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UK Government May Abandon Unilateral CO2 Targets

Jim Pickard, Financial Times

The coalition is heading for a bitter new row over green energy as senior Tories seek to unpick carbon targets which stand in the way of Britain building more than 40 gas-fired power stations.

Ministers struck an agreement in 2011 to reduce emissions by half by the mid-2020s, compared with 1990 levels, as part of Britain’s attempt to cut its share of global warming.

But George Osborne, chancellor, secured a potential opt-out if a December 2013 review by the Climate Change Committee, the statutory body which advises the government on emissions, proved that Britain was moving faster than the rest of the EU.

The Engineering Employers’ Federation has been urging the chancellor to kill off the carbon targets, saying the review will be a “real test” for the government.

“The other EU states haven’t stepped up to the mark and we believe that means the rip cord needs to be pulled on these targets,” said Gareth Stace, head of climate at the EEF. “If we go ahead we will be locked into tougher targets than the other members states.”

However, the Climate Change Committee wrote to the government in July, warning that the largely failed efforts to toughen EU-wide climate targets were not a reason for Britain to change its domestic goals.

The EEF accused the committee, which is chaired by Tory peer Lord Deben, of effectively “pre-empting” its own review, and predicted that the committee was on track for an “almighty battle” with the government.

The Green Alliance, an environmental think-tank, will this week urge the government to cancel the review to reassure nervous investors in the sector.

“Investors had planned to spend £180bn in the UK’s low carbon infrastructure, but they now wonder if their money is wanted here,” said Alastair Harper, spokesman for the Green Alliance. He said many were looking at the review “as the final test of whether the UK government is serious about attracting their investment”.

Mr Osborne privately hopes to use the results of the review to unpick the carbon budget, which he fears could undermine manufacturing and prevent the construction of a new fleet of gas-burning power stations.

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see also: George Osborne and David Cameron refuse to commit to unilateral post-2020 CO2 targets