UK leads G20 nations on low-carbon growth

According to analysis from PwC, the UK has seen 10.9% year-on-year declines in emissions from energy use – the highest reduction ever reported by PwC analysts in the past seven years. (Scroll down for report).

The main reason for the fall was a reduction in coal consumption of around 20%, due in part to the closure of a number pf coal-fired power stations. Strong economic growth and a warmer winter were among the other factors.

Headstart

PwC’s sustainability and climate change director Jonathan Grant said: “While the annual record for the UK is headline grabbing, it’s the UK’s consistent performance since 2000, reducing carbon intensity by 3.3% on average a year that is notable. It’s critical to at a minimum, maintain it, and ideally increase it.

“The level the UK achieved is more than twice the level achieved globally, and with a deal in Paris on long term climate change on the horizon, is a strong long-term competitive positioning. While business should expect and plan for more regulation on carbon emissions, this shows the UK has a head start on other countries.

The analysis by PwC models the G20’s carbon intensity, which measures energy related greenhouse gas emissions per million dollars of GDP. The model found that the UK achieved this by lowering energy-related emissions by 8.7%, while delivering strong GDP growth of 2.6%.

In that time, the UK reported a 19% increase in renewable energy consumption, taking renewables’ share in overall energy consumption to 8.3%. PwC’s report also confirmed a reduction in energy consumption of 6.3% – to levels lower than recorded in 1990 – by moving away from carbon-intensive fuels.

Stability not surprises

However, analysts have warned that these positive results are largely down to circumstance, and that Government policies have raised concerns about the stability of the UK’s low-carbon regulation and the longevity of the transition into a low-carbon economy.

Since May’s General Election, the Government has overseen significant subsidy cuts for onshore wind and solar; the scrapping of a tax exemption for renewable energy; the postponement of the next Contracts for Difference (CfD) auction; the removal of zero-carbon homes standards; and the sell-off of the Green Investment Bank.

“Maintaining the UK’s leadership requires stability not surprises in government policy,” added Grant.

For the G20 nations as a whole, the level of reductions in greenhouse gas emissions per unit of GDP needed to limit global warming to 2°C has been missed for the seventh successive year. Currently, the reduction targets submitted by more than 160 countries would limit global warming to 3°C by the end of the century.

Parliamentary Under Secretary of State for Energy and Climate Change Lord Bourne recently underlined that the government “will do everything in their power” to secure the desired results at December’s Paris climate talks. Yet, the lack of mention of the subject at last week’s Conservative Conference has left many questions unanswered.

Europe Emissions Targets and Implications for Business 2015

Matt Mace