and promote it nationally and internationally.

1.17 The CCCI’s activities will take place across much of the RI premises. The centre’s headquarters and the co-location spaces are on the second floor and house core staff, start-ups and members of the centre (corporates, SMEs and investors). This space is also used to accommodate postgraduate students undertaking their MSc with the centre, and innovation workshops run by the centre. The RI staff contributing to the centre’s activities have offices and workshops on the third and fourth floor. Led by the RI, the centre will be bringing clean technologies to life through practical in-use demonstrations. These will be used at the RI, in schools and online. In addition, one of the most significant angel investor organisations for cleantech (covering UHNWs from the USA and Europe) is located on the fourth floor so that it can be close to the centre.

1.18 The centre’s public facing activities will take place on the ground, first and second floors. Here the lecture theatre can accommodate 400-person events, such as the Centre’s Start-Up Demo Days, public engagement events, roundtable discussions and cleantech demonstration lectures. Large networking events will take place on the ground and first floor, where the centre can bring together diverse stakeholders. These will include meetings between investors and start-ups; schoolchildren and start-ups; policy makers and climate scientists and climate innovators, etc. and The first floor is also where the centre runs bootcamps, hackathons and masterclasses for cleantech innovators. Finally, there will be space on the ground and first floor for public exhibits of cutting edge cleantech innovations, which will include innovations used to retrofit the RI itself. The refurbishment will ensure that the space is developed to support all these activities and ensure a stimulating and inclusive experience is enjoyed by all who visit.  

1.19 As can be seen from the above, almost all of the RI’s premises are used by the CCCI and the condition and lay-out of the premises has a direct impact on how the work of the centre is delivered. In particular, the CCCI needs to be able to demonstrate that they are ‘walking the walk’ and are housed in a building that is actively working towards net zero and using the technology that their innovators are developing. This grant sets the RI on that pathway and will be used as a catalyst to raise further funding to continue that journey whilst also improving the building in terms of visitor and user experience. The RI is developing a building masterplan which incorporates all building developments, including a pathway to net zero, and over the long term will celebrate the heritage of the building whilst creating a vibrant, inspiring space for science discovery, engagement and collaboration.

1.20 The partners in delivering the Project will develop a retrofit plan for the building that will aim to get as close to net zero as possible by 2030. They will fund as many of the identified measures in the plan as is affordable on the existing value of the grant as the first phase of this ambitious and exciting project. This will reduce the energy demand and the carbon footprint of the Ri and deliver a sustainable retrofit of a Regency building. Any additional funding secured by the recipient will go towards funding the next suite of activities as identified in the retrofit plan.

1.21 Current plans, subject to the outcome of the feasibility study and relevant planning (including from English Heritage) requirements and subject to change, include the following elements:

i. lighting system - the lighting has recently been upgraded in the iconic Theatre and the upgrade of lighting in other parts of the building will be one of the first activities undertaken

ii. heating and ventilation systems - Replace as much of the existing gas system as possible with an all-electric heat pump system. The heat pumps will be specified as reverse cycle and so will also replace the existing chiller for the ventilation system

iii. building fabric and insulation – Increased insulation of existing structure and repair or replacement of windows along with secondary glazing where double glazing is not permitted

iv. office refurbishment and re-design - Assessment and undertaking of redesign and upgrade of CCCI work space, as required, to create a dynamic and inspiring working and meeting place for London businesses and stakeholders.

1.22 These plans are designed to deliver the following objectives: 

i. To provide an inspiring and dynamic space for the CCCI to be housed and one that will attract cleantech business from across London to the co-working space to create the first phase of a London cleantech hub.

ii. To develop a net zero by 2030 plan for the building and implement as much of the plan as is affordable with the available grant. Hoping to deliver, subject to feasibility study, a carbon reduction for the RI’s premise of at least 35% (where we would follow the UKGBC Zero Carbon pathway which would allow us target further energy efficiency savings over time).

iii. To improve the Energy Performance Certificate Rating of the RI’s premises (subject to feasibility study) from the current G to at least a D and with the aim of achieving a C.

