Reacting to Secretary of State’s Amber Rudd speech this morning, the Aldersgate Group stressed that continuing to tackle climate change and build a strong low carbon economy is in the UK’s environmental and economic interest.
Nick Molho, Executive Director of the Aldersgate Group, said: “Coming a few days after the outcome of the EU referendum, it is positive to hear Amber Rudd highlight the importance of continuing to tackle climate change. As shown by the 195 countries that adopted the Paris Agreement in December, climate change is an issue that is of major concern to leaders around the world. The world economy is also seeing an important shift towards low carbon technologies, with a record $285bn invested in renewable energy in 2015  and countries such as China reducing their production of coal.
It is in the UK’s environmental and economic interest to stay in touch with these global trends, remain actively involved in international climate change diplomacy and support the growth of a strong national low carbon economy that already employs over 238,500 people directly. ”
Following the outcome of the UK’s referendum in favour of leaving the European Union (EU), the Aldersgate Group argues that it is in the UK’s interest to continue to lead on environmental issues and grow the UK’s thriving low carbon economy.
Noting that environmental issues featured very little on both sides of the EU referendum campaign, the Aldersgate Group said that the government should continue its work to improve the state of the natural environment at home and ensure the UK economy remained competitive at a time where the global market for low-carbon goods and services is rapidly growing.
Nick Molho, Executive Director of the Aldersgate Group said: “Environmental and low carbon economy issues were largely overlooked during the EU referendum campaign. Yet, both within and outside the EU, the UK has often taken a leading position on tackling environmental issues such as climate change. Today, its low carbon and renewable energy economy has a turnover in excess of £46bn, employs over 238,000 full time workers directly and British businesses are leading exporters of clean technologies such as ultra-low emission cars.
“With serious environmental issues facing the world economy and with low carbon investment rapidly growing globally, it is in the UK’s economic and environmental interest to engage positively in international negotiations on climate change and other environmental issues and support the growth of its low carbon economy through national policy. Showing its commitment to the Climate Change Act by adopting the fifth carbon budget and a robust carbon plan to deliver it and making rapid progress on a 25 year plan to improve the state of the UK’s natural environment must now be essential priorities for the government.”
Reacting to today’s Queen’s Speech, Nick Molho, executive director of the Aldersgate Group said: “As part of its legislative agenda for the coming year, we urge the government to build on its achievements at the Paris climate change summit and put forward a package of measures that will accelerate affordable investment in energy efficient and low carbon infrastructure in the UK. Rapidly adopting the fifth carbon budget recommended by the Committee on Climate Change and putting forward a comprehensive carbon plan by the end of 2016 must be a key part of this.”
Following the publication of a report today by the Energy and Climate Change Select Committee, Setting the fifth carbon budget, the Aldersgate Group stressed that an unequivocal adoption of the fifth carbon budget recommended by the Committee on Climate Change (CCC), backed up by a clear plan to deliver it, was essential to cut emissions cost-effectively and support the continued growth of the UK’s low carbon economy.
Nick Molho, Executive Director of the Aldersgate Group said: “Last December, the UK played a commendable role in the success of the Paris climate change agreement, which was signed by over 170 countries just a few days ago. Now is the time to translate international commitments into a new set of national policies to guide cost-effective investment in energy efficient, low carbon transport and clean energy technologies over the next 15 years.
Adopting the CCC’s fifth carbon budget recommendations, which are based on the minimum levels of emission cuts the UK needs to deliver out to 2032 if it is to meet its long-term targets affordably, is an important part of this.”
Nick Molho added: “With China having increased its investment in clean energy by 120% over the last five years and the international low carbon goods and services sector already worth $5.5tn in 2015, it is clear that the international low carbon economy is rapidly growing. It is key to the UK’s future economic competitiveness that it continues to support the growth of its low carbon economy whilst also taking care to provide the necessary support to its energy intensive sector during this transition.”
Ahead of the signing ceremony at the United Nations’ headquarters tomorrow (22 April) of the Paris Climate Change Agreement, the Aldersgate Group said that the signing of the Agreement was an important and positive step forward but that it had to be rapidly followed by regional and national policies to increase investment in low carbon technologies.
