Luke Nicholson takes a late and frugal lunch of soup and bread in the fourth-floor conference room of a former fabric warehouse in London’s East End. The walls are thinly-painted brick, the floors are bare wooden planks, and there’s a visible gap by a nearby window frame, letting air and light in through a place they shouldn’t go.

It’s an unlikely setting for Nicholson’s company Carbon Culture, a cutting-edge clean-tech startup that writes software to monitor energy consumption, expenditure and carbon emissions in eight U.K. government departments, and is about to roll its product out to the private sector.

Since 2010, Carbon Culture has been helping government offices – including Number 10 Downing Street, the British Prime Minister’s official residence – figure out how much electricity, gas, and heat they are using, how much it’s costing, and how it’s affecting the environment. It displays all the information on its website in real-time tabular and graphical form.

From July 18 to 24, for example, Number 10 used 17,664 kwh of electricity, costing 1,530.49 British pounds, and emitting 9,264 kg of carbon into the atmosphere, the company’s web site showed. It also presents a graphical overview of energy use for the period, and calculates per-hour rates for all of the measures. The data is taken every five seconds from on-site meters, and sent to Carbon Culture’s data base.

The data is designed to help the government make its own contribution to meeting an ambitious national target of reducing carbon emissions by 50 percent by 2025. That’s the underlying goal of a new regulation requiring mandatory carbon reporting for large business from the start of the next financial year, making the U.K. the first country to require emissions data in company reports.

Some of the most interesting low-carbon businesses in the world are growing in London,” – Nicholson

At the Department of Energy and Climate Change, a key testing ground for Carbon Culture’s technology, daytime gas usage has fallen 20 percent since the company has been providing real-time data on energy use there. Thanks to the constant data monitoring, and a highly motivated DECC workforce, most of the department’s “low-hanging fruit” in terms of easy energy savings has now been picked, and further gains there are likely to be incremental, Nicholson said.

The government’s energy and environmental agenda, together with growing popular support for energy efficiency, is creating a favorable climate for the cluster of clean tech companies like Carbon Culture that are springing up in London, said Nicholson.

“Some of the most interesting low-carbon businesses in the world are growing in London,” Nicholson told Breaking Energy. He attributed the growth to the government support that sprang from an initiative announced by Prime Minister David Cameron in late 2010, and to British public backing for the idea of a low-carbon world.

“There’s greater cultural permission to deal with this stuff here,” he said.

By contrast, the U.S. has less political will to institute the kinds of large-scale changes that are underway in Britain and elsewhere in Europe, and that’s reflected in the Obama administration’s “muted” support for sustainability, Nicholson argued.

“Carbon in the U.S. is more toxic than it is here,” he said, in a reference to political support for low-carbon policies.

Nicholson, a bearded 38-year-old, is proud of his software, which he says provides the fastest readout anywhere on energy consumption, cost, and climate impact.

But he’s also convinced of the need for a broad social buy-in to the energy-saving agenda. His website seeks to nurture that by telling readers in plain language that the company wants to help them use resources more efficiently. His populist appeal is helped by the appearance on the site of cute multi-colored cartoon figures, giving it a homey feel.

“It isn’t the case that if you make the best spreadsheet, the world is going to love you,” he said.

Diversity of Involvement is Key

The same limitation applies to technologies that are designed to save money but may in the end be less effective than behavioral change among users as ways of saving energy, Nicholson said.

Installing a new energy-efficient boiler, for example, can bring down heating bills but they will be offset by the high capital and maintenance costs of the equipment. At the DECC, boilers used for heating and hot water have been programmed at higher temperatures than are now desired by workers there who are now habitually adjusting thermostats lower, Nicholson said.

The company says only a community-wide approach to cutting carbon output is going to make a meaningful difference. “If we’re going to deal with climate change, we’re going to have to tighten our ‘carbon belts’ at every opportunity,” its web site says. “It’s fine to continue ‘doing your bit’ but ‘doing your bit’ works a lot better (and is more fun) when it’s done with others.”

If individuals can be engaged in the energy-saving process, it’s also a win for their employers, who save money, and for Carbon Culture, which achieves its goal of cutting carbon emissions, Nicholson said.

Carbon Culture now employs six full-time workers on software design, and has generated about half a million pounds in revenue since starting in 2010 but is not yet profitable, Nicholson said. Operations have been funded from revenue, and the company has had no major investors although is now looking for some, especially those interested in the clean-energy space.

“We’re in discussions with investors who are keen to unlock this enormous commercial opportunity, while delivering an equally impressive social benefit through carbon savings,” Nicholson said.

The company is being nurtured by More Associates, which Nicholson describes as a “sustainability innovation incubator.” That entity incubated his previous startup, Onzo, a provider of energy data and analytics for utilities, which is now owned by Scottish & Southern, the U.K.’s second-biggest electricity generator.

Having established successful relationships with eight U.K. government departments, Carbon Culture is now seeking commercial clients. The first of those are now “secure”, Nicholson said, but he’s not ready to go public with their names yet.

When he does, they will add to an enterprise that fulfills his definition of a worthwhile mission.

“I feel very lucky to be able to do something that utterly needs doing,” he said.

This is the third article in a four-part Breaking Energy series covering the emergence of London’s Silicon Valley. Check back tomorrow for the final Silicon Roundabout article.