The Brit-Govt must publish a plan to secure the investment needed to meet the UK’s carbon budgets after a series of policy changes have contributed to a collapse in clean energy investment, according to MPs on Westminster’s Environmental Audit Committee.
The latest figures for low-carbon energy investment show that there has been a ‘dramatic and worrying collapse’ since 2015 that threatens the UK’s ability to meet its carbon budgets.
In cash terms, investment in clean energy fell by 10% in 2016 and plummeted by more than half (56%) again in 2017.
Annual investment in clean energy is now at its lowest since 2008.
For example, in 2015 the Government made the following changes to policy which harmed confidence in low-carbon projects:
- Closed the Renewables Obligation to onshore wind one year earlier than had previously been announced;
- Removed the Climate Change Levy (CCL) exemption for renewables;
- Reduced Feed-In-Tariffs for small scale renewable generation;
- Cancelled the Zero Carbon Homes policy due to come into force in 2016; and
- Cancelled the £1 billion Carbon Capture & Storage competition which could have resulted in the first such scheme being developed at Peterheid.
Labour MP Mary Creagh, Chairman of the Environmental Audit Committee, said: “Huge policy and investment challenges remain in decarbonising transport, domestic heating and industry.
“Billions of pounds of investment is needed in clean energy, transport, heating and industry to meet our carbon targets.
“But this dramatic fall in investment is threatening the Government’s ability to meet legally binding climate change targets. The Government’s Clean Growth Strategy was long on aspiration, but short on detail.
“The Government must urgently plug this policy gap and publish its plan to secure the investment required to meet the UK’s climate change targets. It should provide greater clarity on how it intends to deliver the Clean Growth Strategy by the 2018 Budget, and explore how a Sovereign Green Bond could kick-start its Clean Growth Strategy.”
The report finds that the government’s Clean Growth Strategy does not do enough to meet legally binding climate change targets, even if all its policies are delivered in full, and the privatisation of the Green Investment Bank and a reduction in European Investment Bank lending following the Brexit referendum may also have played a part in the fall in investment.
16 May 2018