United Kingdom

United Kingdom

MPs urged to back 2030 decarbonisation target

Energy Bill enters House of Commons report stage

A coalition of businesses and green groups have lined up to lobby MPs, as the Energy Bill enters the House of Commons report stage and third reading today. MPs will vote tomorrow on an amendment to the bill that would ensure that an electricity decarbonisation target – and a framework to deliver it – is in place by 2014.

The Energy Bill seeks to pave the way for renewal of the UK's electricity generation infrastructure. But many argue that the low carbon transition is being undermined by the prospects of a renewed 'dash for gas' and the lack of a specific decarbonisation target.

The CBI's chief policy director, Katja Hall, said the bill remained "the best instrument for government to give investors the certainty they need to plough billions of pounds into keeping UK lights on, through an affordable low-carbon economy," but added: "We can’t afford further delays, so it is essential there’s political agreement and the bill is on the statute book this year."

Tabled by Tim Yeo MP and Barry Gardiner MP, the decarbonisation amendment calls for near carbon-free electricity generation by 2030. An alliance of 55 organisations has backed it. Among the alliance's signatories are SSE, DONG Energy and Renewable Energy Systems (RES).

RES' chief operating officer of UK and Ireland, Gordon MacDougall, warned: "If this amendment is not made, the issue won't be revisited again until 2016 and critical investment decisions will have been delayed, with negative impacts on the growth of a UK supply chain, jobs and innovation."

Two business and investor associations have also urged MPs to back it. The Aldersgate Group and the UK Sustainable Investment and Finance Association (UKSIF) say greater policy clarity could unleash the £110bn investment required to transform the UK’s electricity infrastructure.

Simon Howard, UKSIF's chief executive said: "A decarbonisation target would support the creation of a clear and stable framework for the long-term investment decisions which are vital for sustainable economic growth. There is significant investor appetite for the UK to be a global leader in profitable low-carbon energy solutions, providing the high-quality innovation and jobs that the country needs to ensure a future economic recovery. We call on MPs to recognise this and vote in favour of enshrining the 2030 decarbonisation target in the Energy Bill."

Andrew Raingold, executive director of the Aldersgate Group, added: "Businesses and investors have been loud and clear that such a target would not only reduce costs, but provide greater certainty for companies to invest in the development of UK supply chains and jobs,"

The Committee on Climate Change (CCC) has already warned that policy uncertainty is damaging the low carbon transition and investment in infrastructure. It too has called for the government to set a target under the Energy Bill, to reduce the carbon intensity of power generation from 500g CO2/kWh to around 50g CO2/kWh in 2030. Its recent analysis showed that investment in low carbon technologies could save consumers £25-45bn and as much as £100bn under higher gas and carbon prices.

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