Richard Benyon is a former Environment Minister and is MP for Newbury.
A familiar refrain is that Britain is ahead of other European Union countries in introducing measures to tackle climate change – but that we should not be.
The assertion raises two questions.
First, how credible is the idea that are we are unilaterally forging ahead of the rest, when you think of France’s extensive nuclear reactor fleet, or consider that Sweden already gets half of its total energy, not just electricity, from renewable sources?
And, second, if we are ahead, is that really damaging the competitiveness of British businesses and our economy overall?
These concerns are misplaced. It turns out that we are not “ahead of the pack”. Which means that we need to look again, in turn, at claims that climate policies are holding back British businesses.
Consider for a moment the fact that all EU member countries share the same ambition – a cut of carbon emissions by 80-95 per cent from 1990 levels by 2050, and an energy system that is secure, efficient and cheap.
These countries are starting from very different circumstances: the Baltic states of Estonia, Latvia and Lithuania, for example, were acutally within the Soviet Union itself, not just in the Soviet bloc, in 1990. Some economies are intrinsically more efficient than others. And some have historical advantages. The UK began the 1990s with the dash for gas, and the then newly-united Germany by using the wealth of the old West Germany to clean up the dirty industry of the old East Germany. So it is not surprising that if one looks only at emission cuts since 1990, both do relatively rather well.
If you try to compare countries based on individual measures, therefore, you will fail to obtain a realistic comparison.
The Energy and Climate Intelligence Unit, a think-tank on whose Advisory Board I sit, has just published a more comprehensive analysis of countries’ progress towards the common EU goal. It looks at a “basket” of seven measures, incorporating both historical achievements and the current rate of progress. These measures cover emission reductions, energy efficiency and the build-out of renewable and nuclear energy.
And on this basket, the UK is just about average. We are near the head of the pack on some, but woefully behind on others. This holds true whether the UK is compared with our closest equivalents in terms of size and GDP (Germany, Italy, France and Spain), or with the entire 28 member states. We are amidst the pack – not out in front.
Both George Osborne and Amber Rudd have observed in recent times that the UK should “cut our carbon emissions no slower but also no faster than our fellow countries in Europe”, and that is important to “travel in step” with our competitors. The ECIU analysis shows that this ambition has been achieved; we are already travelling in step.
Looking ahead, the Government must decide within the next month whether or not to accept the Committee on Climate Change (CCC)’s recommendation on the level of the fifth carbon budget, covering the period from 2028-32. The Government’s response will give a vital signal to investors. As the Energy and Climate Change Select Committee found recently, confidence has been “spooked” by the recent raft of policy changes, which they see as abrupt and opaque.
Unequivocal acceptance of the CCC’s fifth carbon budget advice – with no ifs, buts or caveats – is an ideal opportunity to reassure investors by providing certainty about the UK’s direction of travel, and to unlock the investment that the UK’s energy system sorely needs at the lowest possible costs. The ECC Committee has also recommended unequivocal acceptance of the CCC’s advice as the most cost effective way of meeting our long-term goals and providing certainty to investors.
If the UK is going no faster than its EU counterparts, the notion that our policies are driving British industry into the dust cannot, logically, be true. It was raised during the recent steel crisis, with certain media commentators claiming that unilateral UK climate policies were driving up energy prices and making British manufacturers uncompetitive.
In reality, energy policy costs make up around one per cent of steel production costs. The precise structure of levies and compensation can be amended to give manufacturers some relief – as the Government has done. But the real problems are beyond the capacity of government to solve: excess capacity, collapsed prices worldwide, and a global glut of cheap steel.
The reality is, as the Prime Minister himself has said, that supporting the low-carbon sector is not just good for the planet, but good for the British economy. The low-carbon sector is worth £46 billion per year and employs nearly a quarter of a million people – more than double the size of our car manufacturing industry. Low-carbon industries have revitalised communities in such places as Hull and Grimsby, and are creating new business opportunities for innovative British manufacturers.
As I and a number of of my Conservative colleagues recently said in a letter to David Cameron, early and full acceptance of the CCC’s recommendation for the fifth carbon budget will give investors the confidence to act, and so maintain this government’s proud record of lower emissions combined with sustained economic growth.
The Prime Minister has also said that the UK is in a “global race” and that “the countries that succeed in that race, the economies in Europe that will prosper, are those that are the greenest and the most energy efficient.” He may well be right; but if the UK is to be among the winners of this global race, it needs to keep its foot on the accelerator, because it is not yet out in front.