Nick Molho, Executive Director of the Aldersgate Group said: “Since the Paris Climate Change Summit concluded last December, we have seen a steady increase in business commitments and initiatives to reduce greenhouse gas emissions and grow low carbon investments. National governments need to build on this and the momentum provided by the signing ceremony to rapidly ratify the Paris Agreement and put in place the national policies that will help meet the goal of limiting global temperature increases to well below 2C.”
“In the UK, this will require a rapid implementation of the fifth carbon budget recommended by the Committee on Climate Change, together with a clear plan to support cost-effective business investment in the energy efficient and low carbon technologies that the UK needs to cut emissions and modernise its infrastructure. It will also require a clear strategy to support the UK’s energy intensive industries in the transition to a low carbon economy and ensure that they have a role to play in the supply chain.”
Nick Molho added: “We have to remember that delivering the Paris Agreement on the ground isn’t just important for the environment, it’s essential to prevent the significant negative impacts that climate change will have on the world economy if left unchecked. The move towards a low carbon economy can also open up significant economic opportunities, with the international low carbon goods and services sector already worth $5.5tn in 2015”.
With two weeks to go until the London mayoral election, the Aldersgate Group has today sent a letter to each of the mayoral candidates with four key business recommendations to help London tackle its environmental challenges such as air pollution and grow its low carbon economy.
Building on the recent event hosted by AG in March, we ask the next Mayor of London to prioritise the following areas:
The full letter is available to download.
Reacting to the publication today of the Environmental Audit Committee’s report, EU and UK Environmental Policy, the Aldersgate Group said that whilst improvements needed to be made, EU environmental policy was on the whole positive for UK businesses.
Nick Molho, Executive Director of the Aldersgate Group said: “EU environmental policy is important for UK businesses in that it has helped introduce similar environmental rules that apply to all businesses active in the Single Market. This has created more of a level playing field for UK businesses and reduced the cost and complexity associated with complying with different regulations in different Member States.
The EU’s common environmental and product standards have also sent clear market signals to businesses, which have helped both create market opportunities for businesses across the Single Market and improve environmental sustainability in certain markets such as the energy efficiency of consumer products and the sourcing of timber.”
Nick Molho added: “EU environmental policy could be improved in a number of areas such as by improving the common implementation of rules in different Member States, removing inconsistencies in the EU’s waste legislation and ensuring that new policies are developed in a way that better takes into account the EU’s overall environmental objectives. However, the UK and its businesses are likely to be better placed to make these improvements and influence the EU’s future environmental priorities if the UK remains part of the EU.”
Reacting to Secretary of State Amber Rudd’s speech later today on the importance of the EU internal energy market, Dame Fiona Woolf DBE, Energy Lawyer and Partner with CMS Cameron McKenna LLP and Honorary President of the Aldersgate Group said:
“Secretary of State Amber Rudd is right to highlight the contribution that the EU’s internal energy market makes towards the affordability and security of the UK’s electricity system. Co-operation within the EU isn’t just important for energy security; it is also important to tackle environmental issues such as climate change cost-effectively. EU energy and climate policy has an important role to play in helping the UK build a low carbon electricity system in a way that is secure and cost-effective, such as through building more links like the Britned interconnector between the EU’s national power grids.”
As part of the government’s focus on developing “long term solutions to long term problems”, it must build on the announcements made today to fully restore investment confidence in the low carbon sector by rapidly adopting the Committee on Climate Change recommendations on the fifth carbon budget and putting in place a clear strategy by the end of the year to meet these budgets in a way that is economically beneficial.
Nick Molho, Executive Director of the Aldersgate Group said: “The government’s commitment to auction Contracts for Difference of up to £730 million during this Parliament for up to 4GW of offshore wind or other less established renewables is a positive step forward. This gives the offshore wind industry some confidence to continue to invest in new projects and drive down costs, although a more ambitious level of deployment would accelerate cost reductions and deliver greater supply chain benefits.
But much more still needs to be done in order to address the concerns of investors recently highlighted by the Energy and Climate Change Committee. We now look towards the government’s decision on the fifth carbon budget, the Autumn Statement and its emissions reduction plan to provide confidence that the UK is on the right track to decarbonise cost effectively. We will need a clear strategy to increase investment in energy efficiency and low carbon heat, support the deployment of mature low carbon generation technologies such as onshore wind and solar and the demonstration of carbon capture and storage technology.”
