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I beg to move that the Bill be now read a second time. Mr Speaker, over the past year, energy policy has been in the spotlight. From the Gulf of Mexico to Fukushima, no-one can doubt the importance of our energy choices. And for the first time, scientists have linked greenhouse gas emissions to an increased risk of major floods. Faced with a difficult financial situation, the Government’s objectives are clear. We must secure affordable energy supplies for the future; and we must avoid dangerous climate change. Neither will be easy. The gap between our energy demand and our energy supply is growing. We are increasingly dependent on imported energy. We still rely heavily on unclean and unsustainable fossil fuels. By law, we must cut our emissions by 80% by 2050. We must get 15% of our energy from renewable sources by 2020. Our energy infrastructure is ageing. Our old polluting power stations are shutting down. Building the next generation of power plants will take time and money. If we are to cut our carbon emissions and keep the lights on, we must act now. And the cheapest way of closing the gap between supply and demand is to reduce the amount of energy use. Mr Speaker, the Energy Bill contains provisions to boost our energy security, encourage low-carbon technologies, and improve energy efficiency. It places a new obligation on energy companies to reduce carbon emissions and support vulnerable consumers. And it delivers a key Coalition commitment: the Green Deal. A self-financing building improvement scheme to bring our properties into the 21st century. <strong>Green Deal </strong> Mr Speaker, the UK has some of the oldest and least efficient buildings in Europe. Every day, across the country, our homes and businesses leak heat – and waste energy. <br> A quarter of the UK’s carbon emissions come from energy used in the home. Billions of pounds spent on domestic heating disappear up the chimney. Businesses are wasting money. Our outdated building stock is costing us the earth. Not anymore. Under the Green Deal, energy saving packages worth thousands of pounds will be installed in millions of homes and businesses, right across the country. There has never been anything quite like it. It is the most comprehensive energy saving plan in the world. Green Deal measures will be provided by trusted businesses, installed by accredited professionals, and backed up with a watertight legal framework. Customers will pay nothing up front; businesses will do that for them. Once the property has been refitted, Green Deal providers will get their money back from the expected savings on energy bills over the lifetime of the measures. This is the big change: payments can be made not just by you, but by the beneficiaries once you move out and move on. At the heart of the Green Deal is a ‘golden rule’: for typical households, expected savings will offset costs. Each month, a Green Deal home will save energy while providing the same level of comfort. Money from likely energy savings will pay off the costs of the work. This is not a personal loan. Let me repeat: once a property has had the Green Deal, payment will stay on the energy bill at that address – even if the occupants move out. When you move into a Green Deal home, you inherit the energy savings that pay for the work. Everyone has a part to play. This is about government helping businesses and households come together to deliver energy savings on a national scale. Through this legislation, we are creating a whole new market in energy saving. Just as the law establishing joint-stock companies unleashed big investments, so this law will set the legal framework for a new green growth industry. <strong>Benefits</strong> Millions of homes – and millions of businesses – could benefit from the Green Deal in the next decade. We expect households will be able to install measures worth up to £10,000. This is a massive undertaking. And it can make a real difference. Heating is the second biggest driver of energy demand in Britain. And British Gas pilots show that householders who put in energy efficiency measures can cut their gas consumption – and their bills – by up to 44%. That is a significant saving. But so far, energy efficiency has passed under the radar. We estimate that between £2-3 billion worth of energy is wasted every year because our homes are poorly insulated and inefficiently run. That is £2-3 billion of gas and oil imports that currently make us more vulnerable to the vagaries of global oil and gas markets. Under the Green Deal, households could save up to £400 a year once the measures have been paid off. That will flow through to their spending power, boosting living standards for all. Yet many have never even considered making their homes more efficient. They do not know what better energy efficiency could do for their them. New Green Deal assessments will set out, clearly and consistently, just how homes and businesses can save energy. <strong>A new approach </strong> Mr Speaker, the Green Deal is a new way of doing energy efficiency.<br> No more picking off the easy bits, with a little insulation here and a low-energy lightbulb there. No more relying on regulation alone to change behaviour. No more top-down schemes imposed using public money. Instead, we are creating a new, dynamic market in energy efficiency: shifting from small scale improvements to deep retrofits on a national scale. This dynamic market will bring jobs across the length and breadth of the country; real growth, reaching into the most deprived areas, with no regional bias. The potential benefits are huge – with opportunities for skilled and unskilled labour alike, up and down the supply chain. The number of people employed in insulation alone could soar from 27,000 to 100,000 by 2015. Mr Speaker, the Green Deal will save energy, and help us hit our carbon emissions targets. It also gives us a chance to get people thinking about how they can reduce their own energy consumption. Millions of homes and businesses could benefit from the Green Deal. Like any new product, building consumer trust will be critical to success. We want people to know that the Green Deal isn’t just a smart choice – it’s a safe choice. That’s why the Bill also ensures consumers will be protected. The Green Deal will be delivered by partnerships across the country. Trusted high street brands and local businesses will provide the advice, the installation and the financing of the Green Deal measures. We will make sure high quality, standardised advice is given – so that each customer can clearly see where and how the Green Deal will work for them. We will ensure that those installing Green Deal measures must meet robust standards. We will guard against mis-selling. <br> And we will make sure that the right information is on hand at the point of sale. Competition will keep suppliers keen: if a customer does not like the quote from one Green Deal provider, they will be able to get another. <strong>Energy Company Obligation</strong> Mr Speaker, the Bill will also introduce a new Energy Company Obligation. This will replace the Carbon Emissions Reduction Target (CERT) and the Community Energy Savings Programme (CESP). They have not unlocked carbon savings fast enough. The new Obligation will be more ambitious. Energy companies will be expected to pay to support hard to treat properties – like those with solid walls – where insulation costs can be higher, and the payback period longer, than the typical home. ECO payments from energy companies will be bundled with Green Deal finance and delivered together. It is a way of making sure the Green Deal is available to all. And it will help the most vulnerable people – those in the coldest homes – get the heating improvements they need to keep warm and stay healthy. Cold homes cost lives. By targeting support more closely, we can reach more people, more effectively. So we will focus our resources where they can do the most good. That means finding practical solutions to identify households who need the most support. Mr Speaker, we are determined to get to grips with the causes of fuel poverty – not just the symptoms. But the tools at our disposal are not up to the job. That is why I have asked Professor John Hills to conduct an independent review of the fuel poverty target and definition – so we can understand the problem, and what we can do to fix it. The review will produce an interim report in the Autumn, and a final report early in 2012. For too long, a sizeable minority of tenants have suffered from higher bills and colder homes. Privately rented houses are more likely to have the lowest energy efficiency rating than those owned outright. Landlords don’t want to invest, because tenants benefit. Tenants don’t want to invest, because they will move on. By linking the Green Deal measures to the property, not the tenant, the Bill bridges this divide. With the Green Deal, everybody wins: landlords will face no upfront costs; tenants will keep warm for less. Mr Speaker, I welcome many of the positive responses we have had from landlords to the prospect of the Green Deal. But some individuals and organisations feel we are not committed to securing improvements to the least energy efficient properties in the Private Rented Sector. Many tenants suffer appalling conditions without the power to agree improvements with their landlord. The debate has been lively, and we have listened. That is why I am pleased to announce we will be changing the current provisions to make clear that we will regulate. This is significant step: and a marker of our intent. From 2016, any tenant or their representatives asking for their landlord’s consent to make reasonable energy efficiency improvements cannot be refused. And from 2018 the rental of the very worst performing properties – those rated F&amp;G - will be banned through a minimum energy efficiency standard. We will of course seek to work with landlords well in advance to support their take-up of Green Deal. The precise form of these regulations will be subject to the usual scrutiny processes. <strong>Councils </strong> We also remain committed to ensuring that all councils play a role in delivering the Green Deal. The recent Memorandum of Understanding between DECC and the Local Government Group recognises the enthusiasm councils have for delivering the Green Deal. <strong>Gas security</strong> Mr Speaker, alongside the Green Deal provisions, the Bill also contains measures to enhance energy security. These include legislative changes to reduce the likelihood, duration and extent of gas supply disruption – and protect consumers from very high wholesale prices. These new powers would sharpen the commercial incentives for energy companies to meet their contractual supply obligation during a Gas Supply Emergency. <strong>Special Administration Regime</strong> The Bill also introduces a Special Administration Regime for gas and electricity suppliers, which will help maintain market stability – and protect consumers. The Regime will ensure that if a large supplier becomes insolvent, customers will be supplied with gas and electricity as cost effectively as possible – until the company is rescued, sold, or its customers transferred to other suppliers. <strong>Third Party Access to oil and gas infrastructure</strong> The Bill also includes an updated regime for Third Party Access to oil and gas infrastructure. Timely access to infrastructure on fair terms will be increasingly critical over the next decade. <br> The discoveries now being made in the North Sea are typically smaller than those in the past, and need to make use of existing infrastructure where possible. <br> The measures in this Bill will help us secure the full economic benefits of our North Sea oil and gas resources. <strong>Conclusion </strong> Mr Speaker, the Bill before us brings energy efficiency to homes and businesses across the country. It boosts the security of our energy supply, protects consumers, and supports green technology. In setting up the Green Deal, it places us at the very forefront of the low-carbon drive: with an innovative, dynamic market delivering energy efficiency at scale – with no extra cost to the public purse. Together with our reform of the electricity market, which will open up our energy portfolio and deliver the next generation of low-carbon electricity, it represents a signal step towards a cleaner, greener future for the UK. In the scale of its ambition, this Bill is a statement of intent. It will help cut our carbon emissions, reduce our dependence on imported energy – and protect the most vulnerable in society. Mr Speaker, the Green Deal is our flagship policy. This is the legislation that provides for it; and this is the Government that will deliver it. I commend this Bill to the House. <br>   None http://www.decc.gov.uk/en/content/cms/news/EnBill_second/EnBill_second.aspx Rt Hon Chris Huhne Energy Bill Second Reading 10 May 2011 Department for Energy and Climate Change
<strong>26 April 2011</strong> Welcoming the publication today by the Global Legislators Organisation (GLOBE) of a study of climate change legislation in the major economies, UK Energy and Climate Change Secretary Chris Huhne said: “Low carbon investment needs clear domestic law as well as a comprehensive global agreement. Under the UK’s Climate Change Act, we are transforming the way we live and work to cut carbon, save energy and support jobs and green growth. The report by GLOBE and LSE demonstrates that many other countries are also putting in place the legal frameworks and low carbon development plans to tackle climate change. The race is on, and the pioneers are the most likely winners. The international priority must now be to push ahead, building on the progress at Cancun, and work towards a global climate deal.” <br> The Study is just under 300 pages and is available to download from the <a target="_blank" href="http://www.globeinternational.info">GLOBE International website</a>. None http://www.decc.gov.uk/en/content/cms/news/CH_GlobeRpt/CH_GlobeRpt.aspx Rt Hon Chris Huhne Chris Huhne welcome for GLOBE/LSE report 26 April 2011 Department for Energy and Climate Change
<strong>24 March 2011<br> Check against delivery</strong> Thanks very much. I’m delighted to be here today. Eighty-five years ago, a small group gathered here in London changed the landscape of Britain forever. Led by a reluctant statesman, they published a document whose impact on the countryside is felt to this day. I am not referring to Sir Patrick Abercrombie and the pamphlet he wrote that brought the CPRE into existence. No, I speak of Stanley Baldwin’s government – and the Electricity Supply Act of 1926. In creating the Central Electricity Board and the first national grid, the Act brought Britain into the modern age. For electrification is one of modernity’s defining achievements. It is the cornerstone on which our technical progress rests; everything from the washing machine to the scanning electron microscope depends on it. And when the world’s first public electricity supply was connected – in 1881, in Godalming – it marked a fundamental change not just in our landscape, but in the social contract. From that day, it became increasingly clear that government had a core responsibility to ensure electricity supplies are safe, secure and affordable. In the past, we did so with coal and gas. Now, we are looking toward a low-carbon future. One where clean, green power keeps the lights on and the skies clear. There are many different paths to that destination. Each will bring about real changes. The energy choices we make now will determine the shape of the landscape for generations to come. This is nothing new. Throughout our history, our choice of energy has affected our environment. The fuel that has driven economic and social progress has also driven change on our landscape. Six thousand years ago, three quarters of Britain was woodlands. By the time of the Domesday survey, forest cover in England had fallen to just 15%. Trees were cleared to make way for food; to build houses, weapons, and ships. By 1700, we were dependent on imported timber. Britain’s ancient forests were stripped bare. When the Industrial Revolution began, charcoal was used to smelt the iron on which Britain’s prosperity was built. The Forestry Commission estimates that a single furnace needed 10,000 acres of deciduous woodland to run. In the nineteenth century, everything changed again. Industrial progress meant coke and coal were now the fuels of choice. And so our landscape was altered again. By 1900, over 200 million tonnes of coal were being mined in Britain. Nearly a million people were employed in over 3,000 mines. Surface coal mining only peaked twenty years ago. In 1991, 17 million tonnes of coal were open-cast mined at 135 sites across in the UK. Our hunger for coal left deep scars upon the landscape, some of which remain to this day. And it brought serious consequences for the wider environment. It is no coincidence that the term 'acid rain' was coined in Manchester by a Scottish scientist. Nor that coal – and its contribution to London’s ‘Great Smog’ – resulted in one of the first pieces of modern environmental legislation, the Clean Air Act of 1956. In the half century since then, our energy mix has become more diverse. As British coal production tapered off, nuclear power and natural gas plants have helped provide us with cheap and secure energy. And with full electrification in the 20th century came the National Grid, power stations and pylons. Now we face another change. Over the next decade, we must rebalance our energy system. A quarter of our nuclear and coal power plants will shut down by 2020. In the face of tough global competition and a difficult financial environment, we must attract record investment in new energy. More than £110 billion is needed for new power stations and grid upgrades over the next decade. Not just to meet growing demand and shrinking supply – but also to meet our climate change targets. By the end of this decade, the UK must cut its carbon emissions by 34% on 1990 levels. And we must generate 15% of our energy from renewables. It’s important not to forget why we are doing this. As the Chief Executive of Natural England said, climate change is ‘the biggest issue facing the natural environment’. I am, of course, am preaching to the converted. Two years ago, the CPRE supported a study that looked at how a changing climate could change the landscape. In South East England, beech trees could be badly affected. Pomegranates and olives could replace potatoes and onions. And the hedgehog could disappear from the South East in just 15 years time. This isn’t just about future risk either. It’s already happening. As Natural England has observed, the timing of natural events is changing. Spring comes sooner. Autumn lasts longer. Habitats are changing and species distribution is changing with it. And earlier this year, researchers found that human greenhouse gas emissions may have roughly doubled the chances of the autumn 2000 floods. We can now clearly link extreme events and their effects to the rise in man-made greenhouse gases. So let’s be realistic: climate change is not just a far-off possibility, unlikely and impossible to foresee. It is happening now, with every barrel of oil we burn and every tanker of gas we use. The threat posed by climate change is simply too big and too close to ignore. It is a global problem with local consequences. That means yes, we must do everything we can on the international stage to get an agreement to cut carbon emissions. But we also have to make the case for the low-carbon revolution here at home. We need a diverse, secure and sustainable energy mix, delivered with long-term strategic oversight. Providing clean, green energy to 2050 and beyond. Our plan for low-carbon energy rests on four pillars. The first is renewables – like onshore and offshore wind, biomass, energy from waste, solar, marine and micro hydro power. The second pillar is new nuclear – without public subsidy, and with liabilities covered by developers, who will pay the full cost of waste disposal and decommissioning? The third pillar is clean coal and gas, delivered by carbon capture and storage. Giving us flexible and reliable energy – without the carbon consequences. The important thing is to spread the risk, rather than putting all our eggs in one basket. It’s the same principle as managing a pension fund. To encourage low-carbon investment, we are changing the electricity market. Under our proposals, all low-carbon technologies will benefit from support by virtue of being low carbon. Pioneer technologies like wind, wave and tidal stream will get extra support. There will be a capacity payment, to make sure we can meet peaks in demand – like the infamous ad break in Coronation Street, when everyone gets up to put the kettle on. We’ll send out a clear signal with an emissions performance standard to keep our power plants clean. And the Treasury has announced a carbon price floor to underpin our signal to the marketplace – and to encourage low-carbon use of existing plants. The final pillar of our plan is energy saving. We have the oldest housing stock in Europe. We use more energy heating our homes than Sweden, which is nearly five degrees colder on average. That’s why our flagship programme is the Green Deal, a nationwide home improvement scheme to bring our houses up to 21st century energy efficiency standards. It is the most comprehensive energy-saving plan in the world. And it can make a real difference. Heating is the second biggest driver of energy demand in Britain. Better insulated buildings can help us cut into that carbon overhead. So can renewable heat. That’s why we’re supporting renewable heat technologies like biogas boilers, solar thermal and electric air and ground-source heat pumps. The key thing about our plans is that they will be flexible, letting us choose the lowest carbon energy sources at the lowest possible cost. That flexibility will be critical. Because nobody knows what the energy mix will look like in forty years time. Early stage technologies like tidal power may be long established. Interconnectors could flourish, allowing us to trade natural resource strengths with our European neighbours. Concentrated solar power in the Sahara could create enough electricity for two continents. A technological revolution could deliver deep offshore wind at rock-bottom prices. We cannot predict exactly what combination of energy technologies will power Britain in 2050. But we know the carbon boundaries we must stick to if we are to keep global temperatures to within two degrees of pre-industrial levels. And we can estimate the kind of energy demand we will need to meet. Once we know where the finish line is, we can start to trace backwards and discover what the course might be. And then we can begin to engage the public with the scale and shape of the changes that will deliver it. When the challenges are better understood, then we can have a meaningful discussion about how we will get there – and what kind of trade-offs we might have to make along the way. That’s the fundamental premise of DECC’s 2050 Pathways project, which looks at the choices and compromises we must face on the way to our energy future. There is no silver bullet that will solve our energy problem. We will have to make some difficult decisions. There will be trade-offs. Because every energy resource has its plus points – and its drawbacks. Onshore windfarms demand careful location and siting. Tidal stream and wave power are still in their infancy. For biomass to make a meaningful contribution it will need to cover much of the countryside. Hydroelectric power can help us get to a greener future. But it cannot deliver the level of clean energy we need. Our analysis shows that at the very top end of ambition, hydro could deliver just 3% of today’s electricity. Nuclear power means tight safety standards and a long legacy. Carbon capture and storage is yet to be demonstrated at scale. Interconnection needs interconnectors. Some technologies will fall by the wayside as costs or progress make them unsustainable. Others will improve fast. A few weeks ago I visited Delabole, the UK’s first windfarm. Ten turbines have been replaced by four – at twice the height and double the output. And once electricity has been generated, it must be transmitted. Again, there are no simple solutions. Whether you wish to see electricity carried above ground by pylons or buried within the earth in cables, there are environmental – and economic – consequences. And in a world with more renewable energy, balancing the grid becomes more challenging. We’ll need to look at pumped storage, demand management, smart grids and capacity payments – all the things that can help even out the peaks and troughs. Even energy-saving measures have a price. Air source heat pumps could change the way our homes look. To make our consumption and production add up, we will need a portfolio that includes a little bit of everything – and a lot of some things. The Pathways project is looking at some of these options. So far, it has unearthed many different possible routes to 2050. At the moment, there are no cost projections. But the point of the Pathways project is to get people engaged with what is physically possible – and what the implications are for our homes and our natural spaces. The 2050 calculator lets you figure out your own energy mix. Whether you want a little more wind, or a lot more nuclear, or extra energy saving. If you haven’t already, I highly recommend having a go. It can help put our energy choices into context. Because the reality is that the scale of the problem – and the potential solutions – means our landscape will change again, just as it did during previous industrial revolutions. It is inescapable. But we must keep remembering the rationale. You cannot keep things the same based on unsustainable energy. If we are to conserve the best of our past, we have to embrace the low-carbon future. Done right, energy infrastructure can enhance the landscape. The most popular tourist attraction in my constituency, as I never tire of telling my more sceptical Parliamentary colleagues, is a windmill. It grinds corn rather than generates electricity. So our challenge is to make sure this energy revolution is more sustainable – and more beautiful – than previous revolutions. But how can we deliver new energy infrastructure with the least impact and the most sensitivity? The first step is to listen to the experts. CPRE have been intelligent and vocal advocates for their cause, offering realistic and detailed criticisms and responding to consultations. I know that the uncertainty I mentioned about which technologies will get us to the future can be anathema to the conservationist. But in fact we share a similar aim: to manage change. Just as England’s landscape evolves, with CPRE and other conservationists taking on the mantle of stewardship, so our energy system will evolve. And we want to make sure we leave as small and as soft a footprint as we possibly can. And although I talked about letting technology and innovation decide where our electricity will come from, we are not simply letting market forces loose upon the countryside. We may be flexible about the exact method of travel, but we are clear about the rules of the road. We do not wish to impose energy solutions on anyone. Wherever possible, we will make balanced decisions that take account of landscape and environmental impacts. So on offshore wind, new developments will be assessed strategically as part of a rolling programme of offshore energy strategic environmental assessments, and will be checked again at the consent application stage when environmental impact assessments are carried out for specific projects. When it comes to onshore wind, communities should be protected from unacceptable impacts. The new National Planning Policy Framework will apply to energy developments up to 50 megawatts; the Department for Communities and Local Government will be consulting on it over the summer, so get in touch and let my colleague Eric Pickles know what you think. Sites for potential new nuclear power stations are subject to a strategic siting assessment. As part of this, the Government looks at impacts on cultural heritage and landscape value. Where a site falls down, such as at Braystones and Kirksanton in Cumbria, it may be rejected. And when it comes to how electricity will be moved around the country, we need to strike a balance between the economic and environmental impacts. To meet our 2020 renewable energy targets – and make that contribution to fighting climate change – the transmission system will have to expand to allow new renewables to plug in to the grid. Grid costs can sometimes mean wind farms are put where the electricity is needed rather than where the wind is strongest. Ofgem is looking into this as part of its review into transmission charges, which will conclude later this year. We’re also making big changes at the top level. Once finalised, our consultation on the revised draft national policy statements will form the policy framework for big decisions on nationally significant infrastructure projects. The national policy statements will bring together social, environmental and economic policies in one clear, robust and transparent system. It’s about developing a consistent and a coherent strategic rationale for the way we decide on new infrastructure. This kind of clarity and openness is a first. By getting public and stakeholders like the CPRE involved, we are opening up big decisions more than ever before – and working with people so we can get buy in. Sometimes, national need will mean we have to sit down and take a tough decision about local impact. I know CPRE is acutely aware that it’s where we draw the line between need and impact that matters. But with a more consensual framework drawn up with our partners and the public, you will always have a voice in the room. I want to thank CPRE for taking the time to offer such a detailed response to the consultation. And I want to reassure you that we are not going to wantonly plant windfarms across the country at random. In the next few months, we’ll publish the Renewables Roadmap – the first detailed step-by-step plan to deliver renewable energy. It will take a practical approach, looking at deployment systematically, identifying specific barriers and setting out how to overcome them. It will show how we will meet the 2020 renewables target. And it will set out milestones and metrics that enable us to monitor deployment progress and respond if we are falling behind our ambitions. Rather than being a fixed document, it will be flexible; evolving and changing as renewables come online. I hope today I have given you a sense of how we might deliver clean, secure energy to 2050 – and what it might mean for our landscape. By way of conclusion, and before we get to the Q&amp;A, I want to ask a few questions of you. Firstly, I would ask you all to think about the trade-offs you would make to guarantee the long-term survival of our landscape, the security of our energy supplies, and the affordability of our electricity for all. It is a question of where we choose to draw the line. That is a personal decision, but one that means thinking about the wider consequences. At the moment we buy gas that is easily extracted. But under some scenarios, we could end up relying more on shale gas. If we choose to rely on imported energy, we run the risk of ignoring the embedded costs. Is it morally sustainable to simply outsource our energy impacts to another country? What is conservation? And I wonder whether there is a more basic question here: what are we actually conserving? As the President of the CPRE said in his inaugural speech, the English landscape is ‘almost entirely manmade’. This is not a pristine natural environment, preserved in stasis. Rather, the CPRE is protecting a series of snapshots taken throughout our long and mutable history. And from the beautiful medieval field patterns of Devon to the causeways of East Anglia, human fingerprints are plain to see. Rural England is often a vision of how we want things to be; a vision that we have exported across the world. Perhaps energy infrastructure can be part of that vision. Norfolk’s windmills, Kent’s oast houses and Westmoreland’s watermills are an integral part of our countryside. If we strike the right balance, perhaps the next generation of green energy will leave a similar legacy. We know the choices we make about energy infrastructure stay with us for generations. For proof, you need look no further than Dean’s Yard, two miles away to the west. It is still lit with gas lights. Our current energy system is costing the earth. That is why it is so important to get it right. Think about the grand prize. Cleaner air. More affordable energy. Less risk of climate change. A greater degree of energy independence. For the first time since the 18th century, we have a chance to return to a true sustainability: one that does not see low-carbon generation as destructive to the economy or the environment, but as fundamental to the integrity of both. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/CH_CPRE_lect/CH_CPRE_lect.aspx Rt Hon Chris Huhne Chris Huhne delivers CPRE annual lecture (Speech) 24 March 2011 Department for Energy and Climate Change
