Britain will need to change policy course if it wants to meet the goals of its Low-Carbon Transition Plan, according to the Committee on Climate Change’s (CCC) first annual report to Parliament today.

Among the report’s key findings:

• Emissions reductions averaged about 0.5 per cent a year from 2003-2007, which means the UK will need to boost its reductions to 2 to 3 per cent a year if it wants to meet its carbon budgets.
• Declining economic activity is likely to have produced an emissions cut of around 2 per cent in 2008. But recession-induced reductions must not be confused with underlying progress, which could be undermined by a recession-induced fall in the carbon price. Consequently, the UK should now aim to overachieve emissions reductions in its first carbon budget period.

The ensure delivery of its first three carbon budgets, the British government needs to revise or strengthen policy in three areas, the committee found:

• Electricity generation: Current electricity market arrangements are unlikely to deliver required sector decarbonisation, and would instead lead to increasing dependence on imported gas. The committee therefore calls on the government to undertake a review of alternative arrangements to reduce investor risks and ensure delivery of investment in low-carbon technologies.
• Residential and commercial buildings: Improving the energy efficiency of buildings is likely to require a shift from the existing Carbon Emissions Reduction Target (CERT) approach in which electricity companies meet their supplier obligation through specific measures (for example, the supply of energy efficient light bulbs). A better strategy would include whole-house approaches (simultaneously implementing the full range of measures) and street-by-street approaches involving local government and energy companies.
• Road transport: While electric car initiatives are rapidly getting under way, the committee finds two new mutually reinforcing government policies are required: Support for new car purchase to drive initial volumes and help manufacturers achieve economies of scale; and support for battery charging infrastructure.

“With the carbon budgets in place, we now need to achieve a step change in the pace of emissions reduction,” said Lord Turner, chair of the CCC. “The government needs to build on its ‘Low-Carbon Transition Plan’ and put in place a comprehensive delivery framework. What we have proposed is achievable and affordable but action needs to be taken now if we are to make our contribution to combating climate change.”

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