LATEST

Ambitious and well-enforced environmental regulations are good for business

10th May 2018

Reacting to the publication of the government’s consultation on a new Environmental Principles and Governance Bill, Nick Molho, Executive Director of the Aldersgate Group said: “Well-designed, ambitious and properly enforced environmental regulations are essential to economic growth: they provide a stable environment for businesses to invest in, support innovation in new green solutions and products and provide a level playing field across the economy [1]. This consultation to introduce a new Bill to set out environmental principles and a new governance body with statutory underpinning is therefore a significant and positive step forward and has the potential to support improved enforcement of existing legislation and good quality policy making on the environment after the UK has left the EU.”    
 
Nick Molho added: “To maximise regulatory certainty and clarity of policy direction for business, the new Bill should set out environmental principles in legislation, be broadened to include specific environmental improvement goals linked to the delivery of the government’s 25 Year Environment Plan and should provide the new body with powers to advise government on the delivery of these goals. Environmental gains and business certainty would also be clearly enhanced if devolved administrations played a role in co-designing and owning the new environmental principles and governance body.”

[1] BuroHappold (December 2017) Help or Hindrance? Environmental regulations and competitiveness. This report explores the impacts of ambitious environmental standards on business competitiveness, skills and innovation to conclude that well-designed environmental regulations can deliver positive economic outcomes in the form of increased business investment in innovation and skills, better quality products and infrastructure, greater business competitiveness and job creation. 

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Removing barriers to mature renewables key to lowering industrial electricity prices

5th February 2018

Today, the Aldersgate Group publishes a new report written by University College London (UCL) [1], setting out what the government can do to support competitive industrial electricity prices as it delivers its Clean Growth and Industrial Strategies. The report recommends that the UK government improves investment conditions in low-cost renewable energy technologies such as onshore wind, co-ordinates investment in power generation and network infrastructure more efficiently and ensures that the UK leaves the EU in a way that supports increased interconnection with European power grids and cross-border electricity trading. 

This report, written by Professor Michael Grubb and Paul Drummond of UCL, will be launched at an event in London on Monday 5th February [2]. Professor Michael Grubb, Professor of International Energy and Climate Change Policy at UCL, is available for interview.

Coming shortly after the government has published a Clean Growth and an Industrial Strategy and is reviewing the findings of the Helm Review on energy costs, this report sets out six policy recommendations to provide competitive industrial electricity prices. These recommendations seek to capitalise on the technological revolution underway in the clean power sector to reduce system costs and better align the structure of the electricity market with the UK’s new Industrial Strategy. 

To deliver competitive industrial electricity prices and reduce the gap with prices prevailing in some continental countries, the government should consider:

  1. Removing barriers to investment in mature renewable energy projects, given that technologies like onshore wind no longer need subsidy provided the political risks are minimised. This should be coupled with a resumption of the carbon price escalator, taking effect as coal retires from the UK system in the early 2020s, so that investors have confidence that they will save on fuel and rising carbon costs (with an appropriate compensation mechanism for those electro-intensive businesses in need of support);
  2. Encouraging greater co-ordination between investments in network and generation infrastructure to avoid congestion and inefficient network development. This should be done in conjunction with a review considering how to support electro-intensive companies with network costs;
  3. Ensuring that the UK leaves the EU in a way that retains unrestricted access to the internal energy market and supports continued investment in interconnection with continental grids, which will be essential to maintain system security affordably as the UK electricity system decarbonises. Research suggests that for every 1 GW of additional interconnection, UK wholesale electricity prices could reduce by 1% to 2% [3];
  4. Facilitating cross-border industrial electricity purchases;
  5. Using the five-year review of the Electricity Market Reform and Capacity Market to help UK industrial electricity consumers benefit from providing system-related services to the electricity system, such as demand-shifting and frequency support;
  6. Establishing a long-term market of zero carbon and tradeable electricity contracts to facilitate industry access to low cost and unsubsidised sources of renewable electricity such as onshore wind. Industrial consumers holding these contracts would avoid paying the carbon price.

