Industry leaders and academics debate how to reduce the UK's carbon output

How can businesses help the environment by cutting carbon output, and continue to thrive? Academics and industry leaders discussed this with the Energy and Climate Change minister at an Imperial conference - News

By Simon Levey
Friday 25 November 2011 

Official recommendations expect the UK to almost triple its annual cut in carbon footprint in order to meet its 2050 target of reducing emissions by 80% as compared to 1990. This would require a national reduction of 4.3% per annum in the first half of the 2020s, in comparison with 1.5% needed between 2009 and 2020.

But how should businesses position themselves to deliver these cuts and continue to thrive? This is the topic that was discussed by key figures including the Secretary of State for Energy and Climate Change, Chris Huhne MP, at a conference at Imperial College London on 24 November 2011. The Changing Gear on Carbon Reduction conference was jointly hosted by Imperial's Grantham Institute for Climate Change and Imperial College Business School.

Mr Huhne was joined by scientific experts and leaders from UK industry, business, manufacturing and technology, who examined how best to put into practice such a major reduction in carbon output, without damaging productivity and global economic growth.

The carbon cuts were proposed by the Committee on Climate Change in its Fourth Carbon Budget, and broadly accepted by Government earlier this year. The Department for Energy and Climate Change is yet to publish its detailed proposals for how it expects the UK to turn these recommendations into actions, but such an announcement is widely expected before the end of the year.

"Halving our emissions to hit the Fourth Carbon Budget will mean changing the very fabric of our economy," said Mr Huhne. “If the Government sticks to its plan ... the UK is poised for two decades of aggressive decarbonisation in the power sector and elsewhere. In transport, heating, and industry, in generation and efficiency, we must renegotiate the terms of our relationship with energy. If we succeed, our climate will be safer, and our economy more competitive."

Chris Huhne (centre) is greeted by Grantham Institute Director, Professor Sir Brian Hoskins (L), and Imperial's Rector, Sir Keith O'Nions (R)

He also praised the work of scientists and engineers at Imperial who, he said, play a vital role in developing the scientific understanding that should dictate environmental policy for the UK and on the international scene.

The discussion took place just a few days ahead of the United Nations Climate Change Conference 2011 in Durban, where governments will debate environmental and economic topics on the international scale.

Speakers and panellists from organisations including the Committee on Climate Change, Rolls Royce, Tata Steel, EDF, Scottish and Southern, Alstom, Dow Chemical, the Department for Business, Innovation and Skills and Imperial College London presented a range of views on how the expected radical changes will define the way businesses operate. They considered, among other issues: energy supply, efficiency, product cycle, technology, and consumer culture.

In addition to its main organisers, the conference was supported by Imperial's Centre for Environmental Policy, the Centre for Energy Policy and Technology, Imperial Consultants, Imperial Innovations, and the Climate-KIC.

In the interview below, conference convenor Neil Hirst, Senior Policy Fellow at the Grantham Institute, gives his take on the day’s discussions:

What were you hoping to achieve by holding the event 'Changing Gear on Carbon Reduction'?

The Government has recently adopted ambitious medium-term (2023-27) plans for reducing the UK's carbon emissions. We wanted get business more fully engaged. And we wanted to encourage business to make use of the outstanding expertise we have at Imperial.

Neil Hirst, Senior Policy Fellow at the Grantham Institute for Climate Change

To what extent do you think it achieved this?

More than 200 delegates accepted our invitation, mostly senior executives from a wide spectrum of British business, including power companies, manufacturing, retail and finance, so we reached a lot of the key players. They had the opportunity of hearing about the Government's plans directly from Chris Huhne and Lord Adair Turner, Chairman of the Committee on Climate Change, and to ask the questions that mattered to them.

Judging from the lively debates that took place, and from my own discussions with many delegates, I have no doubt the event did help those who were there to understand the issues and to get to grips with complex and tough challenges that we face.

What do you think the UK could now learn about meeting its carbon reduction target?

The first and most important thing, "the dog that did not bark in the night", is that no-one questioned the vital importance for the UK of meet ing these targets for reduced carbon emissions. The will is there from government and industry but they have a sharply different perspective on where we are right now. Government feels, with some justification, that it has taken the lead and set out a realistic pathway through which we can achieve a greener energy future. But industry sees a huge gap between the articulation of the pathway and putting in place the details of a framework that turns the various elements into viable commercial projects.

Businesses say they are looking for clear and dependable government policies as a basis for investment, however, the recent cut in solar subsidies and recent setback on the capture and storage of carbon emissions from coal or gas plants, are seen as worrying. Industry representatives at the conference highlighted the need to shore up the UK's own strength in innovative manufacturing - for instance as suppliers of components to nuclear power stations - and raised the concern about a shortage of trained engineers. Topics very close to Imperial's heart!

The main lesson is the urgent need for the UK to confirm details of proposals like its Electricity Market Reform white paper to secure affordable, low-carbon electricity, otherwise the prospects of achieving the Fourth Carbon Budget will start to slip away.

What lessons could there be for policy makers?

There is a case that our low carbon policies should look at all the emissions for which consumers in the UK are ultimately responsible, including emissions embedded in imports. Some UK manufacturers feel that our existing policies, which address direct UK emissions only, are unfair to them and, more significantly, fail to address the global nature of the problem. The Committee on Climate Change (CCC) points out that manufacturers with a substantial carbon footprint who are also highly exposed to international competition represent a small proportion of the economy. But they are also some of our biggest industrial employers.

There was also an interesting debate on the importance of being open with the public about the costs of low carbon policies. Have the full implications been adequately explained? Is there a risk of a backlash if the public feel that costs have not been fully exposed? There are different views on this. However the CCC will shortly issue a full analysis of the impact of low carbon policies on electricity bills.

Were there any issues that surprised you during the day?

Several speakers were sceptical about the viability of underground storage of carbon emissions from power stations using Carbon Capture and Storage (CCS), although others recognised this an a technology on which the UK could lead. With my background at the International Energy Agency where we viewed mitigation policy from a global perspective, I am very disappointed that the UK's programme has stumbled so badly. The growth in global emissions in the coming decades will to a very significant extent arise from coal power stations in China and India, two rapidly growing economies with large coal reserves. CCS could become the most important single technology for climate mitigation. It has not yet been demonstrated as a viable commercial proposition and there are significant uncertainties and drawbacks. But of course this is exactly the stage at which an initiative by the UK could make a difference, and at which we still have the chance to capture a leading position internationally. Here at Imperial, we’re investing a lot in this technology; we have the country’s largest CCS research programme and we’re developing a pilot CCS plant. I hope this kind of work will help CCS find its feet.