1.23 A collaboration agreement has been developed and signed to oversee the running of the CCCI and agree the roles and responsibilities of Imperial College and the RI in relation to the operation of the CCCI (See Appendix 1). The period of the collaboration is initially for up to five years with the intention to continue the relationship between the two parties for an additional five years subject to fundraising and thereafter on the same basis.

1.24 Governance arrangements for the CCCI have also been developed which include an executive board and advisory board as detailed in appendix 2 and below. It is proposed that the GLA will be a member of the Advisory board as a major funder and strategic partner.

Objectives

2.1 The objective if the project is to create an inspirational and inclusive physical hub that will:

i. help accelerate the formation and growth of Cleantech businesses across London

ii. create a focal point in London within which to engage all sections of the economy and of society in Cleantech and accelerate the transition to a low carbon circular economy

iii. act as a focal point for creating a more connected and integrated Cleantech community in London, bringing the innovation ecosystem and London’s Cleantech businesses together, providing affordable workspace and establishing a voice for London’s Cleantech community

iv. showcase London’s Cleantech community, its products and its services on the national and international stage and highlight the investment opportunities that exist in London

v. bring together research expertise from across London to test and demonstrate new Cleantech, actively work with industry in developing Cleantech solutions, and support the formation of start-ups through the R&D expertise and technical prototyping facilities on-site

vi. host professional development training, seminars and conferences for London’s existing businesses seeking to pioneer, develop and implement environmentally sustainable business models

vii. house a Cleantech London Team that will work to promote growth and connectivity of the wider Cleantech innovation ecosystem across London.

Outcomes

2.2 The outcomes delivered directly by the project include:

i. the creation of a 5,000m² Centre for Climate Change Innovation

ii. the development and implementation of a net zero-carbon plan that serves as an exemplar for the retrofit of a listed building

iii. match funding of up to £4.35m of funding to develop the activities and programmes that will be delivered out of the CCCI to support the rapid growth of the cleantech ecosystems and low carbon and circular businesses.

2.3 The indirect outcomes, which will be enabled as a consequence of activities delivered out of the CCTI once it is operational include:

i. growth in the number of cleantech businesses and jobs in London

ii. the development and support of a thriving cleantech ecosystem

iii. new technologies and services developed and tested by new and existing businesses to tackle London’s environmental challenges

iv. increased investment in London’s cleantech SMEs

v. new commercial opportunities catalysed within the low carbon circular economy

vi. an increase in the current, 10% growth rate of London’s low carbon and environmental good and services sector

vii. an increase in exports from London’s low carbon and environmental goods and services sector and greater international recognition for the sector

viii. a Cleantech London team based in the Centre for Climate Change Innovation

ix. wider support for the delivery of the Mayor’s net zero 2030 goal.

3.1 Under section 149 of the Equality Act 2010, in making these decisions “due regard” must be had to the need to eliminate unlawful discrimination, harassment and victimisation as well as to advance equality of opportunity and foster good relations between people who have a protected characteristic and those who do not. Protected characteristics include age, disability, gender reassignment, pregnancy and maternity, race, religion or belief, gender, sexual orientation (and marriage or civil partnership status for the purpose of the duty to eliminate unlawful discrimination only). This duty has been taken into account, but no additional equality impact assessments are required beyond those considered in the relevant planning documentation for the Mayor to make these decisions.

3.2 The Mayor’s Equality, Diversity and Inclusion Strategy sets out how he will work to create a fairer, more equal, integrated city where all people feel welcome and able to fulfil their potential.  Equality, diversity and inclusion are subsequently enshrined within the GLA’s strategies, programmes and activities.

3.3 This project proposes the provision of a grant to the RI to retrofit a Centre for Climate Change Innovation.  The funding agreement associated with this project and our on-going involvement in it will ensure our equalities duty is met by the RI and Imperial College.  This will include through their procurement of the project, the accessibility and openness of the resulting building; and the resulting programmes delivered out of the building consider. In addition, RI and Imperial College will ensure that people who have a protected characteristic are supported to engage with, be in involved in and benefit from the project and its activities.