The fact that UK industrial electricity prices are higher compared to those in countries such as France and Germany has been well documented but this report goes further than previous analysis by considering the drivers behind the evolution of electricity prices and what policy measures can help mitigate unnecessary costs to businesses.

It finds that differences in industrial electricity prices have been driven by the fact that some of the UK’s key continental neighbours tend to be better interconnected and engage in more cross-border electricity trading, are more supportive of long-term contracts to reduce prices for electro-intensive companies, take a more strategic approach to supporting electro-intensive companies with network and policy costs and have historically integrated renewable energy on their system in a more co-ordinated – and therefore cost-effective – way than in the UK (although UK policy is now improving in this regard).

Professor Michael Grubb, UCL, said: “With costs tumbling, the clean energy revolution presents an opportunity for UK industry. But harnessing the benefits will require removing the obstacles to mature renewables including onshore wind, and helping business consumers profit from flexibility. It also means ensuring that both fossil fuels and renewables face their environmental and system costs along with developing smarter energy markets, through which industry can procure its energy efficiently with the most cost-effective renewables.”

Nick Molho, Executive Director, Aldersgate Group, said: “Electro-intensive companies have an important role to play in the UK’s transition to a low carbon economy. The government has a wide range of tools available to deliver competitively priced power to those businesses in the years ahead, such as taking a more strategic approach to network development and funding, improving industry access to low cost forms of clean energy and ensuring that Brexit does not get in the way of increased interconnection and cross-border trading with the European electricity market.”

Roz Bulleid, Head of Climate, Energy and Environment Policy, EEF – the manufacturers’ organisation, said: “UCL is to be commended on a thorough investigation of the many complex and interconnected factors driving electricity prices in the UK and on the continent. Energy intensive manufacturers have been concerned for some time about the disparities between UK prices and those paid by their direct competitors. They will be pleased at the recognition of the challenges they face even if the scale of disparity for individual companies may vary beyond the averages necessarily set out here.

As a starting point, government should commission regular assessments of this type, as already happens in some competitor countries, and launch a wider conversation about the impact a more activist approach to electricity prices could have on UK industrial competitiveness.”

Martin Casey, Director of Public Affairs and Communications, CEMEX, said: “This report provides welcomed clarity on some of the challenges facing the cement industry and also puts forward some interesting options to improve the competitiveness of electricity prices which are fundamental to the future success of cement manufacturing in Britain, and consequently to the delivery of the Government's ambitious infrastructure and house building programmes.”

Dr Robert Gross, Co-director, UK Energy Research Centre, said: “This report provides a proper explanation of why UK power prices differ from those in near neighbours. Industrial power prices are not high because Britain is overambitious on green energy but because the way the costs and benefits of clean energy are shared have tended to disadvantage heavy industry.

The report rightly recommends that the UK should push ahead with subsidy-free long term contracts for low cost renewables and encourage large customers to contract directly with generators. The report also shows that prices here are higher because we are less interconnected than our continental neighbours. Interconnection is threatened by Brexit and it is a policy priority to keep the UK in the European energy market.”

Mary Thorogood, Stakeholder Relations Adviser, Vattenfall UK, said: “The UK has a great opportunity to take advantage of its investment in home grown, clean power to deliver competitive prices for consumers and businesses. Vattenfall agrees that, as the cheapest form of generation, UK Government should look at providing a viable path to investment in onshore wind. This will enable decarbonisation at least cost whilst improving the global competitiveness of British businesses of all sizes.” 

Angus MacRae, Head of Electricity Economics, SSE, said: “SSE welcomes this new analysis of how to achieve competitive GB electricity prices whilst delivering the Government’s Clean Growth Strategy at lowest cost. Many of the report’s recommendations will benefit customers by minimising overall costs, in particular, restoring access to the CfD mechanism for the cheapest renewable technologies, ensuring that carbon is properly accounted for in electricity imports, and providing a long-term investable carbon price signal.”