<strong>Reference: 2011/028</strong><br><strong>22 March 2011</strong> Chris Huhne vowed today to leave no stone unturned in support of Scottish renewable energy projects. The Energy and Climate Change Secretary said: “If we are to meet our climate change targets, Scotland will be mission critical. Success here will define our low carbon legacy. “I know that every day that projects are delayed is an extra day we rely on dirty energy, an extra cost for the industry – and an extra cost for consumers. “My job as Energy Secretary is not to give you warm words. My job is to go through step-by-step, breaking through the barriers – so that you can get on with the job of delivering renewable energy in the simplest, quickest and cheapest way.” Speaking this afternoon at the Scottish Renewables conference in Glasgow, he announced: 1. The full text of Chris Huhne speech follows: I’m sorry I couldn’t be with you in person today, but I’m glad we got the low-carbon video option working. I didn’t want to miss out on a chance to address the leading lights of Scotland’s renewable energy industry. If we are to meet our climate change targets, Scotland will be ‘mission critical’. Success here will define our low-carbon legacy. In a world where financial fears have tempered green aspirations, Scotland has not only exceeded its targets – it is actively raising its ambitions, going further and faster than anyone else. This week, the world’s largest tidal array has been given the green light. The Sound of Islay will host ten tidal turbines. The home of Lagavulin and Laphroaig will now be powered by clean, green electricity. I want to make one thing clear: we need more projects like this. After all, the warm glow of 10-year-old single malt is a pretty powerful 'renewable heat incentive'! This is the first Scottish Renewables conference I have addressed as Secretary of State, but it could not be more timely. Over the past year, crises of confidence have struck conventional energy. In April, the disaster in the Gulf of Mexico brought home the environmental impact of our oil dependency. The takeaway lesson from Deepwater Horizon was that cutting-edge extraction can be high-risk – and high-cost. Then, in December, protesters in Tunisia kickstarted a wave of revolution unlike anything we have seen since 1989. Speculation and uncertainty meant the oil price hit $115 a barrel. Around the world, the debate about how fast we should move to low-carbon kicked up a gear. And then, eleven days ago, an earthquake of unprecedented ferocity struck 80 miles out from Sendai. In its scale and its impact, the devastation visited on Japan's Pacific coast is shocking. Our thoughts are with those who lost their lives, their families, their homes. After the earthquake and the tsunami, all eyes are on the country’s nuclear power plants. The situation, particularly at the Fukushima plant, is extremely serious. Millions are without power in Japan. Rolling blackouts and factory shutdowns compound the situation. As the world’s third-largest economy starts to look beyond rescue and toward recovery, getting the grid back online will be critical. So from Tokyo to Tunis, what's happening in the world today reminds us that the energy choices we make now matter in the long term. Decisions taken today can lock us into a particular set of risks, costs and benefits for decades to come. Our challenge is to come up with an energy policy that delivers safe, secure and low-carbon energy to 2050 and beyond. It will not be easy. Despite our stepped-up efforts to save energy, demand for electricity could double by 2050. But over the next ten years a quarter of our nuclear and coal power plants will shut down. As the reserve margin of spare generating capacity falls, the risk of interruptions to our energy supply rises. So we have to build a new generation of power stations. In the face of tough global competition, and a difficult financial environment, we must attract record investment in energy. And it must be low-carbon. By the end of this decade, the UK must cut our carbon emissions by 34% on 1990 levels. In the UK we must generate 15% of our energy from renewables by 2020, up from 3% in 2009, to meet our contribution to the EU renewable energy target. We must go from 25th out of 27 EU member states for renewable energy – the dunce in the class – to Europe’s fastest improving pupil. That means a fivefold increase in the current rate of deployment of renewables. And in Scotland, the Government has announced an even more challenging target: 80% of electricity from renewables by 2020. Growth on that kind of scale will be challenging to say the least. It will require tough decisions, clever thinking, and tightly focused support. We each have a role to play. Industry must carry on making the case for renewables. Engaging with communities – and answering its critics by delivering renewable schemes that save money and save carbon. Government must break through the barriers that are stopping new schemes being built. Overcoming the financial, planning and delivery hurdles that can hold up progress on renewables. And together, we must do a better job of communicating the benefits of renewables. Safety from oil shocks. Stability for our economy. Clean and secure electricity for our consumers. Today, I want to look at the barriers that are stopping us from getting renewables online – and what we can do to break through them. Firstly, the finance. From the small scale to the big picture, we have to get the incentives and structures right so that renewables are the smart choice. That means providing certainty for investors, with clear and consistent market signals. This is not always easy with new technologies, as we have found out with large scale solar. But we intend to put clarity and continuity at the heart of policy so we can unlock private capital on the scale we need. The Renewables Obligation was a good start. It designed renewable energy into the electricity supply chain. But it was created when we thought we might need 10% of our electricity from renewable sources. Now our ambitions are much higher. Single-digit low-carbon growth won't cut it anymore. We’re keeping up the support for large-scale renewable electricity, with a budget due to rise to £3.2bn over the next three years. But we also have to change the way we think about renewable electricity. Instead of treating low-carbon like a bolt-on, we need to think about it as one of the foundations of our energy system. That’s where electricity market reform comes in. Last year Niall Stuart said that EMR could ‘make or break’ progress on renewables. Needless to say, I believe it will be the making of low-carbon energy. But that also depends on you. Our proposals set out how we will encourage low-carbon investment, guarantee security of supply, and provide British consumers with the most affordable electricity. They reflect a fundamental change in our electricity system: renewables are no longer a fringe industry, but part of the mainstream. One of the four key pillars of our strategy: energy saving, new nuclear, clean coal and gas, and renewables. Support for new schemes under the Renewables Obligation will continue until 2017, so developers can keep building renewable energy projects. As we move past early stage mechanisms, the key thing is to provide continuity and certainty for the future. Under our proposals, all low carbon technologies will benefit from support by virtue of being low carbon. That is the compensation for what Nick Stern calls the greatest market failure of all time. A guaranteed feed-in tariff for all. There must also be a premium payment for early stage technologies. Pioneer technologies like wind, wave and tidal stream will benefit from extra support in the prices that we pay for electricity, just as they do now through the Renewables Obligation. Those furthest away from full commercialisation – like wave – will get the most. Our consultation also proposes a capacity payment, to make sure we can meet peaks in demand – like the infamous ad break in Coronation Street, when everyone gets up to put the kettle on. We will pay to save energy and generate it. We will also send out a clear signal with an emissions performance standard, to keep our power plants clean. And the Treasury has consulted on a carbon price floor, to underpin our signal to the marketplace – and to encourage low-carbon use of existing plants. Our proposals will change fundamentally the structure of our energy markets. But if we’re going to meet our renewables target, we can’t do it with electricity alone. That’s why, in a tight, tough spending round, I fought hard to secure £860 million for the world-leading Renewable Heat Incentive. We expect green capital investment in heat to rise by £7.5 billion by 2020, stimulating an entirely new UK market – and supporting 150,000 manufacturing, supply chain and installer jobs. From Dundee to Dartmouth, we want to see industrial, commercial and public sector installations increase sevenfold by the end of the decade. Scotland could expect to benefit by at least £80 million over the next four years. Today, Scottish Renewables threw down an ambitious target. It is up to Scottish parties and the new Scottish government to decide on Scotland’s commitments, but let me be clear: the money is there, and I will support your ambition. This is no flash-in-the-pan. The tariffs will be paid for 20 years to eligible technologies, with payments for each kWh of renewable heat. But as the costs of the equipment and installation reduce through economies of scale, we expect the support for new entrants to the RHI scheme will decrease. Because the long-term aim is to grow and sustain a green sector that delivers low-carbon energy at the lowest possible cost. We also need to ensure more low-carbon technologies are designed and manufactured here. We have a blossoming low-carbon goods and services sector, which seems to be thriving even in tough times. But China leads the world in solar photovoltaic panel production; Germany on passive house architecture and design. And although we have the most installed offshore wind capacity, Britain doesn’t even make the top 10 when it comes to wind turbine manufacture. It would be crazy to support producers generating low-carbon energy, businesses selling low-carbon products, consumers installing low-carbon measures – and not try to capture some of the original value. If our financing goes on buying in technology from overseas, we're not getting the best return on our investment. We're missing a trick unless we start supporting low-carbon manufacturing here in Britain – and grow the green supply chain. Things are starting to change. Siemens are investing in Hull, and Gamesa and GE are looking at setting up research centres and factories here in the UK. And I welcome Doosan’s decision to locate its renewables R&amp;D base – and potentially turbine manufacturing – in Scotland. This is great stuff. But we also need to encourage home-grown innovators. Take Artemis, pushing ahead with ‘Digital Displacement’ offshore wind-turbine transmission. Or Burntisland Fabrications, pioneering a new process design and layout for the manufacture of foundations for offshore wind structures. These companies are building the technologies of the future here on our shores. Locking in profits and expertise, and creating the exports that will keep Britain competitive. We can do more to help. The spending review settlement included £200 million for the development of low-carbon technologies. And the Green Investment Bank, capitalised with at least a billion pounds, will help get private sector investment at scale. The Chancellor will have more to say on the Green Investment Bank tomorrow. We’ll keep funding research and innovation – not just through DECC, but through the business and transport departments, too. So from the structure of the electricity market to research funding, we’re breaking through the economic barriers. We're also focusing on non-financial obstacles. If our renewable industry is to flourish, we need to get the infrastructure right, making it easier for renewable projects to plug in to the grid. Broadband providers often talk about the 'last mile' problem. You can have the fastest, best-designed national transmission network, but if the thousand yards from the local exchange to the customer are old-fashioned copper wire, then all that investment is wasted. It’s the same with energy. We have to make sure that the right transmission charging regime is in place to meet the challenges of renewable generation throughout Scotland. I know developers have real concerns about the current level of forecast transmission charges – particularly in the Scottish Islands, where major projects are on hold. I also know Ofgem recognise these concerns, and like you I await their review of the transmission charging arrangements through Project TransmiT. The key thing is to deliver a simple, fair and predictable charging regime that recognises our new energy landscape. Our purpose is not to build plant near consumers, but to wire up plant wherever the wind blows and the tides run. I’m not going to prejudge Ofgem’s review. But I have asked my officials to look closely at whether there’s a case for adjusting transmission charges for renewable generation on the Scottish Islands under section 185 of the Energy Act 2004 – so we can act quickly if we need to. Planning is rightly a matter for Scottish ministers, and over the last decade you’ve had a better record than England. But on a national scale, there are things I can to help get the green light for green energy. The revised draft National Policy Statements will give investors clarity and certainty. And we’re working with our partners in Whitehall to help smooth the way for new renewables on a national scale. Take radar and aviation. For many wind developers, radar interference causes business headaches. That's why we're working closely with aviation bodies like the National Air Traffic Services and the Civil Aviation Authority to develop and install new radar software. This can be a win-win situation: bringing new state of the art radar and releasing up to 5GW of new onshore wind capacity. And today, I’m happy to announce a new partnership agreement between government, aviation bodies and the windfarm industry to work together to implement new radar solutions. So we’re tackling the financial and the non-financial barriers to getting renewables online. The next step is to get a plan for delivering renewable energy. That’s why we’ll publish the Renewables Roadmap later this spring. The roadmap will be the first detailed step-by-step plan to deliver renewable energy. It will take a practical approach, looking at deployment systematically, identifying specific barriers, and setting out how to overcome them. It will show how we will meet the 2020 renewables target, sending an important signal to investors and technology developers alike. And it will set out milestones and metrics that enable us to monitor deployment progress and respond if we are falling behind our ambitions. The Renewables Roadmap will be the UK’s first systematic blueprint to deliver renewables at scale. Rather than being imposed from Westminster, it’s being drawn up together with our partners in the Devolved Administrations – and based on input and evidence from industry. And rather than being a fixed document, it will evolve and change as renewables come online. We want your feedback. We want to know which obstacles you think are most important, and then we will work harder, sector by sector, to shift them. This is open-source government at its best. And it will make DECC the happening department. So from finance to delivery, we’re making it easier to bring renewable projects onstream. We must hit our renewables target. We must cut our carbon emissions. We must make the case for green growth and ambitious emissions targets at a European level. It’s in our direct economic interest to do so. These are the jobs and businesses of the future. Renewable energy employed more than a quarter of a million people in 2009 – nearly a third of the low-carbon sector. Getting more renewable energy in our mix could reduce our energy import dependence by up to 40%, giving us more security and a greater degree of energy independence. As we reflect on a tumultuous year in global energy markets – one marked by tragedy and volatility in equal measure – that extra security sounds all the more attractive. So let’s work together to deliver the green energy revolution that Scotland, the UK and the world so desperately needs. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/pn11_028/pn11_028.aspx Rt Hon Chris Huhne Huhne - We will break through barriers facing Scottish renewables (press notice and speech) 22 March 2011 Department for Energy and Climate Change
<strong>14 March 2011</strong> “We take this incident extremely seriously even though there is no reason to expect a similar scale of seismic activity in the UK. I have called on the Chief Nuclear Inspector, Dr. Mike Weightman for a thorough report on the implications of the situation in Japan and the lessons to be learned. This will be prepared in close cooperation internationally with other nuclear regulators. “It is essential that we understand the full facts and their implications, both for existing nuclear reactors and any new programme, as safety is always our number one concern.” None http://www.decc.gov.uk/en/content/cms/news/CHstate_Japan/CHstate_Japan.aspx Rt Hon Chris Huhne Chris Huhne statement on the nuclear situation in Japan 14 March 2011 Department for Energy and Climate Change
<strong>14 March 2011</strong> <br> Dear editor The EU Commission’s 2050 low-carbon roadmap released last week needs to raise Europe’s sights beyond its current 2020 emission reduction targets. While the EU has agreed that emissions must be reduced by at least 80% by the middle of the century, it has not so far set out how to do it. We believe it’s vital such a plan starts now rather than in forty years’ time, and is a plan that can stimulate the right investment in low-carbon infrastructure and technology, putting Europe on track for a low-carbon future. Now is the right time to discuss the most cost-effective route to achieving our 2050 goals, maximising growth, jobs and prosperity throughout Europe. We are not starting from scratch; the EU has already cut emissions by 17% from 1990 levels by 2009. The Commission’s roadmap demonstrates both that the current 20% target is not a cost-effective route to the 2050 goal, and that we already have the tools and policies to cut emissions by 25% domestically. The European Energy Efficiency Plan in particular is welcome and shows the big impact reducing energy consumption can have. The case to move to a 30% target by 2020 is now stronger as a result. At a time when the price of oil is soaring, putting in place an ambitious plan for Europe’s low-carbon future has wider benefits than tackling climate change. It will increase the continent’s resilience against oil price spikes and reduce its dependence on imported energy. And it will help Europe compete with emerging economies in the fast-growing markets for green goods and services. We know that some industries are worried about how they will adapt, but solutions are available. In the best traditions of European co-operation, we can work together to overcome these challenges. We call on all member states to enter into this urgent debate on Europe’s future and agree how the roadmap is put into action – ensuring that Europe gets to the front of this low-carbon race, rather than falling behind. <br> Signed by   Chris Huhne, Secretary of State for Energy and Climate Change, UK<br> Tina Birbili, Minister of Environment, Energy and Climate Change, Greece<br> Andreas Carlgren, Minister for the Environment, Sweden<br> Lykke Friis, Minister of Climate and Energy, Denmark<br> Rosa Aguilar Rivero, Minister for Environment, Rural and Marine Affairs, Spain<br> Humberto D. Rosa, Secretary of State for Environment, Portugal<br> Dr Norbert Röttgen, Federal Minister for the Environment, Nature Conservation and Nuclear Safety, Germany None http://www.decc.gov.uk/en/content/cms/news/ChrisH_EULett/ChrisH_EULett.aspx Rt Hon Chris Huhne Letter to the Guardian on 30% EU Emissions Cut from Chris Huhne and EU Environment Ministers 14 March 2011 Department for Energy and Climate Change
Thanks very much for that introduction. The last CBI event I spoke at was the annual climate change conference, back in November. Under Richard Lambert’s stewardship, the CBI went from strength to strength. Now there is a new man in charge. And although I’m a little late, I’m delighted to be able to congratulate John publicly on his appointment. With his experience and commitment to business interests, I know he’ll build on the CBI’s reputation for thoughtful advocacy. We’re looking to him to keep the green agenda firmly on the table. I’m convinced it’s good for British business. The report published today is a good sign. In exploring how we can make the consumer case for low-carbon, it makes a valuable contribution to the debate. Because consumer behaviour matters. British consumers will spend nearly a trillion pounds this year. What they spend it on – and where – makes a real difference. 70% of our greenhouse gas emissions can be linked to consumer action. So consumers, and the choices they make, will play a huge role in taking carbon out of our economy. We can’t meet our climate change goals without changing the way we choose goods and services. Decisions at the till filter up to business planning, and feed back into product development. At each stage – from design to delivery – there’s a chance to inject a little green thinking. We should seize that chance. People feel good about buying things that do good. But in the current environment, we can’t rely on the charitable impulse. We have to make it easier for people to make green choices. We have to get people thinking green at the critical decision points. That means making sure there are alternative products that consumers want and need. That they are signposted and supported by clear and consistent information. And that they are encouraged by the right blend of regulation, standards and incentives. Today, I want to look at how we can grow a low-carbon consumer market. And at the roles of government, businesses and consumers in delivering a greener future. Let’s start with a simple question: what affects people’s buying behaviour? Firstly, events can change what consumers are looking for, and what producers manufacture. Take fuel efficiency. Between 1975 and 1984, the fuel economy of light vehicles in the US rose by 62%. In less than a decade, motor manufacturers used better design to squeeze an extra 7.6 miles per gallon out of domestic vehicles. This great leap forward was an engineering response to the oil supply and price shocks in the 1970s. Higher prices at the pumps meant the emphasis shifted toward economy. Petrol was expensive; people wanted more efficient cars; businesses wanted to provide them. Second, governments can force change by intervening in the market – through regulation, subsidies and standards. Look at what happened in Europe. A voluntary agreement by car manufacturers wasn’t delivering lower tailpipe emissions. So in 2009, the European Commission stepped in. The Council of Ministers legislated, setting standards for new car emissions. The result? The cars on our forecourts in 2010 produced 20% less C02 than they did in 2000. And finally, businesses can drive consumer choice through innovation. By bringing new products to market, businesses can reframe the options open to consumers – as Toyota did with the Prius. They made the solution that got people thinking about the problem. It’s the ‘Field of Dreams’ approach: if you build it, they will come. So businesses, governments, and events can all drive choice. But ultimately, the decision rests with the individual. We need to get over the barriers stopping consumers from going green. That means getting past worries about performance or quality of the sustainable option. It means understanding why some people are reluctant to pay a little more now to save a lot more later. Buying something because it is green is reason enough for some. But for everyone else, the focus must be on the benefits for consumers. Like lower energy bills. Improvements in the environment. Better public health. In tough times, a clear steer on these benefits becomes even more important. So having the right information at hand can make a critical difference. Take the fuel economy labelling scheme. By bringing together fuel consumption, carbon emissions and estimated fuel costs, the voluntary labelling scheme is a perfect example of how information can affect choice. Instead of giving people another system of arbitrary categories or another impenetrable dataset, it has a clear rating system and – crucially – a price, in pounds, of running the car for a year. And it works. 75% of new car buyers said the labels had given them information that influenced their purchase choice. That’s because it makes the critical connection between carbon and cost. Setting out how much it costs to own a product, rather than simply to buy one. We also know that people care more about what they pay now rather than what they save in the future. But we need to get people thinking about price across the lifetime of a product. The key is to make costs real and tangible, rather than abstract. The labelling scheme makes it easy to factor in fuel costs when you’re buying a car. And with dashboard fuel economy readings, people can easily grasp the running costs of their vehicles. But although energy ratings on white goods are well understood, there’s little awareness of how much it costs to run a kettle, a TV or a fridge – each day, each year, or each use. Until you put a price on it, it’s easy to ignore. But once you tell people that they could save £25 a year by choosing a more efficient fridge/freezer, or £150 over five years by choosing a greener TV, or 6p for every load of washing by using a smarter washing machine – then the smart money is on the green choice. Suddenly there’s no need to do environmental targeting, because you can let price targeting do the work for you. But we’re not yet giving customers the chance to make meaningful price comparisons – at least, not consistently across sectors. So the challenge for household goods manufacturers and retailers is to think about how they can bring the same clarity to their consumer information schemes as the automotive sector. The government wants to work together with business on this; so let’s get together and start talking about how we can deliver better information for consumers. Together, we can make it easier for consumers to buy energy efficient products; from providing useful advice in-store and online to developing set of consistent messages. And a simple, consistent, voluntary labelling system setting out real-world costs can make a real difference. It can save consumers money, encourage competition on energy efficiency – and refocus consumers on the more sustainable options. Because at the moment, energy consumption isn’t well understood. And neither is energy supply. Opaque pricing structures, a cost per unit that most people can’t explain, a lack of real-time information on consumption – the net result is that running costs remain abstract. That’s where smart meters and the smart grid come in. Smart meters are about giving consumers the tools to engage with their energy use. We’re finalising plans to roll them out across Britain. As part of this process we’ve been doing a lot of work with consumers and consumer groups to make sure we get it right. And we’ll be publishing our conclusions shortly. Smart meters can help people keep an eye on their energy use, and their energy bills. With a quarter of the UK’s carbon emissions coming from the home, that kind of awareness will be critical. But to really capitalise on smart meters, we also need to look ahead to the next step - enabling consumers to play a more active role in balancing electricity demand. Two years ago, IBM ran a smart grid pilot project in North Carolina. With a wireless data connection and a software control panel, they found that homes could save up to 40% of their energy. Homeowners could check their energy consumption, set daily use profiles, select a monthly target bill amount, and even let the local authority cycle off their appliances during peak times – and all with nothing more than an internet connection. The right information – presented in a way that allows meaningful comparison – can affect people’s buying behaviour. Armed with better information, people can make more informed choices – demanding higher standards, driving markets onward, and sparking innovation. Clearly, information is critical. But who do people trust to provide it? Tucked away in the CBI’s report is a graph that makes depressing reading. It asks people which source of information they found most reliable – government, scientists or Which? Magazine. In the 15-24 age group scientists lead the way, with government close behind. In middle age, things take a turn for the worse. Trust in government and scientists collapses, and Which? magazine soars ahead. And by retirement, only one in five people trust government to provide reliable information. Usually, journalists and politicians are closely matched in the race to the bottom of public opinion. But when it comes to parting with their cash, people trust the consumer champion to give them the information they’re most likely to use when making a purchasing decision. We have to overcome this credibility gap – because we’re about to embark on the single biggest intervention in home energy since the birth of the National Grid. The Green Deal is our flagship programme to boost the energy efficiency of the UK’s building stock. It’s a nationwide, self-financing mechanism that allows tenants and homeowners to install energy efficiency measures like cavity wall insulation and loft lagging without paying any upfront costs. It will be supported by businesses and delivered by partnerships across the country. Consumers will be engaging with trusted high street brands, who will carry out the advice, installation and financing of Green Deal measures under a Government-appointed accreditation body. The warning from the CBI’s research is clear: consumer confidence lies outside the reach of government alone. So we’re looking carefully at exactly how we can best communicate the benefits – and how we can reassure consumers that in this instance, we really are on their side. We need to make sure the information and messaging is spot on, so that people can clearly see the benefits. We need to be certain that the accreditation and standards are absolutely rock-solid, so that people know the Green Deal is credible. And we need to work with businesses to identify innovative – and workable – ways of delivering it. Today’s report talks about businesses having a responsibility to inform consumers about green choices. But with great responsibility comes great opportunity. The low-carbon and environmental goods and services sector is vast; £3.2 trillion and counting, with growth predicted to outstrip world GDP. Those who move first, and move fast, stand to make huge gains. In setting coherent standards and giving people the means make informed choices, businesses can create a vibrant marketplace in which to prosper. Through the Green Deal and smart meters we have a unique opportunity to engage people with the way they use energy – and what the consequences are. It’s also a chance to change the story on green products. Rather than a sacrifice you make to feel better about yourself, we can make it clear that the green choice is also the smart choice. On information, standards and innovation, we can begin to reframe the way consumers make choices, ushering a new concept of value. One that takes account of the lifetime costs and carbon consequences of a product. In so doing, we can make a very real contribution to the UK’s energy and climate change ambitions. Thank you very much.  None http://www.decc.gov.uk/en/content/cms/news/ch_cbi_speech/ch_cbi_speech.aspx Rt Hon Chris Huhne Chris Huhne speech to the CBI: 'Green consumers' 09 March 2011 Department for Energy and Climate Change
<strong>3 March 2011<br></strong><em><strong>Check against delivery</strong></em> In autumn 2000, more rain fell on England and Wales than at any time for 230 years. 10,000 homes and businesses were flooded. In 2003, a heatwave gripped Europe. Drought and wildfires put health services and national infrastructure under huge pressure. Thousands died. Forests were destroyed by fire, and crops by drought. Energy and transport were hit hard. We can’t say for sure that climate change caused these extreme weather events. But the science tells us that as our climate changes, the likelihood of these events increases. In 2004, research suggested human action had doubled the risk of a European heatwave. And now, for the first time, scientists have been able to say what role global warming played in a major flood. Using new methods, researchers found that human greenhouse gas emissions may have roughly doubled the chances of the autumn 2000 floods. That is a significant step up the ladder. We can now clearly link extreme events to the rise in man-made greenhouse gases. And we can put a number on how much more likely they are. We can also see just how costly they will be. The floods in 2000 cost the UK insurance industry £1.3 billion. Since then, the cost of flood damage has tripled compared with the previous decade. In 2009, the Association of British Insurers said – and I quote – ‘our assessment of climate change convinces us that the threat is real and is with us now’. If there’s one thing insurers know about, it’s risk. When they say it’s time to take action, we should sit up and take notice. Of course, the UK is responsible for fewer than 2% of the world’s carbon emissions. But this does not let us off the hook. The consequences of climate change will not respect our borders. Food security, water shortages, environmental refugees; the potential knock-on effects are on a global scale. That is why we must do everything we can to secure a global solution. We are making good progress. The UN climate change talks at Cancun were the most important since Kyoto. For the first time, both developed and developing countries made a political commitment to cut emissions below their present path. We made good on the bellwether issues: The agreements at Cancun prepared the ground for a global deal on climate change. But we must be realistic: this will take time. And after the mid-term elections in the US, Senate ratification of any climate change treaty will be difficult. But a deal will happen. Why am I so confident? Because around the world, there is too much invested in tackling the problem. It would be crazy not to prepare for a low carbon future. In fact, in many ways it is already here. In 2009, the world’s biggest energy consumer poured $34 billion into its low-carbon economy. China now leads the world in solar photovoltaic production. Six of the biggest renewable energy companies in the world are based in China. Last year, 1 million people sat the Chinese civil service exam. The most popular job was ‘Energy Conservation and Technology Equipment Officer’. 5,000 people applied. China will build 24 nuclear power stations in the time it takes us to build one. By 2020, their nuclear capacity will have increased tenfold. They will lay 16,000 kilometres of high-speed rail track in the time it takes us to go from London to Birmingham. They have the highest installed hydro capacity and the most solar water heaters in the world. And they are forging ahead on wind power. So China knows what’s coming. And despite what the mid-term elections suggest, so does the US. Last year, despite serious lobbying – and lots of money from special interests – the Californian public voted decisively to support the State’s ambitious climate change laws. The eighth-largest economy in the world is still committed to going green. And the Northeastern States are leading the way on renewables, on emissions and on energy efficiency. They’re investing in renewable heat, trading carbon, and legislating for clean energy. The US Navy will get half of its energy from non-fossil fuel sources by the end of this decade. They’ve already flown fighter planes powered by biofuels, and they’ve already launched their first hybrid power ship. President Obama used his State of the Union speech to call for a reinvention of energy policy. He challenged the best minds in America to come up with clean energy ‘Apollo projects’. And he set a new goal: for 80% of America’s electricity to come from renewable sources by 2035. Conventional wisdom has it that China and the US are not signed up to the green agenda. <br> But if you look at what they do, not what they say, a different picture emerges. Policymakers around the world understand that climate change is real, is happening, and is worth defending ourselves against. The best thing we can do to help adapt to climate change is to stop it happening in the first place. An ounce of prevention really is worth a pound of cure. So although we must keep pushing for a global deal on climate change, we must also do everything we can at home. We can't expect to convince other nations of the need for change if we can't change ourselves. That is why we have to move further and faster to a low-carbon economy. This makes obvious environmental sense. Today, I will set out why it makes economic sense. But first, let us understand our destination. What does a low carbon economy look like? First, it does not waste energy. We have the oldest and least efficient housing stock in Europe. We use more energy heating our homes than Sweden, which is nearly 5 degrees colder on average. Our homes may be our castles. But they shouldn’t cost a king’s ransom to run. Across the country, boilers are firing up earlier than they need to. Burning more gas than they have to. Producing more emissions than they should do. And all because our homes leak heat and waste carbon. A quarter of the UK’s carbon emissions come from the home. Our housing stock is costing us the earth. That’s why the Green Deal is our flagship programme. It’s a self-financing home improvement scheme to bring our houses into the 21st century. Householders will pay nothing up front. Businesses will do that for them, getting their money back from the savings on energy bills not just from the present occupier but from the next tenant or owner as well. And the Green Deal will be targeted at trigger points – like when people move home and do lots of work anyway – to encourage uptake. Right across the country, homeowners and tenants will get deep energy efficiency improvements without having to front up the cash. From 2012 onwards, when the Green Deal begins in earnest, energy saving packages worth thousands will be installed in millions of homes. And there will be a subsidy for hard to heat homes, and those in fuel poverty. No-one should fear winter – or winter energy bills. We are determined to tackle the root causes of fuel poverty, not just stick plasters on the symptoms. And we are looking at how we can apply the Green Deal model to businesses, too – enabling them to cut carbon, and cut costs. It is the most comprehensive energy saving plan in the world. There has never been anything quite like it. Have no doubt: this can make a real difference. Heating is the second biggest driver of energy demand in Britain. And British Gas research shows that householders who put in energy efficiency measures cut their gas consumption – and their bills – by 44%. Better insulated buildings will do much of the work for us. But we must also look at renewable heat technology. More electric air and ground-source heat pumps, drawing warmth from the outside world to heat the indoors. More biogas boilers, and more solar thermal. So the first principle of the low-carbon economy is that it saves energy. The second is that it will be overwhelmingly electric. A century ago, the streets of New York were served by a thousand electric taxis. Since then, cheap oil and technological change drove electric cars off the roads. Now, the pendulum is swinging back. Every month, new electric cars are coming to market. The shift from the petrol pump to the electric plug is already underway. In the low-carbon economy, we will turn to the grid to heat our homes and charge our cars. That means a big increase in our demand for electricity. It could double by 2050. And that demand must be met with secure, affordable low-carbon supply. But our current energy system is not up to the job. We will lose a fifth of our generating capacity over the next 10 years, as our ageing power plants shut down. We cannot afford to replace them with more of the same. By the end of this decade, the UK must cut our carbon emissions by 34% on 1990 levels. We must generate 15% of our energy from renewables by 2020, up from 6.7% in 2009. With long lead-in times and high capital costs, we must act now to secure a low-carbon supply. Otherwise, we face an energy crunch. Our plan for low-carbon electricity rests on three pillars. The first pillar is renewable energy. Like onshore and offshore wind, biomass, energy from waste, solar, marine and micro hydro power. The second is new nuclear – without public subsidy. Half of my Department’s annual budget is spent cleaning up after past generations of nuclear and coal. Next year, it will reach two-thirds. Never again. That is why we are passing the cost of nuclear liabilities on to developers, who will pay the full cost of waste disposal and decommissioning. And the third pillar is clean coal and gas, delivered by carbon capture and storage. Giving us flexible and reliable energy – without the carbon consequences. Together, these technologies will power Britain to 2050 and beyond. So why haven’t we picked one or two? Because the future is uncertain. No-one knows what the most successful low carbon technology will be in thirty years time.