Alongside the Budget, the government has published its response to the consultation on business energy efficiency. In response to this Nick Molho added: “It is great to see HM Treasury’s support for retaining mandatory greenhouse gas reporting. As the Aldersgate Group has repeatedly highlighted and the government has recognised, this requirement improves business productivity, provides more transparent information to investors and will help build London as a centre of global green finance. Businesses have been very clear about the importance of retaining the current standards.”
Steve Waygood, Chief Responsible Investment Officer at Aviva Investors, the £290 million asset manager, also commented on today’s update about mandatory carbon reporting requirements: “We welcome HM Treasury’s acceptance of the importance of retaining mandatory carbon reporting standards for UK listed companies, as outlined in today’s consultation response. With the decision, the UK remains aligned with international sentiment, which is placing greater emphasis on sustainable business models following last year’s climate conference in Paris and the creation of the Financial Stability Board’s climate disclosure task force. Mandatory standards are based on hard business logic and enable us to make better informed investment decisions over the longer term because sustainable companies are better performers over longer horizons.”
In a context of more sluggish economic growth forecasts but growing international momentum to tackle environmental challenges such as climate change, this Budget must be one that supports the continued growth of the UK’s low carbon goods and services sector in a way that is cost effective and economically beneficial, recognising the £122bn contribution the low carbon sector already makes to the British economy.
Following the government’s consultation on business energy efficiency policies, we urge the government to confirm on Budget Day that it will keep the UK’s carbon reporting requirements for listed companies in place. As made clear in an open letter from several businesses last week, these requirements have been essential in driving greater business productivity and providing material information to institutional investors to guide their fund management decisions. Removing or weakening them would make no economic or environmental sense and would go against the growing international trend towards greater corporate disclosure of greenhouse gas emissions.
The Budget is also an important opportunity to provide much awaited clarity on the size of the levy control framework to allow the continued deployment, cost reductions and supply chain growth of low carbon technologies such as offshore wind. At a time when the government is reviewing the advice from the Committee on Climate Change on the fifth carbon budget and developing its emissions reduction plan, we hope to see greater clarity on the support that will be made available to improve the energy efficiency of the UK’s building stock and demonstrate the commercial viability of carbon capture and storage technology in the UK.
In today's edition of The Independent, the Aldersgate Group and 16 other signatories from leading businesses and NGOs call on government to ensure that the UK's market-leading mandatory carbon reporting requirements are retained.
Nick Molho, Executive Director of the Aldersgate Group said: “The UK’s mandatory carbon reporting rules require listed companies to report every year on their global greenhouse gas emissions in the directors’ report of the annual report. The broad scope of the reporting requirements is important as it provides a far more comprehensive picture of a company’s resource efficiency beyond just carbon emissions from the consumption of energy, which only account for a limited part of the emissions of some businesses. The fact that the reporting has to be signed off annually at a senior level also means that boards of directors become far more engaged behind initiatives aimed at driving greater energy and resource efficiency in their business, thereby improving their productivity whilst reducing environmental impact."
Nick Molho added: "Critically, the requirements provide institutional investors with material information about listed companies’ greenhouse gas emissions in a way that is reliable, standardised and comparable, where in the past information was provided through different voluntary initiatives using different metrics. This information is key to helping them better understand financial risks linked to climate change and guide their fund management decisions.”
The full letter is available online.
Reacting to today’s publication of the Energy and Climate Change Select Committee’s report on investor confidence in the energy sector, the Aldersgate Group urged the Government to rapidly adopt the fifth carbon budget as set out by the Committee on Climate Change and work with businesses from across the economy to deliver a compelling Carbon Plan to stimulate business investment in low carbon and energy efficient technologies. The Group highlighted that this would also help bring the UK’s domestic climate and energy policies in line with the positive work done by the UK government that helped deliver an international climate deal at the recent Paris COP 21 summit.
Nick Molho, executive director of the Aldersgate Group, said: “We have to recognise that the Government has faced some important cost pressures leading to some of its recent policy decisions in the low carbon and energy efficiency sector. But the Energy and Climate Change Select Committee is right to highlight the recent dip in investor confidence in the sector. What has been particularly damaging is the lack of an alternative plan accompanying recent policy changes, rather than the changes themselves.
