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UK low carbon ambitions must be made clear to investors

29th June 2017

Reacting to the publication today of the Progress Report from the Committee on Climate Change, Nick Molho, Executive Director of the Aldersgate Group said:

“If the UK is to significantly cut its emissions and modernise its buildings, energy and transport infrastructure in the next 15 years, the private sector must urgently understand the scale of the UK’s ambitions and the market arrangements under which it can invest in that infrastructure. Greater clarity is particularly needed on the policies that will drive emissions reductions in domestic and commercial buildings.”

“The EU referendum and recent General Election have resulted in some understandable delay in developing such a plan for businesses and investors. However, if low carbon infrastructure is to be delivered on time, at the lowest possible cost and in a way that grows UK supply chains, the government must deliver on the Minister’s intention to publish the Clean Growth Plan when Parliament returns from the summer recess.[1]”

Reacting to the key findings of the Progress Report on the UK’s adaptation to climate change, Nick Molho added:
 
“The limited progress being made to tackle the degradation of the UK’s natural environment and better protect its infrastructure from the impacts of climate change is concerning. In the coming year, we need to see a concerted effort across government departments to develop a detailed National Adaptation Plan and 25 Year Environment Plan. These plans must attract much greater investment to improve the state of key natural resources such as coastal wetlands, peatlands and soil and ensure the UK’s infrastructure and economy are resilient in the face of more extreme weather events.” 

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Business case for disclosing climate risks is overwhelming

29th June 2017

Reacting to the publication today of the final recommendations by the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), Nick Molho, Executive Director of the Aldersgate Group said:

“The publication of the TCFD’s industry-led recommendations cements the importance within the investment and business communities of disclosing the physical, regulatory and commercial risks linked to climate change. There is growing recognition that understanding how this information may impact company or asset performance is essential to enable businesses to make sensible long-term strategic decisions and to give investors the information they need to shift their investments towards more resilient and lower carbon business models.”
 
Nick Molho added: “These recommendations on standardised voluntary disclosure will act as an influential guide for investors and businesses across the economy. However, in light of the urgency of tackling climate change, mandatory regulations remain essential to ensure that climate-related disclosure is widely adopted in the near future and is consistent and comparable between companies of a same sector. Given the UK’s aim to become a hub for green finance, the government should take note of the ambition of these recommendations and strengthen the breadth and scope of its own mandatory carbon reporting regulations in line with the industry standard.”  

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Ambitious low carbon agenda essential to make the UK a leader in new industries

21st June 2017

Reacting to the Queen’s Speech today, Nick Molho, Executive Director of the Aldersgate Group, said:

“It is encouraging to see the government’s desire to make the UK a leader in new industries and enhance its role on the world stage. If the government is to do this successfully, it will need to commit to an ambitious environmental and low carbon agenda. With the global low carbon economy growing fast and international action on climate change gathering pace despite the US withdrawal from the Paris Agreement, this will require the publication this year of a detailed clean growth plan to deliver the UK’s climate targets under the fifth carbon budget and a framework for a 25 year plan to enhance the state of the UK’s environment. In incorporating EU environmental legislation in UK law and determining its future, the government should focus on delivering environmental improvements on the ground that are as good as or better than what is currently legislated for.”

Nick Molho added: “The government is right to seek the “broadest consensus possible” in determining the UK’s negotiating terms on Brexit. In order to deliver the UK’s climate and energy policy ambitions in the most efficient and cost-effective way, the UK must maintain close collaboration with the EU after Brexit in key areas of mutual benefit, such as through continued participation in the internal energy market.” 

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Cross-party support for climate policy must strengthen low carbon economy

9th June 2017

Following the results of the General Election, the Aldersgate Group urges the new government when it is formed and MPs from all political parties to build on their support for the UK’s Climate Change Act and the Paris Agreement by backing the growth of the UK’s low carbon economy.
 

The Aldersgate Group, whose business members represent a wide range of economic sectors and a collective turnover in excess of £400bn, calls on the new government when it is formed and MPs from across the political spectrum to recognise the important role played by the low carbon economy in delivering widespread environmental, economic and social benefits, and in strengthening the UK’s international competitiveness.
 
The UK’s low carbon economy was already worth £77bn in 2015 and employed 432,000 people. With UK strengths in the offshore wind, ultra-emission vehicle, construction, ICT and legal and financial services sector, stable and long-term policies could help increase the size of the UK’s low carbon economy from 2% of GDP today to 8% by 2030. Despite President Trump’s recent decision to withdraw the US from the Paris Agreement, the global low carbon economy is rapidly growing, as shown by the $240bn invested in a record amount of renewable electricity capacity in 2016, the slowdown in coal consumption in India and China and increased collaboration between the European Union and China on tackling climate change.
 
Nick Molho, Executive Director of the Aldersgate Group said: “All the main parties have shown support during the General Election campaign for the UK to put in place an ambitious climate and environmental policy agenda and seize the industrial opportunities that this represents. We therefore look forward to working with the new government and MPs from all parties to put in place ambitious policies that will help grow the UK’s low carbon sector, improve resource efficiency, enhance the natural environment and strengthen the competitiveness of the economy.”
 
Nick Molho added: “As made clear in the Aldersgate Group Manifesto, this is a crucial time to establish policies that will improve the health of the UK’s environment and the future prospects of its economy. An important first step should be the publication in 2017 of a detailed Clean Growth Plan to attract low carbon investment and meet climate targets and a framework for a 25 Year Environment Plan to improve the state of the UK’s natural environment."

