Paris Agreement on Climate Change

Rebecca Pow Excerpts

Wednesday 7th September 2016 Commons Chamber

[Barry Gardiner]

My hon. Friend is absolutely right, but I really hope that we can make some progress this afternoon. The right hon. and hon. Members in the Government Front Bench team know that I have respect for them and that I do not seek to be partisan on this matter, but I will attack them if they do not keep to their commitments and I will continue to do so.

[Rebecca Pow (Taunton Deane) (Con)]

I have great respect for the hon. Gentleman, and this has been very much a cross-party debate on climate change, but the heart of the commitment on climate change is the Climate Change Act 2008, which was voted on in this House and is now part of British law. We have committed in the Act to achieve an 80% reduction in our emissions by 2050. I echo the comment made by my hon. Friend the Member for Wells (James Heappey) that the hon. Gentleman is creating an argument where there is none. The Government have not said that they will not ratify the treaty, and I fully believe that we will do so. We must think about this very sensibly, and I hope that we will continue to lead the way, just as we have done all along the line.

[Barry Gardiner]

I am delighted that the hon. Lady has referred to the Climate Change Act 2008 and to the fact that the commitments made under the Act are legally binding on us. Later in my speech, I shall examine exactly what the legislation stated and try to show precisely where the Government have deviated from it over the past couple of years. This is why we have been on a pathway of divergence rather than convergence in this House for the past two years. The bipartisan—indeed, cross-party—approach that used to obtain in the House on these matters has been severely tested by what has been seen as the Government’s backsliding on those legally binding commitments. I shall adumbrate that a little later.

Until this morning, it was not clear to me why the olive branch I had extended to the Government had been quite so haughtily ignored. Then I found out what the Minister had said to the Aldersgate Group and what the Secretary of State had quietly revealed to journalists at his departmental cocktail reception for the ladies and gentlemen of the press yesterday evening—[Interruption.] They laugh. They said candidly that they would not be publishing the carbon plan by the end of the year. Carbon plan? What is that?

This is not the kind of thing that any normal member of the public would think sounds terribly important. If I were to explain that it is really important because it is supposed to set out precisely how the Government are going to meet their carbon budget, that same hypothetical member of the public might look blank, because people do not talk in these terms. They do not talk in terms of carbon plans and carbon budgets; they talk in terms of effects, not budgets. They know that climate change is causing disruption across the world, with more flooding in some places and more drought in others, with stronger hurricanes and typhoons and with the loss of crops and arable land. They know that that is related to the emissions polluting our air and our children’s lungs, and these things are important to them.

That is precisely why we politicians agreed, back in 2008—under a Labour Government but very much on a cross-party basis—to limit the ways in which we were causing those problems. We agreed to reduce and limit those emissions that were changing the world with such devastating effect. That is why we created the Committee on Climate Change to set legally binding carbon budgets that would precisely limit the damage that we were doing, but we tasked it to ensure that we always adopted the most cost-efficient pathway, so that we could move towards the long-term target of at least an 80% reduction in admissions by 2050 at the lowest possible cost to the public, to industry and to business.

That is why this carbon plan is so important. How dare the Secretary of State let slip to a few journalists at a cocktail party that of course he will not be publishing the carbon plan by the end of this year? How dare the Minister reveal to the Aldersgate Group that he “may” find space in the timetable to publish it in 2017? May? May? I ask the Minister to read the primary legislation, which states that after the publication of a carbon budget, the Government must publish a plan to put it into effect

“as soon as is reasonably practicable”

thereafter. The fourth carbon budget was published in 2011. Five and a half years later, we still have no carbon plan. My grasp of the English language is not so weak that I would think that five and a half years, during which we have had a change of Government and a new Prime Minister, constitutes “as soon as is reasonably practicable”. And now the Minister says that he “may” get around to doing this in 2017.

Earlier this year, the Government promised that the reason for the delay was simply that they now wanted to include their measures for achieving the fifth carbon budget in the plan, which they set almost three weeks later than the legislation required. This is another area in which the Government have lost the people’s confidence. The primary legislation is very clear. It states that a carbon budget must be deposited on 30 June 12 years before it comes into effect. The Government published it before then, but they did not set it in legislation, as was required by law, until 19 July—almost three weeks late.

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[Barry Gardiner]

I was of course referring to the hon. Gentleman being a denier of anthropogenic climate change, and he knows that.

