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The Rt. Hon. Patricia HewittThe Government view on Business and the Environment |
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Greenpeace has been at the forefront of environmental campaigning for over thirty years now. Since your first boat went out and exposed secret nuclear testing near Atlanta, you have led public debate and set a new standard for NGOs and campaigners throughout the world. There was a time when NGOs were regarded with suspicion - as "enemies within". Indeed, there was a time when the present Solicitor General and I were both under surveillance by MI5 – until we took them to the European Human Rights Court and had them put on a statutory footing. Today, NGOs are regarded with respect - and as important stakeholders in public policy decisions. And the relationship goes wider. As this conference demonstrates, the relationship is now increasingly three way - between government, NGOs and business. We value that relationship. And we understand the contribution you can make to national policymaking and raising the public awareness of important issues. We wont always agree and we understand you often need to be ahead of us in order to be effective. But I come here today in a spirit of cooperation to discuss together important issues that affect us. Two of the largest challenges we face today are global poverty and global warming. We are all increasingly aware of the connection between abject poverty and environmental degradation in the poorest countries of the world – just as we are increasingly aware of our responsibility in the richest countries of the world to act, and to lead, on poverty and on the environment. That is the main theme of my speech today – and I want to talk about how we are developing both energy and trade policy to meet this goal. Energy Consultation The Performance and Innovation Unit reported to Government in February on what our long term energy policy should be. We've responded to this with one of the most extensive consultations ever. Which is only right – because the decisions we make today about energy policy affect the lives of each and every one of us. And the effect of the decisions we make today will be felt not just in a few years' time, but in thirty, forty, fifty years' time. So we've tried to reach beyond our traditional stakeholders – and have deliberately tried to engage the public in this debate as well. We received over 1,500 submissions in response to the consultation document my department put out earlier this year. And engaged more than 4000 people - both adults and schoolchildren - in these complex issues, not through the usual passive consultation, but through active discussion – helping to promote more effective, deliberative democracy. Much of this material, in original or summary form, is available on our website – reflecting the transparent approach we are trying to uphold in this policy making process. It is now our job in Government to reflect upon what the public have told us, what the PIU and the Royal Commission on Environmental Pollution have told us, and to set out in our White Paper in the new year the long-term framework for energy policy. Objectives The White Paper will start with our four objectives. First, keeping the lights on. As California showed security of supply is fundamental and cannot be taken for granted. Second, a low carbon economy. Over the last ten years, we have had economic growth of 28%, and a fall in carbon intensity of 25%. That was largely the result of the 'dash for gas' – which is unlikely to be repeated. In the White Paper, we will set out the policy framework we propose to continue decoupling economic growth from resource use and pollution. Third, competitive and affordable energy. We need an efficient market framework that will deliver for domestic and industrial consumers alike. And last, but by no means least, protecting the most vulnerable. In particular, we must continue to reduce and eventually eliminate the problem of fuel poverty. Low carbon economy The PIU report shone a spotlight particularly on the second of these objectives - the need to use our energy policy to move to a low carbon economy. Growth up, carbon down. We know this is a huge challenge. Globally and nationally. The Royal Commission on Environmental Pollution recommended we put ourselves on the path to 60% reductions in carbon dioxide emissions by 2050. We will respond formally to that recommendation at the time of the energy white paper, but already it is clear that action on that scale – in the UK and internationally – is what we need. But to reduce the amount of carbon from energy, we need both to reduce demand and move to low carbon – or zero carbon – energy supplies. Promoting demand reductions On the demand side, there's more to do to promote energy efficiency – particularly carbon efficiency – across the economy. Already we are starting to send signals to industry that they need to lower their consumption - or switch to more sustainable types of generation. That's what the climate change levy has done. I know that it is unpopular with manufacturers, and I understand the difficulties they face, particularly in these tough economic conditions, but the climate change levy is a central part of our environmental tax reforms – not designed to raise revenue, because it is deliberately revenue neutral, but designed instead to change behaviour. And it creates powerful incentives to business to make decisions that will benefit not only them, but also the environment. Promoting supply side changes On the supply side, we need to encourage renewables. We still remain well behind our main European partners. On average, EU countries generate 14 per cent of electricity from renewable sources. We currently generate 2.6 per cent. I must say that I think that this is pathetic. It is due to years of under-investment, both public and private, as well as to difficulties in the planning process, which we are now addressing. Investment is now set to rise sharply, but we