<br> The only way to keep the lights on and the skies clean at the lowest possible cost is to build an energy portfolio. It is exactly the same principle as a pension fund. When we’re planning for the future, we don’t put all our eggs in one basket. It would be equally irresponsible for us to try and play god with the country’s energy future. So instead, we must create a policy framework that lets us discover and then use the lowest cost options. That means thinking about a range of scenarios. At one end may be a world where fossil fuel prices are exceptionally high. In that scenario, we could rely more on renewables and nuclear. At the other end of the spectrum, some argue that plentiful gas from unconventional sources will cause gas prices to tumble. Then we might need an energy mix with more clean gas, with carbon capture and storage. Our policy is about keeping our options open between technologies, but ensuring that we are on the road to the low carbon economy. We have set a direction; we will let innovation get us there. So we will put our money on the table. Funding innovation and research, in DECC and in the business and transport departments. <br> Through the Green Investment Bank – a new institution to fund the scaling up and deployment of green technology and clean energy projects. And through our consultation on electricity market reform, which sets out how we will encourage low carbon investment, guarantee security of supply, and provide British consumers with the most affordable electricity. Under our proposals, all low carbon technologies will benefit from support by virtue of being low carbon. That is the compensation for what Nick Stern calls the greatest market failure of all time. A guaranteed feed-in tariff for all. There must also be a premium payment for early stage technologies. Pioneer technologies will benefit from extra support in the prices that we pay for electricity, just as they do now through the Renewable Obligation. Those furthest away from full commercialisation will get the most. Our consultation also proposes a capacity payment, to make sure we can meet peaks in demand – like the infamous ad break in Coronation Street, when everyone gets up to put the kettle on. This will support all four ways of keeping the lights on: Water pumped up hills off peak and released on peak, interconnection with European partners which have different peaks, demand management from companies arranging short-term switch-offs of freezers or fridges, and cheap gas and coal plant – with carbon capture and storage. We will also send out a clear signal with an emissions performance standard, to keep our power plants clean. And the Treasury is consulting on a carbon price floor, to underpin our signal to the marketplace – and to encourage low-carbon use of existing plants. Getting those signals right will be critical. It is difficult to overstate the scale of the investment challenge. Ofgem estimates we need £200 billion of new investment over the next decade to secure our supply as our ageing nuclear and coal power plants shut down. We need to make sure as much of that investment is low-carbon as possible. It will be a historic missed chance if we lock in a new generation of high carbon electricity plant. <br> If we get the market framework right and give energy companies certainty, they will provide that low-carbon investment. But they are not the Salvation army. They will need to convince big investors – like pension funds – that the UK energy market IS not just stable, but also offers a good return. We must be clear about this: there will be a cost to the consumer. But it will still be cheaper than the alternatives. And in the long term, the fundamentals of the low carbon economy are not going to be expensive. Nick Stern estimated that the overall costs of avoiding dangerous climate change at no more than 2 per cent of GDP by 2050. So if our economy doubles in forty years, that means a 98 per cent increase instead of a 100 per cent increase. It would barely be noticeable. Even that calculation depends on other factors. If we relied on oil and gas, and their prices were around $80 a barrel and its equivalent for gas, then consumers would pay more under our policies – about an extra 1 per cent on their bills by 2020. But the oil price reached $100 a barrel in January, which just happens to be the point at which our economists calculate the British consumer breaks even. And the oil price, as we see, could well be higher. In the medium term, the US Department of Energy forecasts $108 a barrel by 2020. <br> If oil prices continue on this trend, and gas prices rise to meet them, then our consumers will be winning hands down. Paying less through low carbon policies than they would pay for fossil fuel policies. There’s another economic advantage, one that makes a powerful case for the low-carbon revolution: insulation from oil and gas price shocks. I asked economists at DECC to look at how a 1970s style oil price shock would play out today. They found that if the oil price doubled, as from $80 last year to $160 this year, it could lead to a cumulative loss of GDP of around £45 billion over 2 years. This is not just far-off speculation: it is a threat here and now. And the faster we move to a low carbon economy, the more secure and stable our economy will be. This transition to the low carbon economy does not just protect against the threats. It opens up a world of opportunity. The global low-carbon market is worth more than £3 trillion. It is projected to reach £4 trillion by 2015. The UK share of that market is currently worth more than £112 billion. It could be much larger. At home and abroad, the opportunities are huge. For jobs, exports, and growth, the future is green. We are already feeling the benefits. In the Humber, where Siemens have taken the first steps towards building wind turbines on British shores, with 700 jobs. And nationwide. Last year, British Gas announced its plan to ‘go early’ on the Green Deal, investing £30 million and creating 3,700 new jobs. As the Green Deal kicks in, it will bring a significant economic boost, driving growth in manufacturing and supply chains across the country. The number of people employed in insulation alone could soar; from 27,000 now, to 100,000 by 2015 – eventually rising to a peak of 250,000. Recovery from a deep recession is not a respooling of the same old movie. The old industries do not just bounce back. It’s about new industries leading the way - just as it was in the 1930s, when manufacturing of cars and electrical goods helped us fight our way out of recession. Britain can lead the way. Our scientific, research and engineering strengths will stand us in good stead. Look at our record on Carbon Capture and Storage, where British scientists top the tables when it comes to research. We can turn that laboratory lead into an economic lead. The International Energy Agency predicts the world will need 3,400 new coal and gas plants by 2050 if we are to keep global warming below 2 degrees. That’s why we must lead the way in demonstrating that CCS works on a commercial scale. It will be a major new export opportunity And green growth is why we are pressing for greater EU ambition on emissions. The carbon price set out by the EU Emissions Trading Scheme is not high enough to drive the change we need. It must be higher. We want to see a much stronger emissions target. Instead of a 20 per cent cut in emissions by 2020, we should aim for a 30 per cent cut. Two years ago, we had already made it to 17 per cent. Going to 30 per cent will add just 11 billion euros to the costs that were originally estimated of going to 20 per cent. In an economy the size of Europe’s, that’s small change. This is not to send some global signal. It is not negotiating by putting a new concession on the table. It is in our own economic interest. The faster we move, the bigger and better our low carbon industries will be, and the greater the share of that expanding world market. Clear green signals will spark more green investment. A recent report from the Potsdam Institute for Climate Impact Research found that more demanding greenhouse gas targets could increase Europe’s GDP by more than €600 billion, creating 6 million jobs. Why? Because there is spare capacity and unemployed people. Green growth will fuel the recovery. Growth is going ex carbon. We must be realistic: rebuilding our energy infrastructure and rebalancing our economy will take time. Because the capital investments are so huge, and the replacement cycle so long, change will sometimes seem glacial. But it will come. And in the long term, getting off the oil hook will make our economy more independent, more secure and more stable. Because the cost of investing in low-carbon energy and security of supply pales in comparison to the costs of dangerous climate change and energy dependency. And there are real economic opportunities up for grabs. Already, we are making progress. Carbon emissions are down. The international negotiations are back on track. The Green Deal is on the way. We are rebuilding our electricity market. Green growth is here to stay. <br> The transition to the low-carbon economy is underway. It is up to us to see it through. None http://www.decc.gov.uk/en/content/cms/news/ch_speech/ch_speech.aspx Rt Hon Chris Huhne Chris Huhne speech to CentreForum: 'A blueprint for our energy future' 03 March 2011 Department for Energy and Climate Change
<strong>17 February 2011</strong> <em><strong>Check against delivery</strong></em> <br> Thank you very much.<img height="150" alt="Chris Huhne speaking at the Royal Geographic Society" hspace="5" width="225" align="right" vspace="5" border="5" src="/media/viewfile.ashx?filepath=ministers/chrishuhnespsmall.jpg&amp;filetype=5"> The ‘perfect storm’ that gives this conference its name is now two years closer. But are we any safer? You have already heard from climate and environment experts. Today, I will tell you what Government is doing to tackle climate change and boost our energy security. In autumn 2000, more rain fell on England and Wales than had done for 230 years. 10,000 homes and businesses were flooded.  The floods cost the UK insurance industry £1.3 billion. Taking the last 10 years compared with the previous ten, the cost of insurance claims for flooding has tripled. In 2003, a heatwave gripped Europe. Drought and wildfires put health services and national infrastructure under huge pressure. Thousands died. Forests were destroyed by fire and crops by drought. Energy and transport were hit. <br> The UN estimated losses from the 2003 heatwave at over 13 billion euros. We can’t say for sure that climate change caused these extreme weather events. But the science tells us that as our climate changes, the likelihood of these events also increases.  In 2004, research suggested human action had doubled the risk of a European heatwave. And now, for the first time, scientists have been able to say what role global warming played in a major flood.<br><br> Using new methods, researchers found that human greenhouse gas emissions may have roughly doubled the chances of the autumn 2000 floods. That is a significant step up the ladder. We can now clearly link extreme events and their effects to the rise in man-made greenhouse gases. And we can put a number on how much more likely they are. Although the UK is responsible for just 2% of the world’s emissions, the consequences of climate change will not respect our borders. That is why we must do everything we can to secure a global solution. We are making good progress. The UN climate change talks at Cancun were the most important since Kyoto. For the first time, both developed and developing countries  made  a political commitment to take targets and actions to mitigate climate change. We made good on the bellwether issues. Agreeing that the average global temperature increase should be kept below 2 degrees. Strengthening the reporting of emissions reductions with a genuine peer-review process. <br> Establishing the Green Fund, Adaptation Committee, Technology Mechanism and REDD+ mechanism. The agreements at Cancun prepared the ground for a global deal on climate change. We have reaffirmed our faith in the process; now we must make sure it delivers. But we should be realistic: this will take time. And after the mid-term elections in the US, Senate ratification of any climate change treaty is off the agenda for now. But a deal will happen. The evidence for human influence on climate change is even more compelling. We have a chance to show through our actions that climate change is neither distant nor inevitable, but a clear and present danger – and one that we can do something about. Why am I so confident? Because around the world, there is already too much invested in tackling the problem.  Take China. In 2009, they poured $34 billion into their low-carbon economy. <br><br> China now leads the world in solar photovoltaic production. Six of the biggest renewable energy companies in the world are based in China. Last year, 1 million people sat the Chinese civil service exam. The most popular post got 5,000 applicants. It was ‘Energy Conservation and Technology Equipment Officer’. China will build 24 nuclear power stations in the time it takes us to build one. By 2020, their nuclear capacity will have increased tenfold. They will complete 16,000km of high-speed rail in the time it takes us to go from London to Birmingham. They have the most installed hydro capacity and the most solar water heaters. <br> And they are forging ahead on wind power, offshore and on. So China knows what’s coming. And despite what the mid-terms suggest, so does the US. Last year, in the face of serious lobbying – and lots of money from special interests – the Californian public voted to overwhelmingly support the State’s ambitious climate change laws. The eighth-largest economy in the world is still committed to going green. And the Northeastern States are leading the way on renewables, on emissions and on energy efficiency. They’re investing in renewable heat, trading carbon, and legislating for clean energy. The US Navy will get half of its energy from non-fossil fuel sources by the end of this decade. Half of its bases will be energy neutral. They’ve already launched their first hybrid drive warship. President Obama used his State of the Union speech to call for a reinvention of energy policy. He challenged the best minds in America to come up with clean energy ‘Apollo projects’. And he set a new goal: for 80% of America’s electricity to come from clean sources by 2035. Conventional wisdom has it that China and the US are not signed up to the climate change agenda. But if you look at what they do, not what they say, a rather different picture emerges. That is because policymakers understand – like we do – that climate change is real, is happening, and is worth defending ourselves against. An ounce of prevention is worth a pound of cure. The best thing we can do to help adapt to climate change is to stop it happening in the first place. That means yes – we must keep pushing for a global deal on climate change. But we must also do everything we can at home: moving further and faster to a low-carbon economy. What does that mean? First, we must stop wasting energy. A quarter of the UK’s carbon emissions come from the home. Our housing stock – the oldest in Europe – is costing us the earth. So we have set up the Green Deal, a national refit to bring our homes into the twenty-first century. Businesses will pay the upfront costs of energy efficiency improvements, getting their money back from savings on energy bills. Have no doubt: this can make a real difference. After transport, heating is the second biggest driver of energy demand in Britain. British Gas research suggests that householders who put in energy efficiency measures cut their gas consumption by 44%. Better insulated buildings will do much of the work for us. But we must also look at renewable heat technology. More combined heat and power schemes, putting waste heat to better use. More district heating schemes.<br><br> And more electric air and ground-source heat pumps, drawing warmth from the outside world to heat the indoors. Better insulation, smarter homes, and more efficient heating can help us cut our energy demand. So can the next generation of vehicles. Every month, new electric cars are coming to market. The shift from the petrol pump to the electric plug is revolutionary. And it is already underway.   So the second point about the low carbon economy is that it will be overwhelmingly electric. <br> The next decades will see a massive increase in our demand. Electricity use could double by 2050, as we turn to the grid to charge our cars and heat our homes. That demand must be met with secure, affordable low-carbon supply. But our current energy system is not up to the job. We will lose a fifth of our generating capacity over the next 10 years, as our ageing power plants shut down. We cannot afford to replace them with more of the same. But with long lead-in times and high capital costs, we must act now. Otherwise, we face an energy crunch. <br><br> Our plan for affordable low-carbon electricity rests on three pillars. The first is renewable energy. Like onshore and offshore wind; Wave, tidal stream, and micro-hydro power; solar, biomass, and energy from waste like anaerobic digestion. The second is new nuclear – without public subsidy. Half of my Department’s annual budget is spent cleaning up after past generations of nuclear and coal. Next year, it will reach two-thirds. Never again. That is why we have passed the cost of nuclear liabilities on to developers, who will pay the full cost of waste disposal and decommissioning. <br><br> And the third element is clean coal and gas, delivered by carbon capture and storage. Giving us flexible and reliable backup without the carbon consequences. No-one knows what the most successful low carbon technology will be in thirty years time. The only way to ensure a secure, affordable low-carbon energy supply – to keep the lights on and the skies clean at the lowest possible cost – is to build an energy portfolio. It is exactly the same principle as a pension fund. When we’re planning for the future, we don’t put all our eggs in one basket. <br> It would be irresponsible for us to try and play god with the country’s energy future. So we must create a policy framework that lets us discover and then use the lowest cost options. That means thinking about a range of scenarios. At one end may be a world where fossil fuel prices are exceptionally high. We will rely overwhelmingly on renewables and nuclear. With pumped storage to meet peaks in demand. At the other end, some argue that plentiful gas from unconventional sources will cause gas prices to tumble. Then we would rely much more on clean gas, with carbon capture and storage.<br><br> Our policy is about keeping our options open between technologies, but ensuring that we are on the road to the low carbon economy. We have set a direction. We don’t yet know which particular technology will get us there. But we know that the fundamentals of the low carbon economy are not going to be expensive. Nick Stern estimated overall costs at no more than 2 per cent of GDP by 2050. If our economy doubles in forty years, that means a 98 per cent increase instead of a 100 per cent increase. Even that simple calculation depends on other factors. <br><br> If we relied on oil and gas, and the price stayed relatively low at $80 a barrel then consumers will pay more under our policies – about an extra 1 per cent on their bills by 2020. At the oil price reached this month - $100 a barrel or more – consumers will pay less through low carbon policies than they would pay for fossil fuel policies. And if the US administration is right, and the price is $108 a barrel in 2020, then our consumers are winning hands down. Energy security is about price as well as supply. Without both, we have neither. <br><br> So there’s another economic advantage, one that makes a powerful case for the low-carbon revolution: insulation from oil and gas price shocks. Thanks to a decade of missed opportunities on renewables, our energy import dependence could double by 2020. I asked economists at DECC to look at how a 1970s style oil price shock would play out today. They found that if the oil price doubled, it could lead to a cumulative loss of GDP of around £45 billion over 2 years. And this is not just far-off speculation: it is a threat here and now. The Office of Budget Responsibility forecast that if oil prices rose by 20% - as they have since October – the total cost to the economy would be four and half billion pounds. Oil and gas will play an important role in the low-carbon shift. But in the long term, getting off the oil hook will make our economy more independent, more secure and more stable. Britain can lead the way. Our scientific, research and engineering strengths will stand us in good stead. Look at our record on CCS, where British scientists top the tables when it comes to academic citations. We can turn that laboratory lead into an economic success story. <br><br> But we must be more ambitious. Pushing hard for a higher EU emissions target – a 30% reduction by 2020 – to drive innovation in Europe. Showing business that the EU is serious about a low carbon transition. Securing investment in green technology and infrastructure, so we can compete with fast emerging economies who are investing billions today.  Sending a clearer signal through the carbon price. And working towards that binding global deal at the UNFCCC. This is an exciting journey.<br><br> By moving to a low-carbon economy, we can build a shelter against energy price and security storms. And we can tackle the defining threat of our age: climate change. We are already making progress. Carbon emissions are down. The international negotiations are back on track. The low carbon transition has begun. It is up to us to see it through. Thank you very much. <br>     None http://www.decc.gov.uk/en/content/cms/news/RGS_speech/RGS_speech.aspx Rt Hon Chris Huhne Chris Huhne speech to the Royal Geographical Society - "The Perfect Storm" 18 February 2011 Department for Energy and Climate Change
It is a pleasure to be invited here today to open the Energy Centre at Bridgwater college. The transition to a low carbon economy presents a tremendous opportunity. There is great potential for low carbon growth in the south west not least in the nuclear industry. Energy companies have plans to install up to 16GW of new nuclear capacity in the UK by 2025. And with this the possibility of 30,000 new jobs. However we are very aware that 70% of the current UK nuclear workforce is set to retire by 2025 and realise the challenges and skills gaps that this will bring to an industry set to grow. Government is committed to do what it can to ensure that the UK has the appropriate skilled workforce to deliver nuclear new build, as well as that needed for operation and decommissioning. We must ensure that lack of skills does not provide any barrier or discouragement to investment but we also want to ensure that UK workers are well placed to take a full role in the nuclear resurgence. The nuclear industry already employs over 6,000 people in the south west – the second largest in the UK. The planned new nuclear build activity in this region means that we’ll need to see an influx of people into the sector – from apprentices to technicians to graduates with the appropriate skills and competences. The work here at the Energy Centre will be crucial in delivering this. It great to see the South West flagship delivery centre of the National Skills Academy for Nuclear coming to fruition with the strong support of leading players in the industry. The future of skills development is in the strong relationships between Industry, academia and Skills Bodies. We are already seeing progress here and I look forward to watching this grow further. If current industry plans come to fruition - and I must stress here that these must go through the necessary planning and regulatory processes - nuclear power in the South West alone will require the same amount of manpower as the London Olympics. But there will be a greater emphasis on higher skilled jobs and the need to understand the technology. Of course we want the local population to train to access these high skilled jobs and to truly benefit from the nuclear resurgence in this region. Development for nuclear power in this area must go through the necessary planning and regulatory processes I am under no illusions about the challenges we will face but I am heartened by the work that is being done here. We must ensure that the sector is attractive to young people – male and female – so that a career in the nuclear industry becomes an aspiration for those in school, college and at university. This new centre is a great place to inspire the young and deliver the skills necessary for a career in the industry on their doorstep. None http://www.decc.gov.uk/en/content/cms/news/bridgwater_sp/bridgwater_sp.aspx Rt Hon Chris Huhne Chris Huhne speech at the opening of the Bridgwater College Energy Centre 24 January 2011 Department for Energy and Climate Change
Mr Speaker, today we begin consulting on the reform of the electricity market. This programme sits at the heart of my Department’s mission: to deliver secure, affordable and low-carbon energy. The case for reform is clear. We need significant investment in our energy infrastructure. As old coal and nuclear plants shut down – and demand for electricity grows – we must build the next generation of power stations. The electricity they deliver must be both affordable and sustainable, helping us to meet our emissions reduction targets – and keep the lights on. The current energy market has served us well. But it cannot deliver long-term investment on the scale we need, nor can it give consumers the best deal. Left untouched, it could lock carbon emissions into the system for decades to come.<br> Investors and boardrooms around the world want to know whether the UK is a good place to do energy business. Today, we are setting out our plans to make it one of the best places to do energy business. The challenges – and the opportunities – are huge. Put simply, we face growing demand. Shrinking supply. And ambitious emissions reductions targets. <br> Demand for electricity could double by 2050 as we decarbonise the economy. <br> 30% of our electricity must come from renewables by 2020, up from 7% today, to meet our contribution to the EU renewable energy target. In the next ten years, a quarter of our existing power plants will need to be replaced, as nuclear and coal plants reach the end of their lives. <br> Without action, we will face a real and growing threat to the security of our supply. The reserve margin of spare generating capacity will fall over the next decade, and the risk of interruptions to our energy supplies will rise. So we must build the next generation of power stations, and act to ensure there will be enough reserve capacity to meet our needs. Together with renewables, we will need new gas-fired power stations and new nuclear plant. We must attract more than £100 billion of investment in new power stations and grid connections by 2020; double the investment rate of the last decade. And we must rebalance our market framework to attract investment in the right technologies. At the moment, there is a bias toward low-cost, low-risk fossil fuel generation. Renewables, nuclear and carbon capture and storage all have relatively high upfront capital costs. But a more diverse, lower carbon energy mix is better for our energy security, better for our economy, and better for our planet.<br> Some measures have already delivered investment in new low carbon generation - the Renewables Obligation, and the EU Emissions Trading System. But we must go further, and faster. To secure reliable, affordable low-carbon electricity, we must change the market structure. We must create the right framework to ramp up power generation and secure our supply. And we must deliver cleaner, greener electricity for the 2020s and beyond. Today, we are proposing new incentives to drive investment, while protecting the rules for investments already made. The focus will shift permanently from conventional fossil fuel-fired electricity to low carbon technologies – renewables, nuclear and cleaner fossil fuels.<br> Our preferred package of reforms is designed to strike a balance between the best possible deal for consumers, and giving existing players and new entrants in the energy sector the certainty they need to raise investment. Reform will be gradual. We want to reassure industry that the rules for existing investments will be protected. By consulting on a process and principles for the transition to new market arrangements we aim to minimise uncertainty. The competitive market will remain at the centre of our energy policy. But the four elements of the reform package announced today will change incentives in the market and ensure both the security and decarbonisation of our power supply system, whilst minimising costs to consumers. Firstly, greater long term certainty around the additional cost of running polluting plant, to make lower-carbon investment more attractive. Proposals set out in the HM Treasury consultation to support the carbon price directly tackle the core problem – putting a better price on emissions, increasing the cost of fossil fuel based generation, and strengthening the carbon price for UK electricity generators. Second, greater revenue certainty for low carbon generation will make clean energy investment more attractive still. Through the proposed contract for difference feed in tariff, the Government will guarantee greater revenue certainty for low carbon in the form of a top up payment if the wholesale price is below the feed in tariff, and a potential claw back for consumers if wholesale prices are above the contracted tariff. Third, additional payments to encourage the construction of reserve plants or demand reduction measures to ensure the lights stay on. Capacity payments will create an adequate safety cushion of capacity as the amount of intermittent and inflexible low carbon generation increases. And fourth, a back-stop to limit how much carbon any new coal-fired power stations emit. An emissions performance standard will reinforce the existing requirement that no new coal is built without carbon capture and storage. Together, these four reforms make good on our commitments in the coalition’s programme for government. They will make the UK a prime location for low carbon energy investment. They will ensure our energy supply is cleaner and more secure. They will protect the consumer; while prices will rise in the medium term, the additional impact of the reform packages will be small, but by 2030, consumer bills will be lower than if we did not reform the market. And they will lay the foundations for the sustainable economy of the future, bringing jobs up and down the supply chain. The consultation that opens today invites everyone to tell us whether they think the preferred package of reforms is the right one, and to provide the evidence to support their views. Final recommendations will be published in a White Paper in late Spring 2011, and the reforms introduced before the end of this Parliament. We are also reviewing the role of Ofgem and the energy regulatory framework, and today we are publishing the Government’s response to the call for evidence on the terms of the review. <br> We have a once-in-a-generation chance to rebuild our electricity market, rebuild investor confidence, and rebuild our power stations. Like privatisation before it, this will be a seismic shift; securing investment in cleaner, greener power. And delivering secure, affordable and low-carbon energy for decades to come. -END- None http://www.decc.gov.uk/en/content/cms/news/emr_os/emr_os.aspx Rt Hon Chris Huhne Electricity Market Reform (Oral Statement to Parliament by Rt Hon Chris Huhne) 16 December 2010 Department for Energy and Climate Change