Dr Richard Leese, Director - MPA Cement and Director - Industrial Policy, Energy and Climate Change, Mineral Products Association said: “This report draws attention to an important issue for mineral products producers. Energy costs remain a significant issue for small, medium and large companies alike. Some cost compensations and exemptions exist for the few and are only partial where they apply. The Government’s clear support for renewable subsidies has brought down the cost of their installation and operation, but paradoxically, delivered electricity costs continue to rise. The Government needs to delve deeper into the energy system to understand the impacts and costs of low carbon electricity delivery on the system as a whole. In doing so it needs to take action on the rising costs associated with the network and its capacity constraints.”


[1] The Aldersgate Group published today a new report from Professor Michael Grubb and Paul Drummond at University College London, UK industrial electricity prices: competitiveness in a low carbon world.

[2] Delivering competitive industrial electricity prices in a low carbon world. This event will be held from 10.00am-11.30am on Monday 5th February at RELX Group, 1-3 Strand, London, WC2N 1JR. Chaired by Aldersgate Group Executive Director Nick Molho, the event will feature keynote speaker Michael Grubb, Professor of Energy and Climate Change, at the UCL Institute for Sustainable Resources. Panellists include Roz Bulleid, Head of Climate, Energy and Environment Policy, EEF - the manufacturers’ organisation, Dr Richard Leese, Director - MPA Cement and Director - Industrial Policy, Energy and Climate Change, Mineral Products Association, Matthew Knight, Director of Energy Strategy and Government Affairs, Siemens Plc, and Mary Thorogood, Stakeholder Relations Adviser, Vattenfall UK. 

[3] National Grid (March 2014) Getting more connected: the opportunity from greater electricity interconnection

For press enquiries please contact:

Sophie Arndt
Communications Officer
sophie.arndt@aldersgategroup.org.uk
020 7841 8966


Clean Growth now part of UK’s mainstream economic strategy

27th November 2017

Reacting to the publication of Industrial Strategy: Building a Britain fit for the future today, Nick Molho, Executive Director at the Aldersgate Group said: “The Industrial Strategy can have a transformative impact on the UK’s economy, driving low carbon innovation and the continued growth of jobs, skills and supply chains. It is positive to see that clean growth is now a core objective for the strategy and there is increased focus on energy and resource productivity, and strengthening the synergies between power, heat and transport systems.

Annual global investment into climate-related projects is already more than $1 trillion and accelerating. Given UK strengths in industries such as offshore wind, ultra low emission vehicles and low carbon services, UK businesses are among the best placed to capitalise on the growth of low carbon opportunities and export markets.”

Nick Molho added: “Government can grow market demand for low carbon goods and services and help maximise the benefits of clean growth for UK plc through clear incentive policies, environmental standards, supportive policies on skills and a public procurement policy that rewards resource and energy efficient business. Going forward, the Industrial Strategy must also ensure that energy intensive industries are supported in a way that is consistent with the UK’s emissions targets and helps grow the role of these high value businesses in the UK’s low carbon supply chains.”

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Budget 2017: A bright future for Britain needs more focus on the low carbon economy

22nd November 2017

Reacting to today’s Autumn Budget, Nick Molho, Executive Director of the Aldersgate Group said: “The Chancellor is right that we cannot build an economy fit for the future unless we ensure our planet has a future. As well as aiming to be a world leader in tackling plastic pollution, it was good to hear further support for electric vehicles and charging infrastructure, and in ensuring the UK has the skills required to benefit from the job opportunities of the future.
 
However, the lack of clarity and progress on the future of low carbon power investments and energy efficiency standards in new buildings is disappointing. To reduce power sector emissions cost-effectively and continue to grow renewable energy supply chains, the UK needs a policy environment that allows it to deploy mature low carbon technologies such as onshore wind without subsidy, increase its ambition on offshore wind in the 2020s and keep the door open to improvements in new technologies. The announcement that there will be no new low carbon electricity levies until 2025 mustn’t get in the way of that.”

