Committee on Climate Change: if we’re going to decarbonise, we need to know how
- 23 May 2013, 11:15
- Robin Webster
Investing in low-carbon technologies and
decarbonising the power sector by 2030 could save the country £25
to £45 billion, according to the Committee on Climate Change (CCC)
in a new report. But to get there the government must avoid a 'dash
for gas' approach and think long term, it warns.
The government is planning big changes to the power
sector. It aims to shift to a low carbon system and maintain energy
security - while keeping costs down - through a policy package
Electricity Market Reform (EMR). But in
report out today, the CCC says that the
government's lack of clarity about where energy policy is going,
and particularly the suggestion that it might also be
expanding the amount of power the country gets
from gas, is threatening the entire process.
If the country is really going to shift to a
low-carbon energy system, the committee says the government must
think more strategically.
Defining a strategic
What would a more strategic approach look like? The
made a plan for how it's going to
source 15 per cent of the country's energy from renewables by 2020.
But the committee says the government must look far beyond that
According to the CCC, this approach would include:
- Announcing how much funding it intends to commit to
low-carbon technologies in 2030, as it already has for 2020, under
Levy Control Framework;
- Publishing strategies for how it is going to
develop the less mature low carbon technologies - for example
offshore wind, or carbon capture and storage (CCS);
- Giving investors certainty on how much government
support wind power will receive right up to 2019, and signing
contracts with developers so they can start planning to build new
wind farms in the 2020s;
- Setting out options for how it is going to mobilise
finance for the low-carbon economy - from banks, institutional
investors, or the new Green Investment Bank.
This all sounds to us a bit like the low-carbon industrial strategy that the
government launched back in 2009. The strategy contained plans for
how the country was going to build up supply chains for low-carbon
technologies, develop new technologies like tidal power, and
attract new manufacturing - of wind turbines, for example. We're
not sure exactly how much of this plan ever emerged into reality,
however, as little mention has been made of it since.
The committee reiterates its call for the government
decarbonise the power sector by 2030 -
in more technical terms reducing emissions from the power sector to
50g per kilowatt hour of electricity.
It argues that a clear commitment to hitting the 50g
target would provide revenue certainty for investors, drive
investment in low-carbon technologies and make the UK one of the
'early movers' in developing low-carbon technologies like carbon
capture and storage and offshore wind.
According to the CCC's modelling in the long
term this could save the country somewhere between £25 and £45
billion under its central predictions for the future price of gas
and the carbon price. But this could rise to £100 billion with high
gas and carbon prices. The cost savings would arise because the
country avoids the cost of relying on gas, and of having to
decarbonise rapidly in future because it would already have laid
What you aim for versus what you get
The CCC is scathing about the government's
gas strategy, launched last December.
The gas strategy suggested three possible futures for UK energy
policy - including a 'dash for gas' scenario where significantly
more gas generation would be built. Publishing "such widely varying
scenarios for sector development" has created confusion amongst
investors, the committee says.
There are some similarities between the gas strategy
and the CCC's modelling. Both documents suggests that the country
could reduce the power sector's emissions intensity to 100g of
carbon dioxide per kilowatt hour by 2030 - and still hit its
But in the CCC's report, this outcome is very much
"Plan B". It accepts that energy policy is very uncertain and it is
hard to make meaningful predictions. For example, nuclear power
could turn out to cost more than the government
carbon capture and storage technology
might not deliver; or offshore wind might turn out to be more
expensive than hoped.
In these cases, the country might fail to meet the
50g target, and emissions intensity might be reduced to 100g of
carbon dioxide per kilowatt hour by 2030. But crucially, under the
CCC's assumptions, the less mature low carbon technologies would
still have been developed. The country would have a wide diversity
of low-carbon technologies to rely on, not just gas and
The CCC contrasts the government's approach with its
"...a scenario with high nuclear
deployment, but low investment in CCS and offshore wind during the
2020s (e.g. as assumed in the government's emissions projections)
could deliver a similar emissions intensity but would leave the UK
overly reliant on a single low-carbon technology. This would imply
unacceptable costs and risks of achieving the 2050 target and/or of
very high electricity prices required to deploy uncommercialised
low-carbon options at scale after 2030."
As our teachers used to say: to fail to prepare is to
prepare to fail.
Pay now, save later
It's worth pointing out that the report is based on a
crucial assumption - that the UK government and governments
worldwide will be committed to decarbonising in the future. Indeed,
the CCC's prediction of savings in the UK is based on there being
an effective carbon price.
And in the UK, cutting emissions and reforming the
electricity market continues to present a challenge to politicians
focused on short-term energy bills, especially as the savings the
CCC predicts depend on high renewable rollout - which will cost
In fact, in the short term, the CCC estimates that
subsidies for low-carbon technologies will add £100 to consumer
energy bills by 2020. The greatest economic benefits from investing
in low carbon would come after 2030 - which, when the next election
is in just two years, is a long time in politics.
Chief executive of the CCC, David Kennedy, gave
Carbon Brief his opinion:
"Some people might say this is about the 2030s and
40's, so who cares? But lot of us hope to alive then, and so will
our kids our grandkids. It's the same argument as about national
debt or pensions. Energy is the same, you have to think long term.
It's about not lumbering future generations with burdens they can't
UPDATE 11am 24th May: The Guardian's '
EcoAudit' on the committee's report yesterday gave a bit more
detail on the assumptions behind the committee's modelling. The
modelling was carried out for the committee by consultancy Poyry - but the CCC hasn't
released Poyry's writeup yet. The CCC tells us that it probably
won't be released for a couple of weeks. We'll take a deeper look
at it when it is.