<strong>16 December 2010</strong> Britain’s electricity market faces three challenges. First, our demand for electricity could double by 2050 as we shift from fossil fuels to electricity for our vehicles and our residual home heating. Secondly, around a quarter of our generating capacity is ageing plant that will shut down within ten years, and has to be replaced. Thirdly, that replacement cycle – entailing some £110 billion of investment, or more than double the normal amount in the next decade – must be in low-carbon and secure sources like renewables, nuclear, clean coal and gas if we are to meet our climate change targets. Left alone, the current market will not deliver these objectives at the lowest cost. All low carbon electricity generation needs support to capture its benefits to our climate and to ensure security of supply. As Lord Nicholas Stern has pointed out, climate change is “the greatest market failure the world has ever seen”. The true costs of unabated fossil fuels – and the benefits of low carbon electricity – have to be captured in policy. There is also an inherent bias in investment towards gas because its up-front capital costs are low, and its variable gas costs move naturally in line with electricity prices. This provides companies with a more assured earnings stream than other sources. Yet private incentives do not capture public objectives. A new dash for gas would potentially leave us exposed to global fossil fuel price shocks and increasingly dependent on imports. Gas will still play a significant role in our energy future, particularly if unconventional sources continue to grow in importance, and we successfully prove commercial-scale carbon capture and storage. But nuclear and most renewables – particularly wind and tidal stream – are low-carbon sources of power that share the characteristic of high upfront costs and low running costs: the mix that investors most dislike when faced with uncertainty. So today the Coalition begins a consultation on a reform that would reshape this market more fundamentally than at any time since the eighties, when the Lawson reforms were the pioneer of Europe’s deregulation. Since then, we have acquired an overlay of instruments – notably the renewables obligation – that has provided a piecemeal response to the need for more secure, low-carbon electricity. By forging a comprehensive response, we can unlock investment in a broader range of low carbon electricity generation. By providing greater certainty, we can encourage new market entrants and financial investors, reduce the cost of capital, and provide low-carbon electricity at lower cost than under present policies. Our mix of four inter-locking policy instruments should provide greater assurance of decarbonisation at the same time as lower bills in the long run. First, we propose a feed in tariff with long term contracts to give low-carbon investors a guaranteed price. Our proposals will ensure an active and liquid wholesale market and provide new investors with enough certainty to enter the market. The investor prepared to build plant at the lowest cost could win the contract, ensuring the consumer and the taxpayer pay the lowest possible price for low carbon electricity. Guaranteed prices for all low carbon technologies are crucial, but there will need to be extra support for young technologies like offshore wind, wave and tidal stream whose development stands a good chance of further big cost reductions. We need a range of technologies for the same reasons that we invest our pension funds in a range of shares: the portfolio principle remains the best answer to uncertainty. However, there is no justification for paying extra support to nuclear, which is a mature technology. Hence our commitment that there should be no specific subsidy to nuclear. The second mechanism is a capacity payment designed to ensure we have necessary back up plant. This is both to handle surges in demand – the Coronation Street ad break when the nation’s kettles go on – and intermittent supply – the cold, still days in February when the wind does not blow. Those capacity payments would also pay to import electricity from European countries whose peaks differ from ours, thus saving on the need for new plant. Companies could also contract to provide reductions in demand at peak times (for example by temporary switching off of appliances like fridges and freezers or the suspension of industrial processes). Payments would also support storage schemes like Dinorwig, which uses off-peak energy to pump water uphill that can then be released during peaks to drive turbines. The third mechanism – on which the Treasury is consulting today – is carbon price support. By taxing fossil fuels, this would send out clear market signals about the need for low carbon investment, and would also tilt incentives when using back-up plant towards clean gas rather than dirty coal. The fourth mechanism – an emissions performance standard – is designed to fulfil the Coalition commitment that we will not countenance new unabated coal-fired electricity generation. It also sends out a powerful message, as it has done in California, about our long-term intent. Taken together, these reforms can unlock private investment on an unprecedented scale, and ensure that we undergo the low-carbon electricity revolution at the lowest possible cost to consumers. It is time to get off the fossil fuel hook and onto clean, green electricity. Chris Huhne is the Energy and climate change secretary. None http://www.decc.gov.uk/en/content/cms/news/tele_161210/tele_161210.aspx Rt Hon Chris Huhne Chris Huhne, Daily Telegraph article: The biggest electricity reform in twenty five years 16 December 2010 Department for Energy and Climate Change
Mr Speaker, I wish to make a statement on the outcome of the United Nations climate conference in Cancun. The House will remember the disappointment of last year’s conference in Copenhagen, and in particular its failure to agree a comprehensive and legally binding global treaty to supplement or replace the Kyoto Protocol. Expectations for the Cancun conference were not high. After Copenhagen, it seemed as if the very principle of multilateralism itself was on trial. Our objectives, therefore, were modest. We aimed to demonstrate that the UN process was back on track. We also hoped to put in place some of the building blocks for an eventual global agreement. To rebuild momentum. I am delighted to say that our expectations were not just met, but exceeded. The conference agreed a series of linked decisions under both its tracks: the Kyoto Protocol, and the framework for reaching a new and more comprehensive agreement. Emissions reduction pledges made under the Copenhagen Accord, by both developed and developing countries, provided a valuable starting point and have been brought into the UN climate convention framework. We can now assess the overall policy pledges against the requirements of the science. These decisions provide a solid foundation for further work. For the first time, there is an international commitment to ‘deep cuts in global greenhouse gas emissions’ to hold the increase in global average temperature below 2 degrees Celsius. This includes processes for adopting targets for peaking emissions as soon as possible, and substantially reducing them by 2050. The conference also adopted decisions to develop systems for measuring, reporting and verifying emission reductions and actions in line with countries’ commitments. This is essential to confidence in each other’s actions. Developing countries will get access to low-carbon technology and help with adaptation to climate change. Market-based mechanisms will be considered to deliver effective reductions in emissions at least cost. Forestry was a key area. The conference agreed the framework for ‘REDD plus’: reducing emissions from deforestation and forest degradation, through which developing countries will be paid for keeping trees standing rather than logging them. The conference also made progress on rules for accounting for land use, land use change and forestry under the Kyoto Protocol; an issue that was too difficult to be settled at Kyoto and has remained problematic ever since. The conference also agreed the establishment of a Green Climate Fund to support policies and activities in developing countries. The Fund will be governed by a board with equal representation from developed and developing countries, and its finances will be managed by the World Bank. A transitional committee will be established to design the institutions and operations of the Fund, and we aim to see that make rapid progress. The conference endorsed the commitment made by developed countries at Copenhagen to mobilise at least $100 billion per year by 2020 to address the needs of developing countries.<br> The conference did not settle the future of the Kyoto Protocol, and nor did it adopt a new and more comprehensive treaty incorporating all countries. Neither outcome was realistically possible this year. Nevertheless, the agreements reached at Cancun represent a very significant step forward, particularly given that it seemed possible, even as late as last Thursday, that the conference would break up over precisely that issue. In the end, every country represented there, with the exception only of Bolivia, felt able to support the outcomes. There remains much to do in the run-up to the 2011 climate conference in Durban. Given the outcome of Cancun, however, we can be far more confident than seemed possible just a few weeks ago. I am sure that the House will join me in congratulating the government of Mexico, which was responsible for hosting and chairing the conference. The diplomatic skill, political courage and dogged determination of Foreign Minister Espinosa and her team was responsible in very large part for its success. I was happy to be able to support her in co-chairing some of the negotiating groups which addressed the key issues. I also wish to pay tribute to the British team of negotiators. Even though our delegation was one of the smallest of those of the G8 countries, its members played a key role in many of the detailed negotiating groups, often leading for the EU. The climate diplomacy carried out by the Foreign and Commonwealth Office in the year leading up to the conference clearly helped to lay the groundwork for a successful conclusion. Tackling climate change should transcend party politics. Britain has built a strong reputation internationally as a forward-looking country and I want to thank my predecessor for his work in helping to achieve this. I was also pleased to be able to include in the UK delegation representatives of the Scottish and Welsh Assembly Governments. In conclusion, Mr Speaker, the coalition government is determined to tackle the accelerating threat of climate change. We intend to demonstrate how a successful and prosperous low-carbon economy can be developed in the UK and EU, providing employment, exports and energy security – and reducing emissions. The Energy Bill published last week, and the consultation paper on electricity market reform later this week are key components. So too is the adoption of a more ambitious target for reducing EU carbon emissions, and in that context I welcome the Spanish government’s recent declaration of support for a 30 per cent reduction by 2020. We are pressing for an ambitious package of measures to be agreed by EU leaders in February next year, to create the infrastructure and incentives for a faster move to a low carbon economy within Europe. On the international front, we will build on this momentum at Cancun. There is much still to be achieved, but we can now look forward with renewed optimism to the Durban conference next year. As the representative of one NGO said, ‘Cancun may have saved the process but it did not yet save the climate’. That is true – but in saving the process, it represents a triumph for the spirit of international cooperation in tackling an international threat. I am sure the whole House will join me in welcoming that. - END - None http://www.decc.gov.uk/en/content/cms/news/os_cancun/os_cancun.aspx Rt Hon Chris Huhne Outcomes of Cancun Climate Conference (Oral Statement to Parliament) 13 December 2010 Department for Energy and Climate Change
<strong>Wednesday 8 December<br></strong> <strong>Check against delivery<br> Expected 19.30UK time</strong> Thank you, madam President. This meeting matters. The pattern of extreme weather events is alarming. In Britain, our insurers paid out £4.5 billion in flood damage in the last ten years compared with £1.5 billion in the previous ten years. This is a warning of worse to come. I want high ambition. I want a legally binding global deal to keep global temperature increase at 2 degrees or less. We must be guided by the science, and the science has become more worrying, not less. As the UNEP report on the emissions gap makes clear, together we are not yet even promising enough, let alone doing it. But we can do it. There is a willingness to make progress here. But with just two days to go, we’re reaching a crunch point. Let me be clear: a car crash of a summit is in no one’s interest. The answer has to be compromise. We cannot do everything here. But we can make progress on mitigation, deforestation, adaptation, finance, reporting and more. And restore momentum to the global process. Concrete steps to the treaty we want. We believe that the future of the Kyoto Protocol is vital to the success of this process. But Kyoto alone is not enough to protect us from a temperature rise of more than 2 degrees. Along with the EU, we want a second commitment period as part of a wider outcome engaging all major economies, and as long as concerns around environmental integrity are met. In the UK, we are working hard to meet ambitious emissions reduction and renewable energy targets. A new energy-saving programme. Electricity market reform for green energy. The world’s largest clean coal plant. A Green Investment Bank. And more ambition with our EU partners for bigger emission cuts. We have committed £2.9 billion of climate finance over the next four years to help developing countries tackle climate change. We have fulfilled our Fast Start pledge and are fully committed to the long term goal of $100 billion a year in climate finance by 2020. Agreement here on the key issues would send a message from Cancun. A global deal on climate change is not an impossible dream. Let’s do it. END None http://www.decc.gov.uk/en/content/cms/news/091210_huhnesp/091210_huhnesp.aspx Rt Hon Chris Huhne Speech by Chris Huhne, UK Energy and Climate Change Secretary, COP 16 Plenary Statement, Cancun 08 December 2010 Department for Energy and Climate Change
Speaking on the first day of the UN Climate Change talks in Cancun, UK Climate Change and Energy Secretary Chris Huhne said: “We’ve got this next fortnight to get the global climate talks back on track. “We won’t get a full binding deal in Cancun, but people and businesses around the world will be watching and expecting to see us prepare the ground. “This means making progress on issues such as financial assistance to help developing countries deal with climate change, tackling deforestation, bringing the promises made in the Copenhagen Accord into the formal UN process, and agreeing a system to make sure countries live up to their commitments to take action on emissions. “The Mexican hosts have done their homework, they’ve gone to enormous lengths to build trust and confidence among the countries, and there’s every reason this morning for all negotiators to roll up their sleeves and get talking.”<br>   None http://www.decc.gov.uk/en/content/cms/news/chcancun/chcancun.aspx Rt Hon Chris Huhne Chris Huhne speaks on the first day of the UN Climate Change talks in Cancun 29 November 2010 Department for Energy and Climate Change
Check against delivery Thank you very much. It’s my pleasure to be here today. Climate change is the challenge of our age. It is not just about saving the planet, but saving the people on it. We need a more sustainable energy mix, one that can meet our future needs and match our emissions reduction ambitions. <br> We are overly-reliant on imported fossil fuels, exposing us to the volatility of global energy markets. As resources become ever scarcer and demand grows in emerging economies, we cannot risk deepening our dependence. We have the oldest housing stock in Europe, and our draughty homes leak heat, causing a quarter of our carbon emissions. We also face major challenges in power generation. Over the next decade, around 20 Gigawatts of capacity will close, as old power stations shut down. We need £200 billion to replace our ageing infrastructure – double the rate of investment during the normal replacement cycle. <br> Every step we take to get ourselves off the fossil fuel hook and on to clean, green growth brings us closer to achieving our emissions reductions targets. Last week, I spoke at the CBI’s annual summit on climate change. Despite its title, you will not be surprised to hear that much of the discussion focused on energy investment – and on the opportunities for green business. After all, climate change and energy policy are inextricably linked. And thankfully, there is a positive feedback loop between the two. Without cleaner energy, we cannot save our environment. Action on climate change can boost incentives for greener power. And the most hardened climate change sceptic recognises the need for greater energy security. There is something else that helps us make the case. In every public policy discussion at the moment, at every level, the deficit looms large. Public relations professionals, lobbyists, politicians and columnists alike have seized on recession and recovery as the problem to which they offer solutions. Everyone believes their pet project will make an essential contribution to the recovery. But in energy security and climate change, we have the numbers on our side. The value of the global low-carbon goods and environmental services market is expected to reach £4 trillion by the end of this Parliament. It is growing at 4% per year, faster than world GDP. Our share of that market is £112 billion. In the UK, nearly a million people will be employed in the low-carbon sector by the end of the decade. In budgetary hard times, growth like this is hard to come by. And it is even harder to ignore. That is what helped us, during the Spending Review, to secure a favourable settlement for DECC. With £200 million for low-carbon technologies, including offshore wind and manufacturing infrastructure. £860 million for the Renewable Heat Incentive, a world-first scheme to drag renewable heat technology from the margins to the mainstream. And up to £1 billion for the commercial-scale carbon capture and storage demonstration project. We achieved this settlement because we could present a clear and economically sound answer to the question of where the growth will come from. Our answer was that the third industrial revolution – the green revolution – represents a real and tangible prospect for growth. With jobs, investment and exports up for grabs. <br> After every deep recession – such as in the Thirties – recovery is secured by new jobs in new industries, not by the old industries alone bouncing back. Green growth also goes some way towards answering a deeper, more fundamental question: about the kind of economic path we wish to pursue. Yes, the financial services sector makes a huge contribution to our national prosperity. But the lesson of the banking crisis is clear: we cannot afford to risk the house on a throw of the dice. I believe we must rebuild the economy on more sustainable terms, playing to our strengths; not just in the City of London, but in engineering. Highly-skilled manufacturing. Scientific research and technology. The kind of businesses that are represented here today. Together, the science of climate change, the realpolitik of energy security and the prospects for economic recovery make a powerful case for the green revolution. And that is why, across most of the energy and climate change portfolio, there has been such strong cross-party consensus in favour of action. That consensus extends to the Opposition benches. By its end, the previous Government had good intentions and the right ambition. But it failed to grasp the nettle of delivery. That is where we will be different. <br> The Coalition will deliver on its promise to be 'the greenest government ever'. Our policy is based on four pillars: energy saving. More renewables. New nuclear. And clean coal and gas. Our first priority is the Green Deal, the radical programme to bring our existing houses up to 21st century efficiency standards. Across the country, homeowners will be able to get energy efficiency improvements without having to front up the cash. Businesses will pay, receiving their money back from the energy savings on household bills. The golden rule is that savings will always exceed costs. The Green Deal will be extended to businesses, too. And we predict it could create 100,000 jobs within five years, spread across the United Kingdom. Our second priority is the Electricity Market Reform programme, a wholesale redesign of our electricity market. It is clear that the current framework does not provide the certainty that investors need; and that it cannot deliver the low-carbon revolution that we need. The liberalised energy market provided us with cheap and secure energy since the 1990s. But new challenges demand fundamental reform. We must increase drastically the amount of renewables in our energy mix to make our contribution to Europe’s target on renewable energy. We are 25th out of 27 EU members states on renewables. We are certainly playing in Europe’s amateur league when we ought to be in the Premiership. The power sector needs to lead the way when it comes to cutting carbon out of our economy. For us to meet our ambitious climate change goals, it must be close to zero carbon by 2030. And our 2050 Pathways suggests that demand for electricity may double by 2050, as we plug in to the grid to power our cars and heat our homes. Some measures have already been introduced that will help direct investment towards the low carbon energy sources of the future – like the Renewables Obligation, and the EU Emissions Trading Scheme. But these have been incremental, not transformational. And the bias towards cheap fossil fuel generation remains. The existing market framework will not deliver the scale of investment in renewables, nuclear and carbon capture and storage, all of which have significant upfront capital costs. Left as it is, the electricity market would allow a new dash for gas, exposing us to further import dependence and volatile prices – and locking carbon emissions into the system for decades.<br> Our reform will examine the levers we could use to secure investment at scale in cleaner, greener electricity generation. It is a fundamental change in the UK electricity market, the biggest since privatisation. It will bring our stagnant energy market to life, driving investment in the energy of the future. Failure to get a more sustainable energy system up and running also exposes us to fickle international energy markets. Security of supply is important. But equally critical is security of price. We have come to the end of the age of cheap energy. And for businesses grappling with tight margins and for vulnerable people at risk of deepening fuel poverty, volatile energy markets could cause significant problems. Now more than ever, we need to get to grips with the international dimension. So our final priority is to exert our influence on the global stage, to secure more ambitious European action on climate change – and to push for a binding deal. After the disarray of the Copenhagen summit, we desperately need to get international negotiations back on track. <br> Through the UNFCCC, we can show the developing and developed world that we are committed to a fair and firm agreement deal to halt catastrophic climate change. These are complicated problems. Our ability to solve them depends on concerted action, from the household that decides to invest in better insulation to the UNFCCC working group that develops the international framework on deforestation. The best way for us to respond is to get on the front foot. Showing through our actions that the low-carbon transition is affordable, achievable, and beneficial. After all, the transition to a low-carbon future brings significant opportunities - for growth, for jobs and for sustainability. It is up to us to take advantage of them. Thank you very much. -END- <br>   None http://www.decc.gov.uk/en/content/cms/news/cleantech/cleantech.aspx Rt Hon Chris Huhne Speech by Chris Huhne to Guardian's Cleantech Energy Summit 23 November 2010 Department for Energy and Climate Change
<strong>CBI Conference - Tackling climate change in the new economy, 17 November 2010</strong> Thanks very much, Roger It’s my pleasure to be here today, and to be part of this distinguished lineup. Richard Lambert and I spent some time together in China last week, and he is a powerful advocate for British business at home and abroad. His foresighted decision to set up the CBI Climate Change Board helped put British business at the centre of the climate change debate. And you have helped us internationally to show that a pro-climate policy can be a pro-business policy too. I am sure that John Cridland will continue this valuable work. As we look towards business to drive us from recovery to prosperity, the CBI will be lucky to have such an experienced and enthusiastic hand at the tiller. And I am also glad to see the title of today’s event: ‘tackling climate change in the new economy’. As a former businessman and an economist, I have been quite firm in my belief: that we must build a new kind of economy. It must be cleaner, greener and more sustainable. It must secure the economic recovery, promote growth, and meet the challenge of climate change. And it must deliver jobs, investment and profits. To build this new economy, we will need to co-operate across sectors. We will need to create the right conditions to foster investment and opportunity. And we will need to make some difficult choices. You have heard the view from business. Today, I will show you what the Government is doing to tackle climate change and promote green growth. But first, let me set out the scale of the challenge. Climate change poses a unique threat to our security, and our prosperity. From mudslides in China to forest fires in Russia, extreme weather events are becoming more frequent. <br> Food security, water shortages, climate-driven migration, energy conflicts; the potential knock-on effects are on a global scale. The UK may be responsible for just 2% of the world’s carbon emissions, but the consequences of climate change will not respect our borders. We also face a shifting landscape of public opinion; where doubt and disbelief in science itself threatens to undermine collective will for action. 7 in 10 people think ‘it is too late to do anything about climate change’. 1 in 4 believe ‘it is not worth Britain trying to combat climate change because other countries will just cancel out what we do”. Faced with a problem of such seriousness, and a system of such complexity, fatalism can easily take hold. From carbon markets to emissions reductions targets, it can be difficult to pick a path when faced with uncertainty and risk. Exactly how fast carbon emissions are changing our climate – and exactly what that change will mean – may be unknown. But uncertainty is no excuse for inaction. And actually, the search for certainty is misguided. Rather than being caught up in absolutes, we should prefer to think in terms of probability – and risk. One of the clearest lessons from the financial crisis was the importance of risk; understanding it, and planning for it. Business pages around the world have devoted countless column inches to risk management. Around the world, companies devote time and capital to managing their risk portfolios. Increasingly, they include exposure to climate risk – a liability unknown just a few decades ago. I believe in the power of the market to uncover the world of truth; what the American economist Paul Samuelson called ‘revealed preference’. And whatever the state of the public debate about the science, the state of the markets speaks for itself. Investors are subjecting opportunities to ever greater environmental scrutiny. Sustainable investment, as Stephen Green made clear in a speech last summer, ‘has joined the mainstream’. Consider the insurance business. We have the third largest insurance industry in the world. It manages investments comprising a quarter of the UK’s net worth. Risk assessment is at the very core of their business. Last year, Stephen Hadrill of the Association of British Insurers said that ‘our assessment of climate change convinces us that the threat is real and is with us now’. The 2007 floods cost the industry £3 billion. According to the ABI, if global temperatures were to rise by 2 degrees, average annual insured losses from inland flooding would rise by 6%. And the losses from an extreme weather event would rise by 18%. That would mean higher premiums for businesses and homeowners. But it could also restrict the flow of capital. Insurers hold around 15% of stocks on the London Stock Exchange. The kind of flood that strikes once every 200-years, for example, would need over a billion pounds of additional capital to cover higher than expected losses. With extreme weather events becoming more frequent, not less, those odds shorten dramatically. And the global economy would also feel the heat. According to the Economics of Climate Adaption Working Group, current climate risks cost emerging economies between 1 and 12% of annual GDP. If we exceed the 2 degree limit, that could rise to 19%. The rise of specialist climate reinsurance by firms like Swiss Re is a sign of just how seriously businesses take climate change. It is also a valuable indicator of the vitality of the low-carbon sector, a global market expected to reach £4 trillion by 2015. Because after all, businesses tend not to commit capital to ideology. They are not investing billions in reinsurance and managing climate risk portfolios out of blind belief. Instead they have judged, as we have, that the probability is so great that inaction is simply not an option. Clearly, it is worth taking precautions. If science said there was a 90% chance of your house burning down, you would take out home insurance. And that is what climate change policy is – home insurance for the planet. The challenge is to make sure we take the right policy measures. To protect not just our society, but our prosperity. As we become more aware of the scale of the challenge and the size of the solution, so the unthinkable becomes a little more palatable. That is why over the summer we published our 2050 Pathways calculator. It gives people the chance to figure out what kind of technology mix they would choose to help us achieve a sustainable energy supply. But when it comes to interventions which affect businesses, previous Governments have failed to ask themselves a simple question: What does business want? Clarity. Certainty. Direction, not endless directives. Like many of you, I was shocked by the complex web of initiatives that made up DECC’s policy framework. Brick by brick, a crooked house of overlapping initiatives was built. With good intentions, but no overall strategy or sense of direction. The result? A Byzantine structure, onerous for business, unworkable for government – and inefficient where it counts. We want to make things easier. This is not just about smaller government or less red tape. Instead, it is about making government work smarter – for British business, and for the taxpayer. Our job is to create the right framework. One that can meet our challenging emissions reductions targets, but also allow innovation and growth to flourish. Not all the changes will be popular. But they are essential for a profitable and sustainable future. Take the CRC Energy Efficiency Scheme. The principle is sound: saving energy, reducing emissions and improving competitiveness through a clear and transparent nationwide programme. But the implementation fell short of the ideal. We share many of your concerns about the CRC. That is why we have made a commitment to simplify it. The decision not to proceed with revenue recycling was a difficult one, taken against a background of unprecedented pressure on the public finances. We had to focus on getting the best value for money – and sending a clearer price signal to participants. Given a blank slate, we would do things a little differently. But for now, you have my assurance that we will engage with all of our stakeholders to make the scheme work better – for you, and for us. Today, we have published a UK wide consultation on delaying the start of Phase II of CRC. This will mean that participants won’t need to register for Phase II until 2013. This will create a window for us to engage in a proper dialogue with participants about what we need to do to improve it. We can also reduce the administrative burden on businesses. Today, I can reveal that we are proposing to exempt over 12,000 information declarers from the scheme. We now have enough feedback from the first stage of the CRC to remove obligations on information declarers without compromising the scheme’s environmental aims. The Government believes the CRC can be a valuable tool for businesses to cut carbon, and boost efficiency.<br><br> We need to stop thinking about carbon as a bolt-on, and more as an integral part of a company’s profile. Investors require a comprehensive picture of a company’s health to make decisions. As with financial reporting, clear and consistent carbon reporting can boost investment, not hinder it. The need for clarity extends to the big picture, too. Yes, markets are uncertain; that uncertainty drives innovation and profits alike. But to secure energy investment on the scale we need to match our carbon reduction ambitions and keep the lights on, business need to know what kind of marketplace they operate in. The current market framework is not fit to deliver the investment we need. That is why, later this year, we will set out our plans to reform the electricity market. The challenges are huge. We must replace a quarter of our old power stations by 2020. Largely decarbonise the electricity sector in the 2030s. And prepare for a possible doubling in demand for electricity by 2050. Left untouched, the electricity market would allow a new dash for gas, increasing our dependence on a single fuel, and exposing us to volatile prices. It would lock carbon emissions into the system for decades to come. We have a once-in-a-generation chance to rebuild our fragmented market, rebuild investor confidence, and rebuild our power stations. Like privatisation before it, this will be a seismic shift; securing investment in cleaner, greener power. Cleaning up the supply of energy is a huge part of my Department’s work. But we are also determined to do something about energy demand. Energy saving is the cheapest way of closing the gap between demand and supply. Energy efficiency can also offer real opportunities for businesses to save money, increase competitiveness, cut carbon, and access new market opportunities. The Green Deal is our answer to the challenge of our ageing housing stock; a nationwide refit to bring our homes up to 21st century efficiency standards. We’re designing the Green Deal to work for business, too. Allowing businesses to pay for energy efficiency improvements through a charge on their energy bill, and with the level of expected energy saving being higher than the cost of repayment. Spreading the cost of repayment over time, and addressing capital barriers. The opportunities are breathtaking. Not just for the insulation industry, which could quadruple in size, but for supply chains across the country, from Penzance to Perth. Better energy efficiency for small and medium sized enterprises can help reduce our dependence on expensive imported energy. And after all, in a world of growing demand and finite resources, the pressures on fossil fuel supplies will only increase. It is only 160 years since kerosene was first distilled from petroleum. Yet already we are drilling 2 miles beneath the ocean’s surface in search of oil. It is a testament to the relentless pace of engineering, scientific, and economic progress. It also speaks to the power of scarcity. The age of oil will last but a few centuries. So my challenge to you is this: commit to the industries of the future. After all, the low-carbon sector is still in its infancy. Its rapid growth – 4% annually – is testament to that. Britain accounts for just £112 billion of the global trade in low-carbon and environmental goods and services. With our deep reservoirs of engineering and scientific expertise, we can do so much more. As we begin to shift towards a new kind of economy, the smart money will be on emerging technologies. So be forward-thinking in your investment decisions. Help us deliver carbon-capture and storage. Get behind the Green Deal. And last but not least, don’t forget to challenge us. Speak up for your members, and for your businesses. And we will continue to speak up on the international stage. In Europe, where we will continue to push for a more ambitious emissions reduction target. That will firm up the carbon price and send clear market signals about the low-carbon economy. And in the UNFCCC, where we will continue to make the case for a binding global agreement to halt runaway climate change. Although we do not expect such a deal to come in December, it will come. From trade to CFCs, the history of international agreements suggest that although the journey may be long, and the road may be arduous, the destination is worth it. So in Cancun, we can start to bring emissions offers made since Copenhagen into the UNFCCC process. We can develop the framework for cutting emissions from deforestation and forest degradation. We can make progress on a measurement, reporting and verification system to ensure emissions reductions are transparent. We can show leadership on climate finance, encouraging others to deliver on FastStart, and building on the Green Fund commitment made last year. Together, these achievements build on the headline political agreement made in Copenhagen. It is important that we get these pre-conditions right. Because as the CBI knows well, business did not stop when the Copenhagen summit did. By pushing sustainable growth from the margins to the boardroom, business can and will help create the political momentum we need to get international negotiations back on track. That could help turn what Nick Stern dubbed ‘the greatest market failure of all time’ into a market success story. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/101117_ch_sp/101117_ch_sp.aspx Rt Hon Chris Huhne Climate change and the CRC Energy Efficiency Scheme - Chris Huhne speech to the CBI Conference 17 November 2010 Department for Energy and Climate Change