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Aldersgate Group reactive to Professor Helm's Cost of Energy Review

25th October 2017

Reacting to the publication of Professor Dieter Helm’s Cost of Energy Review today, Sarah Williams, Public Affairs Manager at the Aldersgate Group said: “We welcome the publication of Professor Helm’s review. The UK needs a framework that supports the cost-effective growth of a secure low carbon power system. However, it is important to recognise that policies that have supported the deployment and economies of scale achieved in areas such as offshore wind have played a key role in driving clean energy innovation and cost reductions.

We note the suggestion of an equivalent firm power auction with interest, but would suggest that managing a low carbon power grid at the system level is likely to be far more efficient and cost-effective than asking individual renewable generators to arrange for their own balancing services.”[1]

Upcoming UCL analysis commissioned by the Aldersgate Group will explore in detail why UK industry faces higher electricity prices compared to EU counterparts and actions that can be taken to address this. Sarah Williams added: “Our upcoming study will be a useful complement to the findings of the Helm Review."

[1] Professor Jim Watson & Dr. Robert Gross (9 October 2017) Cost of Energy Review: Insights from UKERC Research

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Clean Growth Strategy sets UK economy on competitive path

12th October 2017

Reacting to the publication of the Clean Growth Strategy today, Nick Molho, Executive Director of the Aldersgate Group said: “The importance of positive government messaging on the low carbon agenda for investment confidence is often overlooked and today’s clear cross-government commitment to deliver on the UK’s climate targets will be welcomed by businesses. Recent announcements in the offshore wind and car manufacturing industries have highlighted how a clear vision, supported by detailed policies, enable the private sector to drive innovation, cut the costs of clean technologies and invest in UK jobs and supply chains.
 
By restating key commitments such as the £557 million for new offshore wind projects, providing new funding for electric vehicle charging infrastructure and innovative low carbon heat projects, and setting out important consultations on energy efficiency, the Clean Growth Strategy is an important milestone that will improve business confidence and the credibility of the UK’s climate targets.”
 
Nick Molho added: “To deliver the required increase in affordable private sector investment, the Clean Growth Strategy will have to increase in detail in the near future. This will be particularly important for the UK’s buildings, where mandatory standards and well-timed fiscal incentives such as stamp duty rebates are essential to delivering a step change in energy efficiency investment.”     

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Offshore wind is UK industrial success story

11th September 2017

Reacting to the results of the Second Contracts for Difference Allocation Round, Nick Molho, Executive Director of the Aldersgate Group said:

“The announcement today that the next round of offshore wind projects will receive a strike price of £57.50-74.75/MWh highlights the considerable cost reductions achieved by the offshore wind industry, at the same time as delivering increased UK content.[1][2]

Larger and more efficient turbines now mean offshore wind is a mainstream component of the UK’s energy mix and turbine blade manufacturing facilities in Hull and the Isle of Wight and servicing companies around the coast are important examples of how the industry has driven jobs and supply chain growth across the UK.

The UK is reaping the benefits of competitive auctions and stable government policy in this area. To continue to see costs reduce, a clear pipeline of projects well into the 2020s will be required and the government’s forthcoming Clean Growth Strategy must ensure that the £730m earmarked for auctions of less established technologies during the last parliament will be committed by 2020 as originally planned.” 

[1] The cost of offshore wind projects are now 50% lower than the first auction held in 2015.

[2] Renewable UK (September 2017) Offshore Wind Industry Investment in the UK: 2017 Report on Offshore Wind UK Content

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Scottish Programme for Government sends positive signal for low carbon investors

5th September 2017

Responding to the First Minister’s announcement today of her Programme for Government 2017-18, Nick Molho, Executive Director of the Aldersgate Group said:

“The First Minister’s proposal to phase out the sale of new petrol and diesel cars and vans by 2032 and the ambitious new targets included in the upcoming Climate Change Bill provide a clear sense of direction to business that investment in all forms of resource efficient infrastructure, renewable energy generation and clean transport will need to increase.
 
