'No case' to water down CO2 targets, chancellor told

Coal fired power station The UK is allowed to relax its targets for reducing emissions on CCC advice

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The government will break the law if it waters down its plans to reduce greenhouse gases, its advisers say.

The Committee on Climate Change (CCC) says there is no legal, environmental or economic case for lowering the fourth UK "carbon budget", set in 2011.

It says the budget (running from 2023-2027) should be tightened if the EU agrees strict targets on emissions.

This is likely to displease Chancellor George Osborne, who believes the targets would threaten competitiveness.

Under the Climate Change Act, the UK is allowed to relax its targets for reducing emissions if the CCC advises that circumstances have materially changed since the budget was set.

The government asked the committee to review the budget to ensure it was still appropriate.

Last month the committee said there had been no change in the science, or in international policy to cut CO2. Its latest paper says there is no substantial domestic change either.

It repeats its calculation that low carbon policies will put £100 on the average household bill by 2020.

It assesses that fuel poverty will not be materially affected by the policies, and that risks to industrial competitiveness can be mitigated by government exemptions for energy-intensive firms.

The CCC believes low-carbon investments will actually save more than £100bn with gas at its current price, with much higher savings in a world with a high gas price.

The committee’s calculations have been challenged by some who believe they have underestimated the costs of providing new power lines and back-up for wind power.

The report bases its projections on the questionable assumption that the price of emitting carbon will rise as nations move to tackle climate change.

It says this is reasonable as all major nations have stated their determination to reduce emissions, but critics fear that the UK economy could be damaged if Britain presses ahead with progressive policies and the rest of the world fails to follow suit.

The CCC, an expert committee mainly comprising academics, says the fourth carbon budget will bring other benefits including less reliance on fuel imports, improved air quality and reduced noise pollution.

Lord Deben, chairman of the CCC, said: “This report shows the clear economic benefits of acting to cut emissions through the 2020s. This provides insurance against the increased costs and risks of climate-related damage and rising energy bills that would result from an alternative approach to reduce and delay action.‪

"While it is essential to understand affordability and competitiveness impacts associated with the budget, the evidence suggests that these are relatively small and manageable."

The CCC says the Chancellor George Osborne has no legal basis for challenging the budget now, and green groups have indicated that they would take a judicial review if he attempted to do so.

There will be a particularly close focus on the effect of the advice on the Chancellor’s gas strategy unveiled last year.

The CCC says the core scenarios in the strategy are in line with the fourth budget, moving toward average emissions of no more than 50-100g per kilowatt/hour in 2030. But one scenario aims for 200g - in excess of the budget.

The CCC says if the government accepts its advice, that would narrow the range of scenarios and increase confidence for investors who are being asked to find more than £100bn to renew the UK’s electricity system.

The report is predictably being backed by green groups but it has also found support from a coalition of charities campaigning on air quality, including the British Heart Foundation, Asthma UK and Clean Air in London.

A spokesman for the charities said: "We strongly support the CCC recommendations to halve UK emissions by 2027 - measures to cut carbon will also have significant benefits for air quality. Many of the root causes are the same, so efforts to tackle both issues go hand in hand."

There are severe worries about the future cost of energy from large manufacturers, but the CCC has so far managed to keep the Confederation of British Industry (CBI) on board.

Rhian Kelly, CBI director for business environment, told BBC News: "It seems sensible to maintain the fourth carbon budget at this point in time.

"It would of course be prudent for the government to look again at the UK's emissions reduction pathway once EU discussions have concluded, to make sure we remain aligned."

This is a key issue. Benny Peiser from the climate sceptic group GWPF told BBC News: "Given the EU's manifest reluctance to follow Britain's lead, there is no chance that the government will adopt new unilateral targets until and unless there is a legally binding agreement at the 2015 UN climate summit in Paris."

Lit Ping Low, climate economist for the consultancy PwC, said: "The committee's endorsement of no change to the budget is important because it sets the tone for the direction of the policies investors and businesses need.

"But it's important to remember it's an endorsement of a target that is the minimum we should achieve, when what the IPCC report would tell us is that we need more ambition from all countries."

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