Speech on transport and climate change
IPPR event - Transport: Acting on CO2?
European Commission, Representation in London
[Checked against delivery]
Introduction
I am delighted to be here to discuss the challenges and opportunities we face as we work together to address climate change.
I would like to thank ippr for inviting me to speak. They are an organisation already with a strong tradition of important work on climate change and transport. And I hope this is built upon in the coming years through the establishment of their climate centre.
Because it is only through informed debate - and yes, robust action from governments, industry, individuals and from civil society- that we will address the climate change challenge.
15 years ago I, like many others, read one of the best books authored by a politician in recent decades - Earth in the Balance by Al Gore. I fear I probably bored him with my reflections on it recently when we met. But we did reflect together that in the years between his book's publication and now, climate change has moved from an issue of scientific debate to one of public concern and growing scientific consensus. Today climate change is the greatest long term challenge we face. It is, I would argue, one of the three great international challenges of our time. Alongside global poverty and security, climate change is a real and present threat that we must face up to. That we must act on.
All three issues also have at least two other things in common. First, as I look out at this room here today, I see people who care about these issues. We know that it is our generations - I thought I better be careful not to upset the 20 year olds here today - our generations that our children will hold accountable on these issues. We have a moral responsibility to act. And to act now.
The three issues of global poverty, security and climate change also share something else, in that they are linked challenges. This is an era of increasing interconnectedness. National politics is becoming an increasingly international endeavour. As Bill Clinton has put it, we have moved from an era when politics was defined as 'it's the economy stupid' in the 90's, to an era defined by 'it's the economy plus': the economy plus immigration, the economy plus travel, the economy plus communication. To which we must also add: it's the economy plus the environment.
Today we increasingly recognise that our actions have global consequences. The World Health Organisation estimates that 150,000 people are already dying each year from the effects of climate change. Many, many more will have their lives adversely affected by climate change in the years to come.
We also know that it is largely those areas of the world least capable of dealing with climate change that will be most seriously hit. Declining crop yields, rising sea levels and ocean acidification will of course affect us all - either directly or indirectly - but the wealthiest countries of the world will be those most resourced to adapt.
And these effects of climate change threaten to foster instability, with food security, water security and energy security brought centre stage. These are local issues with global causes and consequences. To meet them we need what Margaret Beckett has called 'the globalisation of responsibility'.
To me this means that we have to recognise both the power and the limits of individual action. Our progressive values, our shared experience, show us that through collective action we achieve far more than we do alone. This is not to argue individual action is unimportant - far from it. Rather, it must be placed within a framework that secures changes across society in a fair and equitable manner.
From science and economics to action
The recent Intergovernmental Panel on Climate Change report reinforced the strength of the scientific consensus. The Stern Review on the economics of climate change published towards the end of last year has moved the debate on from the science of climate change to the economics of climate change. As you will all know, the report argues that to stabilise carbon levels at an appropriate level, a global emissions cut of at least 25% compared to now is required. As a developed country, we must, of course, do more. Further, the economic cost of not acting - or delaying action - on climate change far outweighs the costs of action, providing an economic rationale for the fight against climate change that is also helping win the argument internationally.
But candidly, I fear only part of this argument has been heard. Talk of a 'planetary emergency' is frequently part of today's news coverage. What has been less widely discussed is Stern's analysis that the right policy actions can both meet the scientific challenge and the public's expectation of economic growth. So while I welcome the increased public concern the report has stimulated, our responsibility now is to deepen the public understanding of the capacity to meet the scientific challenge if the right steps are taken. The challenge, if you like, is to match the increased concern with increased clarity on how to act.
As individuals, we all can and must play our part to tackle climate change. But the sacrifice agenda on its own is not, and will not be, enough. What we stop doing is one part of it, but how we change what we do is the vital next step.
To take just one example of Nicholas Stern's approach, he is clear that the way to meet this challenge is not through arbitrary limits on individual sectors of the economy, nor a willingness to make arbitrary decisions on individual pieces of infrastructure. Instead he argues for an economy-wide approach to extract the maximum amount of carbon for the minimal cost through all sectors taking their place within a framework delivering a reduction in carbon emissions.