<strong>07 November 2010</strong> <strong>Tianjin, China</strong> Check against delivery None http://www.decc.gov.uk/en/content/cms/news/huhne_globe/huhne_globe.aspx Rt Hon Chris Huhne Chris Huhne speech to GLOBE Forum, Tianjin 08 November 2010 Department for Energy and Climate Change
<strong>02 November 2010<br> As delivered</strong>   Thanks very much. Three years ago, the credit crunch hit home. Three years ago, the economy suffered its most profound shock since the 1930s. Three years ago, customers queued around the block in the first run on a British bank for a century and a half. From Iceland to Greece, the financial crisis changed the fortunes of countries, their people, and their governments. It framed political debate then as it does now. The UK was hit hard. Our overdependence on the financial sector left us critically exposed. Our banks were badly damaged. Our credit rating faltered. And our gross domestic product fell by 5% in a single year – the sharpest drop since 1921.   Coming after a decade of government overspending, the result was a budget deficit unmatched in peacetime. A fiscal stimulus package without precedent. And a ballooning credibility gap, as it became clear there was no real plan to lift us out of a deep recession. Tackling our chronic structural deficit – and rebuilding confidence in our economy – demanded difficult decisions. The coalition’s response was decisive. The Emergency Budget steered us away from a sovereign debt crisis. And the Spending Review set out a clear and credible path back to sound public finances and renewed national prosperity. The latest indications are good: GDP is growing faster than expected. Our national credit rating is back where it belongs: reconfirmed to AAA by Standard &amp; Poor’s just this week. Investors feel confident that the UK’s course is true. We have weathered the storm. But now we are in the open ocean, and a question still remains: Where is the growth going to come from?   It is no longer enough to decry the excesses of the last Government. Yes, the cupboard is bare. Yes, Liam Byrne left a note saying there cupboard was bare. Now it is up to us fill it. Over the past week, you have heard our plan to bring back growth. A tougher competition regime. Funding for scientific research. The national infrastructure programme. The local growth strategy. Together, they will help restore prosperity and promote growth. But there is something else. Something that can deliver a boost of macroeconomic significance. It is essential to the recovery. It is vital for our future competitiveness. And as the Prime Minister made clear last week, it is a critical part of the Government’s strategy for growth. To change our national economic story from one of financial speculation to one of future growth, we need a third industrial revolution: a green revolution. It will transform our economy as surely as the shift from iron to steel, from steam to oil. It will lead us toward a low-carbon future, with cleaner energy and greener growth. With an economy that is built to last – on more sustainable, more stable foundations. That’s an enticing prospect. But what does green growth mean? It means jobs. It means investment pouring into the UK, and exports pouring out. Technologies that can be licensed and spun off to lock-in profits. A more skilled workforce. Able to compete in the global marketplace, furthering our reputation for innovation, boosting British enterprise. And at home, a more sustainable economy. One less prone to the fits and starts of a fragile and volatile energy market, more resilient in the face of global uncertainty. These are the long-term rewards that await us if we have the courage to build our economy anew. We cannot risk falling behind. Other countries are not waiting for international agreements before engaging with the next global growth sector. Instead, they are nurturing new industries focused on the defining challenge of our age: the development of clean energy. Today, I will set out the case for green growth. The industries it will nurture. The investment it will  spark. The jobs it will create. And the security it will bring, as we gain greater energy independence and build a more sustainable economy.   Because we are at the brink of a new industrial era. From electric vehicles to energy management, the global low-carbon and environmental goods and services sector is valued at £3.2 trillion a year. It is forecast to reach £4 trillion before this Parliament dissolves, growing substantially faster than world GDP. Last year, our share of that market was worth £112 billion. 900,000 people are employed in the low-carbon sector and its supply chain; by 2015, there will be at least a million. That’s a workforce – and a budget – to rival the size of the National Health Service. As global efforts to cut carbon gather pace, the market will grow. Those countries which take the lead will be well positioned. Think of Germany’s expertise in wind turbine manufacturing, or China’s growing, leading share of solar photovoltaic production. We must secure a bigger slice of the pie. In offshore wind, in carbon capture and storage, Britain can establish itself as a market leader. Our job is to ensure British firms can take full advantage of the opportunities. Converting our technical successes into commercial chances. That means removing barriers to innovation and investment at home. Exporting the best of British overseas. And securing international buy-in for the low-carbon transition. The best way to achieve that consensus toward a low-carbon future is to lead from the front. On energy supply and energy demand, we can set an example which boosts growth at home and competitiveness abroad.   As with previous industrial revolutions, our primary energy source will define our economy.<br>  <br> Victorian fortunes were built on coal and steam. 20th century dynasties were founded on oil and gas. The next generation’s prosperity will come from clean energy. It must be affordable. It must be secure. And it must be low-carbon.  Many of the technologies that will power our future are still emerging. Wave and tidal stream are improving quickly. Solar photovoltaic is becoming ever more affordable. And in Britain, onshore wind is expected to be cost competitive with nuclear power. This rapid expansion in new technology coincides with an explosion in demand for new generation. Demand for electricity could double as we plug in to the national grid to power our cars and heat our homes. Yet the UK’s power plants are ageing fast. 20 Gigawatts of capacity will be lost by 2023 as old power stations close.   Ofgem estimates that we need £200 billion of investment by 2020 to upgrade our outdated energy assets. The replacement cycle means energy investment will ramp up significantly – between 0.5 and 1% of GDP a year. Have no doubt: this is a step change. And the opportunities are simply breathtaking. As the next generation of power plants come online, so new industries will spring up around them – from manufacturing to maintenance. Each new plant must be designed, built, operated and connected to the grid.  To take full advantage of the shift to low-carbon generation, we must allow these developing industries to flourish within our borders. Our policy is built on four pillars: energy saving, carbon capture and storage, renewables and – as the coalition agreement made clear – new nuclear plant as long as there is no public subsidy. When saving for your retirement, it would be irresponsible to put all your eggs in one basket. It would also be irresponsible to tie the nation’s energy security to just one technology. We cannot be certain of future costs. To keep the lights on and the public finances in the black, we need a solution delivered by the market. So we are determined to make it easier to invest across the energy portfolio. We want to remove the planning obstacles that have held up new nuclear. Investors looking at the next generation of nuclear power need clarity and certainty, and this Government will provide it. Later this year, we will consult on a new market framework for electricity; one that encourages low-carbon investment and gives consumers a fair deal. Our work on electricity market reform will look at how we can deliver a secure, affordable, low-carbon electricity mix. It is a fundamental change in the market structure that underpins our national supply. By the second half of the decade, annual investment in the UK energy system is expected to reach £25 billion. Key engineering companies are already planning for opportunities in power generation at a national scale. The world’s biggest offshore windfarm, at Thanet, is an impressive feat of engineering, with turbines the height of Nelson’s column. Yet most of the value went to companies outside the UK. This has to change.  The funds for ports infrastructure announced last week is a statement of our intent. We want to make sure turbine manufacturers can build what they need on our shores, instead of importing expensive finished products that could be made here. The sector could create 70,000 jobs, cementing our position as leaders of the offshore wind pack.  We also need to clean up our existing fossil fuel plants. The Spending Review underlined the Government’s commitment to carbon capture and storage; a project worth up to a billion pounds, to tackle our fossil fuel legacy and prepare us for a future of clean coal. This will build the first ever commercial scale CCS plant anywhere in the world, delivering on a technology that the IEA says will be essential for our future. Globally, it estimates 3,400 CCS plants will be needed by 2050 if we are to meet our critical target of 2 degrees below pre-industrial levels. And the demonstration project puts the UK at the forefront of this emerging market.    Greening the supply of energy in the UK will be critical. But action on new generation alone will not be enough. We must also do something about demand. A snapshot of the UK’s domestic power consumption reveals chronic inefficiency. It also shows energy efficiency is cheapest way of closing the gap between supply and demand. A quarter of UK carbon emissions come from housing. We use more energy heating our homes than Sweden. Our homes may be our castles. But they shouldn’t cost a king’s ransom to run. In houses across the country, boilers are firing up earlier than they need to. Burning more gas than they have to. Producing more emissions than they should do. And all because our outdated housing stock leaks heat and wastes carbon. Our response is the Green Deal, a radical programme to bring our houses out of the dark ages. Over the next two years we expect to insulate 3.5 million homes, with a renewed focus on those in fuel poverty - and those who need it most. Then, from 2012 onwards, when the Green Deal begins in earnest, energy saving packages worth thousands will be installed in millions of homes. Householders will pay nothing up front; businesses will do that for them. Businesses will get their money back from the savings on energy bills. And we will look at how we can apply the Green Deal model to businesses, too – enabling them to cut carbon, and cut costs. The potential benefits are vast. From assessment to installation, from manufacturing to supply, the Green Deal means opportunities for skilled and unskilled labour alike. Opportunities that will last for decades – and span the length and breadth of Britain. Nothing on this scale has ever been attempted before in any leading developed country. It is one of the single biggest interventions in British domestic history: a nationwide, once-in-generation refit to future-proof our homes. Over the last two years steady progress has been made, with two million loft and cavity wall insulations installed. But Labour did not have a vision of the comprehensive refit we need. It failed to improve the private rented sector, which benefited from less than 2 per cent of these installations. Privately rented homes have far too many leaky lofts and icy drafts. Over half a million have the lowest energy rating. The Green Deal will change this. We should no longer condemn those who rent privately to higher bills and discomfort. Landlords will face no upfront cost, and will benefit from an improved property – just like other homeowners. By 2015 every tenant should be able to be as warm in their own home as anyone else. This is a win, win, win situation – for the landlord, the tenant, and the climate. I hope and expect that landlords will respond positively to the Green Deal. But this Government will not put up with tenants needlessly living in chilly conditions. If a review into energy efficiency in the sector finds that landlords aren’t taking up this once-in-a-generation opportunity, we will respond. If necessary, we will look to take powers to ensure that from 2015, any tenant who asks for energy efficiency improvements cannot be refused. And we will give local authorities the power to insist that landlords improve the worst performing homes. We estimate that every household could benefit from energy improvements under the Green Deal, with implications for manufacturing and supply chains across the country. The number of people employed in insulation alone could soar from the present 27,000 to 100,000 by 2015, eventually rising to a peak of 250,000. This is no idle ambition. In September, British Gas announced its plan to ‘go early’ on the Green Deal, investing £30 million and creating 3,700 new jobs. Earlier today, I visited their Energy Academy, where they’ve just recruited their thousandth green-collar worker. From school leavers to highly-qualified engineers, this is real green growth. Within our borders. With a long timeframe. And with no regional bias, because our homes are everywhere. The Green Deal will also reduce our reliance on imported fossil fuels. The most inefficient households could save £550 a year on their fuel bills; if every household took up the Green Deal, spending on gas would fall by £2.5 billion per year. With more than a third of our gas currently imported and UK gas production on a downward trend, the net result is a saving on imports and a saving on a national level. That bigger picture is important. The link between the micro and the macro illustrates a curious truth: double-glazing your windows really can improve the UK’s energy security. And energy security matters. Not just security of supply, but security of price. For it is becoming increasingly clear that the age of cheap energy is over. Dwindling fossil fuel resources and soaring demand suggest we are headed towards an energy crunch. The Gulf of Mexico merely underlined the point: extracting fossil fuels is becoming more risky and more costly. Yet one of the clearest lessons of the financial crisis is that growth is nothing without stability. Greater energy independence – with more renewables, more CCS from domestic resources, and more nuclear power – is the best way to protect our consumers and our country from the uncertainty of the energy markets. Our policies are not free. There will be a significant price impact, and there will be costs to the consumer. But not only are they offset by energy efficiency savings; they are also an insurance policy against rising prices in future. Consider oil. At $80 a barrel, energy bills will only rise by 1% in 2020. Yet the IAE predict a $90 barrel by 2020. And the US administration forecasts $108 per barrel. If the US administration right, our consumers will be saving money as a result of our policies. You have to think of the alternatives, the counterfactual. Then take the macroeconomics. I asked DECC economists to look at the impact of a late 1970s-style oil price shock on our economy. They found that if the oil price doubled, it could lead to a cumulative loss of GDP of around £45 billion over 2 years. That’s the equivalent of the entire Ministry of Defence budget in 2008/09.  It’s bad for business, profits and jobs. Even a more moderate rise in oil and gas prices would leave us critically exposed. Thanks to a decade of missed opportunities on renewables, our energy import dependence could double by 2020. As demand grows and the global recovery picks up, it is increasingly clear that an economy dependent on fossil fuels is neither sustainable nor stable. The solution is to get ourselves off the oil hook – and on to clean green growth. We estimate the low-carbon transition will safeguard  growth by cutting UK demand for oil, and boosting our defences against oil price shocks. If we do not create the conditions for sustainable growth, we will be more exposed to rising energy costs. More dependent on finite fossil fuels. And more vulnerable to resource risk.   Instead, we have a chance to build a new kind of economy. A more balanced, more sustainable economy. Where climate stabilisation and financial recovery are not mutually exclusive but mutually beneficial. Delivering jobs, creating exports, and securing investment. Tackling the deficit without sacrificing the environment. Protecting us from the economic and environmental risks of runaway climate change.  And all while maintaining energy security in an increasingly volatile global market. That is the promise of the green revolution. And this is the government that will lead the way. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/LSE_CHspeech/LSE_CHspeech.aspx Rt Hon Chris Huhne Chris Huhne speech to LSE: "Green growth: the transition to a sustainable economy" 02 November 2010 Department for Energy and Climate Change
<em>Check against delivery<br> 11 October 2010</em>   Thanks very much. It’s my great pleasure to be here this evening at the first UK Passivhaus conference. And to meet people united by a passion for improving the energy efficiency of our buildings.  It is a passion that serves a very real purpose. A quarter of UK emissions come from the home. Another 15% comes from public and commercial buildings.  One in ten business and public buildings scores a G rating for energy performance; that’s right at the bottom of the class. Less than one in a hundred has an A rating. To meet our ambitious emissions targets, we must radically change the way we use energy in our homes and workplaces. Saving energy is the cheapest way of closing the gap between supply and demand. And energy efficiency is at the heart of the Government’s programme. It’s good for the environment, cutting carbon emissions. It’s good for energy security, reducing our reliance on imported fossil fuels. And it’s good for hard pressed families, who are wasting money heating inefficient homes. This principle is at the core of the Passivhaus ethos. In its modern application of ancient principles, the Passivhaus standard represent a watershed moment in our relationship with the built environment. For much of our history, housing was about conquering the elements; imposing ourselves on the environment in search of comfort. Passivhaus  is a fundamental re-imagining of our relationship with the outdoors. Rather than seeking to subvert nature and bend it to our will, we can enter into a symbiotic agreement. Using the forces of nature to drive us toward a greener future. I would like to see every new home in the UK reach the Passivhaus standard – and there are some beautiful examples on display tonight. We are making progress. We will ensure that all new homes post-2016 can be zero-carbon,  without letting the costs of new build stop the sustainable development we need. And we will introduce a minimum standard for fabric energy efficiency, based on the recent consultation on the Code for Sustainable Homes. This will help us to break away from the model of homes being developed at low cost, but which are expensive to run. Moving toward a new concept of value in home ownership. I also notice that, in Germany, construction costs of the Passivhaus have tumbled with scale. We need a new paradigm in housing. Where value is measured in the running costs to 2050 and beyond. Where we look at total cost – construction cost and running cost. The answer is create a new focus on the installation of low carbon measures, which consumers understand and value – and which will reduce the cost of owning a new home. We also need to make homes that have already been built more energy efficient. The Technology Strategy Board’s ‘Retrofit for the Future’ Competition is providing some fantastic examples of what is technically possible. Even in the UK, with some of Europe’s oldest housing stock, the Passivhaus standard can be achieved. But it also highlights the cost and disruption, as houses are stripped to their bare bones before efficiency measures are installed. The biggest challenge we face in retrofitting is not just getting householders on board, but having a credible answer when the going gets tough. When cost or inconvenience is a real barrier to improvement. At the heart of the Energy bill which we will be introducing later this year will be the Green Deal: a radical programme backed by a completely new finance mechanism. In times of rising bills and tight family budgets, one of the major barriers to energy improvement is the upfront cost.  The Green Deal will provide a straightforward way for people to find out about energy efficiency measures, finance the work and feel the benefits. It will offer households the chance to improve their homes without covering all the upfront costs, with the option to repay through savings on the energy bills of them and their successors in the home.  It’s designed to work on a national scale, in the average home. But will also help those who want to fund more ambitious efficiency measures. And the new Energy Company Obligation will provide additional funding for the vulnerable fuel poor and those in hard to treat homes who may need additional support. The Green Deal will be underpinned by a strong framework of standards and accreditation - for assessors and installers.  Eligible energy efficient measures will be focussed on the building fabric, and will have to be installed to the highest standard. Using only accredited products, and materials which meet strict performance and safety criteria. Passivhaus has already overcome many of these hurdles. As we seek to roll out the biggest ever programme of domestic energy improvements, it’s vital that we learn the lessons from other successful schemes. Because the Green Deal will open up the market to lots of people who might not otherwise be interested in home improvements, we have to make sure the accreditation and structures are nailed down, so that the improvements are effective – and cost-effective. This Coalition is committed to making the UK a leader in energy efficiency. We are committed to a new level of ambition; at a scale never attempted before. The history of the home is about design and technology bettering comfort and improving efficiency. From the earliest stone houses – complete with smokeholes – to the grandest Georgian terraces, the heating and lighting of homes had a profound impact on their design. Now, we have a chance to reverse the trend. By changing the way we think about our energy use, we can let efficiency in the home drive down demand on a national scale – cutting carbon, saving energy, and saving the planet. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/CH_Passivhaus/CH_Passivhaus.aspx Rt Hon Chris Huhne Chris Huhne speech to the Passivhaus Conference 12 October 2010 Department for Energy and Climate Change
<em>11 October 2010</em><br><em>Check against delivery</em>  Thanks very much, Paul [Noon, Prospect]. And many thanks also for agreeing to start a little early. If only the Cabinet Office could be so flexible when it comes to negotiations. I am delighted to be here today. And to address an audience which has been a leading voice in the energy and climate change debate. The strength of this advocacy should come as no surprise. The challenges we face in creating a low-carbon economy speak to the TUC’s founding principles. Fairness. Sustainability. Equality. The knowledge that by working together in pursuit of common aims we can achieve more than we could manage alone. These are Liberal beliefs, too. On social justice. On environmental responsibility. On inequality and on the role of the state, we share more than we differ. <br> I suspect we share the same diagnosis of the financial crisis, too. Unrestrained capitalism led to economic inbalance. The Square Mile proved no substitute for a rounded economy. And the cost of taming the biggest ever peacetime budget deficit will be with us for years to come. But out of the wreckage of the past can come a new economic future. This time, our economy must be greener, cleaner and more sustainable. The Coalition might not be the government you expected. It might not be the government you wanted. But it is the Government that will respond to the defining challenge of the next few years: securing the economic recovery and promoting green growth. Today, I can give you a sense of where the Coalition is going, and how we intend to get there. Setting out our priorities and our policies. And asking how we can work together better in support of our shared ambitions. Our first priority is to build a new kind of economy. One where green growth leads to green jobs. A low-carbon economy that will help us recover at home and compete abroad. Our second priority is to reshape radically our energy system. Saving energy to tackle demand. Producing greener energy to clean up our supply. <br> And pulling in the investment we need to update our ageing power plants, so we are ready for an increasingly electric future. And finally, we must secure a fair, firm and binding global deal to halt catastrophic climate change. Together, these priorities match the problems we face: an unsustainable economy, built on unsustainable energy, in an unsustainable global climate. It is an ambitious agenda. It would be ambitious even without the aftermath of the recession. <br> In the face of an unruly budget deficit and the hardening of international attitudes, success demands a clear, consistent framework from Government. Our approach is based on three principles. Helping businesses and households save energy. Making it easier to fund new energy. And showing ambition and leadership on the global stage – starting in Europe, and going to the UN in Cancun. <br> So let me deal with each of these in turn. Saving energy is still the cheapest way of closing the gap between supply and demand. At home and at work, the UK’s draughty buildings leak heat and waste carbon. A quarter of UK emissions come from housing. We spend more heating our homes than Sweden, where the sea freezes and the average winter makes Aberdeen look like Australia. So our response is the Green Deal: a radical program to refit our houses and our workplaces. Money spent on improving energy efficiency will be paid for out of the savings on future energy bills, giving landlords and tenants the motivation to save energy. There has never been anything like it. It is important to realise the scale of the ambition. We estimate that every single one of our 26 million homes could benefit from the Green Deal, with a market worth billions. Some 2.8 million businesses could also take advantage of the Green Deal to cut their carbon and save their energy bills. And up to 250,000 jobs could be created across the country, boosting local economies from Bournemouth to Bradford. As so often with energy policy, the numbers are huge. And they span the length and breadth of the country. Because the big picture of the green economy is one of growth. Not the casino capitalism that caused the meltdown; but sustainable, green growth. With opportunities not just for private finance, but in innovation and research. In manufacturing and installation. In maintenance and supply chains across Britain. In our homes everywhere, from Penzance to John O’Groats. And there’s no regional bias here – to the South East or anywhere else. To meet our renewables targets, we’ll need new infrastructure that rivals the great 20th century civil engineering projects. It’s estimated that offshore wind could employ an extra 70,000 people by the end of the decade, in a market worth £6 billion. The global trade in low-carbon goods and services will reach £4 trillion by the end of this Parliament. Last year the British share of that market was worth £112 billion. <br> Over a million people will be employed in low-carbon goods and services by 2015. It’s just over 900,000 now. That’s a workforce – and a budget – to rival the NHS. We must match our capital investments with investment in people. My Department will be working closely with the Department for Business, Innovation and Skills, and will work with the Sector Skills Councils, and the National Apprenticeship Service to ensure low carbon skills are brought within the wider skills framework. Early feedback from the Low Carbon Skills Consultation suggests businesses need to recognise that skills development doesn’t stop. I will make the case to businesses and employers that career development will be critical to ensure jobs created by green growth aren’t one-shot wonders. To make sure jobs are sustainable in the long term, we also need to make it easier for business to invest in clean energy. <br> From Carbon Capture and Storage to offshore wind, we must create the right conditions to allow investment – and innovation – to bloom. Since the financial crisis, big numbers are commonplace; a billion here, ten billion there. But new energy investment is about real money: £200 billion by 2020, to replace our creaking energy infrastructure and deliver the new generation we so desperately need. The TUC have led the way. In 2009, you argued for a multi-billion pound green stimulus to secure a sustainable economic recovery. And just last month, your General Secretary called for ‘much more emphasis on investment to stimulate green growth’. The Coalition Agreement set out our plans for a Green Investment Bank. And last week, the Prime Minister’s conference speech showed just how serious we are. The Bank will help us meet the low carbon investment challenge, bringing private finance to bear on a public policy problem. It is increasingly clear that for the UK, the future will be electric. We predict a doubling of demand for electricity by 2050. To secure long-term supply of low carbon electricity, we also need to reform the electricity market. <br> Later this year, we will create a new market framework for electricity; one that encourages low-carbon investment and gives consumers a fair deal. Our work on electricity market reform will look at how the carbon price, emissions performance standard, feed-in tariffs and the other levers at our disposal can deliver a secure, affordable, low-carbon electricity mix. The first step is to get the evidence base right. Next month, we’ll publish the technical consultation document, before launching a White Paper and then of course the legislation. With input and support from our partners in industry, business and the unions, we can create the right conditions for affordable electrification – and for low-carbon growth. I know many of you will be concerned about how ambitious emissions targets will affect the industries that use the most energy – and produce the most emissions. Industrial processes present tough challenges. <br> Not only are emissions-heavy sectors a vital part of our economy, but we will depend on them to deliver the raw and manufactured materials we need to turn our economy off fossil fuels and on to clean growth. Our 2050 analysis suggest that energy intensive industries can have a long term future within a low-carbon UK. That’s why we’re working closely with the Department for Business, Innovation and Skills on an Energy Intensive Industries Strategy. The strategy will look how key energy intensive sectors can reduce emissions, checking the short, medium and long term efforts to cut carbon. It will factor in improvements to industrial processes as well as alternatives – and take account of the impact on supply chains for UK firms at home and abroad. Again, it’s vital that we get the evidence base right. That’s why I welcome the study commissioned by the TUC and the Energy Intensive Users Group, which will be fed into the strategy. Because we can only achieve the transition if we work in partnership. With business. With unions. And within government. Everyone has a stake in the green growth agenda. We all need to play to our strengths. It’s for government to set the right framework to support the move to a low-carbon economy. It’s for businesses to step up and provide long-term investment on the scale we need. And it’s for unions to keep fighting for fairness, for jobs, and for skills. And to continue to enthuse and support your members as we move toward a low-carbon future. Because this really is an enormous opportunity, not just for businesses but for unions, and I encourage you to grasp it. There are real opportunities for us to work together. At all levels, we’ll continue to engage with the unions. Ministers will meet with union leaders, and my door is open. Officials from DECC, Defra and BIS will work with you as we develop the strategies to take us to a low-carbon future. And we will be relying on your contribution to the debate. When a policy feels like it’s headed in the wrong direction, I know you will speak up. I am sure that, in her remarks, Frances will not hesitate to tell a few home truths. But just as there is a need for government to make hard decisions to secure the low carbon transition, so there is a choice for organised labour, too. Jobs are important. Jobs are crucial. Growth is important. Growth is crucial. But we cannot support dirty fossil fuel generation uncritically. Instead, we must trust in new green technologies to pick up the slack. Yes, the state of our finances means the future is uncertain. The Government will not be able to fund everything we want to fund. But we must play the long game; encouraging the sectors we know will be part of our energy future. After all, it is in everyone’s interest. Jobs in unsustainable industries are by definition unsustainable jobs. Unions should represent the industries of the future, not the past. Short-term protectionism cannot triumph over the long-term health of our economy – or our planet. And there’s another important role for unions. It speaks to one of your traditional strengths: advocacy. Bringing members and stakeholders together, to explain the size of the task ahead and create a more constructive dialogue. We need people to engage with the scale of the challenge, so that the unthinkable becomes credible. An energy crunch is coming. In its scale and its impact, it could rival the credit crunch. But if we are still hooked on oil, there will be no bailout. Unions can play a crucial part in broadcasting the benefits of the transition to a more sustainable, low-carbon economy. Not just in terms of jobs and skills. But making the wider case for change – including on the international stage. I know the TUC supports our ambitions for global action on climate change. Just as governments come together within the UN process, so you work with trade unions globally through the ITUC. As with the transition to a low-carbon economy at home, progress toward an international deal is a shared challenge. I believe the best way to get there is to start leading by example. A higher emissions reduction standard within the EU would prompt a carbon price rise across Europe. Sending a clearer signal to investors and boosting our regional economy. <br> That’s why, together with my French and German colleagues, I have argued in favour of more challenging target for 2020: a 30% reduction in emission, not 20%. It is ambitious, but achievable. And I believe it is absolutely necessary. For consumers, who cannot and should not be held hostage by energy companies’ creative billing. For the public who depend on stable, affordable energy to heat their homes and move their goods. And for the economy, which, in its fossil-fuel dependency, is vulnerable to price shocks and instability. Before I leave, perhaps there is time for one final thought. For many Britons, the 1970s were synonymous with two things: inflation and an energy crisis. At DECC, we’ve been looking at the impact of a 1970s-style oil price shock on our economy. We found that a doubling in the oil price would lead to a cumulative loss of gross domestic product of around £45 billion over 2 years. If we can secure the transition to a low-carbon future, we can protect ourselves, our economy and our jobs against oil shocks and resource risks. If we can work together – on jobs, skills and green growth – we can do our bit to keep below that 2 degree limit – which is the objective of our international negotiations. I look forward to working with you to meet what I passionately believe is the biggest challenge of our time. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/TUC_CHspeech/TUC_CHspeech.aspx Rt Hon Chris Huhne Chris Huhne speech to the TUC annual Climate Change Conference 11 October 2010 Department for Energy and Climate Change
