The Conservative British government response to the climate crisis in the lead up to the Paris Summit is to argue in public that it’s the market that should lead the changes required.
But its new consultation about overhauling the UK’s corporate carbon reporting and taxation landscape implicitly recognises the necessity of rigging the market to achieve the policy goals of reducing emissions – albeit under pressure from the European Commission. Its strategy, though, is to try and reduce the administrative burden on industry.
The government’s attitude, as expressed in a number of recent much criticised attacks on renewable energy and energy efficiency (See our recent article on this, The UK’s energy policy has descended into dangerous farce ) is emboldening climate sceptics in the country such as Benny Peiser, who runs the cunningly named Global Warming Policy Foundation, and who issued a statement this week calling for energy-intensive industries such as iron and steel to be relieved of carbon taxes.
This is an effort by him to influence the new consultation. This proposes changes to the Climate Change Levy, Carbon Reduction Commitment Energy Efficiency Scheme taxes, the Climate Change Agreements, the Energy Saving Opportunity Scheme reporting schemes, and the Electricity Demand Reduction pilot incentive scheme, all of which energy-using industry has to respond to. (For an explanation of some of these, see below.)
The consultation seeks to develop a single reporting framework and a single tax in order to improve the uptake of energy efficiency measures. Writing in the foreword to the document, Exchequer to the Treasury Damian Hinds stresses that the proposals would not compromise the UK’s decarbonisation efforts.
The government acknowledges some parties believe mandatory board-level reporting “creates a standardised framework that can provide information on energy and carbon consumption to investors and other stakeholders to inform investment decisions”, while also leading to a reputational driver than incentivises decarbonisation. This is not just a belief but is backed up by independent research and evidence.
Consequently, it is proposing developing a “single effective reporting framework that incorporates the most effective elements from the existing range of reporting schemes and delivers a net reduction in compliance costs associated with reporting schemes”.