The development of an effective policy framework to tackle climate change is the most pressing of tasks for today’s leaders. It is also an extraordinarily complex challenge. A successful framework will need to span all sectors of the economy, influence decisions by businesses, individuals and others and be compatible with emerging European and international policy.
Now is the critical time: by March 2009 we should have a new agenda for EU action, and the UK government will publish its response to the groundbreaking climate change bill. The true test of the government’s commitment to this issue will be whether it produces a credible plan that drives low-carbon investment and emissions reductions across the economy.
The 2007 Stern review on the economics of climate change emphasised the role of a coordinated policy package in tackling climate change. This should contain three main elements: a carbon price; policies to support innovation and the deployment of low carbon technologies; and action to help individuals respond to climate change. The neglect of any one of any of these will lead to failure or, at the very least, an increase in the cost of meeting our climate objectives.
Although Green Alliance is a strong supporter of emissions trading, and believes the EU emissions trading scheme is arguably the world’s most important policy instrument for tackling climate change, its limits need to be understood. We believe, as argued by Paul Ekins and Tom Burke and others in our recent pamphlet Is there more to life than trading? that other elements of Stern have been underplayed.
Trading does not give sufficient confidence in the price of carbon over the period of many investment decisions. This confidence will only be built over time, through clarity and predictability about the future shapes of schemes. In the interim period, it is critical that we apply additional measures to avoid locking ourselves into a high-carbon infrastructure.
Well-designed carbon taxes (and tax rebates), as supported in shadow chancellor George Osborne’s recent speech to Green Alliance, will need to help deliver this steady carbon price. There is also a strong case for using regulatory levers more frequently. They could be particularly effective in electricity generation, products, existing housing and for stimulating the car market.
The successful deployment of innovative technologies will be critical to maintaining our quality of life in a world with constrained emissions. Carbon pricing will not deliver sufficient investment in innovation, nor bring early-stage technologies to market. The government must use additional public expenditure, public procurement and policies to support these technologies becoming commercial. Again, regulation is vital. It levels the playing field so that companies that are innovative prosper, and encourages research and development by the big players.
Current policies do not provide individuals and communities with the incentives they need to ‘go green’. Only government can enable a dramatic shift in behaviour. We need a citizen’s manifesto for action – a comprehensive policy framework designed for the individual. This should use all the tools at our disposal: choice-editing through regulation, incentivising through the tax system, supporting uptake of low carbon technologies and leading by example.
The consensus for a more comprehensive approach to climate change is growing. We cannot wait for the price of carbon to be stable enough to drive investment. Our energy framework requires a vision that uses all the tools in our policy arsenal. This vision needs to be appropriate for the current economic climate: sufficiently sharp to deliver in the short-term while robust enough to withstand longer-term storms. It needs to provide incentives to individuals and businesses that have wide political support. The climate change bill and the prospect of carbon budgets together provide a fantastic opportunity to establish this.
We hope that both the government and opposition parties will take the opportunity to step back, review the current framework, and set out a longer-term approach that goes beyond trading – and can deliver.
I agree with Rebekah that Government needs to go beyond the EU carbon trading system and employ a sophisticated range of regulatory instruments and fiscal incentives to change behaviour.
We probably need an environmental compact in which every person, organisation and business has reciprocal rights and duties.
For the first time with global warming, accompanied by rapidly rising food and oil prices as well as diminishing fish stocks, we have evidence that the process of globalisation is coming up against limits in the natural resources available worldwide. To put it bluntly: with the world’s population now 6 billion and rising, there is only so much atmosphere, oil, land and fish stock to go round!
Avoiding global catastophe means we must adopt sustainable development as a serious approach now. The only credible moral stance in these circumstances is to adopt a ‘fair shares’ attitude, both in this country and internationally.
Government should adhere consistently to a sustainable development approach in every decision; balancing social justice and environmental protection with economic cost benefits.
The Government has achieved a ‘world first’ with the Climate Change Bill intoducing a legal requirement to reduce carbon emissions. The Bill needs to include aviation and shipping emissions attributable to the UK economy, which should not be as difficult to calculate as some suggest. Also the emerging science indicates a revised target -probably about 80% reduction by 2030, not 60% by 2050!
What is required is a transformation of our economy and society no less daunting than that required by the UK and US economies during WWII. Roosevelt turned round the US wartime economy on a dime. Now we face a similar challenge.
The legal duty to reduce carbon needs to be cascaded onto local councils, other public authorities and neighbourhoods.
There will, in all likelihood, continue to be an upward trend in oil and food prices, which will erode the living standards of those on average incomes and below. A plethora of local community food and energy projects could help to sustain the quality of life of many citizens and this suggests a new and enhanced role for local government.
The vibrancy and potentiality of local democratic politics in the UK was seriously damaged by the Thatcher Government and despite many progressive measures in recent years has never been fully restored. One reason that we have such low turnouts in local elections is because residents don’t think it matters and they in supported in that view by most of the national media and by many national politicians.
My argument is this: a credible approach to climate change depends partly upon reviving local politics. It means developing a true sense of local political initiative to deliver local transport, food and energy schemes. Local authorities should be invested with a legal duty to take action on climate change and given sufficient financial independence and legal power to make it a reality.
At the very least this should mean returning the business rates to local control and reforming and revaluing the council tax (with more brackets for both low and high value homes creating a more progressive system).
The council tax and business rates could be used alongside Energy Performance Certificates to offer incentives to those who occupy energy efficient buildings at the expense of those who continue to live and occupy inefficient premises.
There should be a national legal obligation impinging on local government and the housing corporation to offer support in refurbishing lower value homes, irrespective of tenure. Councils should be freed from capital borrowing restrictions to facilitate this. Where homes are owned by landlords, a legal charge on the property would secure the public interest.
Local residents, through referenda or petitions in particular polling districts, should be given a power to require the local council to obtain an independent report on the possibilities of a local food growing co-operative or community energy scheme, harnessing renewable resources wherever practicable.
Where such a scheme can be realised, local councils should be held accountable for a failure to make progress.
A WIKI approach to residents’ involvement in creating and designing schemes in each neighbourhood could empower residents.
The regulatory system for gas and electricity demonstrates is biased against small producers. Everything should be done to encourage local community production of energy from food waste, wood chip, hydro and wind, linked in turn to dirstict heating and cooling as well as electricity production.
An additional feed in tariff for biogas into the gas means and electricity from CHP could assist. Local energy service companies should be facilitated by the financial and legal resources of local authorities in obtaining consents, permissions and finance.
There are no simple answers to climate change. We must be prepared to try many expedients in the expectation that some will work and some will fail. I the process we must be preapred to reshape our laws and institutions as well as our personal expectations.
Andrew Judge