UK's Energy Secretary Promises Green Policies Will Boost GDP

UK's Energy Secretary Promises Green Policies Will Boost GDP

Energy and Climate Change Secretary Chris Huhne has delivered a robust defense of the government's low-carbon strategy today, insisting that green policies will help bolster UK GDP, enhance economic competitiveness and protect British firms from future oil shocks.

Huhne said at an event in Westminster to mark the launch of a new report from the Corporate Leaders Group on Climate Change which criticizes the pace of the government's green reforms, that the coalition fully understood the economic case for accelerated action to tackle climate change.

In a wide-ranging speech, he argued that curbing emissions and getting the UK "off the oil hook" would deliver jobs and growth, establish a more stable economy as energy imports fall, and result in improved living standards.

Citing recent research from the German government, Huhne said that the UK would enjoy a 7.3 percent GDP boost and an overall increase in GDP growth rates of 0.8 percent if the EU moved to more ambitious emission reduction targets of 30 percent by 2020.

He also dismissed critics who argue that the UK should not step up investment in low-carbon technologies until other nations do likewise, insisting that almost all the world's major economies are taking drastic steps to curb carbon emissions, including large emitters such as China and India.

"Some 89 countries have renewable energy policy targets," he said. "Some 81 countries worldwide have feed-in tariffs to reward small-scale generation. And 73 have biofuels mandates."

In addition, Huhne outlined several green policies that the government has in the pipeline, such as the Green Deal, Green Investment Bank and Electricity Market Reform, and reiterated his view that rising oil prices mean that the new policy framework will actually result in reduced costs for households and businesses.

"The cost of our low-carbon policies by 2020 is just one percent on the average household energy bill, and even that calculation by DECC economists presumes that we can buy oil at last year's cheap rate of $80 a barrel with gas prices in line," he said.

"In the medium term, the US Department of Energy forecasts $108 a barrel by 2020, and $125 a barrel in 2035. If oil prices stay high, and gas prices rise to meet them, our consumers will be winning hands down from our energy policy. Paying less through low-carbon policies than they would pay for fossil fuel policies."

Huhne also noted that the case for the low-carbon economy was now so robust that a recent survey showed that almost three-quarters of global CEOs actively support policies that promote environmentally sustainable growth.

"They know that a green economy is also more resource efficient," he said. "It saves money, boosts the bottom line, and helps shareholder returns."

Huhne's speech comes ahead of the anticipated release of the latest Committee on Climate Change report tomorrow, which is expected to show that UK carbon emissions are flat-lining and that the government has to date failed to deliver the "step change" in low-carbon policy that the committee has called for.

In related news, Climate Minister Greg Barker has criticized the "weird religiosity" that often characterizes the climate change debate, warning that green campaigners' criticism of climate skeptics can serve to alienate the public.

In an interview with The Guardian, Barker called for a less ill-tempered approach to promoting the need to curb carbon emissions.

"We need to make sure [we] don't behave in an arrogant or offhand way, because that really pisses people off," he said.

Barker also hinted that the government was willing to protect energy intensive industries from the impact of green policies that could otherwise result in them migrating overseas.

This article originally appeared on BusinessGreen, and is reprinted with permission.

Photo CC-licensed by the Liberal Democrats.