Confidence is essential to attracting investment at sufficient scale and at the lowest possible cost in the energy efficiency and low carbon sector and needs to be a priority for the government in 2016. A rapid adoption of the fifth carbon budget, together with a clear plan to increase investment in energy efficiency, low carbon generation and low carbon heat as well as to support the demonstration of carbon capture and storage technology would be an important step forward in re-establishing that confidence.”
The positive conclusion of the climate change negotiations in Paris is a fitting reflection of the unprecedented political and business momentum witnessed at the summit, which marks the start of increased global efforts to tackle climate change. The UK government, which should be given credit for its impactful climate diplomacy in recent years, must now rapidly address the incoherence of its domestic energy policy and follow the positive outcome in Paris with a clear plan to meet the UK’s own carbon budgets.
The Aldersgate Group welcomed today the progress achieved at the climate change summit in Paris. As was to be expected, the Paris summit has not delivered a deal that will immediately prevent warming of more than 2°C and there are still some important issues that will need to be worked on in months to come. But it provides a very important step forward in international climate policy, by delivering an international political agreement to tackle climate change, which can be made more ambitious over time.
Nick Molho, Executive Director of the Aldersgate Group said: “Businesses have been very vocal throughout the summit about the need for a strong climate deal. They are fully aware of both the high costs of inaction on their bottom lines but also the huge opportunities on offer in the transition to a low carbon economy. Businesses want to be at the forefront of tackling climate change, develop much needed low carbon infrastructure, continue to reduce the cost of new technologies and create new jobs.
“The Paris summit provides a comprehensive framework that can now be built on and represents a genuine step forward for international climate diplomacy. The inclusion of a review mechanism that will allow countries to increase their emission cut pledges in the near future, the provision of more finance to support developing countries’ efforts to adapt to climate change and cut their own emissions and the reference to a long term goal for slashing carbon emissions in the world economy are key to supporting long lasting action on climate change. Business will now expect national governments to put in place credible plans to deliver on their pledges and continue diplomatic efforts to ensure ambition is ramped up in the future.”
Nick Molho added: “The UK’s efforts on climate diplomacy over several years have helped influence other large emitting countries to take action on climate change. If the UK wants its weight to continue to be felt on the international stage, it needs to ensure that policies are put in place to deliver on its own domestic climate targets. The government should now act swiftly to deliver a plan for meeting the fourth and fifth carbon budgets.”
A range of Aldersgate Group business members welcomed the final deal and progress on climate change action reached in Paris.
Mike Barry, Director of Sustainable Business at Marks and Spencer said: “COP21 has crystallised the enormous potential of business to help create a low carbon future. Its ability to innovate, scale solutions and engage people can complement the hard work of policy makers and other stakeholders globally. The UK must seize the opportunity to be at the centre of this global low carbon business revolution which is creating markets, growth and jobs.”
Dax Lovegrove, Director of Sustainability and Innovation at Kingfisher plc said: “The COP 21 deal is a pivotal step forward. We look forward to future UK policies flowing out of this international agreement to decarbonise the UK economy at the required pace, to drive greater consumer demand for low carbon goods and services, and to improve the energy use across the country's housing stock.”
Steve Waygood, Chief Responsible Investment Officer at Aviva Investors said: "The outcome of the Paris climate summit is a genuine step forward. The quantity, quality, and ambition of the debate on sustainable finance was hugely improved on previous COPs. There was much greater recognition of the trillion dollar scale of impact of the market failure; a grown up discussion on legal or fiduciary duties of investors, and genuine recognition that we need a material carbon price. COP21 will not solve all these issues, but it would have been unreasonable to expect it to do so. Perhaps the most exciting concrete development is that internationally comparable, consistent and complete carbon data took a huge step forward with the unveiling of the FSB industry led task force on carbon disclosure.
“We believe that the political conditions are now there to change the policy environment and redouble global efforts to tackle climate change. For this summit to be a lasting success, it will need to be followed however by continued efforts to increase international ambition and real action on the ground to cut emissions domestically. In the UK in particular, the government will have to rapidly provide a credible plan for meeting its carbon budgets and ensure that it continues to encourage major companies to disclose their greenhouse gas emissions and then encourage investors to report transparently on the greenhouse gas emissions of the companies in their portfolios.”