need a massive step change in investment in renewable sources of energy – particularly wind and biomass. We need to make it easier for people to commit to renewable energy projects -and make sure the right incentives are in place to encourage them to do so. The renewables obligation is already helping. But we are now looking at what we need to do beyond the renewables obligation not only to achieve the target of 10% by 2010, but even more important to achieve our goals beyond that date. We also need to look carefully at our energy infrastructure – and see whether this is presenting any obstacles to renewables. It is becoming increasingly clear that we will move away from a world that depends on large scale generation to one where the generation capacity is distributed more evenly throughout the economy. If, for example, we were to use micro CHP to power our individual homes, what implications would that have both for the electricity grid, and for the regulatory system that supports it? We need to make sure we make the most of innovation. Science and innovation will be absolutely pivotal in making sure we meet our environmental obligations. That's why we're increasing our investment in innovation both through the Research Councils and through our industrially led R&D programmes at DTI. Research Council funding on energy related R+D will be over £11m in 2002-3, DTI funding will be £18.5m. The new "Sustainable Power Generation and Supply Programme" (SUPERGEN), through the research councils and the New and Renewable Energy Programme in the DTI, will tackle basic research and development issues of key areas such as:
In addition, the Engineering and Physical Sciences Research Council have, in collaboration with the Carbon Trust, agreed a major joint programme of research, tackling demand issues through R&D on low carbon innovation. It would be silly though to pin all of our hopes though on any particular new technology which has not yet been fully proven. Instead, we must invest in R&D so that the more efficient low carbon technologies can be developed and take their place when they are ready. We have some examples of what could happen. For example, hydrogen might play a much stronger role as an energy vector in both static power supply and transport applications. But it could be something different. So we need to make sure our policy framework is sufficiently flexible to address our changing needs. There is also an important local/regional dimension. Regional structures and local authorities will have a more pivotal role to play in developing local initiatives - as the emphasis shifts away from big remote power plants connected to the grid towards locally generated power, for example from renewables. And of course local authorities – as the landlords to millions of people – have a role to play in increasing energy efficiency in the home. Nuclear Turning to nuclear power, Greenpeace's views on this are well known. My own view is this. It is clear that our first step must be to deal with the inherited liabilities. That's why we will create a new Liabilities Management Authority in law. I cannot anticipate the Queen's speech but I can say that we are working hard on the legislation and will move ahead as fast as we can. As the results of our consultation paper show, from the public's point of view the number one issue in relation to nuclear power is how we dispose of waste. We know, therefore, that this is an issue we need to grapple with quickly, and DEFRA are, of course, working on this. Separate to this though, we need to consider the need to reduce greenhouse gas emissions – and the issue of how nuclear contributes to our goal of a low carbon economy. Nuclear generation currently makes up around 25 per cent of the total electricity mix. Looking ahead to the time when our current nuclear stations reach the end of their lives, we need to be clearer about how we can replace this zero carbon generation in a way that meets our ever more stretching targets for reducing emissions. When the PIU report came out, there was a great deal of press reporting that we had decided to build a dozen new nuclear power stations. That was complete nonsense. We need to look carefully at whether energy efficiency and renewables alone will be enough to meet our overall security and carbon objectives at an affordable cost. That will be the context for the decisions on nuclear power. British Energy Recent events at British Energy have thrown a new light on the existing nuclear capability. Let me stress that the reason we took action – and the only reason - was to ensure the safety of nuclear generation and the security of supply. My priority, and the reason why I have taken action is to make sure we have secure energy supplies for Britain, not to secure the future of British Energy. We do not believe – as you have suggested – that the steps we have taken are illegal. We have notified the Commission of the action we have taken and await their approval within the normal state aids guidelines. The British Energy situation is a complex one and will take some time to resolve. We will make another statement in due course. But it is worth saying that the need to deal with the issues presented by British Energy is not in any way driving the policies we will develop in the White Paper. In particular, the question of the need, if any, for new nuclear build has to be addressed on its own merits, not in the light of a particular set of circumstances surrounding a particular private sector company. The white paper will be published in the New Year. The PIU report has set us a number of significant challenges. There are hard choices to make. We still have more work to do on analysing the issues; and assessing and balancing the risks involved before we can make decisions. Our conclusions will be in the White Paper. The decisions will affect all of us. We have attempted to address the issues thoroughly, through the extensive consultation we have undertaken. We look forward to rising to the challenges the PIU has set us. Our