October 2006
Government Plans New Carbon Emission Law
Intensive lobbying by environmental groups and a growing cross party consensus has prompted the government to take further action over climate change.
Following months of speeches highlighting the need to take greater action to ensure that the UK meets self-imposed carbon emission reduction goals of 20% by 2012, plans for a new bill on climate change have been proposed.
Environment Secretary David Miliband gave strong indications that the issue would be raised in next months Queen’s speech, which sets the legislative agenda for the forthcoming year.
Mr Miliband’s address to the Commons was emphatic, stating that "[the question] is not whether to legislate, but what form legislation should take and how it could be organised". Although binding annual targets for industry were not mentioned (as businesses already bear the 2001 Climate Change Levy), such a move was not ruled out by Defra, which stated that Ministers were still looking at "all the options".
More specifically, the environment secretary mooted the idea of a "carbon budget". Such a budget would likely be based on the EU Emissions Trading Scheme (ETS). The ETS is already used to regulate industrial polluters of a certain size through the granting of permits which may then be bought or sold on the market.
This has encouraged environmental audits amongst an increasing number of firms to find ways of minimising their carbon footprint, even if they are not currently included in ETS. This is because the government is seeking to include a growing number of industries within the ETS and any possible national scheme. The airline industry has been targeted in particular and has found that the previous paucity of its strategic environmental planning will now add to the costs of any pre-emptive ETS compliance. Indeed, failing to previously set standards and targets has potentially lost industry growing numbers of ecologically minded consumers who are seeking out more environmentally friendly and carbon neutral options.
It is probable that any national scheme would exclude only firms operating at de minimis levels of energy consumption and domestic households as the government is currently struggling to reach its future emissions targets. Moreover, the introduction of such a national scheme is being seen as an opportunity to provide a new currency in business through the commoditisation of emission quotas, in order to dilute the financial impact of a regulatory burden.
It is therefore unsurprising that the BSI (British Standards Institution) found in a survey of 100 FTSE-250 companies, 70% were concerned about rising energy costs and 30% worried about their carbon emissions. Nonetheless, more than two thirds of firms still did not have an environmental standards programme.
BSI director Mike Low remained guarded after the survey, stating that "It is encouraging to see that companies recognise the social and business benefits of going green but we have clearly got some way to go".
However, he sounded a note of urgency about the imperative for action:
"None of us can afford to wait another 10 years when advice and guidance based on years of business experience is readily available to use now."
For more information on environmental audits or strategic planning for your organisation contact Steve Stones on 01788 538 150.
Print this page