Scotland has a real opportunity to capitalise on its successes of recent years. The Scottish Government’s commitment to renewables has helped create a thriving sector that accounted for a total turnover of £2.7bn in 2015 and energy efficiency in Scotland’s buildings has been improving with a 74% increase in homes being rated EPC Band C between 2010 and 2015.
 
However, detailed policies are urgently needed if Scotland is to meet its climate targets on time and on budget and continue to grow its low carbon economy. This is especially the case for Scotland’s buildings where clear regulatory standards and well-timed incentives in the Scottish Energy Efficiency Programme and Warm Homes Bill will be essential to ramp up action on energy efficiency.”

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Briefing: Energy efficiency in the UK’s buildings: key priorities for the new government

24th July 2017

Today, the UK’s building stock is responsible for 19% of annual emissions. Promoting energy efficiency in the UK's domestic and commercial sector is crucial to further decarbonisation in the UK.  Energy efficiency mechanisms could generate potential savings of 23.6MtCO2 per year by 2030, which is roughly equivalent to cutting the CO2 emissions of the UK transport fleet by one third. [1] However, there is a general lack of progress in reducing emissions across the UK’s building stock, insufficient uptake of low carbon heat and insulation and a failure to make any meaningful reduction in non-residential building emissions. [2] The Aldersgate Group and the UK Green Building Council have produced this briefing to highlight priorities for the government in addressing this issue.
 
Our briefing argues that reducing energy demand through greater efficiency can help the UK meet its legally binding climate targets, limit increases in energy bills, tackle fuel poverty, and drive economic growth and long-term job creation.

[1] Cambridge Econometrics and Verco (2015) Building the Future

[2] Committee on Climate Change (June 2016) Meeting Carbon Budgets: Progress Report to Parliament


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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Aldersgate Group Manifesto 2017: A healthy environment, a competitive economy

16th May 2017

Today the Aldersgate Group publishes a manifesto report, A healthy environment, a competitive economy, setting out policy priorities for the new government. The report highlights the growing importance of the low carbon economy to the UK’s competitiveness and urges the new government to put ambitious environmental and climate policy at the heart of its programme as the UK leaves the EU. 

The UK faces several environmental challenges from the growing impacts of climate change on its infrastructure to the degradation of key parts of its environment such as soil. Tackling these environmental challenges effectively will provide economic as well as environmental benefits for the UK. The Aldersgate Group manifesto therefore calls for the next government to:

  • Publish a detailed Clean Growth Plan without delay to attract greater levels of affordable private sector investment in energy efficient buildings, low carbon energy and transport infrastructure. This will help deliver the UK’s emissions reduction commitments under the fifth carbon budget in a timely and affordable way and grow supply chains;
  • Put in place a cross-departmental resource efficiency policy to drive better management of resources across the economy and encourage greater use of secondary materials;
  • Improve the state of the UK’s natural environment via the prompt publication of a 25 Year Plan for the Environment;
  • Develop an industrial strategy to build on the UK’s strengths in the low carbon and resource efficient sectors and support continued growth and job creation in its supply chains;
  • Develop a new finance strategy to increase the levels of private investment flowing into the UK’s modern, green infrastructure, new technologies and innovative business models.

