Monday, July 18, 2016
LEAVING THE EU. ABOLITION OF DECC. A MAJOR CONCERN FOR CLIMATE POLICY?
One of my concerns over the referendum vote has always been that leaving the EU would reduce the UK voice in EU climate policy. This was never a vote of confidence in EU policy as such, but I continue to believe that it matters, both for the direct benefit of UK citizens and because it does, or did, provide a lever for the UK, which has been a world leader in climate policy, to make a greater positive contribution to global policy and to increase the chance of better global outcomes.
I was also concerned by the close connections, in terms of political philosophy, between the Leave campaigners, the neo-liberal and laissez-faire orthodoxies exemplified by the Institute for Economic Affairs, and the anti-science rhetoric of the climate sceptics. Victory for the Leave side raised the spectre of much greater influence for this rather backward looking element of the British political establishment.
In consequence Theresa May’s shaping of her new government team has raised a lot of concerns for the future of climate policy in the UK. Stephen Devlin, environmental economist at the New Economic Foundation argues that:
“Abolishing the Department of Energy and Climate Change is a terrible move … and signals a troubling de-prioritisation of climate change by this government.”
This is a very understandable reaction but I am inclined to take a more cautious and less pessimistic view. The labels certainly suggest that climate policy will have less prominence, with DECC ceasing to be a stand-alone government department but ultimately this may matter far less than the ability of ministers to deliver on some very challenging questions. The positive side of the reorganisation is that energy is now placed in the context of overall industrial strategy, which the new government seems determined to take much more seriously than its predecessors.
Given the scale of the transformations that we can anticipate as a pre-condition for a low carbon economy, the importance of this linkage cannot be exaggerated. To list just a few of the bigger questions, the new minister will have on his plate some massive issues. These include:
· The future of the Hinckley Point nuclear power station, and the nuclear programme in general.
· Restoration of credibility to the UK’s plans for carbon capture and storage.
· Future organisation of the power sector to cope with the coming technology. transformations affecting all aspects of energy use and production, and
· How the UK motor industry responds to the challenge of decarbonising the power sector.
In this context merging energy and industry makes a lot of sense. This is particularly important as the weakness of relying purely on markets to deliver transformative change in the power sector, and more widely, becomes more and more evident.
Richard Black, director of the Energy and Climate Intelligence Unit offers a different view from that of Stephen Devlin:
“Greg Clark is an excellent appointment. He understands climate change, and has written influential papers on the benefits of Britain developing a low-carbon economy. …. Importantly, he sees that economic growth and tackling climate change are bedfellows not opponents – and he now has the opportunity to align British industry, energy and climate policy in a way that’s never been done before."
He adds that “… Theresa May has assured Conservative MPs that her government will continue to be an international leader on climate change, and it would be odd not to continue with that when all the most important new trading partners in our post-Brexit world, such as China, India and the United States, are themselves making massive investments in a clean energy transformation."
This last point is perhaps a key one. Issues of trade policy and trade negotiation will exert a sobering influence on some of the more excitable claims of the Leave camp on climate matters, including the trio of ministers now engaged in seeking to change our relationships with the rest of the world . The idea that the UK can afford to abandon its objectives for a low carbon economy, while the US, India and China press ahead, is simply not realistic.
There are also some questions to be resolved in the context of direct relations with other EU member states. Most obvious is the financing and construction of Hinckley Point. But we will also need to take care that our reliance on interconnections with Europe, now an important element of our security, is not compromised in future commercial arrangements and protocols. And we will need to discuss our participation in the EU carbon trading scheme, the EU ETS.
Meanwhile Andrea Leadsom, who began badly at DECC by asking whether climate change was real but later promised that the UK government would in due course legislate for the zero carbon future promised in Paris, will be fully occupied at DEFRA. Her new department may pick up responsibilities for climate adaptation from DECC, but she is likely to be more than fully occupied with explaining to farmers how referendum promises on agricultural subsidies are to be managed in the Brexit world.So overall, leaving the EU can still be seen as a bad move in a context of global climate policy and international influence. But it does not necessarily have large negative or positive effects on the ability of the UK to manage its own low carbon transitions.