Carbon Budget Order 2011
Debate between Lord Teverson and Lord Turnbull
Lord Teverson
My Lords, I sometimes wish that I agreed with my noble friend Lord Reay on a number of issues because he speaks so eloquently and so certainly, although what he says is usually the direct opposite of what I think. However, there is one area on which we agree on this debate, which I will come on to later.
One of the great things about the Committee on Climate Change report on which the Government’s decision was based—and I absolutely welcome the Government’s decision to adopt the fourth carbon budget—was that the report did not just say what the committee thought should happen but actually went through from the basics: it looked at the 80 per cent target for 2050 and said that was still right; it looked at areas such as the 34 per cent reduction by 2020; and it then looked to see whether the evidence was still there that global warming is happening. Where I deviate very strongly from the speech of the noble Lord, Lord Reay, is that I accept that the report showed very clearly: that ocean levels are rising and have been rising consistently over the past decade; that temperatures at sea level and in the atmosphere are rising; and that the number of square kilometres of ice cover in September—I do not know whether it is a particular conspiracy that September of each year has been chosen—has gone down. There are various other indicators but those are the key ones, which show that this is really happening. That is the reality on our planet.
I sometimes think that the noble Lord, Lord Reay, sees the whole climate change strategy as a car accident in slow motion or waiting to happen, whereas I look at him as aiming for it and putting his foot on the accelerator, and I am sad that is the case. It seems to me that the science is there. I agree that there is perhaps less scientific evidence on whether global warming is created by the human race and all the industrialisation that has taken place, but there too I believe the evidence is very strong indeed. Whether we do something about climate change now or wait another couple of decades to see whether it really has happened is not an option we should consider. I agree that there is a difficult global consequence even though, as the noble Baroness has said, we sometimes underestimate the amount of work that other countries—whether developing or having intermediate income levels—have done and are doing in this area.
There will be a number of challenges in meeting these targets. I still treat with some scepticism the argument made by the Committee on Climate Change that the effects on GDP of implementing these measures will be less than 1 per cent. I always think that is a fantastic bit of statistical evidence. Over that time period, the margin of error is probably something like 5 per cent either way. However, it is good to read that and there is evidence on that.
There are big challenges. The climate change report notes that we need something like £10 billion a year of energy investment—something that I recognise from Ofgem reports. I know the Government are very aware of this as well, even though over the past decade and more investment in the power sector has been under £2 billion per annum. That is a fivefold increase that we are looking for in our energy investment. Therefore, anything that we can do through smart grids, demand management and especially schemes such as the Green Deal to bring down energy usage will improve that figure quite considerably.
For this fourth carbon budget, which is 12 years ahead when it starts and 17 years ahead when it finishes, it has to be a good decision by the Government that we are nailing our flag to the mast and that, as with the first three budgets, we are at one with the recommendations of the Committee on Climate Change. That will be difficult, given the need for electric cars. By 2050, more or less all transport will have to be non-fossil-fuel based. That will require a major change, both technically and culturally—which in many ways may be far more difficult.
I disagree with my noble friend the Minister, very unusually, on carbon credits. I argued very strongly during the passage of the Climate Change Bill that we should not be able to borrow from and lend to other periods and budgets; we should not be able to trade credits if we do not meet domestic demand. I am sad in a way to see that proposal. Another issue on which there is perhaps some change from what the Committee on Climate Change would have liked is reassessing the budget in the future, when we look to see what Europe is doing. I think that that is completely sensible, as we cannot ignore the rest of the world and I am sure that, by the time we get to the budget period circumstances will change—they are entirely unpredictable now and we will need to look at the viability of the budget then. However, at the moment the policy is in that way.
I agree with my noble friend Lord Reay that carbon credits are wrong—but probably for completely different reasons—because they allow an out that we should not be able to have. I think that it is wrong that, with the agreement of the Committee on Climate Change, we should allow credits forwards and backwards under the EU Emissions Trading Scheme in terms of our accounting—even though that clearly happens in terms of a commercial reality, which I welcome. What that means is that, for about 40 to 50 per cent of our emissions, which are under the EU Emissions Trading Scheme, even if our greenhouse-gas intensive industries perform better than budgeted the UK does not get any benefit because we count that as exported credits and we still end up with the same amount, which means that all the pressure comes back on the rest of the sector. That is the only area where there is a real problem with carbon budgets as currently proposed.
My final point is that, although it is not mentioned in the Committee on Climate Change report, the committee has some sympathy with measuring our carbon footprint in terms of consumption as well as carbon production and the standard way that the Kyoto protocol looks at the carbon footprint for each nation. I would like to think that we would start to have carbon budgets, or at least carbon measurement, in terms of carbon consumption, where embedded carbon is taken into consideration, as well as the traditional way.
I congratulate the Government on their courage and good sense in agreeing to the fourth carbon budget. There is a very big task to be undertaken, on which we are providing leadership. We can have pride in that, but we desperately need to bring the rest of the world along with us and that, I agree, is not an easy proposition.
Lord Turnbull
My Lords, there is a strong danger of shooting the messenger here. One cannot criticise the Minister for bringing forward these orders at this time. They are mandated by the Climate Change Act 2008. Equally, one cannot expect the Government to do other than accept the bulk of the advice from the Committee on Climate Change since, otherwise, what would be the point of having it? However, we should not simply wade through these orders—I certainly do not want to—without registering the increasing concern in this House and outside about people becoming profoundly disillusioned by the whole framework created by the Climate Change Act.