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Green policy wranglings begin to emerge within government

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It seems as if with the party conference season not far off, a row is brewing over the government's energy policy, which may have some implications down the line as far as business energy costs and climate change legislation are concerned.

It follows a leak to the Daily Telegraph of a note to David Cameron  discussing the impact of energy and climate change policies on energy prices, Although the focus of the letter is on consumer energy prices, it is possible that a wider review may also need to examine the effect of government policies in the form of climate change legislation on businesses.

The letter suggests that four policies stand out as having the most significant impact on household energy bills: carbon pricing (both our own carbon price floor and the EU emissions trading scheme), the new Energy Company Obligation, the Electricity Market Reform package and the Renewables Obligation. It goes on to ask whether policies can be opened up, particularly support for relatively high-cost technologies such as offshore wind, in a way that minimises cost and disruption to investment.

There is some more background to the story here:




Knowing which carbon compliance scheme you fall under

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Just a short line about a tool I came across from Carbon Guerilla which has produced a useful graphic for organisations to see where their compliance lies.

As Carbon Guerilla director Mark Clayton says, deadlines are concentrating minds, and in terms of finding ways through the various elements of legislation, this flowchart might be useful in the future for deciding whether you're affected by CRC (the Carbon Reduction Commitement Energy Efficiency Scheme), a CCA (Climate Change Agreement) or the EU ETS (European Union Emission Trading Scheme)


Coalition Announces Pledge to halve Carbon Emissions by 2025 - what role will Green IT play?

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Now that the Coalition has announced its pledge to halve carbon emissions by 2025, the next question is how is it going to be achieved. The devil, as they say, is always in the detail.

Winning the political battle in Cabinet - against, it has to be said, some pretty heavy hitters: Messrs Osborne, Cable and Hammond were reportedly against the plans for fear of affecting the economy - is one thing, Now the hard work starts.

Before the end of the year the Government will announce a package of measures to reduce the impact of government policy on the cost of electricity for energy intensive industries and to help them adjust to the low-carbon industrial transformation.

There is more detail on the announcement on the Department of Energy & Climate Change website.

Prime Minister David Cameron, who supported the targets, said, "When the coalition came together last year, we said we wanted this to be the greenest government ever. This is the right approach for Britain if we are to combat climate change, secure our energy supplies for the long-term and seize the economic opportunities that green industries hold.

"In the past twelve months, we have pursued an ambitious green agenda and today, we are announcing the next, historic step. By making this commitment, we will position the UK a leading player in the global low-carbon economy, creating significant new industries and jobs.

"The transition to a low-carbon economy is necessary, real, and global. By stepping up, showing leadership and competing with the world, the UK can prove that there need not be a tension between green and growth."

Energy & Climate Change Secretary Chris Huhne said: "Today's announcement will give investors the certainty they need to invest in clean energy. It puts Britain at the leading edge of a new global industrial transformation as well as making good our determination that this will be the greenest government ever.

"The Coalition Government has set a fourth carbon budget level, in line with the advice from the Committee on Climate Change, that sends a clear signal about our determination to transform Britain permanently into a low carbon economy. By cutting emissions we're also getting ourselves off the oil hook, making our energy supplies more secure and opening up opportunities for jobs in the new green industries of the future.

"Through the Green Deal, electricity market reform and the Green Investment Bank we're already putting in place the tools that will help us meet this ambitious carbon budget. This and every future British Government will have to keep up the pace and put in place the most effective policies to tackle climate change.

"Under this carbon budget, Britain in 2027 will be a different place and transformed for the better with warmer homes powered by green energy, many more cars powered by electricity and far less reliance on fossil fuels to drive our economy."

Under the fourth carbon budget, government will aim to reduce emissions domestically as far as practical and affordable, but also intends to keep open the option of trading in order to retain maximum flexibility and minimise costs in the medium-long term.

Groundbreaking innovation will play a crucial role in helping Britain to decarbonise its energy supplies by 2027 in the most economical way. Today the Energy Technologies Institute is asking industry to design, build and test longer offshore wind turbine blades to improve performance. Currently blades are typically 40-60 metres long, but the next generation of turbines could have blades measuring more than 90 metres - almost the height of Big Ben."

It will be interesting to know what role Green IT will eventually play in hitting these targets. I came across this report, which serves as a reminder of some of the relevant figures. 