Policies such as the Climate Change Act have already helped to cut carbon emissions, reduce household energy bills in real terms [1], reduce the cost of new technologies like offshore wind and deliver growth in new industries. The Office of National Statistics estimates that the UK’s low carbon and renewable energy economy employed some 432,000 people in 2015 and delivered a turnover of more than £77bn. [2] Critically, a lot of this growth is taking place in parts of the country that need it the most such as the North of England and the Solent area. [3]

UK businesses have strengths in numerous areas of the low carbon economy such as the manufacturing of ultra-low emission cars and wind turbines, expertise in energy efficiency services and engineering, leading cutting edge pilots in resource efficiency and natural capital and the provision of legal and financial services for clean energy projects worldwide. Going forward, the export potential for UK businesses is significant, with estimates that the low carbon economy could grow from 2% of the UK’s GDP today to 8% by 2030. [4]

Nick Molho, Executive Director of the Aldersgate Group said: “As the new government negotiates the UK’s departure from the EU, it should not neglect the importance of putting forward an ambitious low carbon and environmental policy. The UK has significant strengths across the low carbon economy, a market which is already worth over $5.5tn globally [5] and is rapidly growing following the Paris Agreement on climate change. The next five years are a unique opportunity to consolidate the UK’s competitive advantages and put its businesses in the best possible position to tap into growing export opportunities.”

Steve Waygood, Chief Responsible Investment Officer at Aviva Investors said: “We are calling for the creation of public league tables, ranking the performance of companies on a range of sustainability issues, including climate change. Providing ambitious and clear low carbon policies in the next parliament and improving the disclosure of corporate information relating to climate risks will be essential to increase affordable private investment. We need policies to direct capital towards the resource efficient and low carbon infrastructure that the UK so urgently needs to build in order to maintain a globally competitive and resilient economy.” 

Jens Tommerup, CEO at MHI Vestas Offshore Wind said, “We support the Aldersgate Group in their calls for a broad political consensus in the UK around the need for a renewed focus on the transition to a low carbon world, and the great opportunities this presents a new Government after 8th June and the people and businesses of the UK. Offshore wind in particular is demonstrating a compelling proposition, accelerated cost reduction - on track to be the lowest cost large scale generating technology by the early/mid-2020s-, whilst at the same time delivering industrialisation and valuable jobs the length and breadth of Britain.”

Chris Newsome, Director of Asset Management for Anglian Water and member of the Green Construction Board said: “As highlighted in the Infrastructure Carbon Review, infrastructure is responsible for over half of the UK’s carbon emissions. We fully support the Aldersgate Group’s manifesto released today, and their aligned efforts to reduce carbon and cost within infrastructure through innovation and collaboration with the supply chain. The manifesto will undoubtedly drive the sustainability agenda and influence future policy."

"It’s through coalitions such as the Aldersgate Group that Anglian Water aims to provide leadership, practical advice and engage with other companies looking to deliver reduced carbon and reduced cost in sustainable growth.”

Nigel Stansfield, President at Interface Europe, Middle East and Africa said: “Our Mission Zero commitment has reduced our greenhouse gas emissions by 98% across our EMEA operations since we started our sustainability journey in 1996. While companies like ours continue to lead the way, governments at both a national and EU level can accelerate moves to reduce our dependence on fossil fuels by encouraging transparency around the environmental impact of products, and introducing measures to change buyer behaviour in favour of those that are low carbon.”

Julia Barrett, Director at Willmott Dixon Re-Thinking Limited said: “The construction industry is willing to invest in research, innovation and skills development to find the solutions for an affordable low carbon future. But, we need to be confident that the government is taking a long-term policy approach that will support spending on resource efficiency, energy efficiency and low carbon infrastructure.”

Mary Thorogood, Stakeholder Relations Adviser at Vattenfall UK said: “Vattenfall supports the Aldersgate Group’s call for the next government to quickly publish a detailed Clean Growth Plan. The publication of a supportive plan will provide certainty for future low cost onshore and offshore wind projects.  These long-term market signals will encourage Vattenfall’s continued investment and job creation in the UK.”

David Symons, Director of Sustainability at WSP said: “A low carbon, resilient and prosperous United Kingdom is key for WSP and our business.  We look to the next government to deliver world class, ambitious programmes that support our own Future Ready ambitions.”