3.4 The transition to a low carbon circular economy is not only a matter of addressing environmental issues associated with economic development but also about addressing social issues and creating a more inclusive approach and greater equality of opportunity for London’s citizens across society. Activity and programmes that are delivered from this building will be open to all and how they are delivered will be informed by the requirements of people with protected characteristics to ensure that they are accessible to all people and businesses across London working in the cleantech sector.  The programmes of activity will be designed to support diversity and inclusion in the cleantech sector.

Key risks and issues

Links to Mayoral Strategies and priorities

4.1 There are direct links to the CCCI with the Economic Development Strategy, the London Plan and the London Environment Strategy.  Each of these strategies that have been consulted on have policies aimed at growing the low carbon and environmental goods and services sector, including establishing a Centre for Cleantech Innovation in west London.

Economic Development Strategy

4.2 Policy 5.5 Low Carbon and Environmental Goods and Services sector – This has been identified as one of the sectors that is key to creating a fairer and more sustainable future economy for London.  This sector will not only provide solutions to London’s environmental challenges and create opportunities for economic growth and job creation, but it is identified as one of the sectors that the Mayor believes can bring wider benefits to London and Londoners.

4.3 In support of this policy, the Economic Development Strategy states that the Mayor will:

i. Help to accelerate innovation in the Cleantech sector by assisting start-ups to test, prototype and commercialise their innovation in London

ii.Establish a Centre for Cleantech Innovation in West London – to provide workspace, collaboration space and business support

London Environment Strategy

4.4 The CCCI responds to both Policy 10.1.1 (‘To build on London’s strengths and grow the low carbon and environmental goods and services sector’) and Proposal 10.1.1a (‘The Mayor will establish a Centre for Cleantech Innovation in west London to provide workspace, collaboration space and business support’).

4.5 The Strategy states that the proposed Centre (and any associated Cleantech cluster) would aim to deliver the following benefits to London and its cluster partners:

i. Tackling the challenges of climate change

ii. Supporting the development of London’s low carbon circular economy

iii. Catalysing commercial opportunity within the low carbon circular economy

iv. Generating new jobs within the cleantech sector

v. Gaining global recognition for London and the UK.

4.6 The CCCI will also help support the Green New Deal mission’s target of doubling the ‘green economy’ by 2030.

London Plan

4.7 The CCCI responds to and supports the following policies in the London Plan:

i. Policy E7 which promotes the intensification, co-location and substitution of land for industry, logistics and services to support London’s economic function (including by intensifying commercial floorspace by co-locating SMEs that will develop products that support London’s economy)

ii. Policy E8 which states that clusters should be supported where opportunities exist such as Cleantech innovation clusters.

Consultations and impact assessments

4.8 This project has been developed with the aim of developing and delivering a strategically important project that will contribute to the direct delivery of the London Environment Strategy, Economic Development Strategy, London plan and London becoming zero carbon by 2030.

4.9 The London Environment Strategy and the Economic Development Strategy were both widely consulted on and in each the Mayor commits to establish a Centre for Climate Change Innovation in west London to provide workspace, collaboration space and business support.  This idea has also formed part of other workshops where we have sought the input and ideas of London’s Cleantech stakeholders on what the sector needs to be able to come together and grow.

4.10 Specific elements of this project have been developed in response to the issues and challenges that partners and stakeholders have raised in our discussions with them on developing a physical hub for cleantech.  As part of the development and delivery of the project we will continue to engage with relevant London stakeholders to ensure that the outcomes are as relevant as possible, and the Centre for Climate Change Innovation is seen as an invaluable resource for Cleantech business across London.

4.11 An Impact Assessment was undertaken for both the London Environment Strategy and the Economic Development Strategy and its associated programmes.  As this bid will help deliver these objectives the original impact assessment is still relevant to the project.  There will be appropriate levels of Impact Assessment and stakeholder consultation in relation to the design and construction of the Centre for Climate Change Innovation.

Conflicts of Interest

4.12 No conflicts of interest have been identified for any officers involved in the development of this proposal or drafting or clearance of this decision form.

