A UK government commitment to a 2030 carbon target for power sector needed to unleash investment

October 8th, 2012 by Aldersgate Group

An alliance of the UK’s largest businesses and industry bodies have stated that a 2030 carbon target for the power sector is essential for stimulating new growth in the economy.

Only greater clarity from the UK Government can unleash the £110 billion investment required to transform the UK’s electricity infrastructure and drive wider economic benefits.

In an open letter to UK Chancellor of the Exchequer George Osborne on the 8 October 2012, the day of his speech to the Conservative Party Conference, signatories warn that his recent statements calling for unabated gas in the power sector post 2030 are damaging business confidence in the low carbon economy and undermining major investments capable of delivering growth.

A power sector carbon target – set down in legislation – would provide investors with long-term clarity and certainty, and ensure the UK stays within its carbon budgets.

The letter points to figures contained in “The Colour of Growth”, a report recently published by the Confederation of British Industry (CBI), which estimates that ongoing policy uncertainty could cause the UK to lose out on almost £400 million in net exports in 2014/15 alone.

In the same report, the CBI calculate that taking a more coherent and strategic approach to our economy-wide decarbonisation could boost the UK’s economy by just under £20 billion.

The letter is signed by over fifty businesses, investors, industry bodies, trade unions and environmental groups.

These include major brands such as ASDA, Aviva, Alliance Boots, Cisco, EDF, Eurostar, Marks & Spencer, Microsoft, PepsiCo, Philips, Reed Elsevier, Sky, The Co-Operative and Triodos Bank.

Peter Young, Chairman of the Aldersgate Group, which co-ordinated the letter, said “the message of this letter is loud and clear: we must put an end to any political uncertainty surrounding the UK’s energy future and start unleashing the billions of pounds of overdue investment which will deliver new growth for our economy.”

“Both the Labour and Liberal Democrat Parties understand this huge growth opportunity and backed a 2030 carbon target for the power sector at their party conferences. Now the Conservative Party must step up to the mark and provide the full cross-party support which businesses have been calling for.”

The letter states that “the Government’s perceived commitment to the low carbon transition is being undermined by recent statements calling for unabated gas in the power sector beyond 2030 and the absence of a specific carbon intensity target.”

It also notes that the Committee on Climate Change has advised the UK Government that extensive use of unabated gas-fired capacity post-2030 is incompatible with meeting legislated carbon budgets.

The signatories of the letter “support the recommendation by the Energy and Climate Change Committee that the UK Government should set a 2030 carbon intensity target for the power sector in secondary legislation, with a reference to this in the next draft of the Energy Bill”.

The Aldersgate Group is an alliance of leaders from business, politics and society that drives action for a sustainable economy.

Its mission is to trigger the change in policy required to address environmental challenges effectively and secure the maximum economic benefit in terms of sustainable growth, jobs and competitiveness.

(please click on image to download Aldersgate Group letter to the UK Chancellor of the Exchequer)

  1. No Comments

Have your say