healthier, happier and richer

The manifestos of the three main UK political parties, Conservative, Labour and Liberal Democrat, all agree that climate change is an extremely serious issue and that tackling it can be done in ways which enhance energy security and strengthen the UK economy.  (Extracts of what they say on climate generally, investment, tax, heating and electricity and transport can be found in the UK General Election category, above.)  They all agree that the UK must be active internationally and in the EU to press for climate policies and agreements. They agree that a Green Bank is needed to mobilise the necessary resources for investment, that the energy market needs to be strongly regulated and that more must be done to reduce fuel poverty. They also agree that there must be increased powers over energy for local councils and an increased role for communities and co-operatives. In terms of the quartet of measures needed for the low carbon transition – energy efficiency, renewables, CCS and nuclear – there is agreement on the first two, broad agreement but differences in ambition on the third, clear disagreement on the fourth. There is also disagreement – though less wide than expected – on transport issues and a clear difference on nuclear weapons.

Energy efficiency

On energy efficiency, all three propose measures to enable people to make their homes more energy efficient, at no up-front cost, with the loan repayments being smaller than the saving in fuel bills. This approach is already widely, and successfully, used in the US and Germany, so it is excellent that the UK appears ready to catch up. One unexpected promise is in the Labour manifesto – that landlords will be required to make properties energy efficient before renting them out. In the government’s Household Energy Management Strategy, published in March, there is only a promise of yet more consultation on this. The minister responsible for the strategy, Energy and Climate Secretary Ed Miliband, also drafted the Labour manifesto, so presumably he overcame inter-departmental opposition to make the manifesto more ambitious than the strategy.

Renewables and bridge technologies

All three parties support a massive expansion of UK renewables. The Conservatives promise to create two Marine Energy parks to harness offshore wind, wave and tidal energy. Labour repeats its plans to increase offshore wind up to 40 times. The Liberal Democrats promise to invest in shipyards to enable them to manufacture marine renewable technology.

All three support coal with CCS. Labour states that the UK is:

“… the only Government in the world to have banned new unabated coal-fired power stations.”

It is technically correct that the UK has banned new coal without any CCS, but it would not have to cover the whole capacity. The Conservatives say that they would introduce an Emissions Performance Standard to limit greenhouse emissions. They do not say what level this would be set at but, if strict, an EPS would prevent any new coal without full CCS. The Liberal Democrats promise to block any new coal stations unless they are accompanied by:

“… the highest level of carbon capture and storage facilities”.

Conservatives and Labour both support nuclear power. The Conservatives say that there must be no subsidy to nuclear stations. However, they also say that there must be a floor price for carbon emissions and promise to reform the Climate Change Levy (a tax on industrial and commercial energy use) to provide this. A carbon floor price would, if high enough, be enough to get new nuclear stations built. The Liberal Democrats remain opposed to nuclear power, but on economic rather than environmental or ideological grounds:

“… nuclear is a far more expensive way of reducing carbon emissions than promoting energy conservation and renewable energy.”

They are correct about this, but the question they do not address is whether energy efficiency and renewables can deliver enough, quickly enough. They promise that 40% of UK electricity will come from “clean, non-carbon-emitting sources” (which presumably means renewables and CCS) by 2020, rising to 100% by 2050. If met, these targets would leave 60% of UK electricity from other sources in 2020, plus oil used for transport and gas for heating. The Liberal Democrats speak often and proudly of their fellow liberal party, the German Free Democrats, who are in coalition with Merkel’s Christian Democrats and therefore support both nuclear and CCS as bridge technologies until Germany and the world can be 100% renewable. The Liberal Democrats might respond that CCS is a sufficient bridge technology. However, the economics of CCS have not been demonstrated at large scale and integrated throughout the process, so the cost of that is uncertain. So it is not possible to say that nuclear is more expensive than CCS. It may be, and the economics of nuclear power are notoriously subject to regular upward revision. Certainly neither coal nor CCS will be cheap, but CCS may be even more expensive. Given the scale of the climate challenge, it is sensible to invest in both bridge technologies.

Transport

Labour supports a third runway at Heathrow and, if returned to power, would simply do another consultation (the courts having ruled that the previous one was inadequate) and try to get it built. However, the manifesto says that:

“… we will not allow additional runways to proceed at any other airport in the next Parliament.”

This is better than expected (though no new runways anywhere is the only real climate policy). The Conservatives say ‘no’ to Heathrow expansion and ‘no’ to new runways at Stansted and Gatwick. However they make no mention of Luton, another London airport, and nothing about airports away from London, though the Conservatives do promise to

“… reform Air Passenger Duty to encourage a switch to fuller and cleaner planes.”