Thank you very much, Lord Heseltine [Chairman, Haymarket Media Group]. It is a great pleasure to be here today for the opening of the Carbon Show, and to see such energy and enthusiasm on display. Emissions trading is an economic curiosity. It is a negative market. For the first time in human history, we are trading in consequences. That the carbon market exists – and is successful - is testament to just how far we’ve come. The US National Air Pollution Control Administration first modelled cap-and-trade forty years ago. Ironically, we adopted the ETS to make it easier to sell it back to the US. You can’t win them all. Over the next forty years, we must hasten our emissions reductions and build a new kind of economy. Because the next global growth sector is green. Countries – and companies – who do not see the opportunities before them will be left behind. At this point of the business cycle, people are asking where the jobs will come from. The answer is here. In this room, today. The promise of the low-carbon economy is breathtaking. In jobs, in goods and services, and in finance, green opportunities are not just emerging. They are blossoming. From wind turbines to eco-kettles, low carbon products form a multi-trillion pound market, with growth that outstrips world GDP. With a vibrant technology and research sector, the UK is well placed to take advantage of the new clean tech markets. From offshore wind to carbon capture and storage, we are already leading the way. <br> If we can convert our scientific advantages into hard commercial successes, we can cut carbon and lock-in profits. Making us more secure at home, and more competitive abroad. We can do our bit to help. The Government is committed to an ambitious programme to reduce emissions – and close the gap between energy supply and energy demand. Our approach is based on three simple principles. Firstly, we need to save energy. Every day, the UK’s housing stock leaks heat – and carbon. Later this year we will launch the Green Deal, a radical scheme to bring our outdated homes up to scratch. 26 million households will qualify for energy efficiency improvements under the Green Deal. And the cost will be offset against future energy bills. Thousands of jobs insulating homes and businesses will be created across the country, with ripple effects across supply chains and local economies. A whole new industry will emerge, one that can claw back the ground lost during the recession. This multi-billion pound nationwide retrofit will save money – and energy. Homes and businesses will make huge efficiency savings. But there is room for improvement in power-hungry industries, too. The CRC Energy Efficiency Scheme is already causing ripples in the sectors which use the most energy. No-one, least of all this government, wants to burden businesses with extra responsibilities without clear benefit. We will keep a close eye on the CRC. Making sure it is effective, simple and streamlined; encouraging those industries that need it most. If it can be improved, we will make changes before the next stage in 2013. Secondly, we need to clean our supply of power. The replacement of our outdated energy infrastructure, and the creation of new low-carbon power plants, will present real opportunities for British business. With £200bn of capital needed over the next ten years, investors and manufacturers alike can benefit from the shift to low-carbon power generation. Again, we will do our bit to help. The Green Investment Bank will help us catalyse private sector finance, bringing forward a new generation of low-carbon energy production. By leveraging private finance on behalf of public policy aims, we can spend a little to secure a lot. <br> The next generation of wind, wave, and waste energy help us get off the oil hook – and onto clean, green growth. So that by the end of this Parliament, we will be the fastest improving European nation when it comes to renewable energy. Two weeks ago I launched the world’s largest offshore windfarm, at Thanet in Kent. It is a spectacular creation; 300 megawatts of capacity, bringing our offshore total to 5 gigawatts. Each of the 100 turbines is higher than Nelson’s column, and to my mind just as majestic. Within the next decade, industry is aiming for a tenfold increase in capacity. Few sectors are comfortable making claims like that in the current climate. Even fewer would expect to honour them. But I expect they will. The growth in renewable power generation and the replacement of our ageing energy infrastructure make a compelling case. Green growth is the best bet for our future prosperity. It’s also best for the future of our planet. A third of UK emissions come from electricity generation. Conversion losses compound the problem. Burning fossil fuels isn’t just bad for the atmosphere, it’s also an inefficient way of transforming energy. <br> We need to get the right mix of technologies and energy sources, so that we play to our strengths. That includes cleaning our existing fossil fuel plants. With strong emissions performance standards, and a commitment to carbon capture and storage pilots. Some dismiss CCS as a sticking plaster solution to a critical situation. But until we can produce our electricity cleanly, we must minimise the damage done by dirty fuels. With a new coal powered power plant switching on every week in China, our ability to develop and export CCS on a commercial scale makes environmental and business sense. Finally, it’s vital that we set out a credible path towards a global emissions deal. That means working with our European partners in support of an ambitious international climate change agenda. And that is why, together with my French and German colleagues, I have called for a more challenging EU emissions target: a 30% reduction by 2020. A higher target will strengthen Europe’s intent. Aspiration is important; it tells investors that Europe’s future prosperity is tied to the low-carbon economy. At the moment, the EU ETS carbon price is not high enough. It does not provide the long-term certainty investors need to commit to low-carbon generation. As we announced in the Budget, we will publish proposals this autumn to reform the climate change levy to secure a more effective, more representative carbon price. That will consolidate our first mover advantage, and open up opportunities for British businesses. The Coalition agreement is clear: we will seek an ambitious, legally binding global deal on emissions reductions. Such a deal is unlikely this year. Instead, we will focus our energies on rebuilding political consensus; and getting the right structures in place before the next round of negotiations. The first step will be to bring emissions offers made since Copenhagen into the UNFCCC process. Then we can strengthen the measurement, reporting and verification system. So that developing and developed countries have faith that progress is measured fairly and firmly. And finally, we can clarify the structure and governance of long-term climate finance. These are practical, achievable steps we can take to firm up the international climate change negotiations, and prepare the ground for a global deal. Action on energy efficiency, to manage our demand. Action on energy generation, to clean our supply. And action on the international stage, to secure a binding legal deal to cut emissions. These are the three principles that underpin our approach. They will drive us toward a new, low-carbon economy. One that is more competitive, more secure, and more sustainable. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/carb_show_spch/carb_show_spch.aspx Rt Hon Chris Huhne Chris Huhne speech to the Carbon Show 06 October 2010 Department for Energy and Climate Change
Responding to today’s announcement from Ofgem, Energy and Climate Change Secretary Chris Huhne said: “This is a welcome step forward in getting energy companies to play fair with their customers by giving advance notice of price increases. It’s important people know about price hikes before they are charged, so they can budget. In any other business, customers know the price before they buy. <br> “The best result for consumers will be if energy companies don’t block the changes that Ofgem propose. But if they do, I won’t hesitate to use my powers to end for good the practice of surprise energy bill hikes, if that’s what consultation shows to be necessary.” Chris Huhne warned energy companies last week not to block changes which would give energy consumers advance warning of hikes in bill.   None http://www.decc.gov.uk/en/content/cms/news/ofgemconresp/ofgemconresp.aspx Rt Hon Chris Huhne Chris Huhne response to OFGEM consultation on making energy suppliers give 30 days notice of price rises (Statement) 30 September 2010 Department for Energy and Climate Change
Check against delivery. Thank you very much, Bernice (Chair). It is my pleasure to be here today, on what is hallowed ground for students of international affairs. It is an appropriate venue. Climate change is the definition of a global threat. A failure to act in time will affect us all. This is the pre-eminent challenge in global governance. If we cannot deal collectively with such a threat to our very existence as a species on this planet, we are lost. Let us first be clear that the science is becoming more certain, not less. This year alone, we have seen extreme weather events across the globe. Mudslides in China. Forest fires in Russia. Floods in Pakistan. And the breaking-off of a massive ice sheet in Greenland.<br> No one of those events on their own can be attributed with certainty to climate change, but the increase in their frequency can (as the re-insurers will tell you). You are not likely to be run over by a bus if you cross the road, but if you insist on doing so repeatedly the likelihood rises. We are playing Russian roulette with our children’s future. So it is not the science that has failed. It is international politics that has proved the obstacle to a truly global response. We have, as an international political class, failed to respond to the warnings of the science. We have failed to communicate those dangers to our people. <br> And we have failed to construct a framework in which our efforts can achieve progress. All this has to change, and quickly. The failure to secure a binding deal at Copenhagen stemmed from a breakdown in political will. Suspicion and division overcame confidence in our chances of achieving a fair and firm agreement. In the UK, we did not follow through on our political leadership. <br> There were warm words and evangelism, but not enough spelling out of the hard-headed consequences if we do not act. After all, climate change is not just about the environment. It is not just about marginal improvements in the well-being of our children and grand-children. It is a critical issue of survival for our society, culture and traditions. It is an encompassing threat to our national security. The UK is responsible for just 2% of the world’s emissions. <br> But that does not mean we will escape the consequences of inaction. Myriad pressures await if we cannot rise to the challenge. Security analysts see climate change not as a matter of public debate, but as a ‘threat multiplier’. Food security, water shortage, climate-driven migration, energy conflicts: these problems will not respect Britain’s borders. These will have a direct impact on our way of life, our security and our taxes. It is in our direct national interest to secure global action on climate change. Let me summarise the task ahead. We face a problem of persuasion. To rebuild the case for a global deal, we need to do a much better job of cajoling, urging and persuading. Consensus for action on climate change rests on three pillars: the science, the politics, and the economics. On the science, we need a more engaging, more accessible, more genuine dialogue. <br> We cannot passively assume that public opinion will fall into line. We need to be smarter in our communications. We need to remind people how overwhelming the scientific consensus on this issue has become, and how marginal are the critics. For the media, in organisations like the BBC, to assume that this debate needs to be balanced is like giving equal airtime to the critics of Copernicus and Galileo on the grounds that, well, you never know, they might still be proved wrong. On the economics, we need to be advocates for the power of the third industrial revolution; the green revolution. <br> To secure economic recovery, to improve our competitiveness, to foster sustainable growth when we need it most. There are already 900,000 British jobs in low carbon sectors that are growing far more rapidly than world income. Our future prosperity will largely depend on our success in taking a high share of these fast-growing markets. And on the politics, we need to convince developed countries that action on climate change is essential for security and prosperity. That falls in particular, in the absence of US leadership, to Europe and Japan. <br> To show developing countries that our commitments on action and climate finance are genuine, reliable and long-term. And to build momentum ahead of the next round of negotiations in Cancun. The Coalition Government agreement on climate change is clear. We are determined to reach an ambitious international deal to limit emissions. A legally binding global deal is the best way to secure a stable framework for action, providing confidence for investors and reassurance for the developing world. An agreement that allows some to ignore their responsibilities to our collective future will not work. We cannot shrink from this ambition. In the face of the economic downturn, our commitment to a global deal is an important signal of intent. Cancun is an opportunity to get the negotiations back on track. <br> To re-establish a consensus between the leading players to and restore faith in the UNFCCC. And to start rebuilding momentum and political will. No-one expects a binding deal to come in December. Instead, we should concentrate on putting the political foundations in place for a more constructive dialogue. We may not be ready to strike a global agreement. But drawing the bow focuses the eye on the target. Concrete achievements at Cancun are possible. There are steps we can take to strengthen the international climate change regime and pave the way for a global deal. <br> We can start to bring emissions offers made since Copenhagen into the UNFCCC process. We can develop the framework for reducing emissions from deforestation and forest degradation. We can strengthen the measurement, reporting and verification arrangements which will ensure progress on emissions is clear, bankable and open. And we can set out the structures for climate finance beyond 2012, including governance. Building on the commitments in the Copenhagen Accord to establish a Green Fund. <br> Together, this is a realistic set of decisions which build on the political commitments made last year. In achieving them, we can affirm our faith in the effectiveness and importance of the UNFCCC process – and its ultimate aim. A global deal is still our best chance of meeting the 2 degree target. We must give it our best shot. But success will not start or end at the negotiating table. There are things we can do now – we are doing now – which represent real progress on climate change, both here and abroad. Finance tops the bill. Creating it, securing it, and distributing it in support of our aims. The way we pay for action on climate change will be crucial. It gets to the heart of questions of responsibility and accountability, and the role of the state. Getting the mix of public and private cash right – and figuring out how it is spent – is critical. Low carbon, climate resilient development paths require complementary sources of finance. Public grants, carbon market finance, development bank type loans and international private finance all have a role to play. Creating the right political conditions will be essential. We must send the right signals to the right people, so that governments, international bodies and private finance groups are all singing from the same balance sheet. <br> Fast start Developing countries need sustainable, predictable sources of finance to give them the confidence to invest in tackling climate change. We can help ease the flow of capital. We have already committed £1.5 billion of fast-start finance between now and 2013; the next step is to encourage other countries to deliver. So that, come Cancun, we have case studies that show it works. With a strong fast-start commitment married to real results, we can rebuild the trust that must underpin any deal. <br> The pledge website pioneered by the Dutch government is a great way of encouraging others to step up. But longer-term climate finance will be more difficult. I have replaced Gordon Brown on the Secretary-General’s Advisory Group on Climate Finance. We will meet again in Addis Ababa in October, and report just before Mexico. <br> This is a chance to set out practical options for raising long-term climate finance, and showing that although the scale is immense, the task is achievable. The AGF can help: by setting out a credible path toward the $100 billion per year the developing world will need by 2020. Some will be from public institutions, which are realistically the principal means of funding adaptation. But private finance can have a key role in unlocking mitigation, if the right regulatory frameworks are put in place. <br> Two weeks ago I was at the launch of the Capital Markets Climate Initiative, which encourages closer working between governments and businesses. CMCI is about the public sector mobilising the private sector; in pursuit not just of profits, but policy aims. Last year, the global market for low carbon goods and services was already worth £3.2 trillion – a £150 billion increase in 12 months. It is forecast to grow by around 4% a year over the next five years. This presents real opportunities. Growth in low-carbon tech will be an essential part of the global economic recovery. And it is crucial in cutting emissions. Over the next decade we will need to see abatement in the power sector ramp up, with big investments in sustainable power infrastructure at home and abroad. The initiatives that came out of the Clean Energy Ministerial at Washington in July underline the need for a global approach. As we have seen in Pakistan, countries facing the most intense development challenges are particularly vulnerable to extreme weather. This is where the development and climate change agendas overlap. We can help countries at risk make adaptation a core part of national planning structures. A fifth of our fast-start finance is already deployed against deforestation. We can explore in more detail the links between deforestation and biodiversity; building on our reputation and membership of the REDD [Reducing Emissions from Deforestation and forest Degradation] Partnership.   Building goodwill toward these agreements means making a more compelling case for change. Better analysis of economic assumptions and better reporting can rebuild faith in the fairness of national commitments. Countries which have made emissions pledges with upper and lower limits should be encouraged to reach high. Those that have not yet pledged should be encouraged to commit. More ambitious emissions reduction targets can lead to bigger carbon markets, where we can use our influence to good effect. Getting countries with existing emissions trading schemes to work together better. And bringing developing countries in to a global carbon market. But to be credible on the world stage, we must be radical on the home front. For too long, the UK could not look the developing world in the eye and ask for change. <br> Not while renewables targets were missed. Not while energy efficiency was ignored. The founding document of the coalition makes plain our plans for the UK. We are determined to cut emissions, decarbonise our economy, and foster the creation of new green jobs and technologies. Our energy policy is focused on the twin challenges of growing demand and unsustainable supply. We are committed to revolutionary programme of domestic energy efficiency. Millions of homes and businesses could qualify for efficiency improvements under the Green Deal. Domestic properties rack up 25% of our total emissions; with each loft lagged, with every cavity insulated, we will free up capacity in the system. Tackling inequalities, improving health and wealth across the nation. Our other focus is on cleaning and greening the supply of energy within the UK. Using our world-leading science and technology sectors to secure a low-carbon energy mix. <br> Clean coal and gas. Renewables. With a role for new nuclear, but without public subsidy. Building new, sustainable energy infrastructure requires long-term vision and extensive capital from the private sector. But years of mixed signals from government have muddied the waters. And investors have been left hesitant, not confident. We will create a Green Investment Bank to help us meet the low carbon investment challenge. With billions of pounds needed for new generation over the next decade, the bank will fund new low carbon energy and kickstart the transformation of our entire economy. That transformation will result in a new kind of economy. One where green growth creates jobs and spawns businesses. Where the UK’s innovation in technology and finance gives us a seat at the global low-carbon table. On the eve of Copenhagen, the IMF’s Fiscal Affairs Director wrote that the science around climate change is often incomprehensible; the politics invariably ugly; but that much of the economics is simple. <br> Our job is to show through the transformation of our own economy that a low-carbon future works and pays. That it is not an ideological luxury, but an economic imperative. Establishing our credentials by ‘walking the walk’ at home is vital. But we must also work with our neighbours to secure the transformation of Europe’s economy. <br> Demonstrating through our actions that a low-carbon, clean energy economy is competitive – and brings real benefits to it citizens. To achieve that transformation, we need a more ambitious emissions target: a 30% reduction by 2020. Our ability to make the case for 30% within Europe will be a mark of our capacity to lead global efforts on climate change. That is why I am working with my French and German counterparts to encourage greater EU ambition. Greater ambition on carbon means a higher carbon price. <br> And a higher carbon price will boost some of the fastest growing parts of Europe’s economy, sending a clearer signal to investors. It will lock low-carbon technologies into the wave of energy investment needed to replace ageing infrastructure. Last week, I called on the EU to be more ambitious in its Energy Strategy. Aiming high on interconnection. Focusing its resources on sustainable growth across the economy. Ensuring consistency of vision throughout energy and climate change policy. And being a more active, more confident global citizen. We need the EU to deliver at home and on the world stage.<br> Global outlook That means taking the lead in negotiations, and acting as coherent bloc. Because Europe is stronger in the world when it works together. The EU alone boasts 500 million citizens and a fifth of the gross world product. As a continent, our standing in the world is considerable. Our leadership on climate change should be too.<br> Remember the key role that the European Union played in the first climate change treaty, the Kyoto Protocol. Without EU effort, often against the work of the then US administration, we would not have secured the necessary number of countries to bring the treaty into force. Europe should be unafraid and unapologetic in pursuit of an ambitious global deal on climate change. It should demonstrate a common resolve to support our common aim.   And that resolve will be sorely needed. There will be tough conversations ahead. Developed countries must reduce emissions, and major developing countries must commit to mitigation actions. Between them, China and the US hold some of the keys to climate change. Without action from one, the other is unlikely to move. Yet neither will commit without demonstrable evidence that is in their national interest. In America, the story of the past decade has been one of security. In China, it is the economy. Both objectives overlap. Action on climate change will bring security – against weather, against oil shocks, against energy dependency and resource conflicts. And the transition to a low-carbon economy will bring a more lasting prosperity. Our job is to make that case. In bilateral discussions. At the UNFCCC. In Cancun, in South Africa, and beyond. But above all, we must lead by example. We can show through our actions that in a post-Copenhagen world, the transition to a low-carbon economy will be a prerequisite for success. In so doing, we can strengthen our economy at home and our voice abroad. We can protect our nation against the worst effects of climate change. And we can secure for all the world’s citizens a greener, more prosperous future. Thank you very much. <br>     -End - None http://www.decc.gov.uk/en/content/cms/news/chathsespeech/chathsespeech.aspx Rt Hon Chris Huhne Climate Change - the way forward in a post-Copenhagen World (Speech by Chris Huhne) 23 September 2010 Department for Energy and Climate Change
15 September 2010 Check against delivery Thank you very much, Matthew [Spencer, Green Alliance]. It’s my pleasure to be here today. This gathering, so kindly arranged by the Green Alliance, is titled ‘Europe: looking ahead on climate change’. It is a perfect name. In many ways, Europe is looking further ahead than its regional rivals. And it is poised to take full advantage of its status as the world’s early adopter of decarbonisation. The launch of the European Climate Foundation’s 2050 roadmap is another contribution towards realising that ambition. It sends a signal to individuals, industries and governments around the world: that the low-carbon transition is achievable, beneficial, and cost-effective. Providing business with a clear analysis of the path to 2050 is the key to securing continued investment in energy and technology. The ECF’s roadmap mirrors our UK 2050 Pathways study, which described the routes we might take to a low-carbon economy. The UK’s ambitions are clear. We are determined to be the greenest government yet. We are dedicated to achieving a comprehensive international deal on climate change. And we are committed to reducing the UK’s carbon emissions by 80% by 2050. To do so, we must take action on energy saving. For too long, the debate around energy has focused on supply at the expense of demand. Practical, achievable energy savings have been neglected. As we move toward a low-carbon future, of course we need to clean and green our supply of energy. But just as important – and often overlooked – is the need to drag our outdated housing stock into the future. The facts speak for themselves. A quarter of all UK emissions come from the home. We use more energy heating our homes than Sweden. The average household spends over £1300 every year on energy and heating bills. And cold housing has been linked to tens of thousands of deaths every winter. The Coalition made a commitment to improve the energy efficiency of new housing. The Green Deal is our pioneering response to the problem of energy inefficiency in existing properties. By allowing householders and businesses to offset the cost of energy improvements and recapture savings made on energy bills, the Green Deal will save carbon, save energy and save money. The potential benefits are vast: 26 million homes could benefit. Thousands of jobs could be created in a market worth tens of billions. It’s a radical program. It will change the way people think about their homes and their energy. It could also help us to achieve the Coalition’s wider aims. Getting unemployed people back into work. Reducing health inequalities. Creating jobs, boosting the economy, and making energy efficiency affordable for all. The most pressing challenge facing the Government is to secure the economic recovery and promote growth. If we return to an outdated economic model, we cannot hope to succeed. <br> But if we have the courage to build a new kind of economy, we can ensure global competitiveness, protect ourselves from price shocks and tackle climate change in one fell swoop. It must be a low-carbon, sustainable economy. One founded on green growth. Where investment in new, clean technologies cuts our dependence on imported resources and also cuts carbon. The UK gets just 3% of its power from renewables. Beaten only by Malta and Luxembourg in the race to the bottom of the European league. That has to change. The Government will create a Green Investment Bank, which will help the UK meet the low carbon investment challenge. It will catalyse private sector finance to address the investment needed over the next decade. It will bring forward a new generation of low carbon energy, supporting the wider transformation to a genuinely low carbon economy. It will help set the tone for a new focus on green growth, with new business and job opportunities. And it will help re-establish the UK’s position within Europe: as one of the most innovative and ambitious Member States when it comes to climate change. Europe is a way for us to deliver British national objectives on the global stage. We are stronger with our neighbours than we would be alone. We often share the same analysis of the problem. And when we work together and act together, we can change global opinion. European action to secure Russia’s ratification of Kyoto is a perfect answer to critics of greater continental co-operation. We are committed to working in the EU to ensure Europe is equipped to face the challenges of the 21st century. That means pushing forward our own decarbonisation, and encouraging the EU to focus its resources on the things that matter: not just delivering growth, but also improving energy security and tackling climate change. The Government wants Europe to do what only it can do; and to do it well. On interconnection of national power grids, on vehicle standards, in global negotiations and when setting ambitious internal targets, Europe can - and must - lead the way. Over the coming months, the European Commission will produce strategies on energy policy and infrastructure, and further roadmaps to 2050. Together, these must set out a compelling and coherent vision of the low-carbon future – and how we will get there. We need to make sure the EU’s budget supports this vision, without neglecting the need for fiscal consolidation across Europe. The Europe 2020 strategy names "sustainable growth" as one of its three main economic aims. We must use all the tools available to make this happen, working closely with our European partners during negotiations on the next 7 year financial perspective. We have a unique opportunity to work within Europe to set a global standard for regional, international co-operation. The European Commission should focus on doing fewer things, better. Action on climate change is one of those things. The move to a low-carbon economy is one area where the European model can excel. Last month, together with my French and German counterparts, I argued that sticking with the 20% reduction target would send Europe to the back of the global low-carbon investment class. Instead, we must set our sights on a more challenging target: a 30% reduction in emissions by the next decade. We won’t be alone in our ambition. Despite the failure to secure a global deal, others took their cue from Copenhagen and are taking action. Japan is not waiting for an international agreement; it is preparing to cut emissions by a quarter. Europe needs to get ready for 30%. And to stay competitive within our own continent, we need to be prepared for a the reality of a more ambitious emissions strategy. A higher standard would prompt a carbon price rise across Europe. Sending a clearer signal to investors and boosting our regional economy. Yet not everyone shares our belief that businesses and investors will benefit from a tougher target. Some feared increased cost of fossil fuels would drive businesses to less ambitious parts of the world. Moving to 30%, it was claimed, would reduce EU output. We commissioned a study from Cambridge Econometrics and Entec which suggests otherwise. The study looked at whether a 30% target would cause emissions-heavy sectors to move outside the EU to cut costs. For most sectors, the results suggest the reduction in EU output would be negligible. In the few sectors that might be affected, a proportion of free emissions allowances would enable firms to absorb cost increases, and reduce the risk. I understand the caution. I once ran a company assessing global risk, so I appreciate the weighing of factors behind every business decision. In order to make the right investment choices and secure the economic recovery, we need – and businesses need – a sound analysis of the impact of policy decisions. That is why my Department, together with the Department for Business, Innovation and Skills, is working on a joint project looking at how our policies will affect energy intensive industries. If we follow the evidence, our ambition need not affect our competitiveness. If we have the courage to reach for a higher ambition, and the integrity to follow promises with action, we can secure a greener, more sustainable future for Europe’s citizens. And a more active global leadership role for the EU in international negotiations. That leadership will be critical. Other countries will take their lead from Europe’s example. We are committed to securing an ambitious international agreement on climate change. Sceptics say global agreements can’t work. But events suggest otherwise: the Montreal Protocol is closing the ozone layer, just as Kyoto is cutting UK emissions. At the UN negotiations in November, Europe can showcase what developed countries can achieve when they work together as a bloc. That is why I have been meeting with my French and German colleagues: to push Europe to build momentum ahead of the next round of talks. Cancun is the first opportunity we have to get the process back on track. Rebuilding trust, and banking agreements as we look ahead to Cape Town. On finance, technology and collaboration, there is a compelling story for Europe to tell. We can demonstrate through our actions that global political differences need not halt regional progress. We also have a chance to show what Europe can achieve when it uses its collective strength in support of a common purpose. The EU will be a major player in the creation of a global carbon market. And it could pioneer direct engagement with other countries on emissions trading and low-carbon technology standards. That is why the Roadmap 2050 is so useful. It makes a technical case for the transformation of Europe’s economy on more sustainable terms. The Roadmap’s principal economic finding is that the price we pay need not decide the path we choose. The higher initial investment needed to kick start a high-renewables energy system is offset by the higher operational and resource cost of fossil fuels. Put simply, spending a little more now saves a lot more later. The long-term benefits are clear. The technology that made the first industrial revolution possible is still with us today. As iron gave way to steel, and steam to oil, so our current energy system will yield to a third industrial revolution. A green revolution. Growing pressure on resources, growing awareness of our impact on the world around us, and the relentless human drive for efficiency. All this combined to move steam power from the steel mill to the museum. In our lifetime, we may see the internal combustion engine go the same way. The clever money is on an electric future. Doubling demand by 2050 as electricity powers our cars and heats our homes. Technically, it is within our grasp; financially it is viable. Our challenge is to create the right policy framework, together with our European partners, to make it a reality. That means working together: on better integration, and more interconnection. Our recent history is marked by exponential growth in information sharing. In science, medicine, and business, the better our connections, the more productive we are. The latest broadband connections can transfer an encyclopaedia volume in under two seconds. In ten years’ time that will seem hopelessly inadequate. Broadband connectivity is so important that it is now a key economic indicator. In every way, connecting makes things better. Yet until recently, artificial borders have set meaningless boundaries between energy sources. Turning what should be energy networks into fractured energy enclaves. This Balkanization of power is a driver of waste. And the result is a double-shot of inefficiency. Countries are generating power which is unused, and building capacity into the system only for it to be artificially curtailed. Capital and carbon are sunk into generation projects to achieve excess capacity. The answer, as the roadmap suggests, is better interconnection between national grids – and a co-ordinated European wholesale power market. That is why this Government encourages the EU to be ambitious on interconnection in the Energy Strategy. We must break out of closed-circuit thinking, pushing for a more sustainable, carbon-free energy network. <br> By connecting across borders, we can harness Spain’s sunshine and Germany’s wind. Sidestepping geography and saving energy. By creating a European framework that puts integration at the heart of planning decisions, we can bring reliable, efficient energy markets to the fore. And by shaping demand through smart grids tied in to smart meters, we can improve energy consumption at home and abroad. It may seem a long way off now. But today’s discussions are another step towards a low-carbon reality. With a strong, coherent European policy ensuring energy security and delivering green growth. With the UK out front, saving energy at home and exchanging it abroad. And with this government, the greenest ever, leading the way. Thank you very much. None http://www.decc.gov.uk/en/content/cms/news/green_all_spch/green_all_spch.aspx Rt Hon Chris Huhne Chris Huhne speech to the Green Alliance, UK-EU Action on Climate Change 15 September 2010 Department for Energy and Climate Change