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Supporting renewables is in Republicans’ interest

7th June 2017

Today the Financial Times published a letter by Aldersgate Group Executive Director, Nick Molho, commenting on Republican US states' growing economic activity around renewable energy. See full text below:

Sir, Many of the US states that are joining the coalition to press ahead with their commitments to cut carbon emissions under the Paris agreement are indeed under Democratic leadership (“Trump Paris deal pullout faces US states’ backlash”, June 5). However, some key Republican states that haven’t yet joined this alliance are witnessing growing economic activity around renewable energy and it is in their interest to continue supporting the growth of the sector.

For example, just under $7bn was invested in renewable energy projects in North Carolina in 2015, while Texas has more than 100,000 people working in the sector. This is one of the reasons some of the federal incentives that facilitate the deployment of renewable energy, such as the wind and solar tax credits, have bipartisan support and were recently renewed for another five years.

When one adds to this the ambitious emissions reduction commitments of a major state like California, the world’s sixth-largest economy before France, it becomes clear that US states and cities could deliver significant emission cuts in the years to come despite an unsupportive federal government.

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Green business needs strong, stable support

5th June 2017

Today the Guardian has published our letter, signed by 11 businesses, highlighting the importance of the UK's low carbon economy and calling on the next government to put in place ambitious and stable environmental policies. See full text below:

Despite the US withdrawal from the Paris agreement on climate change (Anger at US as Trump rejects climate accord, 2 June), the global market for low carbon goods and services is rapidly growing and the UK must make the most of this opportunity. Spurred in particular by major investments in low carbon technologies by countries such as China, India, Mexico and South Africa, the Paris agreement could open up $23tn (£18tn) worth of opportunities for low carbon investments in emerging markets between 2016 and 2030. The commitments made by six world leaders at the recent G7 summit and the decision by China and the EU to collaborate more closely on climate change support this trend.

The UK is well placed to benefit. Its low carbon sector employed 432,000 people and produced a turnover in excess of £77bn in 2015. The UK’s strengths include manufacturing ultra-low emission vehicles and offshore wind turbines, piloting innovative ideas in energy, water and resource efficiency and providing financial and legal services for clean energy projects worldwide. The focus on developing low-cost, low carbon infrastructure is gaining momentum across all key economic sectors.

The low carbon economy could grow from 2% of UK GDP today to 13% by 2050. However, stable policies to grow the UK’s low carbon market will be essential to turn this potential into reality and ensure our economy remains competitive on the global stage. We therefore call on the new government to put in place ambitious and long-term policies to tackle climate change and improve the state of the environment at the heart of its industrial strategy and vision for the UK.

Nick Molho Executive director, Aldersgate Group, Chris Newsome Director of asset management, Anglian Water, Steve Waygood Chief responsible investment officer, Aviva Investors, Nigel Stansfield President, Interface Europe, Middle East and Africa, Pierre Woreczek Chief customer officer, Kingfisher, Jens Tommerup CEO, MHI Vestas Offshore Wind, Matthew Knight Director of energy strategy and government affairs, Siemens UK, Alistair Phillips-Davies Chief executive, SSE, Julia Barrett Director, Willmott Dixon Re-Thinking, David Symons UK Director of Sustainability, WSP, Piers Guy UK country manager, Vattenfall, Paul Greensmith UK country leader, XL Catlin

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Low carbon growth will continue without Trump

1st June 2017

Reacting to President Donald Trump’s announcement that the United States would withdraw from the Paris Climate Change Agreement, Nick Molho, Executive Director of the Aldersgate Group said:

“Donald Trump’s decision won’t result in a U-turn on climate action in the US or globally. Several US States have made clear commitments to continue investing in low carbon technologies [1] and major US businesses such as Walmart have set ambitious targets to cut carbon emissions and increase the use of renewable energy [2].

Globally, the shift to a more efficient, low carbon economy is gathering pace, the cost of clean technologies is rapidly falling and coal use in China and India is slowing faster than anticipated [3]. Over $240bn was invested in record levels of renewable energy capacity in 2016, 40% of which was driven by developing economies including China, India, and Brazil [4]. Following the commitments made by six world leaders at the recent G7 summit [5] and the news of greater co-operation between China and the EU on climate change, major global players like the UK must continue to build competitive, low carbon economies and honour their commitments under the Paris Agreement.” 


[1] A bipartisan group of 17 US state governors representing almost 40 percent of the US population recently agreed for example to co-operate on the deployment of clean energy and transport solutions. 

[2] Walmart recently joined the global science-based targets initiative and committed to cut its emissions of greenhouse gases by 18% by 2025 relative to 2015 levels, source half of its energy from renewables by that date and work with its supply chain to reduce emissions by a further 1 Gigatonne.

[3] https://insideclimatenews.org/news/15052017/china-india-paris-climate-goals-emissions-coal-renewable-energy 

[4] Excluding large hydro. Renewable energy investment in 2016 added 138.5 gigawatts capacity, an 8% increase from 2015 with average costs for solar and wind dropping by 10%. Bloomberg New Energy Finance, April 2017 https://about.bnef.com/blog/bang-buck-record-new-renewable-power-capacity-added-lower-cost/

[5] In a communique on 27 May, the governments of France, the UK, Japan, Italy, Germany and Canada as well as the presidents of the European Council and European Commission reaffirmed “their strong commitment to swiftly implement the Paris Agreement”.  

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