Environment sector at a crossroads

7th July 2015

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Alex Giles

Business leaders from the environment and low-carbon sector have urged the government to set out clear policies for the decade ahead to ensure continued growth.

In a report launched today, the Aldersgate Group pointed to the continuing success of the sector, which the latest data from the business department reveals had an annual turnover in excess of £122 billion in 2013.

It warned, however, that the sector is now at a crossroads and clarity is needed urgently on government funding and level of ambition for low-carbon technologies beyond 2020.

The report highlights major economic growth opportunities in low carbon energy, transport, information and communications technology, but stresses that businesses need unambiguous assurance that if they invest in decarbonising the economy they will be able to count on stable, long-term policies that are not at risk of retrospective changes.

Companies contributing their recommendations to the government include Siemens, John Lewis, BT, Willmott Dixon and BuroHappold Engineering.

Matthew Knight, director of strategy and government affairs at Siemens, said the government should signal the build rate for each energy technology for the next few years to encourage industry to compete to deliver the lowest cost generation for each type.

“A desire not to ‘pick winners’ has led to the official pretence that an unrealistically wide range of technological options exist and the market will decide. In fact, the market is an artificial creation and will deliver whatever it is set up to do,” he wrote in the report.

Lack of clear direction forces suppliers to think short-term, for example, bringing in staff from overseas rather than training local apprentices for the long-term, he said.

Benet Northcote, group head of CSR at John Lewis, highlighted the opportunities for energy efficiency in the retail sector, but warned: “The current policy landscape is cluttered and confusing, and would benefit from rationalisation.”

Nick Molho, executive director of the Aldersgate Group, said that decarbonising the UK’s economy could be done affordably, as outlined by last week’s report from the Committee on Climate Change. “This report goes further and shows that tackling climate change can provide significant economic opportunities for the UK and make our economy far more competitive and resilient to shocks in the future,” he said.

Meanwhile, a report by the New Climate Economy (NCE) has identified 10 areas where stronger climate action could also bring significant economic benefits.

The NCE is a project of the Global Commission on the Economy and Climate, which comprises 24 leaders from governments, businesses and academia in 19 countries, including economics and climate change expert Lord Nicholas Stern. The NCE’s first report in September 2014 concluded that economic growth and climate change mitigation could be achieved together.

The new report goes further by focussing on measures that can be taken on land use, cities and energy, which are the three areas where growth and greenhouse-gas emissions are concentrated, the NCE said.

Together, these actions could achieve between 59% and 96% of the emissions reductions needed by 2030 to keep climate change under two degrees centigrade, it said.


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