Sue Riddlestone OBE, Chief Executive at Bioregional said: "Britain's place in the world, and the strength and sustainability of its economy, now depend on how well we look after our environment and the planet. So, too, does the health and long term prosperity of our people. Deep down, more and more of us know that. Voters and politicians must keep that front of mind during this election campaign."

Peter Young, Trustee of the Wildlife Trusts said: “The next 5 years will see coherent and far-sighted environmental policy as an increasing necessity to underpin our future economic success. It is vital that all parties are explicit in demonstrating their commitments to decarbonise, use resources efficiently and enhance our natural capital. Without heeding the importance of these issues to secure a strong UK economy and international trading position, claims to improve UK prosperity and society will be hollow."


[1]: Committee on Climate Change (March 2017) Energy Prices and Bills – impacts of meeting carbon budgets. Improvements in energy efficiency have saved the typical household around £290 per year since 2008 as demand for electricity and gas has reduced, more than offsetting the price of low carbon policies and network costs.

[2]: ONS (6 April 2017) "UK environmental accounts: Low carbon and renewable energy economy survey, final estimates: 2015"

[3]: Aldersgate Group (September 2016) Setting the pace: Northern England’s low carbon economy. In 2013, there were already 136,000 people working in the low carbon economy in the North and this is set to grow with major ongoing investments such as those from Siemens, ABP and DONG Energy at Green Port Hull. On the Isle of Wight, MHI Vestas’ investment in an offshore wind turbine blade factory has created hundreds of jobs on the Isle as well as jobs and other positive impacts across the wider Solent area.

[4]: Ricardo Energy & Environment (March 2017) UK business opportunities of moving to a low carbon economy

[5]: New Climate Economy (July 2015) Seizing the Global Opportunity


UK needs strong environmental standards after Brexit

29th March 2017

Reacting to the Prime Minister’s triggering of Article 50 today, Nick Molho, Executive Director of the Aldersgate Group, said: 

“Several key environmental and climate change policies are derived from EU legislation. Brexit will open up opportunities to make improvements in certain areas such as farming but the UK’s withdrawal must not lead to any weakening of our environmental protections or ambition. The UK needs stable and ambitious policies that will help improve the state of its environment for the benefit of its economy and society and attract more private investment in innovation and green infrastructure.” 

Nick Molho added: “There are many areas of environmental and energy policy where it will be in the interest of businesses and consumers for the UK to continue working closely with the EU. This will be important in areas such as product standards that will still apply to British businesses selling goods in the Single Market and the future of the Internal Energy Market, which is essential to the cost-effective and secure growth of renewable energy in the UK.” 

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UK needs more ambition on clean tech to be at cutting edge of global economy

8th March 2017

Reacting to the Spring Budget today, Nick Molho, Executive Director of the Aldersgate Group, said:

“It was positive to see lots of focus in today’s budget on supporting innovative businesses and ensuring the UK’s workforce has the skills it needs to benefit from the job opportunities of the future. But despite the fact that some of our key trading partners such as China[1] are investing heavily in renewable energy and other clean technologies, there was no reference to the importance of the low carbon sector to the future competitiveness of the UK economy[2].

If the UK is to meet the Chancellor’s ambition of being at the cutting edge of the global economy, the Autumn Budget will need to be much clearer about the UK’s environmental and low carbon ambitions and provide a clear business plan to meet the UK’s policy objectives under its Emissions Reduction Plan and 25 Year Plan for the Environment.”


[1] A record $285bn was invested in renewable energy globally in 2015 – see Global Trends in Renewable Energy Investments 2016 – http://bit.ly/1RAJA8w

[2] The UK’s low carbon and renewable energy economy was responsible for over 447,000 jobs and a turnover in excess of £83bn in 2014 – see UK Environmental Accounts: Low Carbon and Renewable Energy Economy Survey, total activity: 2014 – http://bit.ly/2mlwIOG

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Low carbon growth essential to deliver objectives of UK Industrial Strategy

3rd March 2017

Reacting to the Business Energy and Industrial Strategy (BEIS) Committee’s review of the Industrial Strategy, the Aldersgate Group stressed that supporting the continued growth of the UK’s low carbon supply chains is essential to deliver the government’s objectives of supporting growth across the UK.

