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Review of carbon budgets nothing new, Ed Davey tells committee

  • 19 Dec 2012, 12:30
  • Robin Webster

Is the UK on track for a 'dash for gas' - and has its approach to the UK climate change act changed? When the UK's gas strategy was released a couple of weeks ago, it looked like a new enthusiasm for gas power could be driving the government lower its carbon cutting ambitions. But yesterday, energy and climate change minister Ed Davey told a committee of MPs that the government's policy hasn't changed at all and it is on track to deliver on the targets in its carbon plan.

The government's gas strategy - busting UK carbon cutting plans?

When George Osborne launched the government's new gas strategy with the Autumn statement a couple of weeks ago, it included three different scenarios for the future development of the UK power sector. One of these proposed that 37 gigawatts of gas - or about forty new power stations - might be constructed by 2030, attracting a fair bit of media attention.

The government says this level of build, combined with a policy to expand production of power from renewables and nuclear, would reduce the emissions intensity of the power sector to 200 grams of carbon dioxide per kilowatt hour of electricity by 2030.

This is four times the level that government advisor the Committee on Climate Change (CCC) recommends is necessary if the government is going to hit its emissions reductions targets under the climate change act. The CCC says that the UK should set a 'decarbonisation target' for the power sector that is much lower - just 50 grams of carbon dioxide per kilowatt hour of electricity by 2030. When Osborne announced the strategy the chief executive of the CCC denounced the 37GW scenario as "completely incompatible" with the government's plans to cut carbon.

A change of policy?

The gas strategy recognises that building 37GW of new gas power over the next couple of decades would put the UK on a different emissions trajectory to the one recommended by the CCC. It justifies this on the basis that other countries in the European Union (EU) are not taking as much action to reduce emissions from the power sector, as the EU-wide caps set by the Emissions Trading Scheme (ETS) are not as stringent.

It adds:

"The UK is pushing for the EU to show more ambition by moving to a tighter 2020 emissions target, which, in turn, will drive a more stringent EU ETS cap. We will review our progress in early 2014 and if, at that point, our domestic commitments place us on a different trajectory from the one agreed by our partners in the EU under the ETS, we will revise up our budget as appropriate to align it with the actual EU trajectory."

In other words, the UK will undertake a review of where the EU's carbon cutting plans have got to in 2014. If the EU hasn't agreed to implement stronger cuts by then, the UK won't either.

The 'budget' referred to is the fourth carbon budget set by the CCC, which covers 2023 to 2027. The CCC's carbon budgets limit UK emissions over five year periods. They are designed to ensure the UK cuts greenhouse gas emissions by 80 per cent by 2050 to meet its legally binding targets under the Climate Change Act.

The comments in the gas strategy looked to us and others like the government might be planning to weaken its commitment to the climate change act. But yesterday afternoon, Ed Davey argued to the energy and climate change committee that government policy has not changed, referencing statements made by his predecessor Chris Huhne.

Back in June 2011, Huhne announced that the government will "undertake a review of progress" on its carbon budgets in early 2014 "to ensure our own carbon targets are in line with the EU's."

In the same statement, Huhne said:

"If at that point our domestic commitments place us on a different emissions trajectory than the Emissions Trading System trajectory agreed by the EU, we will, as appropriate, revise up our budget to align it with the actual EU trajectory."

This phrase is almost identical to the one contained in the gas strategy a year and a half later, so actually it doesn't look like the gas strategy was floating a new idea - it was repeating something the government had already suggested.

100 grams - a central assumption, but not a target

The 37GW scenario is only one of three contained within the gas strategy. There are two others.

In the 19GW of gas scenario, the emissions intensity of the UK power sector is reduced to 50g of carbon dioxide per Kilowatt hour - as the CCC recommends is necessary.

In the 26GW scenario, about 30 new gas power stations are built and the emissions intensity of the UK power sector falls to 100g of carbon dioxide per Kilowatt hour by 2030.

Davey argued yesterday that the 100g scenario is "the central planning assumption of the gas generation strategy" and for "the whole of our climate change policy".  But the energy bill doesn't contain any such target - and the government has said that it won't make a decision on whether to introduce one until after the next election. Yesterday, the chair of the energy and climate change committee Tim Yeo announced that he would be submitting an amendment to the energy bill to introduce a 100g target by 2030.

Government policy still up in the air

So, according to Davey, government policy has not changed, and the government is still aiming to reduce emissions from the power sector to 100 grams of carbon dioxide per kilowatt hours by 2030.

This position will, however, be reviewed again in 2014. If the rest of the EU hasn't decided to make more ambitious emissions cuts by then, the government will presumably plan to build more gas power up to 2027. But under intensive questioning, Davey told Labour MP Alan Whitehead yesterday that the UK is

"...working on the assumption that the EU will improve on its climate change agreement".

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