In providing our services we are confronted by some of the biggest global challenges, including the effects of climate change and the need to make the most of finite resources to provide for a growing population.
We are determined to play our part in tackling these global problems, cutting our carbon emissions, reducing the energy and materials used to maintain our infrastructure, generating our own renewable energy, increasing the efficiency of our equipment, driving out waste, and finding uses for the by-products of our treatment processes in pursuit of a truly circular economy. By doing so, we also reduce costs, drive innovation and set a powerful example for others to follow. Our longer-term goal is to be a carbon neutral business by 2050.
We follow the principles set out by HM Treasury's Infrastructure Carbon Review to release the value of low-carbon solutions in how we build and operate. Over the five-year period to 2020 our goals are to exceed a seven per cent reduction in real terms in gross operational carbon by 2020 from a 2015 baseline, and to deliver a 60 per cent reduction in capital carbon by 2020 from a 2010 baseline.
Annual gross operational carbon emissions have decreased by 11.5 per cent in 2016/17 in comparison to the 2014/15 baseline, reducing from 455,335 t/CO2e to 403,099 t/CO2e. The main influencing factors include grid electricity demand reduced by 2.3 per cent, an increase in renewable energy generated to 113 GWhs (includes biogas, wind and solar, appointed and non-appointed) and 13 GWhs saved through our Energy Initiative. Other external factors included a 16.4 per cent reduction in grid electricity emission factor and an increase in the methane global warming potential.
Greenhouse gas emission data has been measured and reported in line with the Defra Environmental Reporting Guidelines published in June 2013. Annual net operational carbon emissions have decreased by 12 per cent in 2016/17 in comparison to the 2014/15 baseline reducing from 446,834 t/ CO2e to 393,089 t/CO2e. Our design engineers and capital delivery teams have delivered a 55 per cent reduction in capital carbon against our 2010 baseline, through focus on design, materials used and installation and commissioning techniques in construction.
In September 2016 Anglian Water became the first organisation in the world to be verified against PAS 2080 Carbon Management in Infrastructure, showing that we have the right leadership and governance for effective carbon management. Collaboration across the supply chain is a critical element in delivering carbon and cost reductions. PAS 2080 provides a consistent framework for organisations to use in measuring, managing and reducing carbon.
Managing carbon emissions and costs also relies on our ability to constantly monitor and improve the efficiency of our processes and equipment. Our Energy Initiative began more than 10 years ago to reduce emissions and remove unnecessary costs from our operation. This year, it helped us reduce our energy costs by nearly £2.5 million. These savings will help us control our costs and our customers' bills.
We self-generate an increasing amount of power from renewable energy. This year, we produced 113 GWh, around 16 per cent of our electricity use. Of this, 99 GWh was generated by our fleet of Combined Heat and Power (CHP) engines, which are fuelled by the biogas produced at our sludge treatment centres. This is an increase on the 88 GWh generated last year. To increase the engines' efficiency and performance, we have expanded our in-house team of specialist engineers and technicians to take over their running from external contractors. Another site is due to come on line at Chelmsford during 2017.
The biosolids produced from our water recycling process are a valuable product for farmers and an important source of income for our company. We also believe that recycling biosolids to agriculture is the right and most sustainable thing to do. Our nutri-bio division sells biosolids to agriculture as a range of organic fertilisers and soil conditioners, alongside soil sampling, delivery and spreading services.
It is hugely important that the food industry has total confidence in our product. For this reason, Anglian Water led and funded the development of a national Biosolids Assurance Scheme (BAS). All UK Water and Sewerage Companies (WaSCs) are implementing the scheme, opening their sludge treatment and biosolids recycling operations to an independent audit against the new BAS standard.