Source: BBC Radio 4: Today Programme
URL: N/A
Date: 24/04/2013
Event: Unilateral climate change policies "are adding costs that are not borne by our competitors"
Attribution: BBC Radio 4
People:
Sarah Montague: The UK has successfully reduced its greenhouse gas emissions, over recent years - they're down by 20%. But... when you add back in the amount of carbon dioxide used to make goods that we import, then it turns that cut into an overall increase of 10%. That's the conclusion of the Committee on Climate Change, which has published a report, out today, about that. We're joined by David Nussbaum, who's Chief Executive of the environment charity WWF, in the UK, and by Gareth Stace, who's the Head of Climate & Environment Policy at the manufacturers' organisation the EEF. Good morning to you both.
David Nussbaum: Good morning.
Gareth Stace: Good morning.
Sarah Montague: David Nussbaum, that - I mean, going from 10% cut to 20% increase, it's a dramatic difference. What do you think we should be doing about that?
David Nussbaum: Well, firstly we need to recognise that the good news is that our domestic policies to reduce our carbon emissions have been being successful, and we've reduced the production of CO2 here by quite a significant amount. But what we've got to do is to continue to work on that, and also take a leadership role - ourselves and in the European Union - to get a global deal on climate emissions, carbon emissions, so that the whole world gets on the right trajectory for the future.
Sarah Montague: Right. In that we're doing that already, the question is really what, perhaps - how much further we can go. And this report today from the Climate Change Commission [sic] actually says you shouldn't account for total emissions, it's not going to work like that. Is that something you would have liked to see?
David Nussbaum: Well, I think what they say is you shouldn't primarily focus on those. You should measure the production emissions here, because you can do that precisely, but you should keep an eye on consumption emissions, and that other countries - if we get a global deal, we'll be making sure that their production emissions go down, and that means the whole world benefits from a safe climate.
Sarah Montague: Gareth Stace, what do you think the answer is, to reduce the overall levels?
Gareth Stace: Oh, we certainly need a global agreement, and that will address the competitiveness concerns and enable a massive reduction in global emissions that must take place if we are to achieve our goal here in tackling climate change.
Sarah Montague: You mentioned "competitiveness concerns". Manufacturing in the UK is suffering unfairly, do you think, because of the extra costs that it has to bear on carbon - to deal with carbon emissions?
Gareth Stace: I think it's clear that unilateral climate change policies are adding costs that are not borne by our competitors. Government's own figures actually show that by 2020, half of the manufacturers' electricity bill will come from energy taxes. This limits investment in the UK, hinders manufacturers' ability to reduce emissions through R&D and innovation. It ties one hand behind our back.
Sarah Montague: Do you think it actually goes as far as driving factories abroad, driving manufacturing abroad? Because they don't think that, in the Committee.
Gareth Stace: No, and I think it's very difficult to measure. I think we mustn't look historically, here, we must look forward, because the cost of climate change taxes is rising, and it's not a question of a factory closing, another one opening somewhere else - it's a slow erosion of investment here in the UK, that will lead to closures over time, that are irreversible.
Sarah Montague: David Nussbaum, do you feel for the manufacturers?
David Nussbaum: Well, of course energy-intensive manufacturers do need some support, and the government's already set aside £250 million to do that, in the period to 2015, and we think that's appropriate. We don't want to over-compensate them, as they perhaps have done in Germany. But I think there's another point -
Sarah Montague: And that support should continue beyond 2015?
David Nussbaum: Yes, it'll need to be looked at, on the basis of energy intensity and carbon intensity. But I think there's another very important point here, which is that the low-carbon sector in this country has been growing 4.7% in the last year that BIS has figures for. It's a huge part of our economy, over £100 billion. And that's great news - we're growing in that area, we creating more jobs in that area, there's lots of good news from having tough carbon policies and we need the new Energy Bill, that's going through Parliament at the moment, to reinforce that.
Sarah Montague: Gareth Stace, isn't that getting us ahead of the game - eventually the rest of the world will have to catch up, and the UK will have a model for its economy that effectively gives it acute competitive advantage.
Gareth Stace: I think there's a danger of us pricing ourselves out of that market. We talk about the clean tech sector. In China and in India, in 2010 - 2011, that sector rose by 29%, 19% respectively. And the same year it shrank by 1% here in the UK. So, these are countries that are not piling on costs on their manufacturers, they're enabling their manufacturers to compete in this global - fiercely global market.
Sarah Montague: You mean, we'd be doing better if there weren't such costs on industry?
Gareth Stace: I think we'd be doing better if we - if we ensured that cost-effectiveness sat at the heart of the government's approach to secure an investment in the low-carbon economy.
Sarah Montague: David Nussbaum.
David Nussbaum: Well, the reason China's doing well is because it invested $65 billion last year in renewable energy. China is serious about the low-carbon agenda, and what we need to recognise is there's lots of opportunities for us, both to get our own domestic energy supply renewable, but also to be exporting goods and services around the world, if we can continue to drive forward our leadership position on this agenda.
Sarah Montague: We are something like the second highest importer in the world of embodied emissions. I wonder if there's something that actually individuals can do, when they're choosing what they buy, that could end up benefiting British manufacturers because people will make a decision based on the fact that they won't be buying from overseas.
Gareth Stace: Well, I hope consumers are buying, you know, quality British-manufactured goods, here in the UK, that are probably made much more efficiently than elsewhere often, and have contributed to reducing our own emissions. I mean, manufacturing in the last 30 years have reduced emissions by 40%. We're doing very well, we're up for the challenge, but we need to be able to be competitive when we're doing that.
Sarah Montague: David Nussbaum and Gareth Stace, thank you both very much.