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A low-carbon reality

The minister for energy and climate makes the case for the coalition’s policies.

Gone are the days of governments banging on about the green economy divorced from the challenges facing the rest of business and without any reference to what was happening in the real economy.

The truth is that businesses - especially small and medium-sized enterprises (SMEs) - are finding it hard to make ends meet at the moment.These really are tough times. And the last thing that companies need is more Whitehall greenwash rammed down their throats.

We need a new low carbon reality. One which sees green business - and the effort to reduce emissions - as part of the wider success of the economy. One in which efforts to improve resource efficiency and drive down carbon emissions underpin, rather than compromise, the competitiveness of the British economy.

That reality lies at the heart of this coalition's approach to Britain's low carbon transition.

Business is right to demand certainty and direction from government. And that's what this coalition is determined to provide. My mantra is give business plenty of TLC - transparency, longevity and certainty. It's what guides our policy making and is vital to establishing a successful prosperous green economy.

As part of our wider growth effort and work to rebalance the economy, we want a successful green economy in the UK, moving away from our dependence on expensive fossil fuels to a future powered by low carbon energy and green technologies. This shift of course represents challenges but also a massive business opportunity with tens of billions of pounds of investment needed and green job opportunities up for grabs over the next decade.

The green economy isn't just an economy for big companies. Businesses of all shapes and sizes will be at the forefront of this drive. Success will require great innovation and technological progress - one of the key attributes of Britain's SME sector.

And I know for myself that there are already many great British firms that are stealing a march on this global low carbon revolution and are at the forefront of green tech innovation. I want this to continue and it is up to this coalition to create the right conditions to allow them to thrive and prosper.

Firstly, despite the massive deficit we inherited, the coalition is investing billions of pounds of public money into the low carbon transition.
Not just throwing money at the problems but investing smartly, with rigour and in ways that leverage in the maximum private sector investment and create opportunities for our businesses.

We are putting £3bn into the Green Investment Bank as well as £860m to support renewable heat, stimulating investment in green heat technologies by a massive £7.5bn by 2020. Hundreds of millions of pounds of further funding has also been made available to boost a variety of low-carbon technologies including offshore wind.

This represents a huge boost for the low carbon goods and services market in the UK and also represents a huge opportunity for UK exports too.The global market for low carbon goods and services is currently worth £3.2trn and is estimated to grow to over £4trn by 2015.

But the "green economy" isn't just about government spending. Our second priority is to undertake radical reforms that are designed to create new markets and to attract greater amounts of private investment into the green economy. It's about freeing up the private sector to do what it does best: innovate and create wealth. Our proposals for electricity market reform will create a new market which - for the very first time - will create large scale energy efficiency investment to compete with new power generation projects.

It's also about business becoming more energy efficient - a key requirement for any competitive firm in the 21st century. For all businesses, energy efficiency can make a real difference to the bottom line and increase competitiveness.

That's why we're bringing in the Green Deal, to be introduced next autumn for households as well as businesses, to help address the stumbling block of access to capital for green improvements.

Up and down the UK, from shops and offices to pubs and clubs, firms will be able to improve the energy efficiency of their buildings at no upfront cost. The expected energy savings should be higher than the cost of repayment and will help businesses spread the costs over time rather than shelling out upfront.

The Green Deal is not only a great way to tackle the financial barrier to energy efficiency, it also represents a massive new business opportunity with tens of billions of pounds of investment needed, products to be developed and jobs to be supported.

By creating a new market opportunity for private sector finance we will provide another major opportunity for growth and employment with tens of thousands of jobs likely to be created in the home insulation market alone by 2020. We want the Green Deal to be a real success story for British business.

The Prime Minister has committed this coalition to be the greenest government ever. We are driving forward the agenda in tough economic times but we are also absolutely certain that success depends on a business friendly approach to low carbon policy. That is what you'll get from this coalition; big ambition, long term vision but absolutely grounded in the economic realities of today.

