Two days ago Ed Davey, the replacement for Huhne as Secretary of State for Energy & Climate Change, repeated again the Coalition’s boast that it was the greenest government ever. Even by the standards of current self-congratulatory political rhetoric, that’s pretty vapid. It’s worth exploring the actual record. The Coalition Agreement proposed to increase the target for energy from renewable sources. In 2010 the UK was ranked third in the world for investment in green business, and investment in alternative energy and clean technology reached £7bn. However it has now been rated 13th, mainly because investment in wind energy fell 40% last year, with only one offshore wind-farm being completed. That reflected the Chancellor’s openly stated negative attitude to green energy, supported by the letter sent by 101 Conservative MPs to the Prime Minister deploring wind-power development both onshore and offshore.
The Agreement promised to encourage marine energy. The UK has the best marine energy resource in Europe, with potential to supply 20% of current electricity demand and create 10,000 jobs by the end of this decade. But the government’s closure of the £50m marine renewable deployment fund, replacing it with a £20m innovation fund, has dented business confidence.
The Agreement committed to establish a full system of feed-in tariffs. The FIT system introduced in 2009 expanded the solar industry within 18 months from 3,000 employees in 450 businesses to 25,000 people in nearly 4,000 businesses. In autumn 2010 the Coalition decided that the scheme should be reviewed and prices brought down, but gave the industry just 6 weeks’ notice and proposed to bring in the changes even before the consultation period had ended. As a result dozens of firms were put out of business, 5,000 jobs on the government’s own estimate were lost, and the import of Chinese solar panels was increased. After cutting solar power by 70% in six months, it is difficult to see how the Coalition expects to achieve its target of 22GW of solar energy by 2020.
The Agreement promised to continue investment in carbon capture and storage (CCS) technology. But time is at a premium. With demonstration projects already under way in Canada and Australia and with 20 other projects sitting on a shelf, the government’s announcement of a new competition risks losing the international initiative in this sector.
Yet another important commitment in the Agreement was to create a green investment bank. But the Chancellor then declared that it will not be a bank until the debt reduction target has been met. That means it will not operate as a bank till at least 2017.
The Agreement also trumpeted a new Green Deal. Originally the government claimed it would create up to 100,000 insulation jobs by 2015 and reach 24m homes by 2020 and 26m by 2030. However Transform UK now believes it will reach only a fifth of the number of households the government expected, and the number in fuel poverty could reach 9 million by 2016. Moreover the key information on the interest rate to be charged has still not been made known which is inevitably inhibiting participation in the scheme.
Despite this rather disappointing performance so far, the Coalition is looking to 2012 to move up a gear, in particular to install at least 4GW of green energy this year. Nevertheless Friends of the Earth in their recent report still judged that they found little or no progress in three-quarters of the government’s 77 green policies that they examined.