COLUMN-UK climate act limits energy choices: Gerard Wynn

LONDON Fri May 31, 2013 5:55am EDT

LONDON May 31 (Reuters) - British policymakers are finding out just how far a climate act passed in 2008 has tied their hands on broad-brush energy policy for the next four decades.

The country's Climate Change Act has left the government rather little room for manoeuvre on big energy choices, and especially the role for fossil fuels including coal and gas.

The centre-piece of the act is an ambitious 2050 target for greenhouse gas emissions which narrows the trajectory for interim targets and is almost impossible to water down.

Also significantly, it created a statutory government adviser, called the Committee on Climate Change (CCC), to propose carbon emissions targets and to review the government's progress towards meeting these.

Limiting room for manoeuvre was exactly the idea, to make policy free from the whims and meddling of governments subject to short term electoral cycles, reflecting the fact that climate change is a long term problem.

The CCC so far has successfully argued for the phase-out of all new, unabated coal-fired power, and parliament next week votes on sharply limiting the role of new gas.

The government will probably defer a decision until after the election in 2015, as allowed under the act.

Taking the example of Germany, it is not clear that making such a policy straight-jacket was necessary.

Britain has set binding targets on carbon emissions which have a broader energy impact than Germany's narrower, binding targets for renewable power.

And Germany already has massive renewable energy capacity, almost all of which was installed before it made binding its long-term targets last year.

APPROVED

Britain has so far backed the CCC's advice, further limiting its energy choices.

First, it legislated the CCC's suggestion for a tougher 2050 emissions target than originally planned, to cut greenhouse gas emissions by at least 80 percent below 1990 levels rather than a previous aspiration of 60 percent.

Second, the government agreed to block any new coal-fired power generation unless fitted with presently expensive and unproven carbon capture and storage, in rules laid out in a draft energy bill now working through parliament.

And third, it has approved all the CCC's carbon budgets proposed so far, from 2008 to 2027.

The CCC was clear that one direct consequence of agreeing the tougher 2050 target would be the need for "the radical decarbonisation of power generation by 2030." ("Building a low-carbon economy - The UK's contribution to tackling climate change", December 2008)

That has led to its latest advice, that the government should approve in this parliament a carbon intensity target of an average of 50 grams of carbon dioxide (CO2) per kilowatt hour (kWh) of power generation by 2030.

The CCC says that would rule out new gas-fired power plants after 2020, unless fitted with carbon capture and storage or else limited as back-up for wind power, while all new unabated gas would have to operate at less than 20 percent full capacity on average by 2030.

POWER SECTOR

The CCC's proposed 2030 carbon intensity target is a 90 percent cut on the present carbon intensity of 500 grams CO2/kWh.

It would raise costs in the short term, but generate longer term savings by avoiding gas imports, the CCC said in a report earlier this month. ("Next steps on electricity market reform - securing the benefits of low-carbon investment," May 2013)

There would be additional benefits from investment in new technologies, and more flexibility and security in the country's energy supply, it said.

One important assumption in the reported savings was a high UK carbon price which may in fact be dragged down by a crash in EU prices, which are now a fraction of those assumed in the CCC report, and which would make gas-fired power cheaper than as calculated.

The CCC said a less ambitious "Plan B" of 100 grams CO2 per kWh "would still prepare sufficiently for the 2050 target, and would still enable the legislated ... carbon budget to be met."

It was ranked plan B because it would be more expensive, unless low-carbon technologies worked out more costly than expected, it said.

MANOEUVRE

Any government can repeal the act if it has a sufficient majority and public backing, but that would be a huge step.

Short of that, there are limited options to intervene in carbon emissions targets.

These options include: to weaken legislated emissions targets; ignore CCC advice in setting future ones; or simply not to meet them.

The first course is very difficult, and would need parliament backing.

The act states that the government can only amend legislated targets "if it appears to the Secretary of State that there have been significant developments in scientific knowledge about climate change, or European or international law or policy."

If the CCC disagreed, it would be difficult to stand this up.

The second option is a little easier.

If the government proposed a weaker interim target than advised by the Committee (the long-run 2050 target is already legislated), it would have to "publish a statement setting out the reasons for that decision," with a convincing case for ignoring its adviser.

But it would still ultimately have to meet the 2050 target.

The third option, to miss the legislated targets, is not attractive, since the targets are a "duty" implying these are subject to judicial review.

The government can still set energy policy within the straight-jacket of carbon emissions targets, for example choosing how far to support nuclear or renewables, and whether to back shale gas or give tax breaks for oil exploration.

But the present debate over carbon intensity in 2030 shows how the CCC is proposing firm limits on gas-fired power while the government legislates against any new unabated coal.

Using the example of Germany, Europe's biggest economy has more ambitious carbon emissions targets in 2020 (a 40 percent carbon emissions cut) and 2050 (an 80-95 percent cut).

By leaving these non-binding and not creating a legislated adviser, however, it has kept the flexibility to continue to build cheap, new, unabated coal-fired plants which can balance its vast, newly installed solar and wind power. (Editing by James Jukwey)