Decarbonisation is important, but at what cost? (Part 2)

18th Sep 2017


Last week I gave you a flavour of how we got to the 80 per cent carbon emissions reduction in the Climate Change Act, I want to explore the question of what it is likely to cost to meet the obligation and whether we are spending the money in the most effective way.

A clue to my thinking is a section of the Act which looks at “international carbon credits”. During the debate, whilst MPs recognised the UK need to act domestically, a limit of 30 per cent was placed on non-domestic carbon reductions – a process whereby the UK could use the Clean Development Mechanism (part of the Kyoto Protocol) to trade emission reductions.

An important caveat, quite rightly, is that any carbon reductions in developing countries traded by the UK must be additional to, not instead of what that country was planning.

Let me expand my thinking. If a country like Nepal, one of the poorest in the world but with abundant natural resources for hydro-power, is helped to develop their renewable electricity production wouldn’t this be a more efficient use of resources compared to electrifying domestic heat in the UK? At a cost of upwards of £300 billion I would think so.

Given climate change is a global problem, then global solutions should be considered. Providing Nepal with plentiful power would massively change their development potential, especially as so much hydro-electric could be exported into their power-hungry neighbour India. You now start to see how carbon reductions take place – India can move away from coal; Nepal gets power and growth (and reductions in biomass emissions) and world gets the benefit in terms of impact on climate change. All at the fraction of the cost the UK would waste trying to tackle the difficult bits of carbon reduction.

As a BEIS official said to me, anything is technically possible, but is it cost-effective?

Now before I get called a heretic, the UK should reduce domestic emissions and show a lead. But the sensible figures in Government, when writing the Climate Change Act, expressly allowed for this course of action. Perhaps it is time to start using it.