Utility Week

10 | 2ND - 8TH FEBRUARY 2018 | UTILITY WEEK Policy & Regulation Analysis T he government has signalled its com- mitment to take emissions more seri- ously, with prime minister Theresa May's decision to award energy and climate change minister Claire Perry the right to attend Cabinet in her reshuffle earlier this month. Key to translating such aspirations is the Clean Growth Strategy, which Perry launched just over three months ago. But while the document demonstrates the will to tackle climate change, many worry that it is short on practical plans to cut emissions. It is the job of the Committee on Climate Change (CCC) to make sure ministers meet the UK's statutory greenhouse gas reduction targets. Last week, the committee published its response to the strategy, which shows how the government plans to achieve these targets. Lord Deben, the committee's chair, was anxious to stress that it had seen a "funda- mental change" in the government's stance on the issue. The good news for Perry is the commit- tee's assessment that the government is closer to meeting the climate change targets outlined in the fourth carbon budget, which stipulate that emissions must be 52 per cent below 1990 levels by 2028. Revisions to emissions projections, which were published earlier this month by the Department for Business, Energy and Indus- trial Strategy (BEIS), cut the size of forecast savings that will have to be made in order to hit the fourth carbon budgets. Less welcome will be the CCC's finding that the policies and actions outlined in the strategy still fall "well short" of achieving the level of emissions reductions needed to meet these targets. The committee says new policies will be needed to save a further 10 million metric tonnes of carbon (MtCO2) over the next dec- ade, which is the size of the gap in the fourth budget. Further, there is an even bigger shortfall to overcome in order to meet the fih carbon budget, under which emissions must fall to 61 per cent on 1990 levels by 2033. "This shows there is no way they are going to meet the fih carbon budget targets without step- ping up," says Tim Yeo, former chair of the now defunct Department of Energy and Cli- mate Change select committee. Fill the gap In order to help fill this gap, the CCC makes a series of recommendations. For consum- ers, one of the report's more eye-catching is the proposal for a more aggressive rollout of charging points to accelerate the uptake of electric vehicles. Potentially of more impact for consum- ers, however, are the CCC's thoughts on the future of domestic heat, which accounts for around 45 per cent of final energy consump- tion in the UK and therefore represents a major opportunity to close the national emis- sions reduction shortfall. The committee identifies heat decarboni- sation as a major gap in the government's Clean Growth Strategy and insists a defini- tive decision must be made in the first half of the next decade on the future role of the gas networks in delivering heat to homes. More immediately, while it welcomes plans to phase out fossil fuel heating in homes off the gas grid, the CCC says gov- ernment must also show a clear plan for decarbonising the heat sources of new and existing heat networks and says the rules of the Renewable Heat Incentive should be reformed to target support at heat pumps and biomethane. It also calls for more ambi- tion in tackling the problem of energy effi- ciency in all new-builds in the UK. A specific government strategy consider- ing the future of low carbon heat in the UK, is expected in the spring. On generation, the committee says there should be more encouragement for onshore wind and solar, which will give the BEIS ministerial team ammunition in its attempts to overcome Conservative party hostility. The report also notes additional low- carbon power may need to be sourced if new nuclear plants and interconnectors fail to contribute the level of energy the govern- ment expects. Perhaps the biggest call made by the com- mittee is for the government to set out plans in 2018 to kick-start a UK carbon capture and storage (CCS) industry in the 2020s. Without the deployment of CCS, the com- mittee's report says, the UK cannot meet the ultimate 2050 target to cut emissions by 80 per cent on 1990 levels. And it says the £100 million earmarked in the Clean Growth Strat- egy for developing CCS is insufficient. Seize the opportunity Yeo admits he is "anxious" about the com- mittee's reliance on the ability of CCS to be delivered economically, particularly if it encourages a more relaxed approach to gas. Nevertheless, he believes the committee's report will help BEIS when it fights its inevi- table Whitehall battles. Richard Black, chief executive of the Energy and Climate Intelligence Unit, believes the government should seize the opportunity presented by the strategy, given that it is hamstrung on so many issues by a lack of cash and the preoccupation with Brexit. "Climate change and reducing emis- sions gives them an opportunity to do some- thing because there won't be a great deal of opposition in Parliament to implementing what the CCC has said," he says. However, the CCC is also clear that there is no time to waste, partly because of the government's own dilly-dallying over the past year and a half. And it says the govern- ment has a "small" window to develop pol- icy. The delayed publication of the strategy in October, more than a year aer the fih budget had been set in the summer of 2016, means "urgent action" is required. This entails outlining by the end of this year policies to enable the UK to achieve its fourth carbon budget targets. And policies to fill the gap in the fih carbon budget need to be in place by the end of 2020. The committee is right to strike this urgent note, says Yeo: "This is very impor- tant because we will be at 2030 in no time." The pressure is on. It's a good job Perry has her eye firmly fixed on the energy and cli- mate change ball. Emissions plans fall short The Clean Growth Strategy is key to the government's ambitions for tackling emissions, but many worry that the document is short on practical plans for how to do this. David Blackman reports.

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