The Government’s move to sign for a 50 per cent cut in emissions risks damaging manufacturing competitiveness, the EEF says.
Yesterday, Energy Secretary Chris Huhne announced to MPs in the House of Commons that ministers had agreed to recommendations by their climate advisers which would commit the UK to reducing emissions by 50 per cent on 1990 levels by 2025.
EEF, the manufacturers’ organisation, said the government needed to demonstrate it understood the threat to competitiveness and the risk it posed for future investment and jobs.
EEF chief executive Terry Scuoler said the decision was “bad” for manufacturing and the government needed to move “quickly to address the competitiveness concerns faced across manufacturing, as well as energy-intensive industries”.
“Government must reassure industry that if there is no European agreement to move to tougher targets by 2014 it will automatically reverse the UK position,” he added.
As part of yesterday’s announcement, Huhne said there would also be a review in 2014 of the fourth carbon budget, which spans from 2023 to 2027, which could be relaxed if Europe was not making similar efforts. And there would be no tightening of the second and third budgets up to 2020 before the EU decides if it will sign up to tougher goals for the end of this decade.
Before the end of the year a package of measures would be announced which aimed to reduce the impact of the costs for energy-intensive industries, Huhne said.
The five-year carbon budgets aim to put the UK on track to meet its legally-binding long term goal of an 80 per cent emissions cut by 2050.
The Government’s Committee on Climate Change has said the cost of meeting the fourth carbon budget was less than one per cent of GDP and annual investments of £16 billion would be needed through the 2020s to hit the target.
David Kennedy, chief executive of the committee, which was set up to advise the Government on cutting emissions, said the announcement was a world-first, with no other country yet setting legally-binding commitments to ambitious reductions in the 2020s.
“Setting and meeting the carbon budget will place the UK in a strong position, both in terms of meeting the 2050 target, and building an economy very well placed to prosper in a low-carbon world,” Kennedy said.
Greenpeace executive director John Sauven said the announcement made the creation of new jobs and factories in clean energy industries here more likely and “puts the UK back in the race to compete with China, Germany and Silicon Valley in the clean technologies which will power our economies into the future”.
EU Climate Action Commissioner Connie Hedegaard said the announcement was an “outstanding example of strong willingness to act despite difficult economic times”.
“It also confirms that clever climate policies are not only about climate alone; they are also about improving energy security, stimulating innovation, raising competitiveness, and creating economic growth and jobs. With this decision, the UK seizes a huge economic and innovation opportunity that will make its economy more competitive in the future,” Hedegaard said.