13 May 2010: A new UK government

The UK has a new government and the prospects for climate policy are mixed. The promised policies on aviation and coal are stronger than those of the former Labour government. The approach to renewables is similar to that of Labour – though, in the UK, renewables is all about delivery, not policy. However, the approach on nuclear power looks like a recipe for muddle and delay.

On aviation, the third runway at Heathrow has been cancelled and new runways at Gatwick and Stanstead ruled out. This is in line with both Conservative and Liberal Democrat manifestos. However, there is no mention of expansion of other airports. The Lib Dem manifesto says that there should be no expansion in South East England, but that aviation is important for other parts of the UK. Local councils run by the Lib Dems, such as Bristol, support airport expansion in their area. The Labour manifesto said “yes” to Heathrow expansion, but that that would be the only new runway allowed anywhere in the UK for the entire parliament. It makes no difference to the climate (although great difference to residents) where airport expansion takes place. Any new runway, anywhere in the UK, should be opposed. This is the policy of the Green Party, but they have only one MP.

The Conservative/Lib Dem coalition does promise to change the Air Passenger Duty into a tax on planes, so the same amount is payable whether the plane is full or empty. This is sensible, though the impact will clearly depend on what rate of tax is introduced. The coalition agreement is also supportive of high speed rail. However, the main problem with UK rail travel is ticket cost and the agreement does not say how these will be controlled or reduced.

On coal, the coalition promises an Emissions Performance Standard (EPS). This is based on the Californian approach and is welcome. No new coal station will be allowed unless it meets the standard. The debate must now move on to what the standard should be. Should it be equivalent to a gas power station? This would probably result in another ‘dash for gas’ in the UK, which is better in climate terms than expansion of coal without CCS, but worse than coal and gas with CCS. In climate terms, the EPS should be lower than the level of emissions from gas without CCS, but this would risk nothing getting built and could lead to the ultimate politicians’ nightmare –  the lights going out.

On renewables, there is an encouraging mention of renewable gas as well as electricity. There is also a promise of yet more targets for electricity to come from renewables. These have little relevance. The UK is already signed up to a target to get 15% of total energy from renewables by 2020, under the EU Renewables Directive. The Conservative manifesto accepted this target, in line with its acceptance that the EU is essential on climate policy. What the UK must do is deliver by constructing on and offshore wind, plus anaerobic digestion plants to extract renewable gas from organic waste, including sewage.

The Conservative promise to allow local councils to keep the business rates from any renewables facilities would be a good way of increasing local support (though it would certainly not remove opposition). Even better would be to allow local councils to sell electricity. However, they are prevented from selling electricity generated by, for example, a council-owned wind farm, under an Act passed in 1976 by a Labour government. Fortunately, both Conservatives and Liberal Democrats are in favour of increased roles for local government and Labour will not oppose this – in March the then Energy Secretary Ed Miliband launched a consultation proposing to allow councils to sell electricity. And Labour did well in local elections last week, so they also have political self-interest in supporting greater localism. The consultation closes on 2 June 2010, so should be a priority for the new government. 

On nuclear, the Conservative manifesto was good in supporting civil nuclear, but bad in supporting expansion of nuclear weapons. The Liberal Democrats were good in opposing expansion of Trident, but bad in opposing civil nuclear. The coalition agreement threatens the worst of both worlds. The Tories seem to have won on Trident – though at least this will now be considered as part of the strategic defence review – and there is an agreement to disagree on civil nuclear. Both parties say there will be no subsidy, though this does not mean there will be no ETS floor price, which means higher tariffs for consumers and, if high enough, would possibly be enough to get nuclear power stations built. Lib Dem MPs will be allowed to abstain on civil nuclear in votes in parliament. Commentators have said that this will not be a problem for the government, as Labour is pro-nuclear, so Lib Dem votes are not needed. Which is true, but not the whole story. The government will be able to get things, such as the national planning statement on nuclear, through parliament. The national planning statement is supposed to be the guidance for decisions then taken by the Infrastructure Planning Commission (IPC), an unelected quango. However, both Tories and Lib Dems have said that the IPC will not take decisions, as that is a matter for politicians. And the politician in charge of energy and climate change is a Lib Dem, Chris Huhne.

Huhne is a good politician, with a strong track record on green issues. He was a member of the cross-party Green Fiscal Commission, which outlined some radical proposals for shifting taxes off income and onto pollution, and he remained active in this forum even when he was made the Lib Dem shadow home secretary. So, his appointment to the Department of Energy and Climate Change is broadly to be welcomed. (The Tory who lost out, Greg Clark, is also a good politician, and it’s a shame he didn’t make the cabinet this time, but I doubt he’ll have to wait long.) Also welcome is the fact that David Cameron didn’t re-arrange Whitehall departments. During Labour’s 13 years, we had DETR, DEFRA, DECC, ODPM, DoT, DTI, BERR, BIS, and probably some other whose acronym or existence I’ve forgotten. We also have the Office of Climate Change, which is cross-departmental (despite originally being based in the Department of the Environment, Food and Rural Affairs, and now in DECC) and has done some excellent work, notably on heat.

Re-arranging Whitehall Departments has a significant cost, in terms of money and disruption. It was worth it to bring climate and energy together, but needn’t be done again. Huhne at DECC won’t win all the battles with cabinet colleagues, though it is helpful that another Lib Dem, Vince Cable, is Business Secretary. In particular, Huhne won’t win all battles with the Treasury, but re-arranging departmental furniture is not the way forward. The Cabinet Office acts a co-ordinator between departments, and the person in charge of that, Oliver Letwin, has been central to the adoption of good climate policies by the Tories. Ultimately, though, it will be the Prime Minister who decides between departments. Cameron says he is serious about controlling climate change and, in opposition, he was serious and convincing. Now, he has the opportunity to prove it.

We shall see…

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