Matthew Knight, Director of Strategy and Government Affairs at Siemens Plc said: “The Paris agreement is unprecedented; never before have so many countries agreed to take such a level of action on a common issue.
Siemens has long recognised the seriousness of climate change and is committed to working with other businesses and countries, to minimise and manage effects on the climate. That’s why Siemens engaged in the Paris conference and recently announced our own commitment to decarbonise fully by 2030.
Lessons from the previous conference in Copenhagen have been learnt; government and businesses worked in advance of the summit to clarify our positions, to maximise the chance for agreement. There is still a long way to go. The governments need to deliver on their promises and will need to go further to meet the 1.5 degree target.
But, national governments have been joined by cities and businesses, each making their own commitments. And each will be held to account by future generations. Therefore, the progress made at COP 21 Paris has been a great step forward.”
Niall Dunne, Chief Sustainability Officer at BT Group said: “At BT, we’re delighted that the negotiations at COP21 have achieved this agreement and significant step towards a sustainable future. We hope that the spirit of collaboration that has been centre stage these last few weeks is continued as governments, business and civil society identify actionable ways to implement the details of the agreement.
As a net positive company, BT along with our suppliers and customers around the world, knows that the business case for a low carbon economy is clear and we’ll continue to innovate, collaborate and scale up to use the power of communications to make a better world.”
David Symons, Environmental Director at WSP | Parsons Brinckerhoff said: “It’s strong testimony to the global process that 187 countries from the UK to the USA, from Canada to China have committed to manage their greenhouse gas emissions as part of the Paris process. Business, cities and governments now need to play their part to both implement these plans, and also to get ready for the weather extremes that will still happen.
"A hot day in London will be up to 10°C hotter than today by the end of the century, sea levels 1m higher and rainfall much heavier. Getting our buildings, transport networks and business supply chains ready for the future is a huge challenge – and is one which needs action and investment now.”
Sue Riddlestone OBE, CEO & co-founder of Bioregional said: “An outstanding outcome of COP21 is that more than 180 countries have committed to plans (INDCs) to reduce their carbon emissions. This will feed through into national strategic plans and policies which will give business the framework we need to work with Governments to deliver on what the whole world wants, a stable climate.”
Further to the publication today of the Committee on Climate Change’s advice to government on the fifth carbon budget, the Aldersgate Group called on government to rapidly adopt the fifth carbon budget in 2016 and avoid the delays and investment uncertainty that came with the slow adoption of the fourth carbon budget. The Group stressed that the medium-term clarity provided by the carbon budgets was essential for encouraging international businesses to invest in the UK’s low carbon infrastructure and for remaining on track to meeting the UK’s long-term climate goals at least cost and in a way that could deliver growth.
Nick Molho, Executive Director of the Aldersgate Group said: “With the UK Met Office recently confirming that global temperatures are set to rise by more than one degree above pre-industrial levels for the first time, the UK needs to build on the emission reductions achieved to date and put itself in a situation where it can tackle the challenge of dangerous climate change in a way that is timely, cost-effective and delivers economic benefits in terms of growth and jobs to the UK. The timely adoption of the fifth carbon budget is key to this.
Companies investing in low carbon infrastructure, many of which are international and have a choice as to which countries they want to invest in, are already looking at projects that will be developed in the next decade. Continued confidence in the UK’s low carbon ambitions is essential to attracting this investment. It will allow businesses to keep on investing in innovation, new projects and supply chain factories, all of which will help develop much needed infrastructure, reduce the cost of new technologies and create new jobs in the UK’s low-carbon economy, which already employs 460,000 people.”
A day after the Autumn Statement, the Aldersgate Group also stressed that the Treasury had an important role to play in ensuring the UK would have the means to meet its fourth carbon budget (covering the years 2023 to 2027), as the majority of low carbon and energy efficiency policies and supportive funding were due to end over the course of this Parliament. The Group added that this was also key for the government to meet its existing renewables target for 2020, as the Department of Energy and Climate Change recently acknowledged.