Cabinet agrees Climate Change 'Green Deal' - UK 'world leader' in cutting carbon emissions

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The Coalition is expected to announce this week that it has agreed a far-reaching, legally binding "green deal" that will commit the UK to two decades of drastic cuts in carbon emissions. The package, reported last weekend in The Observer, will, it is claimed, place Britain at the forefront of the global battle against climate change.

Huhne is now expected to tell parliament that the government will accept the recommendations of the independent committee on climate change for a new carbon budget. The deal puts the UK ahead of any other state in terms of the legal commitments it is making in the battle to curb greenhouse gases.

The new budget puts the government on target to meet a reduction by 2050 of 80% of carbon emissions compared with 1990 levels. The committee has said that to reach this target, carbon emissions should be cut by 60% by 2030.

The article says ministers believe that major companies involved in developing offshore wind technology - such as Siemens, Vestas and General Electric - will now be keener to invest in Britain, knowing it is committed to a huge expansion in renewable energy. It is also hoped that the commitment to renewable energy - the committee says 40% of the UK's power should come from wind, wave and tide sources by 2030 - will stimulate new industries.

These would include the development of tidal power plants, wave generators and carbon capture and storage technology - which would extract carbon dioxide from coal and oil plants and pump it into underground chambers. All three technologies, if developed in Britain, could be major currency earners.

The committee's report says the new carbon deal will require that heat pumps will have had to be installed in 2.6m homes by 2025. It also says that by the same date 31% of new cars, and 14% of those on the road overall, will be electric. Experts say a total of £16bn of investment will be needed every year to meet the commitment, with some of the money likely to be raised through increases in electricity prices.

Greening the Government's new ICT strategy

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The government's new ICT strategy has generated plenty of comment, notably in Computer Weekly and by Socitm in the Guardian discussing the perceived lack of local government focus in the strategy.

Another key ares of interest is in the government's approach to Green IT encompassed by the strategy.

There are three areas specifically covered in the strategy: green ICT standards, a greening government ICT approach, and data centre reductions. The relevant paragraphs in the ICT plan say the following:

  • Green ICT standards that are pivotal to the delivery of improved cost efficiencies will also be factored into the design, delivery and disposal of ICT solutions


  • The Government will publish a Greening Government ICT strategy in line with the Government ICT Strategy and wider carbon reduction policies. This will set out how government will achieve reductions in operational costs and carbon footprints, and will include the use of collaboration and mobile working technologies


  • To reduce the cost and carbon footprint of government ICT, the Government will set up a programme to reduce the cost of data centres across the estate, leading to a 35% reduction in costs over five years

Summing up what the Budget means for 'Greentech'

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I was talking to a company the other day that has an interest in the Climate Reduction Commitment (CRC) legislation and while we didn't expect any major changes relating to CRC in the Budget, there was a feeling of 'you never know'.

The devil is still in the detail, and more may emerge over the coming days. But it seems there are no changes to CRC announced by George Osborne.

Those 'green' issues that were covered have been well summed up by the Guardian here


Coalition Government releases Draft Carbon Plan

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The Government has launched a Carbon Plan, effectively a Government-wide plan of action on climate change, including domestic and international activity, which sets out department by department, actions and deadlines for the next 5 years.

The Plan is available here. It represents ongoing and planned cross-Government action on climate change with specific deadlines providing for both internal accountability and public transparency. Quarterly updates on progress against actions within the Plan will be published on the No.10 website.

The Plan sets out what has to happen and by when if the Government is to live up to its green ambitions, meet tough domestic carbon targets and encourage greater action internationally. It is focused on the jobs and economic opportunities of the low carbon economy and on policies that will help insulate Britain from future energy price shocks.

The final version of the Carbon Plan will be published in the autumn, and will be updated annually. Reports last weekend had  suggested that the government wants to take steps - possibly in the Budget on March 23rd -  to 'wean' the country off oil,  amid fears that the Libyan battle for power  has created uncertainty over fuel supplies, and left consumers  facing a further rise in fuel prices.

The energy secretary, Chris Huhne, told the Observer that the UK had no option but to speed up efforts to move away from oil. "Getting off the oil hook is made all the more urgent by the crisis in the Middle East. We cannot afford to go on relying on such a volatile source of energy when we can have clean, green and secure energy from low-carbon sources," he said. "The carbon plan is about ensuring that the whole of government is engaged in a joined-up effort to lead us into a low-carbon world."

