Last Friday, 1,000 people in the solar power industry were issued redundancy notices. Today the Trades Union Congress says that 27,000 more jobs in the renewables sector are at risk. At a time when the United Kingdom’s economy is far from recovered, the Tory government’s cuts to financial support to renewables – the one industry that bucked the last recession – is hitting both jobs, investment plans, future energy bills and our climate.
Indeed, things are so bad that in a rare move, the United Nations’ chief environmental scientist has criticised the government’s approach to renewable energy. In a short few years the UK has gone from a world leader on climate leadership to a country on the brink of squandering its early advantages. Despite the economic crash, the UK led the world with the first Climate Change Act, an ambitious target to cut emissions by 80 per cent by 2050 and a measurable process to get there. And there are nearly one million people employed in green industries today.
Yet instead of realising this potential, the first 100 days of the Conservative government have been characterised by cuts to existing financial support, including a planned 82 per cent cut in the feed-in tariff for renewables, coupled with clear support to oil-based industries like fracking. The latest quarterly assessment from Ernst & Young has seen the UK drop out of the top 10 for places to invest in renewable energy for the first time. The report declared that the government had ‘sentences the UK renewables sector to death by a thousand cuts.’
The government says that it is taking action to control spending on renewables to keep consumer bills down. This is, of course nonsense – according to the government’s own forecasts, government green measures will see energy bills £166 a year lower than they would otherwise have been.
And, the change goes much wider than that. Ministers are dismantling the policy apparatus on renewables that has been in place since Ed Miliband became the first secretary of state for energy and climate change in 2007. The durable mix of subsidy and financial support for new technologies under Miliband, Chris Huhne and Ed Davey is over. The new regime is clear about the role of gas as a transition and on standing by new nuclear, but beyond that policy is absent.
Until the government sets out a roadmap for its energy policy, uncertainty for investors will remain. We need more ambition on climate leadership and energy policy, both to play our part on the world stage in Paris as part of the COP climate negotiations and to create the economic benefits at home to boost growth and jobs. This message is echoed in Green Collar Nation: a just transition to a low-carbon economy published today by the TUC and Greenpeace. The report picks up where government policy has stopped, outlining a positive case for climate investment as part of a green industrial strategy. As TUC general secretary Frances O’Grady commented on the launch of the report, ‘The UK has the potential to be a world leader in low-carbon manufacturing. But this won’t be achieved by slashing support for renewable energy … Ministers should be learning from the likes of Germany, and getting behind the green economy. This is the way to create the high-quality jobs and apprenticeships we need to boost productivity.’
So what should be done? The report calls for a more ambitious plan for clean technology apprenticeships, to provide support for business and households to become more energy efficient and to develop a long-term investment strategy. It is an approach shared by business and unions. CBI director general John Cridland described the green economy as ‘an emerging market in its own right, brimming with opportunity’ but warned that the government ‘risks sending a worrying sign to businesses.’ And it is also a lesson that others around the world are quickly learning – many policy analysis believe that at least part of the recent and dramatic fall in oil prices is a result of China’s increased reliance on renewables.
But in order to have an energy policy that addresses the UK’s long-term energy needs, to attract investment and achieve the global framework to manage carbon reductions, we also need to rethink our energy infrastructure. Big is not always better. Smarter technology, reforming our distribution networks and giving communities control over their energy has the potential to transform the energy market – to the benefit of the consumer and climate. In Germany, just five per cent of the renewables installed are owned by the big utilities. The new devolution agenda should incentivise more towns and cities to follow the Nottingham example where the city council has recently established its own energy company (Robin Hood Energy) as an alternative to the big six players. Lisa Nandy, Labour’s new shadow energy secretary, got it right in continuing Labour’s commitment to community and cooperative energy, when she said at the Labour party conference in September that we need ‘secure, affordable energy, designed, built and owned by the people … drawing on inspiration from around the world.’ There are huge opportunities here for the UK. When business, unions, campaigners and the opposition are on the same page, the government should listen.
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Andrew Pakes is former chair of SERA, the Labour Environment Campaign, and tweets at @andrew4mk. Melanie Smallman is co-chair of SERA and tweets at @melaniesmallman
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