The first annual report to the UK Parliament by the Committee on Climate Change (CCC) has concluded that a step change is required in the pace of UK emissions reduction to meet carbon budgets, and that in some areas, new policy approaches will be required to deliver the government's low carbon transition plan.
Key findings of the report suggest that going forward, reductions of 2-3%pa will be required to meet the carbon budgets.
Declining economic activity is likely to have produced an emissions cut of around 2% in 2008, and recession could reduce emissions in the first budget period by a total of 40-70 million tonnes. But recession induced reductions must not be confused with underlying progress, which could be undermined by a recession induced fall in the carbon price. The UK should now aim to overachieve emissions reductions in the first budget period, the report said.
According to the report, decarbonisation of electricity generation is a priority, and scenarios to achieve a reduction in grams per kWh from today’s 540g CO2/kWh to less than 300g CO2/kWh in 2020, could include 23GW of new wind capacity, up to three new nuclear stations and up to four CCS demonstration plants by 2016.
The report suggests that current electricity market arrangements together with the EU ETS trading scheme are unlikely to deliver required sector decarbonisation, and will lead to increasing dependence on imported gas.
The committee calls on the government to undertake a review of alternative arrangements to reduce investor risks and ensure delivery of investment in low-carbon technologies. Options to be considered include carbon price strengthening, providing certainty on the price paid for low-carbon generation, and ensuring low-carbon investment.
Energy efficiency in homes could be improved by 35% by 2020 with a program of improved insulation, the installation of 12 million energy efficient condensing boilers, and improvements in electrical appliance efficiency. But achieving this program is likely to require a shift from the existing Carbon Emissions Reduction Target (CERT) approach in which electricity companies meet their supplier obligation through specific measures.
Whole house approaches (simultaneously implementing the full range of measures) and street-by-street approaches involving local government and energy companies within a strategy defined by national government are likely to be required.
As outlined in the committee’s first report in December 2008, road transport emissions need to be reduced via a combination of efficiency improvements and measures which will constrain growth in traffic volumes: emission cuts of 30% by 2020 are possible.
The committee reiterates its belief that the carbon-efficiency of new cars can and should be reduced from above 160g/km today to 95g/km by 2020. This reduction could be achieved by improvements to fuel efficiency on conventional cars, but further reductions beyond 2020 will require a role for electric cars.
The Climate Change Act requires the committee to report each year on emissions reductions relative to the UK’s carbon budgets. In the first monitoring report, the committee has focused on analysing progress in the years running up to the first budget period, understanding the impact of the recession on emissions, and identifying leading indicators.