Government's scorecard on combating climate change doesn't add up
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* Ashley Seager, economics correspondent
* The Guardian,
* Monday December 31 2007
As we look back on the past year and look forward to the next, there are clearly huge challenges for our economy. The housing market, consumer spending and economic growth look poised on the edge of a pretty steep drop, and there is a growing chance of a recession.
But Gordon Brown - and before him Tony Blair - have stressed that the biggest challenge of our time is the transition to a low-carbon economy.
Professor Nick Stern recommended in his report this year that rich countries start spending at least 1% of their gross domestic product to combat climate change. That's roughly £13bn a year. The United Nations has since gone further and talked of 1.6% of GDP to achieve an 80% reduction in greenhouse gases.
The government has committed Britain to a legally binding target to cut carbon emissions by 60% by 2050. This year the EU set a very demanding requirement that countries increase their share of energy produced from renewables such as wind, solar and biomass to 20% by 2020.
Bold targets and grand intentions are one thing - meeting them is quite another. Emissions have risen during the last decade under this Labour government. So it is a question not just of reducing carbon, but of arresting a rising trend. Not only that, but Britain has so far achieved very little. We have one of the lowest shares of renewable energy (about 2%) in the European Union, one tenth of the wind power and 1/250th of the solar power that the German firms have produced.
The government's response was to cut grants it was offering households to install renewable energy systems through its low-carbon buildings programme (LCBP). The result was entirely predictable - take-up of grants collapsed and installations of solar panels and micro-generators slowed right down. Renewables companies - employing about 25,000 - were forced to lay off staff.
In Germany, 25,000 jobs were created in the industry this year. Not a high score for the government here, either.
The Germans have a "feed-in tariff" (Fit) which guarantees generous payments to households that install micro-generation equipment and sell the surplus electricity to the grid. Electricity companies have to buy the power and share the cost among all their customers. The additional cost is not high and the Germans are building a huge new industry on the back of it.
Debacle
Nearly 50 other countries have introduced a Fit but, in spite of a growing campaign here, and a commitment to one from the Conservatives and LibDems, the government shows no sign of listening. It prefers its renewables obligation scheme - where electricity suppliers must source an annually increasing proportion of power from renewable sources - in spite of academic work showing it is more expensive and less efficient than a Fit. The renewables obligation has boosted onshore wind power, but little else. The government plans to alter it to promote other renewables, but only from 2009, so its score this year on that front is low.
After the LCBP debacle, things got worse. In the summer, the Guardian revealed that officials were advising ministers that as the UK had no hope of meeting the 2020 EU target, they should work to undermine the target at EU level. That is a nought out of 10.
Brown, of course, appeared to ride to the rescue last month, being widely reported to have recommitted Britain to the 2020 20% renewables target. Except he didn't. He committed the UK to ensuring the EU met the target as a whole on average. That would still give Britain leeway to under-achieve if other countries, such as Germany, exceed the target. Luckily, the European commission says Britain will have to play its full part, especially as it is one of the EU's richest members.
Over the year, too, we have had the ongoing debate about the Merton rule, named after the London borough of Merton. Introduced in 2003, it requires that developers incorporate renewable energy production equipment on site to deliver at least 10% of a new building's energy. Over 100 councils have since adopted it and the Greater London Authority increased the minimum requirement to 20%. But builders, who don't like the extra costs, have campaigned against it, urging more off-site renewables.
The Department of Communities and Local Government under Hazel Blears released a planning policy statement before Christmas backing the rule again, though councils are seeking clarification. The Merton rule matters because it has been the main driver of renewable energy in Britain while central government has dithered.
Blears has a bold policy requiring that all new homes are zero-carbon by 2016, which deserves a high mark for ambition. But delivery will be a problem. Her department's renewables advisory board warned this month that meeting the 2016 target required a huge step-up in renewables use now. Given the LCBP shambles and lack of a feed-in tariff, Merton is the best hope and gets a high mark too, as long as it is extended and accelerated.
This month business secretary John Hutton announced a grand intention to build 33 gigawatts of offshore wind power capacity by 2020, up from about 1GW now. That was branded hopelessly optimistic by experts who said it was timed to impress ministers gathered at the UN's climate summit in Bali rather than to signal genuine intent.
Finally, Brown said this month that government departments will have to factor a notional price for carbon, starting at £25.50 a tonne, into all decisions governing transport, construction, housing, planning and energy.
This sounds promising, but we will have to wait and see whether road-widening schemes and new airport runways will be curbed, or whether the plan is really a way to allow more nuclear power stations to be built. So, too early to put a score on this.