One of the options being mooted is a nationwide strategy to promote installation of infrastructure for electric cars by June. It is also expected that new deadlines will be set for building low-carbon homes, and that a firm starting date of September 2012 will be established for a new "green investment bank" to become fully operational.


Is mandatory reporting of greenhouse gas emissions by business getting closer?

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Interesting post on the Guardian's Sustainable Business blog yesterday which discusses the need for mandatory greenhouse gas emissions reporting.

The piece suggests that over 80% of business professionals surveyed by the Insitute of Environmental Management and Assessment believe that mandatory reporting of  emissions should be introduced for companies as it can deliver significant benefits, with those reporting emission reductions achieving an average of 9% CO2 savings over the last two years.

The end for the Carbon Reduction Commitment?

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It looks as if someone within the government is flying a kite to see what reaction there might be to the ending of the Carbon Reduction Commitment (CRC).

This article appeared at the weekend, suggesting that CRC could be merged with other taxes following the publication of a number of so-called "discussion papers" for the 5,000 companies due to be affected.

As the piece points out, the news that more changes could be on the way will cast more confusion over the tax, which has been criticised for baffling businesses. It's said, however, that doing away with the CRC would not necessarily mean that companies would have to pay less because its intended effects could be included in another green tax covering a wider number of businesses.

This year's Budget is being held on March 23rd, and I'm told the future of CRC could be up for discussion in government circles around a week before, leading to the possibility that an announcement about the future of CRC - and a new green tax? - could be made in the Budget.

CRC was originally meant to reward companies for reducing their emissions and penalise those who failed to do so. But the Treasury seemed to pull rank on the Department of Energy and Climate Change when it decided to, as the article points out, 'pocket the proceeds meant to go to good performers in order to help reduce the deficit.'

There is a degree of frustration about the government's dithering over CRC, not least from companies who in good faith are trying to develop services around it, but find themselves twisting in the wind as the government goes back and forth over its future. Leaks like the one at the weekend don't help them. And they certainly don't help organisations - and particularly their CIOs and Finance Directors - looking for some policy certainty going forwards. 

CBI tells Government to match its green ambition with action

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The CBI has taken a shot at the government over the system of planning for Green energy projects and warned that business still has concerns over the future of the Carbon Reduction Commitment (CRC) energy efficiency scheme.


The CBI believes uncertainty about how the planning system will operate is undermining the Coalition's pledge to be the "greenest government ever", the CBI said in launching its latest Climate Change Tracker, which charts progress in de-carbonising four areas: power, buildings, transport and industry. Of the 13 indicators, one is green showing progress is on track (nuclear), three are red for little progress (homes, buildings and industry) and 9 are amber showing good ambition but insufficient delivery.


The group called on the Government to tackle a raft of planning applications awaiting approval and to ensure the transition to its new Major Infrastructure Unit is smooth.


It highlighted 37 energy infrastructure projects awaiting a decision, inherited from the previous government. These include wind farms, nuclear and gas-fired power stations, which are essential for delivering a balanced and sustainable energy mix.


The CBI also warned that the Government's proposed changes to the CRC had removed an important incentive for businesses to improve energy efficiency. The Government's subsequent decision to delay the second phase of CRC has not allayed concerns among businesses about how the scheme will work.


Without confidence and certainty in critical areas such as planning, the CRC and electricity market reform, the CBI believes investment needed for low-carbon buildings and infrastructure will not be unlocked, endangering the UK's ability to meet climate change targets.


John Cridland, CBI Director-General Designate warned that changes to the Carbon Reduction Commitment and the planning system have created a mood of uncertainty among investors.


"An effective planning system is at the heart of building the low-carbon infrastructure needed to transform our economy," he said, adding that 'businesses that take steps to cut their emissions should be rewarded, not penalised. That's why the CRC needs changing to ensure it is an incentive for action.


"This Government has great green ambition, but we need to see swift action if it is to fulfil its green promise."


The CBI has set out the actions needed to get the UK on track to meet its 2020 emissions reduction targets. In the next six months the CBI is calling for the Government to:


·                       Clear the backlog of delayed planning applications

·                       Finalise Electricity Market Reform plans

·                       Support investors with a prompt national planning statement on energy

·                       Change the Carbon Reduction Commitment to incentivise energy efficiency among companies

·                       Approve the first carbon capture and storage (CCS) demonstration project

·                       Ensure long-term incentives for the success of electric vehicles beyond 2012

·                       Clarify the details of the Green Deal to ensure it will stimulate consumer demand.


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