Nick Molho added: “To remain on track for meeting our long-term climate goals cost-effectively, the Treasury must urgently support the government in rapidly introducing policies that will ensure the UK meets its fourth carbon budget. This requires in particular a clear set of new policies in the energy efficiency, low carbon heat and low carbon transport sectors where all support policies are expiring in the near future. Clarifying the government’s plans on renewable electricity beyond the offshore wind auctions announced last week is also an urgent necessity if the UK is to meet its climate goals at the lowest cost and its renewable energy targets for 2020.”
Further to the Chancellor’s Autumn Statement today and ahead of the publication of the Committee on Climate Change’s advice on the Fifth Carbon Budget tomorrow, the Aldersgate Group said that it was unlikely the Autumn Statement had done enough to allow the government to meet its environmental objectives effectively.
Recognising the difficult challenge faced by government in addressing the deficit, the Aldersgate Group welcomed the government’s decision to increase climate finance, maintain support for the purchase of low emission vehicles, commit to an increase in funding on low carbon heat and protect the budget of the FCO, a department which performs important functions in climate change diplomacy and in setting up trade opportunities for UK businesses.
However, it was unclear how the government’s proposal to increase funding for low carbon heat whilst saving £700m would help deliver the increase in low carbon heat required by the UK’s carbon budgets. The proposal to insulate one million homes during the course of this Parliament also amounts to a significant drop compared to the number of homes which took on energy efficiency measures during the course of the last Parliament.
Nick Molho, Executive Director of the Aldersgate Group said: “Without rapid investment in energy efficiency and low carbon heat at scale, it is difficult to see how the UK will meet its Fourth Carbon Budget at least cost and on time. The government needs to do much more to improve the energy efficiency of our building stock and explain how its new proposals will deliver the increase in low carbon heat that the Committee on Climate Change has been calling for. It is also unclear how the government intends to allow further investment in cost-effective renewable electricity projects outside of the offshore wind auctions announced last week.”
The Aldersgate Group however welcomed the Government’s increased focus on apprenticeships and highlighted that a comprehensive strategy was needed to ensure the UK’s workforce was equipped to benefit from the employment opportunities that the transition to a low carbon economy had to offer. This will be the subject of a major Aldersgate Group event in Parliament next week.
Referring to the spending cuts of 15% at DEFRA at 22% at DECC in particular, Nick Molho said:
“Government departments such as DEFRA and its regulatory agencies provide important – and often overlooked – services that are key to the effective functioning of our economy. These include providing access to high quality natural resources such as water and interpreting UK and EU environmental legislation in a way that is pragmatic and can support business innovation. The implementation of the different settlement plans must ensure that these government departments and their regulatory agencies have sufficient resources to continue providing these services effectively.”
Pointing to the fact that businesses were awaiting clear policy signals to increase investments in the UK’s natural capital, Nick Molho added:
“As the Aldersgate Group highlighted in its report last week, the government has the opportunity to drive greater levels of private investment in improving the state of the UK’s natural assets in a way that would support the competitiveness of the UK economy and wouldn’t jeopardise its objective of tackling the deficit. Doing this requires greater policy co-ordination between government departments to support projects that are mutually beneficial and helping support the financing of natural capital projects by making existing subsidy schemes more efficient and developing markets for ecosystem services.”
Reacting to today’s speech by the Secretary of State for Climate and Energy the Rt Hon Amber Rudd MP, the Aldersgate Group welcomed the government’s commitment to phase out the UK’s old coal-fired power stations but stressed that more clarity was rapidly needed on the government’s plan to support future investment in renewables and energy efficiency if the UK was to meet its objectives on carbon emissions, affordability and security of supply.
The Aldersgate Group welcomed the government’s decision to set a clear date for the closure of the UK’s old coal-fired power stations, as this will help modernise the UK’s energy infrastructure and reduce carbon emissions.
Nick Molho, Executive Director of the Aldersgate Group said: “The closure of the UK’s old coal power stations is a pre-requisite to modernising the UK’s energy system. It will help reduce carbon emissions and make clear that modern gas-fired power stations, not coal, are the best complement to increasing amounts of low carbon generation.”