The Liberal Democrats are the strongest of the three on aviation (as on transport generally). They say that they would:

“… cancel plans for the third runway at Heathrow and any expansion of other airports in the South East”.

However, they say nothing against expansion of airports outside the South East – though they also say that they would:

“… replace the per-passenger Air Passenger Duty with a per-plane duty (PPD), so capturing freight movements by air for the first time [and] introduce an additional, higher rate of PPD on domestic flights for which alternative and less polluting travel is readily available”.

All three parties declare their support for high speed rail in the UK, which is essential to stop short haul flying.

The leaders’ debate

On Thursday, the first ever UK debate between potential prime ministers was held. This was supposed to be about domestic issues, but in 90 minutes there was no mention of climate. Yes, it’s a global issue, but it’s a domestic issue too. Even Nick Clegg, the Liberal Democrat leader who by common consent performed best in the debate, didn’t think it worth mentioning. Instead, there was lots of ‘debate’ (in reality, more pointless argument from fixed positions) about tax. Gordon Brown defended the proposed increase in national insurance contributions, claiming it is better than cutting public expenditure and so endangering the recovery. David Cameron repeatedly attacked “Labour’s jobs tax”.

In reality both are right. Putting up the part of NI paid by employers makes employing people more expensive, so it is indeed a tax on jobs. However, cutting public expenditure by an extra £6 billion, to cover the cost of not increasing it, is unlikely to be possible through just efficiency savings, as the Conservatives say it would. So, either the Conservatives would have to cut expenditure even more than anticipated, harming the recovery as well as public services, or they would have to put up another tax. Labour says that a Conservative government would increase the UK sales tax, Value Added Tax (VAT) – though, strikingly, Labour’s manifesto promises not to increase income tax rates, but makes no such promise about VAT.

This is an unnecessarily narrow argument. Given the deficit, many taxes will have to go up. Employers’ NICs are a bad tax to increase. So is VAT, as it is regressive. Income tax is progressive, so is a better tax to put up. Even better are some green taxes, but a tax on domestic energy is regressive, so should be avoided. Labour introduced the Climate Change Levy on industrial and commercial energy, but not as a carbon tax (since this would have been bad for the UK coal industry) and at a relatively low level. It should be turned into a carbon tax, as the Conservatives propose, and increased. Motoring taxes should be increased, as both Conservative and Liberal Democrats suggest. The Conservatives propose a ‘fair fuel Stabiliser’, which would cut fuel duty when oil prices rise, and vice versa. This makes sense in climate and social terms, though could play havoc with government revenue forecasts. The Liberal Democrats propose a rural fuel discount scheme which would allow a reduced rate of fuel duty to be paid in remote rural areas. This also makes sense, though there is clearly a potential ‘tank tourism’ problem, when people drive to faraway petrol stations just to buy cheaper petrol. Taxes on flying would be extremely progressive, since rich people fly much more than poor people, and could also raise billions of pounds. Overall, it is quite possible to increase green taxes in effective, progressive ways.

The other relevant issue that came up in last Thursday’s debate was Trident, the UK nuclear weapons system. Labour and Conservatives both say that it should be replaced and renewed. Labour’s manifesto states that a Labour government:

“… will maintain our independent nuclear deterrent. We will fight for multilateral disarmament, working for a world free of nuclear weapons.”

No inconsistency there, then. The Liberal Democrats’ manifesto includes:

“… committing not to replace the Trident nuclear weapons system on a like-for-like basis”.

Clegg was attacked in the debate for being ‘weak on defence’ and, afterwards, Labour and Conservative politicians both condemned the proposal as unilateral nuclear disarmament – one of the ultimate insults in the British political lexicon. Liberal Democrats countered that they are not proposing unilateral disarmament, just not replacing a system designed to flatten Moscow and St Petersburg with one designed to do the same, since the Cold War is over. (They didn’t say where it should be designed to flatten, but presumably somewhere like Tehran.)

The next debate is about foreign affairs. Presumably, this will cover the EU, since most British people regard Europe as ‘foreign’. One of the most encouraging aspects of the three manifestos is that the Conservatives recognise the essential role of the EU in controlling climate change:

“European countries need to work together to boost global economic growth, fight global poverty, and combat global climate change. The European Union has a crucial part to play in enabling the countries of Europe to meet these great challenges of the 21st century. A Conservative government will play an active and energetic role in the European Union to advance these causes.”

They also accept the EU target of 15% of all energy to come from renewables by 2020. Euro-scepticism (which, like climate-scepticism, basically means hostility) is widespread in the Conservative party, as it is in the electorate. So it is  good news that Cameron has identified that the EU is crucial to control climate change.