# The Role of Low Temperature Waste Heat Recovery in Achieving 2050 Goals: A Policy Positioning Paper
## 3 Results
### Incentivising Investment  
To meet 2050 goals, the nature of corporate governance must change to emphasise \"climate optimisation\" as well as \"financial optimisation\". An obvious approach, introducing measures along these lines, is to'monetise' greenhouse gas emissions. The EU's carbon trading legislation, for example, places a monetary value on emissions, which can be traded at a cost, creating a financial incentive for reducing emissions. There have been some attempts to prioritise public good in investment decisions. For example, the UK Public Services (Social Value) Act 2012, which applies only to government contracts, states that decision makers \"should be taking a value for money approach - not lowest cost\" and should therefore take into consideration any (positive or negative) externalities for the local area [40]. At present, the act does not specify a value for the reduction of greenhouse emissions but this may be a valuable addition. The European Union has also pursued a'socially responsible' policy on procurement. In 2011, its 'Buying Social' publication set out an agenda for taking social elements into account when considering procurement bids [41]. More recently, the EU have adopted reformed procurement rules that allow public authorities to take social elements into account when making procurement decisions. Guidance has been published, in the form of a \"Buying Green Handbook\", on how Green Public Procurement (GPP) can be implemented [42]. Although green considerations are, at present, voluntary, the EC aims to achieve a critical mass of demand for sustainable goods and services. The above legislation is not yet linked up to corporate governance, and to do so would require a heavy shift in stance. Such requirements are a far easier sell for government contracts than for private enterprise in general. However, it is easy to see such rules applying to carbon emissions, and legal requirements for a net zero-carbon economy by 2050 may make such legislation necessary. In terms of policy, the most common approach is likely to be that which seeks to align the incentives of businesses and the public good. Taxes on carbon emissions, for example, attempt to make it financially advantageous for businesses to seek future proofed, low carbon alternatives. Policies that help reduce risk on environmentally friendly solutions should also be considered. For waste heat recovery, policy should be aimed at making it more financially viable than non-renewable alternatives. Some forward looking financial institutions and companies have seen opportunities in investing in long term, low carbon, community based schemes. One example is the collaboration between energy company Engie (France) and Axium that secured a 50 year Comprehensive Energy Management Contract with Ohio State University in the US in 2017. Another is the collaboration between energy company VEKS (Denmark) and CP Kelco, a US-owned company that produces pectin, a natural starch. The company is located some 40 km from Copenhagen and produces a large amount of excess heat. CP Kelco and VEKS have different business models. CP Kelco is an entirely commercial company and this means that, as a starting point, a large focus on investments with a short payback period is required. In contrast, VEKS, as an operator of infrastructure in the form of district heating systems, has a longer time horizon for its investments; VEKS works with more patient capital. An agreement was able to be reached due to clear system boundaries and a contract detailing payment schedules. CP Kelco was responsible for the investment and the design of the technical installations up to the \"connection point\" with VEKS. VEKS was responsible for the investments and the design of the technical installations from the \"connection point\" with CP Kelco and to the existing district heating network (meaning a larger investment for VEKS since about 150 m of underground district heating piping was needed). In terms of payback periods, two time periods were established.