However, there are sane heads who understand that when the world’s largest superpowers ratify a climate change treaty that commits the world to a net carbon future by the second half of this century, it is time to do what President Obama said last week and

“put your money where your mouth is.”

Last year, global investment in low-carbon technology was $286 billion. The problem is that investment in developing countries outpaced that in richer nations. We are locked in a low-carbon race and we are losing. The reason I want us to get on and ratify is not because Paris is some sort of totemic environmental symbol, but because political leadership sends a strong signal to attract investment. Countries with a clear policy framework are the ones that attract investment. Countries with a stable policy framework attract investment. The UK has had neither over the past few years.

On solar, the Government plan this month to hike the tax on businesses with rooftop solar installations through a six to eight times increase in business rates. In 2015, they cut all solar subsidy for commercial installations of over 5 MW and reduced the subsidy for the rest by 65%. The Government’s own figures show that that has resulted in a 93% fall in UK solar deployment and the loss of more than 12,000 jobs in the industry.

On wind power, the Government decided to end all subsidy for onshore wind farms despite them being the cheapest source of renewable power. For offshore wind, they took away all investment certainty by announcing that they would extend the levy control framework only to 2021.

On biomass, I wrote to the Secretary of State only a few days ago to ask why regulatory changes to the tariff structure of combined heat and power biomass plants were rushed through this summer, using secondary legislation to amend the renewable heat incentive without proper consultation. No impact assessment was made of the risk to business, and trade associations estimate that £140 million of investment is now at risk.

On carbon capture and storage technology, the Government broke their manifesto promise, cancelling £4 billion of promised finance—the latest £1 billion was cancelled last year just six months before it was due to be awarded, sinking the White Rose and Peterhead projects.

On energy efficiency, the Government ditched the zero-carbon homes policy and finally scrapped their green deal policy despite having no idea about how to replace it with other household efficiency measures.

On transport, the Government reduced the vehicle excise duty incentives for low-emissions vehicles. Is it any wonder that in just four years we have sunk from fourth to 13th in the Ernst and Young index of the best places for investment in low-carbon industries?

Just to make the investment picture complete, they took the quite monstrous decision to sell off the green investment bank. A bank that was precisely set up because there was a market failure that the private sector simply could not address. By abolishing the GIB, they are now prepared to starve low-carbon industries in the UK of the investment that they need at a critical phase of development.

However, not all parts of the energy nexus are being hit by this Government. In 2013, they announced that fracking companies would pay half the tax paid by conventional oil and gas producers. The then Chancellor called the tax regime the

“most generous for shale in the world”.

CCS, commercial solar, business rates on rooftop solar, onshore wind, offshore wind, biomass, the levy control framework, the green deal—is there any part of our energy sector that I have not mentioned? Oh yes, nuclear. Hinkley—oh dear. Dithering, delay, incompetence and an overpriced contract have led to a contract for difference that will now cost the bill payer, not the Government, not the £6.1 billion originally calculated by the Government but the £30 billion as determined by the National Audit Office.

The Hinkley project has already been delayed for eight years, and the Prime Minister has now thrown in into chaos. Two and half years ago, the Government should have reviewed the project on grounds of cost. To do so after the EDF board had taken a final knife-edge investment decision is to show a level of contempt for investors in our energy infrastructure and a lack of understanding of how company boards actually take decisions, sending out the most damaging message and turning investors away from the UK as a market of preference for low-carbon investment.

[Rebecca Pow]

The hon. Gentleman is making a powerful point, but I suggest that it is all about the way one uses statistics. In this country, 16% of our energy comes from renewables, and this year 25% of our electricity is from renewable sources. He laughs, but in 2014, 30% of all of Europe’s renewable energy investment took place here. Does he not agree that that is an excellent track record, and that one of the best ways we can indicate we are combating climate change is by phasing out fossil fuel power stations, which is exactly what this Government are doing?

[Barry Gardiner]

The hon. Lady is right to say that we have had an enviable track record on the amount of our renewables and way in which they have been built up. But of course the statistics she referred to were created by the policies that previously allowed the subsidy into the renewable industry. The points that I have just been making show clearly how the Government, in the past 18 months to two years, have withdrawn those subsidies. As I said, the effect on the solar industry was a 93% cut in the projects that are now going ahead—in the panels and the capacity now being installed.