International frameworks
Yet some of the recent contributions to the debate around climate change have owed more to 'capturing headlines' than 'capturing carbon'. The suggestion that VAT on domestic air travel - which could of course be passed on to business travellers - ignores the fact that domestic air travel accounts for only 0.4 per cent of UK emissions. Today, aviation accounts for around 6.2 per cent of the UK's emissions. Globally, aviation accounts for around 1.5 per cent of emissions. These are, of course, rising percentages. But given the inherently international nature of aviation, it is vital we establish the right international framework.
That is why I have previously called for the Chicago Convention to be re-written. This international document - drafted back in 1944 - which governs international aviation, makes literally no reference to the contemporary concerns of security or of the environment. In fact it is an impediment to action, and that is why we will continue to press for its reform ahead of the next ICAO conference in Montreal.
Simultaneously, the UK has been leading the effort within Europe for aviation's inclusion within the EU Emissions Trading Scheme and welcome the fact that the Commission has recently published its proposals. Just as Europe pioneered emissions trading schemes after the Kyoto agreement, so it must be equally pioneering in including aviation in the present scheme.
It is through such a cap and trade system that we as individuals, industries and economies can make choices on the actions that must be taken within a declining cap.
That is why the UK government has recently published its draft Climate Change Bill. Consistent with Stern's analysis, this commits us to at least a 60% reduction in domestic carbon emissions by 2050, from 1990 levels. It also contains enabling powers to help make this happen. This is the first of its kind in any country. It sets out a framework for moving the UK to a low-carbon economy, demonstrating the UK's leadership as progress continues towards establishing a post-2012 global emissions agreement.
Because let us be clear - it is only through international agreement that we will properly address the climate change challenge. I am proud of the UK's global role on this issue. But the UK does, after all, only account for 2% of global emissions. To take perhaps one of the most apposite examples: China plans to build 49 new airports and expand a further 71. This is not an argument for inaction. On the contrary, it is an argument for a strong international response to the challenges that we face. The up-coming Bali round of negotiations will be an important step as we establish a post-Kyoto framework with the participation of the US.
Transport: acting in a Stern-consistent manner
Yet notwithstanding our global leadership role, transport is periodically accused, here and abroad, of being a sector neglecting its climate change responsibilities. So I want to take this opportunity to set out the action this government is taking in transport against the rigorous framework set out by Stern.
Within this context, surface transport provides an opportunity to deliver significant reductions in carbon emissions, because from kerosene in aircraft to the petrol in our cars, transport is - of course - heavily reliant still on fossil fuels. Within an economy-wide approach, as long as overall emissions are declining sufficiently, this is theoretically sustainable. The atmosphere doesn't discriminate on the basis of the source of carbon emissions - and obviously this applies to geographical location as much as economic sector.
But we must ensure we take a long-term view in order to meet ready to meet future realities. And a recognition of the importance of seeking reductions in carbon emissions from the transport sector leads one inexorably to the issue of surface transport.
Why? Because surface transport accounts for around 90 per cent of transport's domestic emissions. And its emissions have also increased in relative and absolute terms since 1990, with carbon emissions from road transport, for example, increasing by 9.6 per cent between 1990 and 2005.
In large measure this reflects increased prosperity, as we are travelling further and more often by private vehicle. The number of vehicles on the road has increased from around 27 million in 1996 to over 33 million now. But this emissions figure also reflects a specific increase in emissions from HGVs and LGVs. So my Department will shortly be launching significant new work on the future efficiency of the freight distribution network, to see how government can bring about better environment performance in this sector, including through new vehicle technologies and more intelligent distribution systems.
The DfT has already undertaken some work in this area. Indeed, we will be shortly publishing the Low Carbon Transport Innovation Strategy. This document demonstrates that surface transport provides a real opportunity to deliver significant reductions in carbon emissions through technological advancement.
And remember, the Department is one of those departments where the rubber quite literally hits the road. Our key challenge is to reduce carbon, not reduce mobility. Indeed, within this context our challenge is this: in the years ahead transport must become one of the solutions to climate change, not simply one of the problems.