It is hard to say that Britain has made much progress towards a low-carbon economy this year. Even a kind reading of the government's report card would conclude "must try harder" and its overall mark for achievement would be very low. Let's hope for better in 2008.
But Gordon Brown - and before him Tony Blair - have stressed that the biggest challenge of our time is the transition to a low-carbon economy.
Professor Nick Stern recommended in his report this year that rich countries start spending at least 1% of their gross domestic product to combat climate change. That's roughly £13bn a year. The United Nations has since gone further and talked of 1.6% of GDP to achieve an 80% reduction in greenhouse gases.
The government has committed Britain to a legally binding target to cut carbon emissions by 60% by 2050. This year the EU set a very demanding requirement that countries increase their share of energy produced from renewables such as wind, solar and biomass to 20% by 2020.
Bold targets and grand intentions are one thing - meeting them is quite another. Emissions have risen during the last decade under this Labour government. So it is a question not just of reducing carbon, but of arresting a rising trend. Not only that, but Britain has so far achieved very little. We have one of the lowest shares of renewable energy (about 2%) in the European Union, one tenth of the wind power and 1/250th of the solar power that the German firms have produced.
The government's response was to cut grants it was offering households to install renewable energy systems through its low-carbon buildings programme (LCBP). The result was entirely predictable - take-up of grants collapsed and installations of solar panels and micro-generators slowed right down. Renewables companies - employing about 25,000 - were forced to lay off staff.
In Germany, 25,000 jobs were created in the industry this year. Not a high score for the government here, either.
The Germans have a "feed-in tariff" (Fit) which guarantees generous payments to households that install micro-generation equipment and sell the surplus electricity to the grid. Electricity companies have to buy the power and share the cost among all their customers. The additional cost is not high and the Germans are building a huge new industry on the back of it.
Debacle
Nearly 50 other countries have introduced a Fit but, in spite of a growing campaign here, and a commitment to one from the Conservatives and LibDems, the government shows no sign of listening. It prefers its renewables obligation scheme - where electricity suppliers must source an annually increasing proportion of power from renewable sources - in spite of academic work showing it is more expensive and less efficient than a Fit. The renewables obligation has boosted onshore wind power, but little else. The government plans to alter it to promote other renewables, but only from 2009, so its score this year on that front is low.
After the LCBP debacle, things got worse. In the summer, the Guardian revealed that officials were advising ministers that as the UK had no hope of meeting the 2020 EU target, they should work to undermine the target at EU level. That is a nought out of 10.
Brown, of course, appeared to ride to the rescue last month, being widely reported to have recommitted Britain to the 2020 20% renewables target. Except he didn't. He committed the UK to ensuring the EU met the target as a whole on average. That would still give Britain leeway to under-achieve if other countries, such as Germany, exceed the target. Luckily, the European commission says Britain will have to play its full part, especially as it is one of the EU's richest members.
Over the year, too, we have had the ongoing debate about the Merton rule, named after the London borough of Merton. Introduced in 2003, it requires that developers incorporate renewable energy production equipment on site to deliver at least 10% of a new building's energy. Over 100 councils have since adopted it and the Greater London Authority increased the minimum requirement to 20%. But builders, who don't like the extra costs, have campaigned against it, urging more off-site renewables.
The Department of Communities and Local Government under Hazel Blears released a planning policy statement before Christmas backing the rule again, though councils are seeking clarification. The Merton rule matters because it has been the main driver of renewable energy in Britain while central government has dithered.
Blears has a bold policy requiring that all new homes are zero-carbon by 2016, which deserves a high mark for ambition. But delivery will be a problem. Her department's renewables advisory board warned this month that meeting the 2016 target required a huge step-up in renewables use now. Given the LCBP shambles and lack of a feed-in tariff, Merton is the best hope and gets a high mark too, as long as it is extended and accelerated.
This month business secretary John Hutton announced a grand intention to build 33 gigawatts of offshore wind power capacity by 2020, up from about 1GW now. That was branded hopelessly optimistic by experts who said it was timed to impress ministers gathered at the UN's climate summit in Bali rather than to signal genuine intent.
Finally, Brown said this month that government departments will have to factor a notional price for carbon, starting at £25.50 a tonne, into all decisions governing transport, construction, housing, planning and energy.
This sounds promising, but we will have to wait and see whether road-widening schemes and new airport runways will be curbed, or whether the plan is really a way to allow more nuclear power stations to be built. So, too early to put a score on this.
It is hard to say that Britain has made much progress towards a low-carbon economy this year. Even a kind reading of the government's report card would conclude "must try harder" and its overall mark for achievement would be very low. Let's hope for better in 2008.
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