Greg Barker MP is minister for energy and climate change

This article originally appeared in the New Statesman supplement, "The green tech revolution"

This article first appeared in the 07 November 2011 issue of the New Statesman, The triumph of the Taliban

Photo: Getty Images
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It's time for the government to think again about Hinkley Point

The government's new nuclear power station is a white elephant that we simply don't need.

Today I will welcome Denis Baupin, Vice President of the French Assembly, to Hinkley.

His own choice to come and visit the site of the proposed new nuclear power station reflects his strong desire to prevent the UK disappearing up a dangerous dark alley in terms of energy policy. It also takes place as France takes a totally different path, with the French government recently adopting a law which will reduce nuclear energy in the country.

Greens have opposed Hinkley ever since the government announced its nuclear strategy. Hinkley, with its state aid and an agreed strike price of £92.50 per megawatt, has always been financially and legally suspect but it is now reaching the level of farce. So much so that George Osborne is required to be economical with the truth in front of a House of Lords committee because he cannot find anything honest to say about why this is a good deal for the British people.

Mr Baupin and I will join hundreds of protestors – and a white elephant – to stand in solidarity against this terrible project. The demonstration is taking place under a banner of the triple risks of Hinkley. 

First, there are the safety and technological risks. It is clear that the Pressurised Water nuclear reactor (EPR) – the design proposed for Hinkley C – simply does not work. France’s nuclear safety watchdog has found multiple malfunctioning valves that could cause meltdown, in a similar scenario to the 1979 Three Mile Island nuclear accident in the US.  The steel reactor vessel, which houses the plant’s nuclear fuel and confines its radioactivity, was also found to have serious anomalies that increase the risk of it cracking. Apart from the obvious safety risks, the problems experienced by the EPR reactors being built at Flammanvile in France and Olkiluoto in Finland have pushed the projects years behind schedule.

Secondly, Hinkley poses risks to our energy security. Hinkley is supposed to produce 7% of the UK's energy. But we now know there will be no electricity from the new nuclear plant until at least 2023. This makes power blackouts over the next decade increasingly likely and the only way to avoid them is to rapidly invest in renewable energy, particularly onshore wind. Earlier this week Bloomberg produced a report showing that onshore wind is now the cheapest way to generate electricity in both the UK and Germany. But instead of supporting onshore wind this government is undermining it by attacking subsidies to renewables and destroying jobs in the sector. 

Thirdly, there is the risk of Chinese finance. In a globalised world we are expected to consider the option of allowing foreign companies and governments to control our essential infrastructure. But it is clear that in bequeathing our infrastructure we lose the political control that strengthens our security. The Chinese companies who will be part of the deal are part owned by the Chinese government and therefore controlled by the Chinese Communist Party. What a toppy-turvy world globalisation has created, where our Conservative British government is inviting the Chinese Communist party to control our energy infrastructure. It also seems that China National Nuclear Company is responsible for the manufacture of Chinese nuclear weapons.

Of course it is the Chinese people who suffer most, being at the hands of an oppressive government and uncontrolled companies which show little respect for employment rights or environmental standards. By offering money to such companies from British consumers through their energy bills our government is forcing us to collude in the low human rights and environmental standards seen in China.  

Research I commissioned earlier this year concluded we can transform the South West, not with nuclear, but with renewables. We can generate 100 per cent of our energy needs from renewables within the next 20-30 years and create 122,000 new quality jobs and boost the regional economy by over £4bn a year.

The white elephant of Hinkley looks increasingly shaky on its feet. Only the government’s deeply risky ideological crusade against renewables and in favour of nuclear keeps it standing. It’s time for it to fall and for communities in the South West to create in its place a renewable energy revolution, which will lead to our own Western Powerhouse. 

Molly Scott Cato is Green MEP for the southwest of England, elected in May 2014. She has published widely, particularly on issues related to green economics. Molly was formerly Professor of Strategy and Sustainability at the University of Roehampton.