Who pays the bill?

1st Jul 2019

 

When the Chancellor asked that question, suggesting the bill was around £1 trillion for the UK to decarbonise, there was an outcry. From “it’s not that much”; “the cost is worth it” to “look at the benefits”, the range of arguments suggests there is a debate to be had, not just about how much, but more importantly, who will pay the bill.

Here the UK stands at a quandary. We might have been the first to pass a commitment to 80 per cent reduction; the first to set up an independent advisory body, the Climate Change Committee; the first major economy to commit in law to Net Zero but we haven’t yet answered the question about who pays.

The UK is the fifth richest economy in the world (for now) so arguably could afford to pay its way. And the argument about our historic carbon emissions is compelling but it doesn’t mean current generations should be disadvantaged because of the sins of the past. So it’s a tricky one. All I would observe is that the UK population generally believes in fairness – it strives to behave that way but resent it when others don’t. So if the UK pays its way (and yes is bound to mean opportunity if not economic cost) what about the rest of the world?

The strength of the international agreements, such as Paris, is that they are arrived at by consensus. The weakness, ironically, is that this consensus carries no penalties for failure. If only Ofgem operated the scheme I hear you cry.

So how do we ensure all countries, who can afford it, pay their fair share and what about those can’t afford it? How do we ensure the benefits of going green are realised for UK consumers and business and not just seen as a cost? I’ll address those next week Steve.

Best wishes

Mike Foster, CE

Mike Foster

EUA's Chief Executive

 

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