Carbon Diary: Put more money in the green bank
Whoever wins the election will build a greener economy. The crunch issue is delivering the just transition.
For guidance on testing manifesto commitments on climate change, we’d return to the Stern review. The three pillars of Stern’s strategy were: a carbon price, low carbon technology policy, and removing barriers to behavior change through regulatory and voluntary means.
Both main parties support carbon pricing. But investing the flow of carbon revenues is a key issue. Frankly, while cross-party support for a Green Investment Bank is welcome, up to £200 million of new energy investment is needed between now and 2020. Dieter Helm put the overall green infrastructure challenge – including high speed rail, low carbon vehicles, etc – at over £450 billion. Neither party has yet scaled up the bank’s funding to meet this challenge.
We’d agree with James Cameron (no relation) in The Times that Government should use a massive new £40 billion windfall from the sale of CO2 emissions permits from 2012 to 2020, “to fund the move to a cleaner, safer, low-carbon economy.”
The TUC was happy to co-sign a letter to The Times backing this proposal, along with the Environmental Industries Commission, Aldersgate Group, Renewable Energy Association, Greenpeace, WWF, E3G and others.
On Stern’s second pillar, regulation, a key issue here is the UK’s binding target to 15% of our energy from renewables by 2020 – in line with our EU obligations.
- Labour: “We are committed to meeting 15% of our energy demand from renewables by 2020.”
- Conservatives: “We need to generate 15% of our energy from renewables by 2020.”
As manifesto drafters know, there’s a world of difference in language here between “committed to” and “need to”. For Conservative clarity, we could turn to their report, ‘Rebuilding security – Conservative energy policy for an uncertain world’, launched last month. It acknowledges the existence of the EU target but there is no clear commitment to meet it. No-one is saying that 15% won’t be difficult. But manifesto writers know what they are doing, and we would read a clear difference between parties on this central energy issue.
For technology deployment, Stern’s third pillar, interestingly, both main parties support a return to some form of municipal energy supply:
- “giving local authorities the power to establish new district heating networks which use biogas and other low carbon fuels.”
- giving local councils “powers to develop local energy systems, such as renewables and district heating.”