UK Energy Policy

UK Energy PolicyPhilip Pearson

www.tuc.org.uk

2008 Climate Change Act Legally binding targets

◦34% cut in CO2 emissions 2020◦60% by 2030◦80% 2050

Independent Committee on Climate Change◦4 x 5-year Carbon Budgets

UK Energy Policy Framework

2012: 574 MtCO2e

2030: 310 MtCO2e ◦ = 60% reduction on 1990. ◦= 46% reduction over the next 20 years ◦= 62% cut 2030 -2050 to meet 2050

target.

UK – carbon budget cuts

Energy supply: energy mix and CO2 intensity

Surface transport: road • Domestic Energy Efficiency • Industrial Energy Efficiency

Greatest effort needed - 4 priority sectors

Power = 25% UK greenhouse gases £110bn investment needed C02 target for 2013 Energy Act:

◦2030 = C02 intensity 50-100g ◦2012 = 500g CO2 KWH

New Energy Legislation 2013

UK Electricity Supply – Market Share

Source: Elexon – bmreports.com

Energy: Policy vs political risk

Policy Risk

2020 RE target: 15% energy/30% electricity

CCS [4 pilots] for coal & gas &industry

Coal plant closures New nuclear “dash for gas” Green Investment

Bank EU = ETS reforms

“Greenest government ever”

RE hostility◦ Public investment◦ Balance Regulation vs

Market Austerity > GIB Lobby

◦ Investors “gaming”◦ Oil & gas lobby

Anti-EU

TUC Energy Policy in Transition

Energy Industry

“Balanced” energy supply – renewables, new nuclear, CCS for coal & gas

Green Investment Bank CO2 tax/floor price FITs No to shale gas “Green Deal” domestic

energy

Greening the workplace Skills for low carbon

economy Energy intensive

industries CCS – regional networks On-site power

generation Low carbon vehicle

manufacture

Yorkshire 60 MT C02 carbon cluster Regional CCS network: CO2 Sense Reliable/flexible low carbon energy supply. “Industrial security” Low-carbon economy/jobs. Developing key skills and expertise. Attracting direct investment.

CCS: power & industry clusters

“Carbon price floor” 2020 (£30/tCO2) 2030 (£70/tCO2)

“is consistent with longer-term emissions targets and should strengthen incentives for

emission reductions.” [CCC] Recycling revenues?

UK carbon tax

14

Carbon Revenue Forecast

Total revenue between 2013 and 2027 is £64bn (£11bn CPS)

20112013

20152017

20192021

20232025

2027£.0 Bn

£1.0 Bn

£2.0 Bn

£3.0 Bn

£4.0 Bn

£5.0 Bn

£6.0 Bn

£7.0 Bn

£8.0 Bn

.4 .41.9 2.0 2.2 2.3 2.5 2.7 2.9 3.0 3.3 3.6 4.1 4.7 5.2 5.7 6.2

.4 .5 .6 .7 .7 .7 .8 .81.0 1.0

.9.8

.7.7

.6

EUETS Revenue Carbon Price Floor Revenue

Year

Reve

nue

(£bn

)

“Just Transition” in practice

Greening the workplace Green Economy Council

◦ Energy Intensive Industries Skills◦ Investment◦ Energy Roundtable

Social partner initiatives & campaigns◦ Clean Coal Task Group◦ Energy Intensive Industries◦ Renewable energy

www.tuc.org.uk – go to Green Workplaces