17 August 2010<br>   Dear Sir, The idea that we are “watering down” our commitment is simply incorrect ("<a href="http://www.guardian.co.uk/environment/2010/aug/15/coal-fired-power-stations-coalition">Dirtiest coal power plants win reprieve, 16 August</a>"): this Government has committed to introducing an Emissions Performance Standard. We are moving as quickly as possible and our consultation on a radical reform of the electricity market to deliver secure, affordable and low carbon energy, will be out within 6 months of election while a white paper will be published within a year. The view that this might raise the possibility of new coal-fired power stations “slipping through the system” is ludicrous.  We consider planning applications thoroughly and will not allow any new coal power station to be built without being equipped with carbon capture and storage. While we will consult on the final details of an Emissions Performance Standard, I am clear that without CCS it would be impossible to meet such a standard. However an Emissions Performance Standard on its own is not a magic bullet to decarbonise our economy. We have inherited an energy system that has suffered from a lack of clear direction and was not fit for purpose. That is why we will be implementing comprehensive electricity market reform to ensure that we can have a secure, low carbon, affordable electricity mix for decades to come.   Chris Huhne, Secretary of State for Energy and Climate Change None http://www.decc.gov.uk/en/content/cms/news/Guardian_lett/Guardian_lett.aspx Rt Hon Chris Huhne Chris Huhne letter to the Guardian on an Emissions Performance Standard 17 August 2010 Department for Energy and Climate Change
The Secretary of State for Energy and Climate Change (Chris Huhne): With permission, Mr Speaker, I wish to make a statement on energy policy. This statement and the departmental memorandum that I am placing in the Libraries of both Houses fulfils our commitment to present an annual energy statement to Parliament. In making this statement within three months of coming into office we are signalling the importance of this policy. We are setting out a clear strategy for creating the 21st-century energy system that this country urgently needs if we are to have affordable, secure and low-carbon energy in future. We face short-term challenges as a result of the legacy inherited from the previous Government. We have the third lowest share of renewable energy of all 27 states in the European Union, which is the same ranking as in 1997. In the longer term, we must meet the challenges of a volatile oil market and increased energy imports. We are taking three big steps forward: we are creating a market for energy savings through the green deal; we are ensuring a properly functioning electricity market; and we will strengthen the carbon price. Our actions must be informed by the best information about the future. That is why I am publishing our work on 2050 energy pathways, which has been worked up in consultation with industry, scientists, engineers and economists. We are making the data and analysis available and we are inviting comments over the summer. We want to start a grown-up debate about what a low-carbon future will look like and the best way of achieving it. These are possible pathways; we are not claiming to be able to see the future with certainty, but we cannot continue on the current pathway, which is high carbon and highly dependent on imports, with highly volatile prices. Like the other industrial revolutions, the low-carbon revolution will be driven by entrepreneurs, the private sector, local communities, individuals, businesses, scientists and engineers-not by government. However, industry needs stable policy and functioning markets. The role of government is to provide the policy framework and to act as a catalyst for private sector investment. As the 2050 pathways work demonstrates, we need to apply those principles to the challenge of changing fundamentally the way we produce and consume energy. The cheapest way of closing the gap between energy demand and supply is to cut energy use. We need to address the state of our buildings-we have some of the oldest housing stock in Europe. Our green deal will transform finance for improving the energy efficiency of Britain's homes. It will get its legal underpinning from measures in the first-Session energy Bill. We are also accelerating the roll-out of smart meters, which provide consumers and suppliers with the information to take control of their energy management. Alongside this statement, the Government and Ofgem are publishing a prospectus for smart meters, which sets out how we will do this. Openness is important to us, as it is to business and the public. Alongside this statement, I am also publishing analysis of the impact of energy and climate change policies on both household and business energy bills up to 2020, and I will continue to do so on an annual basis. At the moment, the UK economy is reliant on fossil fuels. As UK oil and gas production decline, this leaves us more exposed to volatile prices and increasing global competition for the resource. The challenge is to spur the capital investment required for new energy infrastructure. The volatility of fossil fuel prices and continuing uncertainty about the carbon price makes such investment high risk, pushing up costs and slowing development, so the first step is to support the carbon price. In addition, I can announce that we are carrying out a comprehensive review of the electricity market and I will issue a consultation document in the autumn. This will include a review of the role of the independent regulator Ofgem. The Government will also put forward detailed proposals on the creation of a green investment bank. The coalition agreement is clear that new nuclear can go ahead so long as there is no public subsidy. The Government are committed to removing any unnecessary obstacles to investment in new nuclear power. In the memorandum, I have outlined some clear actions to aid this. As a result, I believe that new nuclear will play a part in meeting our energy needs. In the heating sector, I can confirm our strong commitment to action on renewable heat. The Government are considering responses to the renewable heat incentive consultation and will set out detailed options following the spending review. The UK is blessed with a wealth of renewable energy resources, both onshore and offshore. We are committed to overcoming the real challenges in harnessing those resources. We will implement the connect-and-manage regime, and I am today giving the go-ahead to a transitional regime for offshore wind farms. Both those measures will help to speed up the connection of new generation to the grid. We remain committed to developing generation from marine energy, biomass and anaerobic digestion. Biomass investors that were promised help under the renewables obligation will continue to benefit. We also need incentives for small-scale and community action. We are consulting on a new microgeneration strategy, and I am today laying an order to allow local authorities to sell renewable electricity to the grid. Fossil fuels can also have their place in a low-carbon future, provided that we can capture and store most of their carbon emissions. We will introduce an emissions performance standard and we intend to launch a formal call for future carbon capture and storage demonstration projects by the end of the year. This is a bold vision. We will not be able to deliver it without a 21st-century network that can support 21st-century infrastructure. The statement sets out practical measures that we are taking to improve network access and begin the building of a truly smart grid. However, the vision needs to be grounded in reality. The low-carbon economy must happen, but it will not happen tomorrow. There are potentially 20 billion barrels of oil equivalent remaining in the UK continental shelf, but we must maximise economic production while applying effective environmental and safety regulations. We are doubling the inspections of offshore oil and gas rigs, and we will undertake a full review of the oil and gas environmental regime. We must also be mindful of our inherited responsibilities. My Department is responsible for managing the country's nuclear legacy. I am committed to ensuring that those essential duties are carried out with the utmost care and consideration for public safety. The UK does not stand alone. The Government will work together with our international partners in efforts to promote action on climate change and energy security across the world. We are working hard to put Europe at the front of the race for low-carbon technology. This will help to refresh the appetite for action across the world after the disappointment of Copenhagen. In conclusion, the statement is about planning ahead and providing clarity and confidence in the policy framework. That is why I am also publishing today my Department's structural reform plan to show how we are carrying out our priorities. Once we have completed the spending review, we will publish a full business plan. At last we can have an energy policy with real direction and purpose, and a Government who are willing to take the bold steps necessary. I commend the statement to the House. -End-   None http://www.decc.gov.uk/en/content/cms/news/aes/aes.aspx Rt Hon Chris Huhne Annual Energy Statement (Oral Statement by Chris Huhne) 27 July 2010 Department for Energy and Climate Change
Two months ago the Coalition Government published its programme for government, in which we pledged a package of measures to fulfil our joint ambitions for a low carbon and eco-friendly economy. Speaking at my department during his first few days in office, the Prime Minister announced that this will be the greenest government ever. he challenge is huge: to reduce the potential impacts of climate change and ensure our future energy security by weaning ourselves off our addiction to fossil fuels. And we face it as we come out of recession, wrestling with our biggest ever peacetime deficit. Economic recovery, energy security and climate stabilisation all require a commitment to a consistent, long term policy and this month I will present to Parliament the first of our promised annual statements on energy policy. Alongside this we will publish the detailed analysis and underpinning data of the 2050 Pathways project, which will help us understand the scale of the challenge and the choices and trade-offs we will have to make over the next 40 years. The long term task is nothing less than the transformation of our economy, to put in place the right incentives for low-carbon growth to create the investment, exports and jobs we need to bring back economic prosperity. In short, we must seize our share of the green technology revolution and make the UK the best place in the world to do energy business. During that transition we must secure diversity of energy supplies from abroad while making the most of our home-grown energy, including north sea oil and gas, and developing renewables technologies such as wind and marine. There can be a role for nuclear so long as there is no public subsidy, a pledge set out in the coalition agreement and guaranteed by the state of the public finances. Carbon capture and storage can also provide us with a low carbon energy source to meet peaks in energy demand. It will be government's role to provide the long term certainty in which to develop this new energy infrastructure. £200 billion of investment is needed over the coming decade and we intend to leverage private sector investment through a Green Investment Bank. We are working on a wide range of options for the scope and structure of the Bank and will bring forward detailed proposals in the autumn. In the recent Emergency Budget the Chancellor also announced that we will reshape the Climate Change Levy as the way of delivering our coalition commitment to a carbon price floor, in order to boost investment across the range of low carbon energy technologies. The cheapest way of closing the gap between energy demand and supply is through energy saving measures. The Green Deal for households will be established through legislation in the forthcoming Energy Security and Green Economy Bill and will encourage home energy efficiency improvements such as insulation and lagging, paid for by savings from energy bills. Energy saving will also mean smart meters and smart grids that can give consumers control over their appliances, curb energy waste and save money. We will take measures to improve energy efficiency in businesses and public sector buildings – we are leading by example with a target to reduce central government carbon emissions by 10 per cent within 12 months. The transition to a low carbon UK will be a mammoth task and will in time directly affect us all. Inaction, however, is not an option and the potential rewards for our country are vast. <br> That is why I will be looking keenly at the progress of the Telegraph/Shell Age of Energy partnership and hope participants and readers alike find it an informative initiative. <br>   None http://www.decc.gov.uk/en/content/cms/news/ch_telegraph/ch_telegraph.aspx Rt Hon Chris Huhne Low carbon energy: vast potential rewards for a greener UK (Article by Chris Huhne) 19 July 2010 Department for Energy and Climate Change
  <em>Check against delivery</em> <em>Thursday 08 July 2010</em> Secretary of State – Welcome Address • It’s a great pleasure to welcome you today to DECC’s first Carbon Capture and Storage senior stakeholder conference. <img height="231" alt="Chris Huhne delivers his speech to the CCS Senior Stakeholders Conference" hspace="5" width="350" align="right" vspace="5" border="5" src="/media/viewfile.ashx?filepath=news/chrishccs.jpg&amp;filetype=5"> • Making the UK the First Choice for Investment in CCS” – is certainly something i want to see come to reality. • Low carbon technologies and tackling climate change march hand in hand. But CCS also represents massive opportunity for the UK - for jobs, for development and for our economy. This sector could be worth £3bn by 2020. • And without CCS we know staying below 2C will be that much more difficult and costly – up to 70 per cent more according to the IEA and Lord Stern. • Our coalition priorities are clear. We will be the greenest government ever and we will tackle climate change whilst securing our energy supplies and CCS is a big player in that mix. • We need to meet our national targets to cut our emissions by 34 per cent by 2020 and by 80 per cent by 2050, whilst maintaining a wide energy mix necessary for energy security. • I am under no illusion that there are real challenges to successful demonstration and deployment of CCS. But it gives me great encouragement in overcoming these challenges to announce today that the UK is open for CCS business. The Office for Carbon Capture &amp; Storage is waiting to receive your input on the CCS demonstration programme for a further three CCS projects.  • We are launching a market sounding exercise aimed at potential project developers to get an indication of their level of interest in the programme and more information on their individual projects.  • Later this summer having considered the response to the exercise, I hope to confirm the objectives for the UK programme so that UK projects can prepare their entry into the EU NER competition in autumn.  I remain committed to launching the formal selection process for projects 2 to 4 before the end of this calendar year. • I would also like to hear your views on how you see the role of coal and gas developing and on whether you as project developers and investors would be prepared to take this forward.   • All of this requires the government to work in partnership with business. And this does have to be an endeavoured partnership. I want to avoid a government ‘thumb’ on the back on anyone’s neck. I want to see and use external expertise to see how we can use that knowledge to our advantage. • Along with the primary aim of tackling climate change, our CCS plans create opportunities for UK based business.  We’ve been playing catch-up in other parts of the green economy where other countries have implemented bolder,  more progressive policies. We will not make the same mistake with CCS. I know that business needs certainty and stability and I firmly believe the UK is well placed to lead on CCS and the coalition Government is committed to delivering 4 large-scale demonstration projects.  The role of the Office of Carbon Capture &amp; Storage is to facilitate this delivery. • Already the progress we have seen globally on CCS has accelerated significantly as countries recognise the important role it can play in tackling CO2 emissions from fossil fuels. • The report by the International Energy Agency to the G8 last month highlighted the significant global progress that is being made, but we need to do so much more, not just for domestic plans but also internationally. • The UK was singled out for its notable investment plans and I am eager we build on this by making rapid progress with  our demonstration projects. • But we need to go faster and see wider application of CCS across different sectors and around the globe if we are to effectively combat climate change. The demonstration and deployment of CCS in fossil fuel dependent countries is crucial. The UK has a already has a strong track record in driving international action and will continue to take a leading role and drive harder and faster than ever before. We are now taking this further and at the Clean Energy Ministerial in Washington later this month where we will be bringing together countries and businesses to develop a plan for how CCS can be deployed globally by 2020. • I urge you to engage in this conference, to think what you as individuals and as representatives of your organisations can be contributing to help deliver this challenge, to let us know what we are doing right and what we are doing wrong, and to work with us collectively to make UK the number one location for CCS.    None http://www.decc.gov.uk/en/content/cms/news/SoS_CCSspeech/SoS_CCSspeech.aspx Rt Hon Chris Huhne Secretary of State speech to CCS Senior Stakeholders Conference 15 July 2010 Department for Energy and Climate Change
Europe’s current focus on recovery from recession must not distract us from the urgent question of what kind of economy we want to build. <img height="191" alt="Secretary of State, Chris Huhne" hspace="5" width="191" align="right" vspace="5" border="5" src="/media/viewfile.ashx?filepath=news/chrishccs191.jpg&amp;filetype=5">Unless we ensure that the economic recovery sets our countries on a path to a sustainable low-carbon future, we will face continued uncertainty and significant costs from energy price volatility and a destabilising climate. At the same time we have a tremendous opportunity: to reinforce our own economic recovery, to improve our energy security and to tackle climate change through the development of decarbonised energy sectors, opening up new sources of employment and exports. But Europe is not alone. A global race to lock in a sustainable low-carbon economy has begun. Europe’s economic competitors are not hanging back.<br><br> The key question Europe faces is: do we have the vision to grasp this opportunity and to lead the world in creating this new low-carbon model for economic growth? We are convinced that Europe has the capability – but it does not yet have the right incentives for changing investment patterns. A key barrier is the EU’s current emissions target, a 20 per cent reduction from 1990 levels by 2020, a target that seems now insufficient to drive the low-carbon transition. <img height="190" alt="German Federal Environment Minister Dr Norbert Röttgen " hspace="5" width="191" align="right" vspace="5" border="5" src="/media/viewfile.ashx?filepath=news/rottgen191.bmp&amp;filetype=5">After all, the recession by itself has cut emissions in the EU’s traded sector by 11 per cent from pre-crisis levels. Partly as a result, the current price of carbon is far too low to stimulate significant investment in green jobs and technologies. If we stick to a 20 per cent cut, Europe is likely to lose the race to compete in the low-carbon world to countries such as China, Japan or the US – all of whom are looking to create a more attractive investment environment by introducing low carbon policy frameworks and channelling their stimulus packages into low-carbon investment. This is why we today set out our belief that the EU should adopt an emissions target that represents a real incentive for innovation and action in the international context: a 30 per cent reduction by 2020. This would be a genuine attempt to restrict global temperature rise to 2 degrees – the key climate danger threshold – stiffening the resolve of those already proposing ambitious action and encouraging more from those currently waiting in the wings. It would also make good business sense. By moving to a higher target, the EU would not only have a direct impact on the carbon price through to 2020 but also send a strong signal of our commitment to a low carbon policy framework in the longer term.   We must not forget that it will be overwhelmingly the private sector that will deliver the investment which will build our low-carbon future and moving to 30% will provide greater certainty and predictability for investors. <img height="191" alt="French Environment Minister Jean-Louis Borloo" hspace="5" width="191" align="right" vspace="5" border="5" src="/media/viewfile.ashx?filepath=news/borloo191.jpg&amp;filetype=5">Europe’s companies are already poised to take advantage of the new opportunities.  They currently have a global market share of 22 per cent of the low-carbon goods and services sector, thanks to Europe’s early leadership in tackling climate change. But the rest of the world is catching up. The Copenhagen commitments, though less ambitious than we had hoped, have triggered widespread action, notably in China, India and Japan. The case for early action becomes even more compelling when you take into account the reduction in cost estimates.  Because of reduced emissions in the recession, the annual costs in 2020 of meeting the existing 20 per cent target are down a third from €70 billion to €48 billion. A move up to 30 per cent is now estimated to cost only an extra €11bn more than the original cost of achieving a 20 per cent reduction, a supplement worth less than 0.1 per cent of the EU economy. In addition, delayed action comes with a high price tag: according to the IEA every year of delayed investment on low carbon energy sources costs €300-400 billion at the global level.  Furthermore, these costs were calculated on the conservative assumption that oil will cost $88 a barrel in 2020. Given the current constraints on supply-side investment, rapid growth in consumption in Asia, and the impacts of the Gulf of Mexico oil spill, oil prices may well rise further; under one IEA scenario, the price could reach a nominal $130 a barrel. Rising oil prices would lower the costs of hitting any targets and, under some scenarios, the direct economic effects of hitting the 30 per cent target by 2020 actually turn positive. Businesses and households would save more money, in lower energy consumption, and hence imports, than the extra costs to the economy. Some energy-intensive sectors will be exposed to greater costs than the average. We already try to safeguard them through free emissions allowances where necessary, and alternative measures might be needed to prevent carbon leakage over time. The real threat they face, though, is not carbon prices, but collapsing demand in the European construction and infrastructure markets. The one sure way to increase demand for the materials that these sectors produce is to put in place the incentives to boost investment in large-scale low-carbon infrastructure – voracious users of steel, cement, aluminium and chemicals. Our industry departments are working with these sectors to ensure that we manage this transition effectively and we maximise the opportunities for EU industry. We need to give our companies the chance to grow domestically while continuing to compete internationally. Moving to a 30 per cent target would result in at least a doubling of low-carbon markets compared to sticking to the current 20 per cent. Much of the new growth would be in jobs-rich sectors like energy saving. Ducking the argument on 30 per cent will put us in the global slow lane. Early action will provide our industries with a vital head start. That is why we believe that the move to 30 per cent is right for Europe. It is a policy for jobs and growth, energy security, and climate risk. Most of all, it is a policy for Europe’s future.<br>   None http://www.decc.gov.uk/en/content/cms/news/EU_CC_article/EU_CC_article.aspx Rt Hon Chris Huhne Joint EU Climate Change article by Chris Huhne, Dr Norbert Röttgen and Jean-Louis Borloo 15 July 2010 Department for Energy and Climate Change
  Bournemouth 7 July 2010 CHECK AGAINST DELIVERY Thank you, it’s a pleasure to be here. The LGA conference is certainly getting its money worth out of the coalition – I’m pleased to be following my colleague Eric Pickles who spoke to you yesterday. I hope you see that as an indication of the importance we give to the role of local government– and this is no more true than in the area of climate change. I’ve been in post now for eight weeks and already, the Prime Minister has tasked my Department with leading Whitehall in becoming the greenest government ever. On his second day in office, I think that shows how high on the agenda this issue is. Our task is to create the framework for a move, over the next four decades, to a low-carbon economy.  We have to meet the challenge of climate change, to establish energy security and to create new jobs, new export opportunities and shared prosperity. This will require a radical transformation of the British economy , society –in fact all of us; local and central government, devolved administrations, local communities, Whitehall and Westminster, have a role to play. We can only meet this challenge by working together. The coalition’s programme for government makes our commitment to decentralisation clear – as it says, ‘a radical devolution of power and greater financial autonomy’, including giving councils a general power of competence. We are tearing down the structure of centrally set targets, and returning genuine power to local authorities. And of course you all understand the acute financial constraints we are working under. Even if we wanted to create new responsibilities for local authorities, we don’t have the money to give you to fulfil them. But at the same time everyone here understands the over-riding urgency of tackling climate change. We have, through the Climate Change Act, a legally binding requirement to reduce the UK’s carbon emissions by 80 per cent by 2050. What we need to do now is to construct a new partnership between local and central government, which enables us to meet these goals in the fastest and most cost-effective manner possible. I understand and appreciate the LGA’s ‘offer’ to central government to reform the way in which public services are delivered, using an area-based budgeting model, delivering services which are both of higher quality and more cost-effective. What I want to ask you to think of today, and in the weeks to come, is whether you can put forward to me another ‘offer’, outlining how local and central government can work together to meet our national climate change targets. I also appreciate that we need to lead by example and get our own house in order first. That’s why our first step is cutting Whitehall’s emissions by 10 per cent over the next 12 months. We can learn lessons there from those local authorities which have already taken action, and help to exchange examples of best practice. What we must do in central government is to set an enabling framework to allow local authorities – and communities, and business, and individuals – to take more ambitious action. The heart of the Energy Bill which I will be introducing later this year will be the Green Deal – a mechanism to make it easy for individuals and businesses to save energy, reduce emissions and cut their costs. Energy efficiency has traditionally been the Cinderella at the  energy policy ball, but it is absolutely key area. Our Green Deal aims to make home insulation affordable to all. The aim is that householders will save money by insulating their home. The process will be simplified for customers and the  work paid for upfront. Householders will then pay back over time on their energy bills from the energy savings they make. We have already announced an extension of the CERT – the Carbon Emissions Reduction Target, refocusing on domestic energy efficiency so that 3.5 million extra homes will be helped with loft and wall insulation. Some people – such as the fuel-poor, and those in hard-to-heat homes lacking cavity walls – will need extra help because energy savings alone will not be enough. We intend to provide that help by refocusing the obligations on energy companies. There is a clear role for local authorities in this new framework. Local councils could join with energy companies to reach those who live in houses that need it most; insulation measures are often cheaper if implemented a street at a time. We want to work with you to learn the lessons of the existing Community Energy Saving Programme – or  CESP. These schemes have already demonstrated how energy companies, local authorities and community groups can work together. Through focussing on local supply and demand, which you can gauge best, it can deliver local solutions. We want to build on your experiences in developing the Green Deal legislation. I want to see local authorities playing a central role in delivering the Green Deal and we would very much welcome your ideas. And of course, don’t forget that this is a way of creating tens of thousands of jobs in the home insulation market, everywhere round the country. Our other top priority in building a low-carbon economy is to develop renewable sources of energy. And here as well, we want to see communities and individuals owning a stake in our collective low-carbon future. The coalition programme sets out our commitments to more community-owned renewable energy schemes, and to allow communities that host renewable energy projects to retain the additional business rates they generate. But I want to be able to do even more. My political ancestor Joseph Chamberlain, mayor of Birmingham in the 1870s, developed the doctrine of municipal liberalism, using the power of local authorities more actively to improve the conditions of life of the local population. Among other things, he established a successful municipal gas supply by purchasing two gas companies on behalf of the borough. We can learn from that experience. It is frankly ridiculous that the 1976 Local Government Act prevents councils from selling electricity from local wind turbines, or from anaerobic digestion. I want to see this repealed. By the end of the year, I hope local authorities will be able to sell electricity from renewables – generating revenue to help local services and keep Council Tax down: local communities, truly benefiting from the low-carbon transition. This will allow local authorities to take full advantage of the incentives that are available through feed-in tariffs to invest in renewable energy on their own buildings. We are also keen for local authorities to work with other partners on community scale renewable electricity schemes which can be supported by FITs. There are many areas in which local and central government can work together to construct the new low-carbon economy and society. To provide both clarity and flexibility, we’re proposing a new National Planning Framework. It will replace the plethora of existing guidance with one straightforward document. To support this new framework we will help local authorities, working together, to assess the potential for renewable and low-carbon energy development in their areas. This will ensure a robust and consistent evidence base for planning for renewables at the local level. I referred before to the UK national target of an 80 per cent reduction in emissions by 2050. Within this overall target central government departments have their own carbon budgets covering their own areas of policy. What we need to do now is to discuss with you the appropriate structure through which local authorities can take the lead in accepting responsibility for carbon emissions in their own areas. We do not want to dictate local targets or carbon budgets to you. Equally, we have a responsibility to ensure that central and local government, working together, hit that 80 per cent target. I look forward to hearing your thoughts in this area, including what obstacles you can identify which we can work with you to remove. A key part of this process is having the data available on which to base decisions. For the first time today carbon emissions data from English local authorities’ own estate and operations have been published, covering the 2008/2009 financial year. This I know has taken a great deal of effort by local authorities and shows how seriously the need to measure and assess carbon footprints is taken.  I am pleased that pilots on data on local carbon budgets are continuing. I know that there is much we can learn from the actions taken by many of you. My own local authority, for example, Eastleigh Borough Council, has pledged to reduce its carbon emissions by the 2012 London Olympics by introducing a programme covering all areas of the council and its buildings. Eastleigh recognised the fact that they won’t be able to get to zero carbon, so they have decided to compensate for their residual emissions by tackling issues locally through a scheme that residents, businesses and the council can invest in. Their first priority is additional insulation in older homes, tackling fuel poverty as well as carbon emissions. Over 150 homes have now had loft insulation or cavity wall insulation or both, paid for by CarbonFREE. This is just one example. Many other local authorities have similar stories to tell, from building low-carbon housing developments, to installing local renewable schemes, to converting their vehicles to run on low-emission fuels, to promoting household and street-level energy efficiency schemes. Others, however, have been less ambitious, and it is clear that the country as a whole is not yet on the path to meeting our 80 per cent target by 2050. I am determined that we will rise to this challenge. I also know that we cannot achieve it without you. I want to create the framework that ensures that local and central government together meet that target, that allows local government and local communities to deploy the innovation, ingenuity and creativity that I know you possess to meet local needs. I want to ensure that government at all levels – local as well as central – meets our pledge, to become the greenest ever. END None http://www.decc.gov.uk/en/content/cms/news/LGASpeech/LGASpeech.aspx Rt Hon Chris Huhne Chris Huhne speech at the LGA annual conference 07 July 2010 Department for Energy and Climate Change
