Net-zero Emissions Target: Affordability

Baroness Hayman Excerpts

Thursday 3rd April 2025 Lords Chamber

[Baroness Hayman (CB)]

My Lords, it is always a privilege to follow a maiden speaker in your Lordships’ House, but this was more than a privilege: it was a pleasure and a very moving experience for all of us to hear the maiden speech of the noble Lord, Lord Rees of Easton. At one point, he said his background was chaotic. The speech he made about his early life—his experiences and how an intervention from the Prince’s Trust could make an enormous difference and end up being one of the factors that brought him to your Lordships’ House—told me how much we will benefit here from the breadth of experience that he brings.

I think we knew of the noble Lord as Mayor of Bristol; he comes as a Bristolian, and I am sure that that city’s interests will be well represented in your Lordships’ House. But the dimension that he talked about afterwards, how cities are important in the governance of nations and governance globally, is an essential point for all of us concerned with tackling not just the climate issues we are debating today but the social issues we will all face in one way or another. The noble Lord has an enormous amount to contribute to your Lordships’ House, and we all look forward to hearing more from him in future.

Turning to my own contribution to this debate, I declare my interest as chair of Peers for the Planet. I put on record at the outset, because the point has been made by others, how much I regret the crumbling of the cross-party consensus that has served this country so well in our efforts to combat climate change, and which has given us such soft power globally and allowed us to lead so effectively on the international stage. The noble Lord, Lord Offord, has done the House a service in initiating this debate, allowing us to hear some extraordinarily powerful contributions. It is always invidious to name names, but I shall continue by doing so. We have heard from the noble Lords, Lord Sharma, Lord Turner and Lord Stern, people who have huge authority in this area. I hope that the noble Lord, Lord Offord, might share the relevant Hansard with the leader of his party, so she can perhaps reflect on the rather high-level attitude she has taken on these issues.

No one disputes that achieving the Government’s statutory commitment to reach net zero by 2050 will cost a lot of money—although, as many noble Lords have pointed out, a substantial part of that investment will come from private rather than public sources. The noble Lord, Lord Howell of Guildford, is absolutely right that we have to look at innovative ways in which to partner between public and private in this area. But affordability, as this debate has illustrated, is a much more nuanced concept than simply that of price. It is less easy to calibrate, and it involves questions of both the return on the investment we are making and the value ascribed to the outcomes of that investment. It is also dependent on the external environment and changing pressures, as we have seen only too clearly in the altered views in NATO countries, since the invasion of Ukraine, of the affordability of increased defence expenditure.

There is no denying that there will be real technical and capacity challenges, particularly regarding the national grid, and competing interests and trade-offs of particular policies and infrastructure proposals. I certainly would never deny that the high cost of energy we currently face is causing hardships for households and holding back business growth. But there are solutions to all those issues; as the noble Lord, Lord Stern, pointed out, we need to take the right and urgent action to tackle them.

But other things cannot be denied. The overwhelming scientific evidence of the perils facing the world if we do not rapidly reduce global emissions and halt the rise in temperature has only become more compelling year by year. The recognition of that danger is what led to the passing of the Climate Change Act in 2008 and the net zero remit in 2019. The UK’s response through both policy and action on decarbonisation has been of benefit, not only in the global fight against climate change but domestically in the UK, as many have said.

We have reduced our dependence on fossil fuels, improved our air quality and, strikingly, grown our economy. We have established footholds in low-carbon industries and created new markets for exports, as we can see in our world-leading offshore wind sector. The net-zero economy, as others have said, is growing three times faster than the wider economy and each job generates 38% above the UK average in economic value. I will repeat the quote that others have given from last week’s OECD report:

“Accelerated climate action does not hinder economic growth, it provides economic gains”.


We have to recognise that calling a halt to progress is not a neutral or cost-free option. That was the crucial point that the noble Lord, Lord Stern, made in his seminal report. His judgment has been echoed by many others and many organisations. In the words of the CBI’s chief economist,

“inaction is indisputably costlier than action”.

Nothing has changed the imperative of the transition; it has become only more urgent. Our climate is already warming faster than scientists initially predicted. In these circumstances, it is a category error of monumental proportions to suggest that investing to tackle climate change can be treated as just another spending issue, of no greater significance than any other in the annual spending decisions, and airily dismissed as an unaffordable dream. This is not the time to lose our nerve. We need to buckle down with grit and determination to provide certainty for industry and to encourage innovation.

The fundamental reason why we should continue to lead on this issue is that we owe it to those who are immediately threatened by climate change and to our children and grandchildren. As many contributions in this debate have shown, leading nationally and globally to tackle climate change will also be in the best economic and security interests of the UK. Let us not behave like Oscar Wilde’s cynic, who knew

“the price of everything, and the value of nothing”.

Renewable Energy: Costs

Baroness Hayman Excerpts

Thursday 14th November 2024 Lords Chamber

[Baroness Hayman (CB)]

My Lords, it is a pleasure to follow the noble Lord, Lord Whitty, and to agree with him particularly on the last point that he made. There are difficult decisions to be made; we need transparency and we need critical analysis of individual projects and policy decisions that will influence how we go forward. But we had the advantage in this country, and it is one reason why we became such a leader, of basing those decisions on a fundamental agreement across parties of the huge significance of the issues relating to climate change and the opportunities that there were both to save the world—that sounds very dramatic, but it is not necessarily incorrect—and to hold back and stem the potentially disastrous consequences of global warming by taking action now.