Stern: regulation
Sir Nicholas Stern sets out the tools by which such an approach can be addressed - involving regulation, trading, fiscal measures, removing the barriers to behaviour change and technological innovation. So let me take those in turn.
On regulation: we have welcomed the recent EC proposals to establish mandatory targets for vehicle fuel efficiency. It is clear that the current voluntary agreement has not worked sufficiently well. As the Chancellor made clear in his Budget speech, not only is the UK supportive of the mandatory approach, but we also want a long-term framework. That is why, working with industry, we should embrace a medium term objective of 100 grams of carbon emitted per kilometre.
This would deliver significant carbon savings, in the range of 4 million tonnes of carbon in 2020 and has the potential to be one of the biggest interventions we can make as a government in transport sector. Given the integration of the European car market, this can only be achieved by working closely with Europe - just another example of why in today's world you cannot be pro-environment and anti-European.
The Renewable Transport Fuel Obligation - perhaps up there with the High Level Output Specification as the most inelegant phrase my department uses - also has a crucial role to play here. By requiring that biofuels make up 5% of all surface transport fuel sales by 2010, we hope to deliver 1 million tonnes of carbon savings per year. That is the equivalent to taking around 1 million vehicles off the road.
We are currently consulting on the details of this and the potential to extend the scheme towards a 10% biofuel mix, of course providing sustainability criteria are met.
This is an important, contemporary and contraversial issue. It can be too easy for people to just assume that a biofuel is - environmentally - a good thing - that it will necessarily deliver carbon reductions. Yet the way the biofuel is produced - including any changes to land use - and transported are fundamental to any calculations of carbon savings.
Now given international legal obligations there is work to be done. But this challenge is one I believe we should not respond to by placing an immediate freeze on biofuels - as George Monbiot argued yesterday in the Guardian. Rather, as I wrote in a letter to the European Commission last month, we must work together to strengthen the rules on the area of sustainability. Once again the UK is leading the debate within Europe on this issue and I hope we can progress the necessary legal framework as quickly as possible.
As an interim step, we have established a reporting framework, requiring the disclosure of the carbon savings and wider environmental impact. These reports will be made public and we will publish league tables on the best and worst performers.
Mandatory targets for fuel efficiency and biofuels, are two examples where the Government is using regulation - as Stern suggests - to deliver significant carbon savings. This is also being done in a way that provides market certainty. By establishing long term, clear frameworks for carbon reduction, the private sector can plan its investments and innovate towards achieving the objective of carbon reduction.
But influencing the supply of vehicles and fuel is only one side of the coin. As Stern advocated, we must also incentivise the take up of greener technologies, and we are through fiscal measures.
Stern: taxation
The company car tax regime introduced in April 2002 was a significant step in the Government's continuing strategy to protect the environment by encouraging company car drivers to choose more environmentally friendly cars. This is leading to reductions in emissions - around 0.2 to 0.3 million tonnes of carbon in 2005. We hope they reach around 0.5 million tonnes of carbon by 2012.
And as the budget just last week further demonstrated, we are using the car tax system to both tax the most polluting vehicles whilst simultaneously encouraging the purchase of more fuel efficient vehicles. And the differential in fuel duty for biofuels - of 20 pence per litre - will be maintained until the spring of 2010. Again, providing certainty for the industry as it invests in this developing technology.
The policies set out in the climate change programme should deliver around 6 million tonnes of carbon savings in 2010, compared to what they would have been. And the extra policies outlined above are designed to take us even further.
Stern: removing the barriers to action
So the Government is using all three mechanisms under Nick Stern's first 'leg': taxation, trading and regulation mechanisms. But the Government is also acting to remove the 'barriers to action', as Stern put it. Through the provision of information and public transport investment, we are encouraging behaviour change.
Indeed the Government has recently launched the Act On Co2 campaign. The first use of this new brand has been our Smarter Driving campaign, launched on 11th March. You may have seen the adverts in the newspapers or on the billboards. These are designed to make the simple point that small changes in behaviour can have an impact on emissions and your wallet. Smarter driving - or eco driving - has the potential to reduce emissions on average by 8%. This is, deliberately, a message of empowerment - we can all act on C02. We are also aiming to bring forward a second stage of the campaign in the coming months, providing consumers with information on the most fuel efficient vehicle in each class.
