Osborne vows UK emissions cuts will not lead Europe


George Osborne has vowed the UK will not lead the rest of Europe in its efforts to cut carbon emissions, raising the prospect that the country’s carbon targets could be watered down if the EU does not agree to more ambitious emissions reduction goals.

In a potentially explosive intervention, Osborne insisted the government will only cut emissions in line with its neighbours to ensure British businesses are not disadvantaged.

Speaking at the Conservative party conference, the chancellor accused environmental regulations of “piling costs on the energy bills of households and companies” and argued that the government should not adopt green targets that damage the business sector.

“We’re not going to save the planet by putting our country out of business,” he said. “So let’s, at the very least, resolve that we’re going to cut our carbon emissions no slower, but also no faster, than our fellow countries in Europe.”

He also stressed the UK accounts for less than two per cent of global greenhouse gas emissions, compared with 40 per cent from the US and China, warning that if the UK attempts to cut emissions too quickly, carbon-intensive businesses will simply migrate overseas.

Significantly, Osborne said he had “insisted” on a commitment that the UK’s emissions reductions would not outstrip the rest of Europe as part of the agreement on the recent fourth carbon budget, which commits the UK to halving emissions against 1990 levels by 2025.

This is a reference to the deal brokered earlier this summer, which saw the UK agree to the ambitious targets recommended by the Independent Committee on Climate Change, but only after the Treasury had secured a commitment to review the targets if the EU failed to agree to similarly ambitious targets for post-2020.

The comments threaten to reignite the cabinet row over the UK’s emissions targets and represent a blow to Lib Dem ministers who have hailed the demanding emissions targets as a major achievement.

However, it remains to be seen if Osborne’s commitment not to cut emissions faster than the rest of Europe can be realised.

Under the UK’s Climate Change Act, the government is legally committed to cutting emissions by 35 per cent by 2022 and 50 per cent by 2025.

In contrast, the EU is only committed to cutting emissions 20 per cent by 2020, and while the UK and a number of other countries are lobbying Brussels for this target to be increased to 30 per cent, several member states remain resistant to any change.

Any attempt by Osborne to cut the UK’s targets in the event the EU fails to agree a similarly aggressive set of post-2020 targets will almost certainly be opposed by the Lib Dems, committed green MPs in his own party, green businesses and NGOs, and the Independent Committee on Climate Change.

However, the speech will raise the prospect of a review of the UK’s carbon targets that would see Osborne and other influential Conservative ministers push for a watering down of the previously agreed carbon budgets.

Green groups slammed Osborne’s comments, accusing him of undermining the coalition’s green agenda by falsely blaming environmental policies for energy price hikes.

“The chancellor clearly can’t do his sums – government figures show the reason our power bills are soaring is the UK government’s addiction to coal, gas and oil, not green regulation that safeguards our economy,” said Friends of the Earth’s executive director, Andy Atkins. “Harnessing the UK’s clean power potential is the only way to boost our energy industry and keep costs down in the long run - it’s astonishing that Osborne seems to be in league with those falsely blaming moves to free us from our costly fossil fuel habit.”

His comments were echoed by Greenpeace’s senior policy advisor, Ruth Davis, who accused the chancellor of stealing “a line straight out of George Bush’s climate playbook” with his pledge not too adopt green policies until competitors do likewise.

“In reality it’s in Britain’s interests to lead the world on climate change because the economies that win the race to develop clean renewable energy systems will be the ones that sell them to the rest of the world,” she said. “The move to review the UK’s climate targets if Europe doesn’t cut its carbon fast enough is not new, it was agreed and announced months ago. By presenting it as a break with the past just weeks before governments prepare to gather in South Africa to agree a new international climate deal, the chancellor has put red meat for party activists above global leadership.”

However, John Cridland at the CBI predicted that manufacturers would welcome Osborne’s commitment to ensure environmental targets are in line with Europe.

“For businesses, one of the challenges to growth is rising energy costs, so manufacturers will be encouraged by the chancellor’s commitment that cutting emissions will be no faster than our European competitors,” he said.

Elsewhere, Osborne offered some succour to the UK’s low-carbon economy, underlining his commitment to the planned Green Investment Bank and announcing a £195m investment programme in science and computing initiatives.

He revealed that a £50m grant would help support the development of commercial applications for graphene, an ultra-light and conductive material developed by scientists in Manchester that has been hailed a hugely significant breakthrough in the development of clean technologies such as lightweight aircraft and renewable energy systems.

He also announced a £150m investment in high-performance computing programmes and IT infrastructure, some of which will help support improvements in energy efficiency.

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