Government concludes climate change agreements

The Government has announced that it has largely concluded the climate change agreements with industry sectors in preparation for the launch of the Climate Change Levy on 1 April (see related feature), reaching a total of 40 agreements.

The agreements will mean that the most energy intensive industry sectors will be permitted an 80% discount on the Climate Change Levy, in return for commitments to substantially cut greenhouse gas emissions. The agreements are designed to protect the competitiveness of the industry sectors, whilst giving them the incentive to cut emissions, according to the Department of the Environment, Transport and the Regions (DETR). Agreements have been entered into by 10 large industry sectors, and with 30 smaller groups, including three which are to be finalised.

Proposals for a wider emissions trading scheme are currently being developed by the Government, with input from the Confederation of British Industry (CBI) and is currently expected to come into effect in January next year, a DETR spokesperson told edie.

“I am delighted that we have now reached agreement with these energy intensive sectors,” said Energy Minister Lord Whitty. “All of these sectors have made a commitment to improve their energy efficiency and reduce their environmental impact.”

The minister pointed out that the industry commitment means that by 2010, carbon emissions will be reduced by 2.5 million tonnes per year, assisting the UK in meeting its Kyoto targets. “Not only will businesses be helping to protect the environment, they will also reap the financial benefits of using energy more efficiently and cutting their energy bills,” said Lord Whitty. “This is a ‘win win’ situation for businesses and for the environment.”

“I would like to thank the sectors for the efforts which they have made to conclude these agreements and for their commitment to tackling climate change,” he said, adding that agreements have been made with almost all the eligible sectors, including the largest energy users such as steel, chemicals and paper.

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