What happened to political ambition?

10th August 2012

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  • Business & Industry ,
  • Renewable ,
  • Central government



After another round of political pat-a-cake over the Renewables Obligation, Sarah-Jayne Russell asks if problem with environmental policy is the politicians

Last month’s spat between George Osborne and Ed Davey over subsidies for onshore wind was just the latest face-off in the ongoing struggle between the Treasury and DECC as to what the government should be doing to encourage the uptake of low-carbon technologies and what it can, in strained financial times, afford to do economically and politically.

Often world leaders’ efforts to agree on the best way of tackling climate change are lamented as ineffective, hogtied as they are by politics, but is it any wonder when individual governments can’t seem to come to their own consensus?

Even as Davey reassured the energy and climate change committee that if the carbon budgets were threatened the Treasury would have to loosen the purse strings, Osborne was strong-arming DECC into declaring gas as crucial to electricity generation beyond 2030.

The committee on climate change has repeatedly warned that a dash for gas will knock the UK off the most cost-efficient path to cutting CO2 by 80% by 2050. But being seen to be tackling rising utility bills – ironically caused mainly by hikes in gas prices – is more important to the Treasury. Hence, the £500 million in tax relief for the gas industry was announced alongside the new Renewables Obligation (RO) bandings – dwarfing the subsidies for renewables.

The carbon budgets and electricity market reform are supposed to provide the policy certainty firms need to invest in energy-efficient, low-carbon and renewable technologies, but if the delays to announcing the RO banding, the volte face over revenue recycling in the Carbon Reduction Commitment and the unscheduled cuts to the feed-in tariff are anything to go by, providing long-term certainty just isn’t compatible with politics.

Politicians like to talk about a better future for the next generation, but in reality they always have one eye on the next election, so they shy away from long-term thinking.

The signs are that the coalition is already thinking about the 2015 election with its new definition of environmental taxes. By removing fuel and vehicle excise duties from the equation, the government’s promise to increase the proportion of green taxes collected each year moves from being a real challenge to laughably easy.

In truth, all that the figure massaging and infighting is accomplishing is the erosion of the headline pledge to be the greenest government ever. Whatever happened to that political ambition?


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