Government slows down

3rd April 2017

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Quite a lot has not happened.

Things started not to happen in earnest in 2015. That year’s autumn statement heralded a new Energy Company Obligation (ECO) covering the period from 2017 until the early 2020s. We have not heard anything about the revised ECO since, except for a consultation on a one-year extension to the present scheme, and nothing after 2018.

Then there is the non-appearance of the low-carbon plan, which is required by the Climate Change Act and is supposed to set out how the government will meet the terms of the fourth and fifth carbon budgets. The low-carbon plan should have been published six months ago, and the government is now technically in breach of the legislation. Yet, despite questions from myself and other MPs, there is no sign of it.

Then we came to the 2017 Budget. The 2016 autumn statement had promised the Budget would include details of the future scale and finances for the next phase of the Levy Control Framework (LCF) – the arrangement that funds and provides auctions for investment in renewable energy – and the carbon floor price (CFP). Information on both was missing.

The Budget book merely statied that the LCF update would be published ‘later in the year’ and the CFP would continue at its present rate for a couple more years. The lack of information is important because investors in low-carbon technologies are all looking to see what the terms for their investments are likely to be. Many are not committing to projects because of continuing lack of clarity about future direction.

What is the explanation? It certainly looks like a cooling of enthusiasm for green and low-carbon policy in the government. There was also the paralysis that had seemed to grip the Department of Energy and Climate Change and the Department for Business after they merged. And then there was Brexit.

The sucking-away of large parts of the policy machine to deal with the hideous complications of disentangling the country from its 44-year legacy of aligned and merged legislation is now palpable. But, whatever the reasons, the effect is to produce an air of stagnation around green and low carbon policies.


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