School of somethingFACULTY OF OTHER

The UK Low Carbon Transition Plan: Where are we going?

Dr Tim FoxonSustainability Research Institute, and Centre for Climate Change Economics and Policy,

School of Earth and EnvironmentUniversity of Leeds, UK

Sustainability Research InstituteSchool of Earth and Environment

Overview• Brief history of climate change targets and challenges for Copenhagen• UK Climate Change Act and targets for 2020• UK Low Carbon Transition Plan and Renewable Energy Strategy• Beyond market solutions: A ‘Green New Deal’

UN Climate Change Convention• UN Framework Convention on Climate Change (1992):

• to ‘stabilise atmospheric concentrations of greenhouse gases (GHGs) at a level that avoids dangerous anthropogenic interference in the climate system’

• ‘common but differentiated responsibilities’ between industrialised and developing countries

• Kyoto Protocol (1997) – industrialised countries agree to 5% reductions in GHG emissions relative to 1990 by 2008-12

• Few countries will achieve this target• UN Climate Conference in Copenhagen in December 2009 is aiming to achieve a ‘comprehensive, ambitious and fair international climate change deal’ to begin in 2013

• Prospects for a meaningful deal not looking good

Drivers of climate change• Historically, industrialised countries have been responsible for majority of CO2 emissions (USA is still 25% of global emissions)

• Emissions of fossil fuel-based CO2 emissions rising at 3% per annum in 2000-2006, largely due to economic growth in China and India• Rising emissions → rising concentrations → temperature increase → climate impacts (heatwaves, rising sea levels, etc.)

• Doubling concentration to 560 ppm CO2e implies rise of 2-5ºC

• Uncertainties due to feedbacks in system, e.g. rising temperature melt permafrost, which releases methane, causing more warming

Global CO2 emissions from fossil fuels 1850-2000

Source: Stern Review 2007

Atmospheric concentrations of GHGs

Source: Stern Review 2007

Global average temperature 1850-2005

Source: Met Office 2006

Implications for UK GHG emissions

• Already high chance of world exceeding 2ºC temperature rise• For very small chance of exceeding 4ºC rise by 2100, global emissions need to peak by 2016 and then reduce by around 3% per year to 2100

• Implies halving global emissions from current 40 GtCO2e to 20-24 GtCO2e by 2050

• Assuming fair allocation of these emissions amongst 9 billion people by 2050, implies UK share of 2.1 to 2.6 tCO2e per person

• Implies 80% cut in UK GHG emissions from 797 MtCO2e (in 1990) to 159 MtCO2e by 2050

UK Climate Change Act

• UK Climate Change Act (2008) sets target of 80% reduction in GHG emissions relative to 1990 by 2050

• All party agreement on this target• UK Climate Change Committee (2008) recommends a 34% reduction (interim target) and 42% reduction (intended target) by 2020• Government (2009) publishes UK Low Carbon Transition Plan for meeting interim target• UK Climate Change Committee Report (2009) argues for a step-change in the pace of emissions reductions, in order to meet intended target

Scale of UK emissions reductions needed by 2050

Source: Climate Change Committee Report 2008

UK possible 80% CO2 emissions reduction path

Source: Climate Change Committee Report 2008

Carbon intensity of UK electricity generation under 80% and 90% emissions targets for 2050

Source: Climate Change Committee Report (2008)

UK Low Carbon Transition Plan

• Government setting out how it will meet Carbon Budgets to 2020

• Interim budget of 34% reduction in GHG emissions relative to 1990• Implies 18% reduction in GHG emissions on 2008 levels

• 40% of electricity from low carbon sources by 2020• 30% of electricity from renewables (UK Renewable Energy Strategy)• Funding up to four demonstration of carbon capture and storage (CCS)• Facilitating building of new nuclear power stations

• Improving energy efficiency of existing households and businesses, and regulation for zero-carbon new homes• Make the UK a centre of green industry

• £120 million investment in offshore wind• £60 million investment in marine (wave and tidal) energy

Emissions reductions by sector

Source: UK Low Carbon Transition Plan (2009)

UK Renewable Energy Strategy

• UK committed to sourcing 15% of its energy (electricity, heat and transport) from renewables by 2020• 30% renewable electricity generation

• Renewables Obligation for large-scale generation• New ‘feed-in tariffs’ for small-scale electricity generation

• 12% renewable heat generation• New Renewable Heat Incentive

• 10% transport energy from renewables• ‘Sustainably sourced’ biofuels• Support for demonstration of electric vehicles

Climate Change Committee Report 2009

• Need for step-change in three key areas:

(1) Reform in current electricity market arrangements to support investment in low-carbon power generation

(2) Policies to promote energy efficiency improvement in the residential sector

• ‘Whole house’ and ‘Street by street’ approach

(3) Measures to support roll-out of electric cars• 2 million electric vehicles by 2020

Beyond markets solutions• Government still hampered by ideological belief in market solutions, which often have unintended consequences and can be manipulated by powerful market actors• E.g. European Emissions Trading Scheme

• Too high caps led to collapse in permit prices in early 2007• Recession leading to reduction in permit prices again• Windfall profits for electricity generators

• Renewables Obligation• Little support for early-stage and small-scale renewables• Still uncertainties about how new feed-in tariffs will work

• Potential for greater green fiscal stimulus• Need for continued pressure from civil society actors

Green New Deal• A ‘Green New Deal’ has been proposed to addresses the linked financial, energy and climate crunches:

• $80 billion programme of investment in energy efficiency and local renewable electricity generation

• Creating and training a ‘carbon army’ of workers• Establishing an Oil Legacy Fund, paid for by a windfall tax

on the profits of oil and gas companies • Re-regulating the domestic financial system to ensure the

creation of money at low rates of interest, combined with tighter controls on lending and the generation of credit

• End of ‘cheap oil’ and global financial crises should be seen as an opportunity to stimulate a transition to a low-carbon economy

Conclusions

• Low Carbon Transition Plan and Climate Change Committee Reports represent an important step forward• But need for greater direct role by government• Still hampered by ideological belief in market solutions, which often have unintended consequences and can be manipulated by powerful market actors• Need for step-change in levels of investment, e.g. by transferring resources from military uses• Huge potential for job creation in low-carbon industries