<strong>Monday 5th July 2010</strong> The coalition Government's emergency Budget began to stabilise the public finances and lay the foundations for economic recovery. The next step is to ensure that what emerges from recession is a different kind of economy: rebalanced away from excessive reliance on household debt, property markets and banking, with prosperity spread more evenly across the country, supported by modernised and efficient infrastructure – all of which will support long-term, sustainable growth. However, one of this Government's crucial challenges is to ensure that this growth does not occur at the expense of the environment, but rather for its benefit. The balance must tip away from reliance on fossil fuels for power, heat and manufacturing. We aim to construct a low-carbon economy that will meet our ambitious climate-change targets, deliver energy security and contribute to economic recovery. If we do this right, there is a real chance of a win-win: investment in the short term that stimulates demand and generates jobs, and at the same time prepares the ground for the long-term development of a low-carbon economy. With the global market for low-carbon goods forecast to grow by around 4 per cent a year up to 2015, this is a major export and employment opportunity. More than 900,000 people in Britain already work in this sector, so we are not short of expertise. Indeed, the UK is already a leader in key sectors such as offshore wind power. With an estimated £200bn needed by 2020 to replace our ageing power stations with secure low-carbon energy, as well as the investment needed to make a reality of high-speed rail and electric cars, the opportunities are enormous. We do not underestimate the extent to which, with modest Government support, the private sector is already pursuing low-carbon market opportunities. Toyota, for example, has just launched the Auris Hybrid, the first full hybrid produced in Europe, in Burnaston, Derby. The Nissan Leaf electric car will be produced in Sunderland, where staff are being hired to work in the new battery plant. And RWE Innogy and their partners have announced a €2bn (£1.65bn) investment in the Gwynt y Mor offshore wind farm off North Wales, while Dong Energy's new Gunfleet Sands offshore wind farm is now helping to power Britain. Thanks to the huge budget deficit however, we will need a new approach if significantly greater investment is to take place. We cannot afford to dole out unlimited subsidies. Even if such an approach had been shown to work – which, given the UK's patchy record in picking winners, is far from the case – we lack the financial room to stimulate investment directly. The bulk of investment in sustainable low-carbon growth will need to come from the private sector. To make this happen, we aim to establish a long-term framework of incentives, and a policy framework to mobilise private-sector capital. The emergency Budget gave an early indication of several of the key steps. First, we need to make sure that the parameters within which the market operates send the right price signals. The current framework clearly isn't working. The current carbon price, for example, provides a very limp incentive to green investment. That's why the Budget announced plans to consult on reforms to the Climate Change Levy to provide more certainty and support to the carbon price; and that's also why the Government is committed to arguing for an increase in the EU emissions reduction target from the current 20 per cent by 2020 to 30 per cent. Further reforms of the energy market to promote low-carbon generation will follow in the Energy Bill. Getting the market framework right is necessary, but by itself not sufficient. What resources we have should be used where we can make a real difference – such as in supporting infant technologies and encouraging research. These should bridge the gap in areas that are crucial in the long term but, because they are relatively new technologies, still look somewhat risky in the short term. Our announcement today of £10m in grants to companies working on next-generation offshore wind technology is a perfect example. With these exceptions, however, the Government cannot directly fund the major investments the country needs – which is why our plans for a Green Investment Bank, also flagged up in the Budget, are so significant. Of course, there is much to be decided about how this might work. Bob Wigley's comprehensive review of the issue, published last week, sets out one possible model – a commercially independent bank given clear overarching goals for green investment in new technologies and infrastructure. Innovative green financial products could give an opportunity for individuals, as well as institutional investors, to take a stake in the infrastructure to support the new green economy. We will study this – and other options – carefully, and detailed proposals will be published following the Spending Review. Close attention will be paid to the principles of effectiveness, affordability and transparency. But no one should doubt our determination to make it work. Green investment is not only about multi-billion-pound initiatives. Relatively small energy-efficiency measures can not only reduce carbon emissions but also help homes and businesses save money. Our Green Deal programme will ensure householders and businesses can pay back the up-front costs through lower energy bills, with extra help provided for low-income groups and hard-to-insulate buildings. Although individual measures such as these are small, together they provide another major opportunity for growth and employment. The coalition's commitment is clear: to implement a full programme of measures to fulfil our joint ambitions for a low-carbon, eco-friendly economy. Over the next few years, we aim to put in place a framework that will provide the private sector with the confidence needed to invest billions of pounds here in Britain in the face of global competition. Investment in low-carbon technologies and infrastructure, from electric vehicles to new renewables to home insulation, will underpin economic growth for long-term prosperity and climate security. As prosperity is locked in for the long term, carbon must be permanently locked out.   None http://www.decc.gov.uk/en/content/cms/news/indie/indie.aspx Rt Hon Chris Huhne Chris Huhne and Vince Cable: The green economy is still viable (Independent Article) 05 July 2010 Department for Energy and Climate Change
  I’m sorry I can’t be with you in person today. But I want to personally convey to you three things:   Both the Prime Minister and I stated quite categorically that we will be the greenest government ever. As a coalition we want to build a different kind of economy. We need a low-carbon economic recovery to tackle the challenges of climate change and energy security. And of course in this challenge lies a tremendous opportunity. I know that you need clear and consistent policies so you can make long-term investments. <br> I am committed to ensuring you have the right incentives for low-carbon growth. The offshore wind industry can be a key player in creating the investment, exports and jobs we need to bring back economic prosperity. I am personally absolutely committed to offshore wind. You don’t need me to tell you that we are in a unique position to becoming a world leader in this industry, or that as an island nation we should be harnessing our abundant offshore wind, wave and tidal resources. I want to work with you accelerate deployment and technical advances so we can meet Renewable Energy targets – especially in the short term. But I know that your investments are looking far beyond 2020. That is why we are asking the Committee on Climate Change to consider higher targets for renewable energy generation beyond 2020 so you can be sure of government’s long-term commitment to the renewables industry. I think you have made a fantastic start, with 14 offshore wind farms operating in the UK today, and 1.5 GigaWatts of further construction underway.<br> But it is not enough. For you as an industry, and for us as a country. I was delighted to see that you have set out ambitions to generate up to 50 GigaWatts of energy from offshore wind by 2020 - enough to generate enough electricity to power the equivalent of around 33 million homes. And I was pleased to read the recent Offshore Valuation report say that we could even have the potential to become a net electricity exporter. This really can be an industry to rival the North Sea. It is not going to be cheap. But as part of the £200 billion of investment needed in our energy infrastructure over the next decade, tens of billions of investment will be needed in the UK offshore wind industry.<br><br> That is both a challenge and a huge opportunity for UK plc. It will require significant effort from Government, the Crown Estate, the investor community and most importantly you – the wind industry. Because we need your co-operation, your partnership to meet this challenge. As the UK remains the global leader in operating offshore wind, we are committed to retaining this position by working closely with industry to overcome current barriers and help further investment. This is why the Government will be supporting the Offshore Wind Developers’ Forum, which my colleague, Charles Hendry will co-chair. By providing a platform for all developers investing in UK offshore wind projects, we can work together towards addressing the key barriers to these ambitions. We are also currently considering in detail how creating a network of marine energy parks can work to push the wave, tidal and wind sectors forward. Each marine energy park will be unique and different; building on the strengths of the region in which it is based and bringing together such elements as grid availability, industrial and supply chain development, economic regeneration, skills and academic excellence. We are also working to speed up access to the electricity networks and developing a good regulatory regime for offshore electricity transmission. In doing so we are listening carefully to the concerns industry have raised with us. We have the same ambition as you – that offshore wind turbines can come on stream and on grid as soon as possible. We want this country to be the best place in which to invest . We’re already starting to see some of the industrial benefits of our commitment to wind energy, with some big recent announcements by some of the world’s leading companies that they are coming to the UK. We intend to build on this going forward to ensure that we fulfil our ambitions for a low carbon and eco-friendly economy. We will continue to provide clear signals to the market through the Renewable Obligation and Feed In Tariffs for example. We are committed to maintaining banded Renewable Obligation Certificates (ROCs) and any move to a FIT will be done with the aim of ensuring that the UK is best placed to meet 2020 targets, protecting both investors and consumers.<br> We’ve got the intellectual capital to build on. We have world beating universities. We are a world leader in research. The UK is now home to world class testing facilities, from the Orkneys and NAREC in Northumbria to the Wave Hub in the South West. I look forward to working with you over the years to come to ensure we can all harness the benefits of renewables in the UK. Greater energy security. carbon emission savings. And new jobs and economic regeneration for the country. <br> I hope you have a successful conference and wish you the very best of luck. We will be by your side on this journey. Thank you<br>   None http://www.decc.gov.uk/en/content/cms/news/renukcon10/renukcon10.aspx Rt Hon Chris Huhne Renewable UK conference (Transcript of Chris Huhne video message ) 30 June 2010 Department for Energy and Climate Change
<strong>Thursday 24 June 2010</strong> <em>(check against delivery)</em> This is the first coalition in sixty five years. The last coalition won a world war. This one must tame our biggest ever peacetime deficit. Coalitions can provide strong and decisive government because of their broad support. Indeed, seven of the ten biggest fiscal consolidations in the developed world since 1970 were under coalitions. But it is not just a question of recovery from recession, difficult enough though that will be. The real challenge is to build a different kind of economy. One that cuts our carbon emissions to tackle climate change and which makes our energy secure in a volatile world. In this challenge lies a tremendous opportunity. By putting in place the right incentives for low-carbon growth, we can help create the investment, exports and jobs we need to bring back economic prosperity. This is what I would like to talk about to you today. I aim to show you how our approach will be different from that of the last thirteen years; and how we intend to make a reality of our pledge to make this the greenest government ever. I understand the role that business has played in so much of the progress made in the last few years on infrastructure, investment and new technology. We need to build on this progress to create a new partnership between business and Government. You need clarity, certainty and stability from Government to deliver the investment we all need. We’ve inherited bad habits. For too long we heard about knee-jerk reactions that had no real understanding of finances, and indeed, the business world. But the absolute necessity of dealing with the public spending deficit means that we can’t lurch back into a patchwork of solutions, initiatives and agencies, doling out grants. Those days are gone. The imperatives of economic recovery, energy security and climate stabilisation all march hand in hand. All require a commitment to a consistent policy set for the long term. I look at these challenges in the same terms as businesses and investors – in terms of risk and reward. My business background was starting and running one of the biggest groups of economists looking at country risk. Helping to run a successful ratings agency taught me a lot about risk. In particular, I learned the need to take decisions yourself - or the decisions get taken for you. I learned that business needs firm frameworks from policy-makers – just as much in energy as in banking. And I learned that short term headline-grabbing gimmicks from government are worse than useless. This coalition aims to provide stability and predictability – not least, a fixed-term five-year parliament. Given the tough decisions we have to take – starting with this week’s budget – we are determined to see the country through to growth and prosperity again. But the type of growth is crucial. Simply going back to dependence on fossil fuels would be folly. It would make us vulnerable to oil price spikes and volatility. It would deny us opportunities for green growth rich in jobs and export chances in the low-carbon markets that are expanding around the world. The case, to me, is clear – we must fix ourselves on a path to a decarbonised society and economy, stimulating growth while meeting the twin challenges of climate change and energy security. Let me turn to the first of those challenges: climate change. Science tells us the probability of climate change being man made is 90 per cent. If someone told us that there was a nine in ten chance of your house being burned down, I suspect most of us would take care to renew the fire insurance. And that is the calculus that most Governments are making despite the disappointments of Copenhagen. It is simply not true that others are doing nothing, as some have argued. Even as we continue to seek a legally binding global agreement, there is rapid action in China and Japan. Even in the United States, where prospects of early cap and trade legislation are slim, the administration is planning on pushing business hard through the Environmental Protection Agency. In turn this means that Europe’s lead in low-carbon technologies is now at risk. Our industrial future – our competitiveness and our prosperity – depends on being a pioneer of the new green industries that will decarbonise our economies, and we need to be ahead of the international game. The impacts of the changing climate by themselves give adequate cause for radical action. But they go hand in hand with the second challenge – that of ensuring energy security. In an uncertain world, we need security of supply at home and abroad. So it is vital we make the most of our domestic oil and gas assets. There is still potentially 20 billion barrels of oil equivalent, possibly more, left to produce.  We must continue to invest in exploration, development and production - whilst at the same time maintaining high standards of management and minimising environmental impacts. The events in the Gulf of Mexico are devastating. The impacts of the explosion on the Deepwater Horizon give us pause for thought, particularly given the beginning of exploration in deeper UK waters West of Shetland. I am confident that the UK’s regulatory regime is in good shape to manage the risks of deep-water drilling. But as oil becomes ever more difficult to extract, and as demand for oil surges in the emerging economies, we need to recognise the dangers inherent in our history of fossil fuel addiction. Look at the long term forecasts for fossil fuel demand. Note the new constraints on marginal exploration. And see what’s happened with energy price spikes as global recovery gets under way. We therefore need to take action on two fronts: to stimulate the expansion of low-carbon technologies, particularly in power generation, and improve the energy efficiency of our economy. The UK faces a massive challenge. No less than £200 billion of investment is needed in our energy infrastructure over the coming decade. In setting the framework to encourage and steer this investment in the right directions, we recognise our responsibility to support infant and emerging technologies - like renewables and carbon capture and storage - while removing unnecessary barriers to investment, like planning, offshore connections and grid bottlenecks. We have enormous potential in renewables. Thanks to the Renewables Obligation, onshore wind has become cost competitive. The UK is already the world leader in offshore wind and we are also supporting wave and tidal stream. The prospects for growth in all these areas is excellent. And with the new feed-in tariff, and support for renewable heat, community and micro-generation can also play a part. But substantial investment in low carbon technologies such as these will not happen quickly enough unless we strengthen the incentives. We need a meaningful carbon price to underpin investment decisions. The current price is simply not doing this. It is not yet driving our economy towards the green technologies of the future anywhere near quickly enough. A 30 per cent cut in EU emissions by 2020 – up from the existing 20 per cent target – would push the price higher, create business opportunities in the domestic market, and put the EU at the forefront of the international race.  And, in light of the recession, it is not expensive to achieve. It would cost just 0.1 per cent of EU gross domestic product more than the original pre-recession estimate of achieving 20 per cent. And those cost estimates fall even further if oil prices rise.  We are arguing for the 30 per cent target within the EU. But we are also taking action in the UK. On Tuesday the Chancellor announced that we will reshape the Climate Change Levy as the way of delivering our coalition commitment to a carbon price floor. That will support new investment across low-carbon generation. Including, of course, nuclear. The coalition agreement is clear that new nuclear can and will go ahead – but only so long as there is no public subsidy, a pledge robustly guaranteed by the state of the public finances. We will learn from past mistakes. Streamlining planning. Dealing with waste, reprocessing and decommissioning. And a clear policy framework. The third low carbon energy source is of course fossil fuels with carbon capture and storage, giving us the potential to provide the flexible response needed to complement intermittent wind. We are committed to four demonstration projects that will enable production at commercial scale. This is a technology that can also provide us with enormous export opportunities as we decarbonise electricity generation. The Government will shortly make a statement setting out our plans for major infrastructure development which will include details on National Policy Statements. The abolition of the Infrastructure Planning Commission (IPC) is a coalition agreement. I understand your need for clarity, stability and speed in planning approval, but I am quite clear that the new system will not slow down planning decisions. If we are to generate that £200 billion of investment in energy infrastructure, we have to create an enabling environment. We need to bring down the cost of borrowing – and Tuesday’s budget has set out our intentions. But we also need to leverage private sector investment in energy infrastructure and low carbon technology through a Green Investment Bank. As announced we are working on a wide range of options for the scope and structure of the Bank and will bring forward detailed proposals in the Autumn. Alongside investment in new energy infrastructure, we need to reduce overall energy demand. So let me now turn to the Green Deal – our way of expanding the energy mix to a fourth resource. Energy saving is the cheapest way of closing the gap between demand and supply, yet it is the Cinderella of the energy ball. On the near horizon, energy saving will mean smart meters and smart grids that can give consumers control over their appliances - for example ensuring that fridges power down during temporary price surges. This will take time to develop. But there is also much we can do now. To date we have heard too much talk and too little action. Britain has on average some of the oldest housing stock in Europe, much of it built in the era of cheap coal - but that’s no excuse. Why have we kept building inefficient homes?  We have been locking in waste, which is why my colleague Grant Shapps, the Housing Minister, is moving quickly to toughen building standards. Most of the homes we will use in 2050 have of course already been built. That is why we have big plans for the Green Deal. It will be my department’s flagship bill for this first session. Its aim is a radical overhaul of our existing homes to save energy, carbon and costs. At the moment, we may as well be burning £50 notes outside our front doors. We use more energy per home than does Sweden.  And this waste cannot be ignored, because households account for a quarter of all carbon emissions. This is another area which can help drive economic recovery. The market is big. There are currently up to 14 million homes in the UK which could benefit from insulation under the Green Deal. We are working on the package for each home, which could unlock tens of billions of spending in the coming years. The Green Deal is a completely new and ambitious approach to home insulation. The aim is that every participating householder will save money by insulating their home. Energy companies and high street stores will help guide customers through a simplified process and pay for the work upfront. Householders will then pay back over time on their energy bills from the energy savings they make. Some people – such as the fuel-poor, and those in hard-to-heat homes lacking cavity walls – will need extra help because energy savings alone will not be enough. We intend to provide that help by refocusing the obligations on energy companies. Local authorities could also join with energy companies to reach those who live in houses that need it most. Insulation measures are often cheaper if implemented a street at a time. And we are planning to strengthen the Government’s powers to target energy insulation measures on the highest priority cases. A competitive market will provide best value and confidence in products for the customer. With professional marketing from trusted brands, we ought to make energy efficiency as attractive as broadband or satellite TV. And the Green Deal – by tying energy saving to the people who pay the energy bills – will be a breakthrough not just for owners but for tenants as well. We are also looking at whether it could apply to businesses. To sustain the market on the long march to a comprehensive refit of our housing stock, we are also looking at triggers and incentives to encourage demand. All in all, this will send the right signal to the energy efficiency industry, providing investment confidence and job opportunities. Indeed, this green growth sector can provide a big fillip to the economic recovery. We’ve already said we want this to be the greenest government ever, and that means that we must practice what we preach. The Prime Minister in his second day of office committed himself and the Government to cutting 10 per cent from Whitehall carbon emissions in the next twelve months. This is vital because we must lead by example. We have no business encouraging people to change their lifestyles if we can’t do as we say. And the same argument applies just as much to the international arena – we can’t argue for an ambitious global deal if we can’t demonstrate how to do it at home. We intend to set high standards for the energy sector too. We need strong regulation and zero tolerance of market abuse and poor service to protect those who are most vulnerable. Because there are those who need protecting. The era of cheap energy is over.  Today’s consumers know that. Tomorrow’s bills will undoubtedly be higher, and I do not want to see the energy challenge as an excuse to inflate our energy bills unnecessarily. Consumers must be respected and treated fairly. Energy companies must take full responsibility for their actions. I hope I have given a taste of the coalition’s strategy. To set a demanding policy framework, ideally along with our EU partners. To create the long-term incentives to invest in low carbon energy sources so that we can make the shift to an increasingly electric economy. To save energy as well as produce it. And all in a package which will improve energy assurance and security whether our supplies come from home or abroad. Labour claimed to have 2020 vision. We need to have 2050 vision. Our 2050 pathways project shows us the scale of the challenge. We will not hide it. We will publish detailed analysis and underpinning data alongside our first annual statement on energy in July, and we will welcome comments and feedback. I want Britain to be the best place in the world to do energy business. To lead the world in decarbonising the economy. To develop the unique products and processes that will power the second industrial revolution - the green revolution - just as steam, coal and iron drove the first. Britain has a proud history as the pioneer of industry and development. Let us rediscover that spirit now as we face the challenges of a green future. <br>   None http://www.decc.gov.uk/en/content/cms/news/Energy_Summit/Energy_Summit.aspx Rt Hon Chris Huhne Chris Huhne speech to UK Energy Summit 24 June 2010 Department for Energy and Climate Change
14 June 2010 The House will wish to join me in expressing our deepest sympathy for those bereaved or injured in the explosion on 20 April. And for all the individuals and communities affected by spilling oil or fearing that they will be affected over the days and weeks to come. Our thoughts must be first with them. On 20 April, an explosion and subsequent fire on board a drilling rig operated by Transocean under contract to BP in the Gulf of Mexico tragically killed 11 workers. On 22 April, the rig sank. On the sea bed, 1600 metres below, substantial quantities of oil were leaking into the ocean. The Blow-out Preventer which should have sealed this leak failed.<br> The causes of the accident are now subject to a US Presidential Commission of Enquiry and to civil and criminal investigation. There has never been such a large leak of oil so deep in the sea. Attempts by BP, working under the direction of the US authorities, to seal the leak were not successful. The company then pursued a strategy of capturing as much oil as possible. In recent days, more than 15,000 barrels a day of oil has been recovered. However it is also now thought that the leak is worse than previously thought. The US Government’s estimate of the daily flow of the leak is now 35,000-40,000 barrels per day. BP hope to be able to increase significantly the amount of oil it is capturing, but very large quantities of oil continue to be released into the sea. Moreover, the leak will not be fully stopped until August at the earliest, when the first relief well which BP is already drilling should enable the original well to be plugged. There is also an enormous operation to address the impact upon the environment of oil already in the water. Working under US Coastguard Admiral Thad Allen, over 2000 boats have been involved, skimming the water and using dispersant chemicals. Thousands of workers and volunteers on-shore are removing oil and maintaining coastal defences. The House will wish to join me in paying tribute to those involved in this work. We understand and sympathise with the US Government’s frustration that oil continues to leak at the rate that it does. To appreciate the scale of this environmental disaster, each week a quantity of oil equivalent to the total spillage from the Exxon Valdez is escaping into the sea. The US administration has said that BP is doing everything asked of it in the effort to combat the spill. We of course look to the company to continue in this and will do everything we can to help. The key priority must be stopping the environmental damage. In their phone conversation at the weekend President Obama reassured the Prime Minister that he has no interest in undermining BP’s value and that frustrations in America have nothing to do with national identity. We have offered the US authorities dispersant chemicals, and will respond quickly and sympathetically to any request from US authorities for help. Honourable Members will remember that in 1988 the Piper Alpha rig in the north sea exploded, with 167 fatalities. Following that disaster, our regulatory regime was significantly tightened, and we split the functions of licensing and health and safety in the UK. The US have announced that in future in the US these functions will be dealt with by separate organisations. We hope that we have useful experience to offer of building and operating such a system. Officials from my Department and the Health and Safety Executive have been discussing this with their US counterparts. Here in UK waters, it is my responsibility to make sure the oil and gas industry maintains the highest standards. I have had an urgent review undertaken. It is clear that our safety and environmental regulatory regime is already among the most robust in the world. The industry’s record in the North Sea is strong. But with the beginning of exploration in deeper waters West of Shetland, we must maintain vigilance. Initial steps are already under way, including doubling annual environmental inspections by DECC to drilling rigs. I will review our new and existing procedures as soon as detailed analysis of the factors which caused the incident in the Gulf of Mexico is available, building upon the work already begun by the newly formed Oil Spill Prevention and Response Advisory Group. Given the importance of global deepwater production during our transition to a low carbon economy, I will also ensure that lessons and practice are shared with relevant regulators and operating companies. Mr Speaker, I now turn to the position of BP. It is hugely regrettable that the company’s technical efforts to stop the spill have, to date, been only partially successful. But I acknowledge the company for its strong public commitment to stand by its obligation, to halt the spill, and to provide remedy and payment of all legitimate claims. As BP’s chairman has said, these are critical tasks for BP must complete in order to rebuild trust in the company as a long term member of the business community in the United States, in Great Britain and around the world. BP remains a strong company. Although its share price has fallen sharply since April, the company has the financial resources to put right the damage. It has exceptionally strong cash flow, and will continue to be a major employer and vital investor here and in the United States. In many ways, BP is effectively an Anglo-American company with 39 per cent of its shares owned in the US against 40 per cent in the UK. Mr Speaker, there has been much speculation in the press about the impact on UK pension funds and whether the company will pay a quarterly dividend. This is entirely a matter for the BP Directors, who will no doubt weigh all factors and make a recommendation to their shareholders that is in their best interest – which of course includes the best interests of many UK pension funds. Many citizens have real and legitimate worries about their pensions, but I would like to reassure the House that not only is BP financially sound, but pension funds that hold BP shares generally also hold a very diverse portfolio of assets. Their exposure to a single company, even a company as economically significant as BP, is limited. In concluding my statement, I wish again to express the Government’s profound sympathy to those in the US affected by this accident, and by its aftermath. The priority must be to address the environmental consequences of the spill. Our concentration is on practical measures that can help in this. This disaster is a stark reminder of the environmental dangers of oil and gas production in ever more difficult areas. Coupled with the impact of high-carbon consumption this highlights yet again the importance of improving the energy efficiency of our economy and the expansion of low-carbon technologies. We must and will learn the lessons of these terrible events. None http://www.decc.gov.uk/en/content/cms/news/100614oilspill/100614oilspill.aspx Rt Hon Chris Huhne Implications of the Gulf of Mexico oil spill for the UK (Oral Parliamentary Statement) 14 June 2010 Department for Energy and Climate Change
  The Secretary of State, Chris Huhne has sent his congratulations to Christiana Figueres on her appointment as UNFCCC Executive Secretary Chair.   None http://www.decc.gov.uk/en/content/cms/news/CH_letter/CH_letter.aspx Rt Hon Chris Huhne Letter of congratulations from Chris Huhne to Christiana Figueres 19 May 2010 Department for Energy and Climate Change
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March 2011
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