Emissions trading schemes ‘not enough’
Drastic policy changes are required if the government is to meet its target of cutting carbon dioxide emissions by 2010, a new report warns.
Projections by Cambridge Econometrics suggest that despite efforts to improve carbon efficiency and cut the production of greenhouse gases, the government is on course to miss its self-imposed target.
And the economic forecasting group warns that the emissions trading scheme (ETS), where firms are given a certain limit on the carbon dioxide they can emit, must be tightened to have any effect.
There are two main tenets to Britain’s energy policy – the climate change programme (CCP), which is a tax on the use of energy in industry, and ETS.
Across the European Union, the EU ETS requires firms to purchase permits that effectively give them the right to emit carbon dioxide. Each permit brings with it an allowance, which firms can then trade with each other according to need.
However, today Cambridge Econometrics argues that too many permits are being issued and that they are not expensive enough to deliver the kind of cut in greenhouse gas emissions required to meet environmental targets.
It claims that prices must be increased even to achieve a 12 per cent cut in carbon emissions by the end of the decade – well short of the government’s self-imposed 20 per cent target.
However, the report notes that despite last year’s rise carbon emissions, Britain should meet the Kyoto target of cutting emissions by 12.5 per cent below 1990 levels by 2008-12.
Responding to the report, environment minister Elliot Morley said it showed the progress the government has already made, while admitting that more still needs to be done.
“This report confirms the UK is well on course to meet its Kyoto obligations for cutting greenhouse gases however, it underlines the need for substantial measures in the climate change programme review if we are to meet our more ambitious domestic target for cutting carbon dioxide emissions,” he said.
“It also underlines the importance of energy efficiency from households; the new building regulations announced this week for better insulation and more efficient heating systems will save a million tonnes of carbon dioxide by 2010.
“Renewable energy and carbon abatement technologies for cleaner fossil fuel us will reduce our vulnerability to high fossil fuel prices.”