5.1 Approval is being sought for the award of capital grant up to the value of £4.35m to the RI as a contribution towards its costs of the design, retrofit and fit out of a Centre for Climate Change Innovation, which will be based at the RI Building in Central London. The RI have estimated total project costs to be between £10.7m and £13m. Imperial College have agreed to match the GLA’s contribution also up to the value of £4.35m, with the balance currently being sought by the Imperial College’s fund-raising team.

5.2 The proposed capital grant of £4.35m will be funded from the Mayor’s Strategic Investment Fund (as set out in MD2363), with the indicative phasing of the grant expected to be as follows:

i. 2022-23 – £470,000

ii. 2023-24 – £680,000

iii. 2024-25 – £3,200,000

5.3 The GLA’s funding will be capped at a maximum of £4.35m and will be dependent upon the full funding for the scheme being secured by the RI and Imperial College London. In line with the GLA’s standard grant funding conditions, milestone payments will be made upon satisfactory delivery of agreed deliverables and in the event of abortive works, the funding agreement includes clauses to enable the GLA to withhold, suspend and recover funding where appropriate.

5.4 In relation to the Strategic Investment Funding for this initiative, MD2363 set aside £8.70m for the Centre of Climate Change Innovation (previously cleantech innovation), for which £4.35m is to be utilised as described above.

5.5 All appropriate budget adjustments will be made.

6.1 The foregoing sections of this report indicate that the decisions requested of the director fall within the statutory powers of the Authority to promote and/or to do anything which is facilitative of or conducive or incidental to economic development and wealth creation and the development of the improvement of the environment within Greater London and in formulating the proposals in respect of which a decision is sought officers have complied with the Authority’s related statutory duties to:

i. pay due regard to the principle that there should be equality of opportunity for all people

ii. consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom

iii. consult with appropriate bodies.

6.2 In taking the decisions requested of them, the director must have due regard to the Public Sector Equality Duty; namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010, and to advance equality of opportunity between persons who share a relevant protected characteristic (race, disability, gender, age, sexual orientation, religion or belief, pregnancy and maternity and gender reassignment) and persons who do not share it and foster good relations between persons who share a relevant protected characteristic and persons who do not share it (section 149 of the Equality Act 2010).  To this end, the director should have particular regard to section 3 (above) of this report.

6.3 Officers have indicated that the expenditure proposed concerns the award of grant funding. They must ensure therefore, that it is distributed fairly, transparently, in manner which affords value for money and in accordance with the requirements of the GLA’s Contracts and Funding Code and grant funding agreements are put in place between and executed by the GLA and proposed recipient before any commitment to fund is made.

6.4 In addition, as the proposal in respect of which decisions are sought involves the making of commitments which extend beyond the current Mayoral term officers must ensure that the terms of all agreements entered into in respect of the expenditure do not have the effect of fettering the discretion of any successor administration, considering in particular the London elections taking place in May 2024. Accordingly, Officers must ensure that the funding agreement includes a GLA right to terminate at any point for convenience (at no cost to the GLA) and is managed in such a manner, and any deliverables, milestones and/or output requirements are structured so as to mitigate risks of the GLA incurring abortive expenditure (which might be reasonably be taken to fetter, practically, the exercise of such discretion).

1. 1. 7.1 The project timelines are set out in the bullet points below illustrating that the work on the design, gaining planning permission will start once the DD and the resulting Funding Agreement are signed, expected to be in October 2022.  With the planning and design projected to be completed by April 2023 the building is expected to be fitted out and fully operational by Dec 2025. Fundraising will be ongoing for the centre activities and any additional retrofit work needed.
   2. 7.2 There are four key workstream identified to deliver the CCCI at the RI:

• • i. Finalising the design of the building and gaining planning permission – Work estimated to start in October 2022 with completion estimated to be by April 2023
  • ii. Ground works and services – Work estimated to start in October 2020 with the ground works completed and services installed by April 2023
  • iii. Building works and internal fit out – Work estimated to start in April 2023 with the building estimated to be built and operational by December 2025

Appendix 1 - Collaboration agreement

Appendix 2 – Governance structure