The announcement that three CfD auction rounds for offshore wind will take place during this Parliament was also a positive step forward. However, the Group stressed that more clarity on the funding available to support these auctions and policies to facilitate investment in other forms of low carbon generation such as mature renewable energy technologies was rapidly needed. This was essential to support continued investment in these technologies and secure further cost reductions for consumers and supply chain benefits for the UK economy.
Nick Molho added: “Having provided over 25% of the UK’s electricity in the second quarter of 2015 and demonstrated significant cost reductions in recent years, renewables have an important and growing role to play as part of a secure, low carbon and affordable energy system but the current lack of specific policy has been undermining further investment. Building on today’s positive announcement on offshore wind, the government must rapidly set out its proposals in more detail as to how it will support continued investment and cost reductions in the renewables sector.”
The Aldersgate Group called on the government to clarify as soon as possible the funds that would be available for investment in low carbon power stations under the levy control framework and under what mechanism investors could still develop mature and cost competitive renewable energy technologies such as onshore wind and solar projects.
The Aldersgate Group also highlighted that clarity was needed as to how the government would support investment in a range of other infrastructure areas that were key to meeting the UK’s carbon targets on time and on budget. This included in particular future policies to guide investments in energy efficiency, carbon capture and storage, low carbon heat and low emission vehicles.
Following the publication of the Committee on Climate Change’s report, Power Sector Scenarios for the fifth carbon budget, the Aldersgate Group urges the Government to rapidly extend or replace existing low carbon support policies, the vast majority of which are expiring during the course of this Parliament.
The Aldersgate Group, whose corporate members span a wide range of economic sectors and have a global collective turnover in excess of £300bn, urged the Government today to provide greater policy clarity to support continued investment in the UK’s future low carbon power and energy efficient infrastructure, accelerate cost reductions and deliver supply chain benefits.
Nick Molho, Executive Director of the Aldersgate Group said: “UK low carbon policy has helped deliver many successes in recent years from the falling cost of onshore wind, solar PV and offshore wind to supporting the rapid growth of the UK’s low carbon economy which delivered a turnover of £122bn in 2013 and employs 460,000 people. But the low carbon sector is now at a crossroads, with urgent clarity needed in particular on the funds available to support investment in low carbon power stations in the 2020s and on the support mechanisms that will help improve the efficiency of the UK’s building stock.”
The Aldersgate Group added that the need for long-term policy signals extended beyond the power sector and affected other key infrastructure areas such as low carbon heat and low emission vehicles, where support policies are all due to expire within the term of this Parliament.
Nick Molho added: “In setting out future policies to support investment in low carbon infrastructure, cut its cost and deliver supply chain benefits, the government should also provide continued support to those energy intensive industries at risk of competitiveness impacts to ensure they can play a role in the UK’s future low carbon supply chain.”
Following the publication of the Committee on Climate Change’s report today on the scientific and international context for the fifth carbon budget, the Aldersgate Group urged the UK government to continue its effort to cut carbon emissions and grow its low carbon economy amidst increasing international action on climate change.
Following an increase in ambition in the climate change policies of key emitting countries such as the US and China, the Aldersgate Group highlighted that international action to tackle climate change was strengthening despite the fact that current pledges to cut emissions were still insufficient to prevent dangerous levels of climate change.
Nick Molho, Executive Director of the Aldersgate Group said: “The upcoming Paris climate change summit won’t result in an agreement that can immediately lock-in commitments that will prevent dangerous levels of climate change. But the summit will be a success if it commits countries to initial emission cut pledges and provides for a mechanism to increase these pledges in the coming years.”
Nick Molho added: “To support this strengthening international action on climate change, the UK must continue its own efforts to cut carbon emissions at home. Concretely, this requires rapidly replacing a range of policies such as the levy control framework that will expire during the term of this Parliament and which are critical to increasing innovation and attracting investments in energy efficiency and low carbon power, heat and transport infrastructure.”
The Aldersgate Group also pointed out that in designing the UK’s future climate change and energy policies, the government should not lose sight of the economic opportunities presented by a transition to a low carbon economy.
Nick Molho said: “The international market for low carbon goods and services is already worth $5.5tn. We must look at climate change and energy policies not only as a tool to tackle climate change but also as a way of supporting UK businesses playing an increasing role in this growing international market.”