The Committee calls for horizontal policies to drive forward the Prime Minister’s ambition of rebalancing productivity and growth the UK. A recent report from the Aldersgate Group showed that the UK’s cross-sector low carbon and renewable energy economy, which was responsible for over 447,000 jobs and a turnover in excess of £83bn in 2014[1], has seen significant investment in jobs and skills in parts of the UK that have suffered most from under-investment in recent years[2]. The continued growth of low carbon markets such as offshore wind, electric vehicles, ICT and energy efficiency, can have a central role in driving productivity and the government’s objective of delivering an economy that works for everyone.

Nick Molho, executive director of the Aldersgate Group said: “Supporting the continued growth of the UK’s low carbon economy provides the horizontal cut-through that the BEIS Committee demands. The government’s Industrial Strategy must complement its Emissions Reduction Plan (ERP) to maximise growth in UK low carbon supply chains and provide the policy consistency that business needs.” 

 

[1] ONS (30th November 2016) “UK Environmental Accounts: Low Carbon and Renewable Energy Economy Survey, total activity: 2014”

[2] Aldersgate Group (September 2016) Setting the Pace. Northern England’s Low Carbon Economy

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Scottish Government reasserts its ambition for a low carbon future

24th January 2017

Reacting to the publication of the Scottish Government’s Draft Energy Strategy today and Draft Climate Change Plan last week, Nick Molho, Executive Director of the Aldersgate Group said:

"The Scottish Government has set out some challenging climate targets but has a great opportunity to capitalise on the progress already achieved and continue growing Scotland’s low carbon economy and supply chain. The bold measures that are being considered are welcome - particularly actions to tackle emissions in the built environment and transport. The proposal for 50% of all energy to be generated from renewables by 2030 will set an important long term signal that businesses can respond to with affordable investment and innovation. Technologies such as hydrogen can play an important role in the decarbonisation of heating, if the lack of progress on Carbon Capture and Storage can be tackled, but continued support should be given to more established technologies such as district heating networks and heat pumps."

Nick Molho added: "It is also positive to see that the Scottish Government’s consultation on improving energy efficiency includes suggestions such as tax rebates and green mortgages. Targeting fiscal incentives at key moments in a building’s life will help drive demand for energy efficiency improvements, with positive knock-on impacts on energy bills, carbon emissions and insulation supply chains. It is essential that the Scottish Government takes concrete measures as an outcome of this consultation."

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Aldersgate Group welcomes Industrial Strategy Green Paper

23rd January 2017

Reacting to the publication of the Building our Industrial Strategy Green Paper, Nick Molho, Executive Director of the Aldersgate Group said:
 
"The government’s focus on ensuring the UK secures the economic benefits of an affordable and timely transition to a low carbon economy is welcome. The opportunities arising from the low carbon economy extend beyond energy innovation into a wide range of highly productive sectors. This part of the economy was already employing 447,500 people in 2014, with a turnover in excess of £83bn. The global transition to a more decarbonised economy led by countries as diverse as China, India, Brazil and South Africa offers significant economic opportunities in areas where the UK has a competitive advantage, such as in ultra-low emission vehicles, offshore wind, the built environment and ICT.

The government’s forthcoming emissions reduction plan will be key in attracting affordable private investment into energy efficient and low carbon projects in the UK. Through greater co-ordination with Local Enterprise Partnerships, a clear low carbon skills policy and consideration on the future role of the UK’s energy intensive industries in the low carbon economy, the industrial strategy could help maximise growth and employment opportunities in the UK’s low carbon supply chains."

Nick Molho added: "The industrial strategy must also embrace resource efficiency. As seen in two reports launched this morning, the shift to a more circular economy will help deliver financial benefits and carbon emission savings in addition to reducing the UK’s resource dependency."

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