Providing information to the public about the consequences of their actions can deliver significant results. This is why I am so keen on the carbon calculator we've recently installed on the Transport Direct website. This provides a facility for users to calculate their fuel use and carbon emissions for any journey they make - and also details on how they can be offset. We will be shortly extending this to other modes of transport, enabling comparisons for different trips.
And providing information for the public to make informed decisions on their travel behaviour is also crucial. And as the early results from the Sustainable Travel Towns demonstrate, this can lead to real results. Our Sustainable Travel Towns - Peterborough, Darlington and Worcester - are perhaps not that widely known. They are pilots, established in 2005 and 2006 to provide targeted travel marketing and personal journey planning. While I stress these are early survey results, they suggest an over 10 per cent increase in public transport use and a commensurate decrease in private car use amongst those surveyed.
This kind of intervention, encouraging what are called Smarter Travel Choices, is useful in 2 ways. It can help address congestion and encourages more environmentally friendly travel choices. They are the types of measures that help remove Stern's barriers to action.
Now as research commissioned by DfT in 2004 reported, smart measures can encourage drivers to use alternative modes of transport. This is primarily a congestion relieving policy tool, but can also help deliver in addressing transport's carbon emissions. As a department we have a joint target with the Department for Education and Skills, that by March 2010 all schools in England will have a school travel plan. More than 10,000 schools already have one in place. And last year we announced grants to encourage 'walking buses' for school children. Over 3,200 primary schools - more than 1 in 6 - will receive these grants, as I announced just 2 days ago. At the same time I launched the national roll-out of the 'Bikeability' scheme, which combines the new cycle training standard designed to provide children with the on-road skills they need to handle modern traffic conditions.
In February this year DfT launched the National Business Travel Network, operated by the Transport 2000 Trust, to promote and encourage wider take-up of travel planning both for the commuter and during the course of business. Travel planning can reduce car use to the workplace we understand by between 10 and 25 per cent.
So working with businesses is also an area of real opportunity. As well as the potential benefits of travel planning, they are significant transport users and these are also consumers of vehicles. Fleet vehicles, for example, account for half of all new vehicles purchased each year. There are a number of schemes running in this area already - for example the DfT-funded Energy Saving Trust's green fleet reviews.
My department has been considering the feasibility of developing a comprehensive transport accreditation scheme and we will be discussing this with interested businesses during the summer. This will aim to encourage and recognise those businesses who implement best practice and show improvements in the environmental performance of their transport activities.
This will also ensure that we are coordinating our work with businesses, so government is providing coherent advice and support to encourage action in this area. It will also help mainstream green travel activity as a central part of a company's activities. We will seek to get as wide a take up as possible. Success in this area would be dependant on the buying power deployed could deliver significant market transformation.
This summer we expect to receive the first business cases from those authorities interested in taking forward local road pricing pilots, to address local congestion. I am expecting and hoping that as part of these bids authorities will propose significantly more spend on Smarter Choices, along the lines of our Sustainable Travel Towns. So there is the prospect, therefore, of our initial pilots also being extended to major towns and cities across England in the coming years.
Investment in public transport to make this happen
But of course encouraging those smarter choices also requires the provision of viable alternatives. This is why our record, sustained investment in public transport is not incidental but vital and central. In rail, we are investing £88 million a week in the network. We now have more people travelling by train than any time since the 1940s. This certainly presents new challenges - especially capacity. But we are now in a position to invest in meeting this challenge - as my announcement just 2 weeks ago of 1,000 new rail carriages demonstrates.
We have also doubled spending on buses - with over £2.5 billion being invested every year in the bus network. We have seen the first year-on-year increases in bus patronage literally for decades, but patronage remains patchy across the country. This is why, last year, we published proposals to give those authorities that need them the powers to make a real difference to the way transport is delivered in their communities, especially bus services.