conclusions will also of course be within the grain of wider European and foreign policy. The UK will not remain self-sufficient in energy. So security of supply becomes a key objective of European and Foreign policy. We work closely with our European partners on climate change – in many environmental and energy activities. For instance, on emissions trading, and also on the liberalisation of European energy markets – creating an open and level playing field in gas electricity supplies. Trade As we also work closely with our European partners on trade – and in meeting our responsibility to tackle world poverty. The route out of poverty is through free and fair trade. The Doha agreement - signed last November by 142 countries, most of them developing countries - was historic. Not just because we succeeded where previous attempts failed. But because for the first time in world trade negotiations we've put the interests of developing countries first. In our first term of government, Gordon Brown and Clare Short put Britain in the lead, cancelling the debt of the developing world. Now, in our second term, we must put Britain in the lead again to win trade justice for the developing world. Because, if we could halve global tariffs, and do it in the right way, we could boost developing country incomes by $150 bn a year, three times the amount currently given in aid to those very same countries. Trade has the potential to lift people out of poverty. I said do it "in the right way" because it is important to get our sequencing right. I believe that British NGOs - Oxfam, Friends of the Earth, Christian Aid and Greenpeace and the World Development Movement - are right to raise concerns that unplanned, unsequenced liberalisation can have damaging effects. The last 10 years have seen the potential risks and destabilising effects of opening up certain markets too fast, and the vital importance of appropriate sequencing in capital account and trade liberalisation. But that does not mean markets should stay closed. I am completely clear in my mind that when markets open in a sequenced way, properly regulated by domestic governments, foreign investment is a force for good, a route out of poverty for the poorest in the world. And - although that is not our only motivation - good for our own country too. That's why we wanted to open a new trade round in Doha. It is why we are actively supporting the extension of negotiations to trade in services. And it is why Liz Symons and I are today launching a wide-ranging consultation to inform Britain's policy stance during the GATS negotiations. We want to make sure that we get these negotiations right, so that they can work for us and work for developing countries. So I would urge all interested parties - development groups or industry - to submit their analysis and research to the DTI. Because I am clear that when we get it right, liberalisation in services can be a force for good. In the UK, the liberalisation of telecommunications has led to increased competition giving consumers greater choice and lower prices. But there are some who say that services liberalisation must be damaging to poorer countries. I do not subscribe to that point of view. Indeed I say now to those who stand in the way of world trade reform that GATS will not force any country to privatise or to sell anything - to the Brits, or anyone else. It will not prevent any country from regulating in their national interest. Indeed, if a developing government decides it wants to open up its markets, strong regulation in the public interest is essential – as we know from the British experience. It is important that developing countries understand the full impact of liberalisation proposals and the benefits that would flow from them. That's why impact assessments are so important. Second, that the measures we have supported to increase the capacity of poorer countries to negotiate - £30m from Britain for this thanks to Clare Short – are in place and shown to be working. Because we believe that if conducted in the right way, all countries – developed and developing – stand to benefit from improvements in their services sector. In some cases these improvements will come from liberalisation – doing away with barriers that hinder growth and trade. But it is up to the country to decide. GATS is simply a mechanism for countries to come together and make changes when it is in their mutual interest to do so. We want to provide the opportunity for developing countries to benefit from these discussions so that the trade rules that result are fair as well as free. But we, as Europeans, do not start from a clean sheet of paper. We carry some responsibility ourselves. We must reform the common agricultural policy as part of the Doha negotiations because we cannot and we will not accept a system of subsidies that gives $2 a day to every cow in Europe … but leaves one thousand, two hundred million men, women and children around the world living on half that amount. It is time to end Europe's double standards on trade: demanding market opening from the poor, but practising protectionism to defend their own special interests. To conclude, I think we are building an increasingly robust and durable partnership – between NGOs, Government and industry. A partnership that is built on openness and transparency – respect and integrity. We won't always agree – but I am fully aware that it is encumbent on us in Government to make sure we listen to you, and fully consider your views as we develop our policies. That is the approach that we are applying both on Energy – in the run up to the White Paper; and trade – in the run up to the next WTO Ministerial in Cancun next September. We won't always agree on how we go about meeting our objectives – but we do agree on our aims – tackling world poverty, improving the environment. |
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Other speeches by The Rt. Hon. Patricia Hewitt
(the following are available from the archive) |
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