CARBON EMISSIONS TARGETS: UK MUST NOT GO IT ALONE
The risk to UK business from tough new government environmental targets could become excessive if other European Union economies do not deliver on their targets, says the CBI.
The employers' organisation is stressing that none of the other EU countries that have so far announced their emissions allocation plans ahead of the European Commission's 31 March deadline have yet demonstrated how these will meet their Kyoto commitments.
Some EU members, Denmark and Austria for example will fail to meet their Kyoto targets with Austria actually increasing emissions.
The CBI points out that the UK is the only member state pledging to go beyond its Kyoto commitment.
CBI Deputy Director-General, John Cridland, said: " "British business is already demonstrating it takes the threat of climate change very seriously. But it is extremely concerned that the UK is making too large a commitment if other countries do not deliver. This could damage business competitiveness in key industrial sectors, especially if electricity prices rise faster than the government expects.
"Germany is expected to protect its electricity generation sector while the UK's will bear the brunt of the emissions reduction obligation with the extra costs passed to UK power users.
"The CBI supports emissions trading and does not want it to be discredited. The government must implement rules and targets for the UK that do not undermine the ability of companies and plants to compete and it must ensure consistency across the EU. If the government cannot achieve this and all member states cannot meet the EU deadline the government must be prepared to revisit the UK's proposed plan."
In its submission to the government's consultation on implementation of the EU emissions trading scheme (which closes today, Friday) the CBI says the government must:
- ensure it does not impose a damaging handicap on UK business which other EU countries are not planning for themselves.
- avoid severe damage to the competitiveness of affected sectors or companies by ensuring all data are as accurate as possible.
The CBI says it is also concerned that inaccurate data is adding to uncertainties about the impact of the targets on UK business. Lack of clarity is making it difficult to be sure figures for past emissions and projections for the future are accurate. Some plants have been missed out or wrongly categorised, others have been given quotas so low that they could suffer huge extra charges.
If the government cannot ensure accurate data and equivalent effort across the EU in time to meet the scheme's 1 January 2005 introduction date it must be prepared to adjust the targets or relax the rules. The CBI believes it is more important to produce an emissions trading scheme that works than to rush things through to meet EU deadlines. (We welcome the government's announcement on Thursday 11 March that it is delaying the submission of detailed emissions allocations to the European Commission until June).
John Cridland added: "The UK produces about two per cent of the world's greenhouse gas emissions. Even the severest reductions here would mean very little in global terms. The UK is putting itself on the line, expecting others to follow but it's increasingly clear that they are not going to. For this small but important gain, the government risks driving jobs abroad to countries where conditions are less onerous."
11 March, 2004
Notes to Editors:The emissions trading scheme will allocate carbon emissions quotas to individual plants. Sites that emit less than their allocation will be able sell their excess quota while those that emit more will have to buy in allowances.
Media Contact:Richard Dodd, CBI Press Office 020 7395 8086 richard_dodd@cbi.org.uk
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