Following the Emergency Budget presented by the Chancellor of the Exchequer George Osborne today, the Aldersgate Group stated that the continued growth of the low carbon economy was vital to the UK’s long-term economic prospects and that the government should do more to back it.
Today’s Emergency Budget, which contained very few proposals to support the growth of the UK’s low carbon sector, came a day after the Aldersgate Group published its latest report A Brighter, More Secure Future. In this report, businesses from a wide range of economic sectors called on the government to provide enough policy clarity to support continued investment in the UK’s low carbon infrastructure and help investors to continue cutting the cost of new technologies.
Nick Molho, Executive Director of the Aldersgate Group said: “The government’s understandable focus on tackling the annual budget deficit and the national debt shouldn’t come at the expense of failing to support those sectors of the economy that are key to the UK’s long-term growth and competitiveness prospects. With the global low carbon goods and services sector already worth US$5.5 trillion and international momentum building to accelerate cuts in carbon emissions, the UK economy can’t afford to drop out of the low carbon race."
With the UK’s low carbon economy already reaching a turnover of £122bn in 2013, the Aldersgate Group added that rapidly providing sufficient funding under the levy control framework to invest in low carbon infrastructure after 2020 and extending energy efficiency policies would help accelerate the cost reductions of new technologies such as renewables and continue the low carbon sector’s positive contribution to the UK economy.
Nick Molho added: “Yesterday, business leaders from all across the economy showed that they were willing to make significant investments in the UK’s efficiency and low carbon infrastructure, reduce the cost of new technologies and deliver economic growth. If it wants to unlock this much needed investment, the government must use the upcoming spending review to show its commitment to rapidly growing the UK’s energy efficiency and low carbon infrastructure.”
In a new report from the Aldersgate Group out today, leaders from multiple sectors of the economy, academia and civil society set out the key policy priorities in this parliament that will allow the UK to meet its carbon targets on time, on budget and in way that will be beneficial to the UK economy.
The report, A Brighter, More Secure Future: Low carbon priorities for the new government gathers contributions from leaders drawn from sectors as varied as the telecoms, manufacturing, finance, retail, construction, cement, energy and engineering consultancy industries as well as prominent academics, consumer groups and NGOs.
In it, the Aldersgate Group urges policy makers to provide clarity as soon as possible on the funding and level of ambition for low carbon technologies beyond 2020, prioritise the improved energy efficiency of the UK’s infrastructure, continue the positive work done to date in international climate negotiations and provide the necessary support to vulnerable parts of society and the economy in doing so.
The report, which will be debated at a high profile event tomorrow (8th July 2015) in Guildhall jointly hosted by the City of London Corporation and the Aldersgate Group, argues that the environmental and low carbon goods sector is already playing a key role in the UK’s continued economic recovery, with an annual turnover in excess of £122bn in 2013. But the sector is now at a crossroads and needs clear policies for the decade ahead to ensure its continued growth.
Nick Molho, Executive Director of the Aldersgate Group said: “Last week’s report from the Committee on Climate Change showed that decarbonising the UK’s economy could be done affordably. This report goes further and shows that tackling climate change can provide significant economic opportunities for the UK and make our economy far more competitive and resilient to shocks in the future.”
Contributors set out key policy recommendations that would ensure the UK’s transition to an efficient and low carbon economy stays on track and is delivered in a way that is as economically beneficial as possible to the UK.
The report highlights that there are major economic growth opportunities ahead in low carbon energy, transport, information and communications technology, smart grids and energy efficiency, but emphasises that businesses need unambiguous assurance that if they invest in decarbonising the economy, they must be able to count on sufficiently stable and long-term policies and won’t be at risk of retrospective policy changes.
Nick Molho added: “The recommendations that business, academic and civil society leaders have set out in this report will help the UK meet its emission targets on time, on budget and in a way that’s economically beneficial. We urge the government to take note of them and put forward stable policies for the decade ahead.”
Joan Walley, Chair of the Aldersgate Group said: “One crucial area for government engagement will be to continue driving ambition to achieve binding commitments at the climate change negotiations in Paris at the end of this year. But as many businesses in our report make clear, the UK’s positive stance in international negotiations must be backed up by credible and stable policies at home to rapidly grow an efficient and low carbon economy. The government now needs to set out its plans for the low carbon economy in the very near future.”