By John Parnell
The UK welcomes Climate Week 2013 with the future of the country’s energy supply and carbon targets hanging in the balance.
The Energy Bill currently crawling through Parliament has the awkward task of keeping the lights on at a decent price, while cutting the country’s emissions of greenhouse gases.
But while gas, renewables and nuclear all remain in the picture, an ambitious power sector ‘decarbonisation’ target for 2030 vanished at the end of 2012.
Dragging this back into the frame is now one of the main goals for Climate Week organisers, who are mobilising thousands of supporters to back efforts by Conservative MP Tim Yeo and Labour MP Barry Gardiner to have it re-introduced.
What is the target?
The idea is to limit how much carbon electricity producers can emit per unit they generate.
The Government’s independent advisors, the Committee on Climate Change have suggested 50g of carbon of CO2 per kilowatt hour of electricity produced by 2030. Natural gas measures up at 400g and coal around 800g, according to IEA data.
Once the country’s electricity is low carbon, around 80% lower than it is today, logic follows that so is everything that can be electrified, trains, residential heating, some industrial processes and electric vehicles.
The target was proposed in early versions of the UK’s sweeping Electricity Market Reform bill, but in November 2012, it disappeared from a published draft.
Pressure is growing on the coalition government to revisit the proposals and an amendment to put it back into the heart of the Energy Bill has focused attention on the issue.
Why did it disappear?
Most people we have spoken to just say two words: George Osborne. The Chancellor may have played a key role in blocking a decarb target, but he is supported by a large number of Conservative MPs who say it will send energy bills soaring.
“The main source of resistance appears to be the Treasury,” says Will Straw from the IPPR think tank, which has just published new research showing the proposed decarbonisation target need not increase energy prices.
“It’s supported by the Labour Party and the Liberal Democrats and in 2010 David Cameron appeared to tell Tim Yeo he supported it.
“We have to be clear about how we are going to stay on track for our legally binding 2050 target. It has now become essential to have a 2030 decarbonisation target for the power sector.
“Without it there’s a high risk that if we go down the gas route we’ll be four times higher than the decarbonisation target on 200g. That will leave us as polluters and make consumers vulnerable to volatile, high natural gas prices rather than the falling costs of renewables and nuclear”.
Why has this come to a head?
The proposed Energy Bill has dragged all these problems to the surface – that combined with the fact that previous governments have ignored the impending energy crunch.
Energy prices in the UK are rising and as a number of power stations prepare to go offline, the country is facing a £100bn bill to build the infrastructure necessary to keep the lights on.
The UK is already subject to its own economy wide carbon budget, part of the Climate Change Act, and the EU’s 2020 targets on emission reductions, renewable energy and energy efficiency.
Supporters say a decarbonisation amendment would provide longer term certainty to renewable energy investors at a time when utility firms are looking for replacements for ageing infrastructure.
They say a longer term, sector specific target for electricity providers would create an immovable boost to the renewables sector that currently relies on a more flexible and unpredictable stable of subsidies.
Once the power sector has been decarbonised, an increased electrification of transport, residential heating and some industries can follow.
Who backs it?
The amendment was publicly backed by a diverse coalition including WWF, Cisco, the Quakers and SSE, an electricity generator that would be subject to the target.
“We have long argued that a 2030 decarbonisation target would provide investors with greater long-term certainty over the UK’s commitment to decarbonising,” Keith MacLean, Policy & Research Director at SSE wrote in a statement.
“The UK needs to unlock massive investments in new low-carbon power generation over the coming years, and a unified, unambiguous statement of intent from this and future governments in the form of a sector-specific decarbonisation target would be an important first step towards creating a framework that gives investors the confidence they need”.
The EU Commission is also a strong supporter. Existing EU climate legislation depends in part on the bloc’s struggling Emissions Trading System (ETS) and a shorter term EU-wide decarbonisation target. A strong commitment from the UK could give others confidence to adopt similar plans.
What’s the case against?
Many argue there are enough targets and mechanisms in place to support low carbon development. Guy Newey, from the Policy Exchange think tank says there is enough certainty already.
“I think targets are very important. A large number of companies want a decarbonisation target but it is uncertain how central it really to businesses’ decision making. Just because some companies want it doesn’t necessarily mean it’s the right thing to do,” Newey told a Parliamentary hearing last week.
“We have certainty in the UK from the Climate Change Act. We’re also about to sign 15-40 year deals to guarantee electricity prices for low carbon suppliers…how much more certainty do we want?”.
Others say it will lead to energy bills spiking as cheaper fuels such as coal and gas are forced from the market – although research published today suggests relying on gas will boost bills by as much as £15.
A final point here – if you believe climate change is a hoax, then you’re obviously going to think this is a pointless exercise. Avoiding 2°C is a central part of this proposal.
What’s the global impact?
A longer term target could also have a future beyond the UK as countries seek to build trust ahead of the 2015 deadline for a global deal at the UN on emission reductions.
“If the EU is going to encourage China and the US to come to the table at the UN talks in Paris in 2015 then it will need to have some clarity on the direction it is going in post 2020, so I think it is quite likely that we will end up with a 2030 target across Europe at some point,” says Straw.
With EU climate ambition in stasis and US low carbon legislation embryonic, the UK could be one of the first developed countries to send a strong signal ahead of 2015.
And of course, if this does set a precedent and help the world avoid hitting the 2°C target, then we will all avoid the potentially colossal bill that increased incidences of extreme weather events, resource conflicts and rising sea levels could land us with.