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[Mr Hurd]

Let me be absolutely clear: this Government welcome the shift in dynamic in terms of the ratification process. It is fantastically good news. As the hon. Gentleman has rightly pointed out, the important change—it has been the most important change since I was immersed in this matter in my first Parliament—is the shift in the attitude of the two biggest economies—the United States and China, This is the big game changer. Frankly, that is much, much more important than the exact timing of when we lay a command order in this place. No one is in any doubt about the commitment of the UK to this process. We have demonstrated that commitment under the leadership of successive Secretaries of State—I am delighted to see the right hon. Member for Doncaster North (Edward Miliband) in his place today—over many Governments.

[Rebecca Pow]

I am heartened by the positivity from the Minister on this subject. The fact that the United States has come forward first with the ratification is largely because Britain was leading the way on this matter. Many of these countries, China in particular, are among the biggest offenders on climate change, so to see them taking part is great. I urge the Minister to continue to lead the way, and I am heartened by his assurance that we will ratify this treaty and that we will be playing our part.

[Mr Hurd]

I thank my hon. Friend for that constructive and positive intervention. I am delighted that we are doing our bit to shift the tone of this debate, which is much needed. I will go on to address her point about how we intend to maintain our leadership and this international influence.

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[Mr Hurd]

I am about to finish. The hon. Gentleman had plenty of time to speak. He knows that I am very laid back, but he stirred me with the approach that he took. The conversations that we are having about the emissions reduction plan—the carbon plan—are driven by the conviction that we must get this right. The hon. Gentleman knows the subject well and he knows the challenge that faces us. We have to take people with us, including a set of new Ministers with critical briefs, who need some time to get on top of the issues at stake because they are so important. We need to engage with the private sector and non-governmental organisations. This has to be a shared challenge. We have to make sure that the process is properly connected with the extremely important substantive and long-term work and thinking being done about the industrial strategy, because Paris, as he rightly said, changes so much—not least because the two largest economies in the world are saying, “We are now set out on a path towards decarbonisation of our power systems and our transport systems.” If we turn that into an estimate of the investment required, it runs into trillions of dollars.

We need to get this right, and all I was saying is that that is the priority. If we can meet all those criteria—if we can do all those things—by the end of 2016, great, but the overriding priority is to get this right, and that is what drives us. I hope that that is supported by Members on both sides of the House who can see that this commitment is important for our UK national interest, as it is for our identity as a responsible global citizen.

I am going to conclude. Our primary task is to manage a risk, but all this investment and innovation, as I have suggested, is creating one of the most important economic opportunities the UK has seen—arguably since the industrial revolution. The global low-carbon market is estimated to be worth more than $5 trillion, and it is now forecast to expand rapidly in the wake of the Paris agreement. Over the next 15 years, it is estimated that around $90 trillion will be invested in the world’s energy systems, land use and urban infrastructure, and an increasing proportion of that needs to be low-carbon if our globally agreed climate goals are to be met. The UK’s leadership and experience will put UK industry in a prime position to benefit.

The UK low-carbon sector is worth over £46 billion across more than 90,000 businesses. It employs more than 240,000 people and indirectly supports many more. There is great potential for it to continue to create high-value jobs in construction, manufacturing and services. That is why—here there is a genuine point of difference with the Opposition—the creation of the new Department for Business, Energy and Industrial Strategy is such an exciting opportunity. As we contemplate the importance and the consequences of Paris, and as we go through substantive processes in the industrial strategy, we think deeply about the future of our places, industries and sectors, and about what we can do to make them more competitive and more resilient, to broaden opportunity in this country and to make the economy work for everyone. It must be right to look at how our energy decarbonisation and industrial challenges can be brought together and thought through much more effectively than in the past. I regret that the Opposition continue to shadow the Government as they would like them to be, rather than as they actually are.

[Rebecca Pow]

I thank the Minister for so generously giving way to me again. Are not the Government showing that they really have thought deeply about the situation by linking business with energy and with this new low-carbon era in tackling climate change? This shows a whole new move in the direction of this Government. Does not the Minister agree that this is absolutely the way to go if we are really serious about climate change and linking it with business?

[Mr Hurd]

I could not agree more with my hon. Friend. More importantly, the feedback we are getting from the business community on this is extremely positive, because they want the Government to join things up, and to think intelligently and for the long term. However, I have to finish my speech because Back Benchers must get in.