We therefore have the prospect of real innovation in this area. Our policy on road pricing - that we have a national debate on road pricing, and that in the first instance government works with interested local authorities to bring forward pilots as local solutions to local problems - will be part of a package of significant reform. We have consistently stressed that significant investment in public transport is a key part of the package. But the associated roll out of the Smarter Choices agenda akin to our Sustainable Travel Towns means that in the coming years many households within pilot road pricing authorities should receive targeted travel advice.
Not only would this help reiterate that our intentions are primarily to address congestion it could also provide a significant impetus to public transport in those areas. Combined with our work on workplace and school travel planning, we would have a comprehensive package in place.
Outside of public transport we have also invested in cycling. To be fair the Mayor of London has led the way on this agenda. I doubled the cycling budget last year and am looking to do more to place cycling higher up the transport agenda.
So as a government we are working on both the supply and demand side of transport. We are acting now - at the forefront of the debate in Europe - to influence the fuel efficiency of vehicles on the road. And we are providing incentives - and some disincentives - to encourage environmentally friendly behaviour, so that we all face up to our climate change challenge.
But when people are travelling for work, to see family and friends and for leisure, I don't think we are going to win this argument by telling people they have to travel less. We have to win the argument that they should travel differently. This is why our approach of a package of measures is so important. It means we influence the technologies available, we encourage their take up and we provide more environmentally friendly travel choices.
But as we look out into the decades ahead, the challenge is to make surface transport one of the cleanest sectors of the economy. Again our Low Carbon Transport Innovation Strategy provides a useful assessment. Across a number of technologies - fuel, materials and engine efficiency - there is the prospect of very low, or even zero carbon vehicles.
We must ensure that we capitalise on that opportunity.
Stern: investment in research and development
As the Stern Review argued, there is a clear role for government here. Through establishing regulatory controls and product standards, for example - which I discussed earlier. But also through support for research and development.
The Government already has a number of programmes in place to support the development of these new technologies. For example the Energy Technologies Institute, the Environmental Transformation Fund and the DfT's Low Carbon Research and Development Programme. We also hope to announce more targeted support in LCTIS.
These initiatives are working to stimulate low carbon technology and help bring it towards market. They also help us exploit economic opportunities, making sure the UK is at the forefront of the emerging technologies.
That is why the Chancellor's announcement of the joint King/Stern Review in the Budget is so important.
For while we are interested in exploring the opportunity of securing a medium-term fuel efficiency target of 100 grams per kilometre, we must also look further.
So that's why Professor Julia King and Sir Nicholas Stern have been tasked with identifying how surface transport vehicles could be 'decarbonised' over the next 25 years and how government might accelerate their cost-effective introduction. They will also explore how the UK can maximise the economic opportunities of this agenda and how the UK can influence emerging markets and technology transfer. The terms of this review will be published shortly.
The terms of that review reflect a real challenge. And to explore this challenge we must draw on the considerable experience and expertise of the UK vehicle technology sector - and indeed beyond. This is both a challenge and a huge opportunity to British industry and British science.
Conclusion
Let me, by way of conclusion, offer a different way of explaining the challenge we face by recounting what John Ashton - the Government's climate change envoy - recently described to me. He explained that globally we face a basic challenge over the next generation. 21 trillion dollars will be invested in new energy and transport infrastructure. The question we face is: how, globally, do we ensure this investment advances a low carbon economy?
When faced with the necessity to act, humankind has in fact a history of delivering - from the wheel to putting a man on the moon.
Limiting our ambition is not the best way to limit climate change.
We were the country that led the industrial revolution at the turn of the 19th Century. We can, with the right choices, lead the post fossil fuel revolution.
But my key objective isn't to reduce mobility, it is to reduce carbon.
That is why, along with aviation, we want the EU to consider including surface transport in the EU Emissions Trading scheme. That is why we need to do more on the issue of biofuels.
That is why the medium term challenge of 100 grams of carbon emitted per kilometre is one we should embrace. And why now we must explore how by 2030 zero, or close to zero, emissions cars could be commonplace on Britain's driveways.
In the years ahead transport must become one of the solutions to climate change, no longer simply one of the problems.
That is our shared challenge.
That is our shared responsibility.
And working together I believe it can be our shared achievement.
Delivered: 28 March 2007
(This speech represented existing departmental policy but the words may not have been the same as those used by the Minister.)