I am getting ahead of my speech and I have not declared my interest, which I do now. I also congratulate the noble Lord, Lord Frost, on again directing the House’s attention to these issues. However, I fear that today he has asked us to take a very narrow focus on the cost of renewable energy and the effect on energy costs in the UK. I do not dispute that these are important issues, but I will not spend my precious four minutes going into the arcane debate about the latest LCOE figures from DESNZ or the implications of the latest strike price from AR6 CfD.

I simply say to the noble Lord that he puts a very gloomy interpretation on these figures, and he says that they are disputed. I do not dispute that he disputes them. However, there is a weight of opinion—academic, scientific and international—that suggests that his interpretation is wrong. If we look at the latest reports of the NESO, which he referred to, the CCC, the IEA and the International Renewable Energy Agency, and the excellent briefings we got from the Grantham Institute, the ECIU and the UK Sustainable Investment and Finance Association, they do not take the same view of the costs as he does.

My fear is not only that the noble Lord, Lord Frost, has got his sums wrong—and possibly, some would say, not for the first time—but that we focus only on the narrow issue of the debate today. We run the risk, as Oscar Wilde told us, of seeing

“the price of everything and the value of nothing”.

There is value in the transition to renewables, beyond the savings to consumers, which I believe are there. There is value in terms of energy security, sustainable jobs for the future, this country’s economic performance and our ability to lead in this area in the future. I hope that other noble Lords will go into more detail about that value later in this debate.

Climate Agenda

Baroness Hayman Excerpts

Thursday 24th October 2024 Lords Chamber

[Baroness Hayman (CB)]

My Lords, it is a pleasure to follow the noble Lord, Lord Randall, and to echo what he said. I think it is the first time that young people have been mentioned in the Chamber. We all need to recognise where the public are on these issues, particularly people younger than ourselves—where not my children but my grandchildren are about their future—because much of what we are debating today involves the potential damage and potential prosperity not of our generation but of generations to come. I declare my interest as chair of Peers for the Planet.

I am going to be disciplined and not follow many of the assertions that have been made in this debate with which I disagree; I will try to argue my own case, but I think it is a bit rich to be told that we, who are on the side of the argument that recognises the existential challenge of climate change, as the noble Lord, Lord Young of Cookham, said, and the category in which that danger and threat exist, are the ones who are subject to the fallacy that it will be all right on the night. We are the ones who actually recognise that something has to be done.

If you accept the facts of the severity of climate change, they logically take you on to look at what needs to be done and, of course, what it costs. The noble Lord, Lord Lilley, is absolutely right—we are talking about big numbers. But the numbers are not nearly as big as they would be if we did not do anything. That point was made 15 years ago by the noble Lord, Lord Stern, in his review, it was endorsed by the OBR and there is a publication today from the University of Cambridge talking about exactly those issues. There is a cost to inaction exactly as there is a cost to action.

Much of the debate has focused, from those on the other side—we are a divided House, in some ways, on this—on the idea that those of us who argue for action overestimate issues; we overestimate the dangers of climate change. If you overestimate the dangers of climate change, you do not have to do so much. I would simply refer them to every single scientific climate academy and meteorological organisation in the world to see the seriousness of what we face. I refer in particular to the proximity outlined recently by Professor Tim Lenton of the earth systems tipping points, such as the melting of the west Antarctic ice sheet or the melting of the carbon-rich permafrost. These could cause irreversible change and accelerate some of the most damaging impacts far beyond those we have already seen.

We should recognise that, alongside those apocalyptic tipping points, there are also positive social and economic ones, and we should not underestimate them. To quote Professor Lenton again,

“tipping points in favour of renewable energy and EVs”—

in some countries but not here, because we have not done it properly—

“are already underway that can help eliminate 37% of global emissions”.

His wider work on tipping points suggest that the global economy could move rapidly towards zero emissions by triggering a cascade of tipping points for zero-carbon solutions in sectors covering 70% of global greenhouse gas emissions.

The cost of delay is serious. It is a cost because, rightly, we have to look at this country’s economic interests. It also means the cost of falling behind our rivals and those countries that have recognised what the future is: the States and those countries that have set strategic industrial targets and are seeing the benefits of that investment. For example, last year, clean energy represented 40% of China’s growth. We talk about China as the bad guy on emissions, but it is at the forefront of clean production and we should not go behind that.

The last thing we should not underestimate is the power of Government to unleash new economic opportunities by providing incentives and consistent policy frameworks that allow businesses to innovate and succeed, as my noble friend Lord Browne of Madingley said.

Nor should we underestimate how globally influential we can be in this area. As has been pointed out, we may only contribute to 1% of annual global emissions, but a third of global emissions worldwide come from countries with less than 1% of the total. Half of global emissions come from countries with less than 3% of the total. So our contribution does matter numerically, as does our leadership—our hard-won global standing—across business, science and technology.

I conclude by saying that I have always believed that this country’s contribution to fighting climate change will be measured not only in the quantity of the emissions we reduce but mainly in the quality of the leadership that we provide. I hope this Government will continue that leadership.