Supplementary memorandum submitted by
the Association of Electricity Producers (U29a)
Supplementary questions arising from oral
evidence given to EFRA Committee Inquiry "Climate Change—Looking
Forward"
Q 138. Perhaps you might just be able to quantify
for us what you think is the target of CO2 emissions
that we have to deal with, particularly to bring us back onto
the government's target, how much of that you think you could
contribute and, ballpark figure, what has to be dealt with by
the rest.
A. In its Consultation Paper on the UK Climate
Change Programme Review, the Government suggests that CO2
reductions of 14% from 1990 levels will be achieved by 2010, thus
falling short of the national goal of 20%. The 14% reduction assumes
full delivery of policy measures; a figure of 12% would probably
be more realistic.
Switching from coal to gas, growth in renewables
generation and the building of new nuclear capacity all offer
the prospect of reduced CO2 emissions in the electricity
sector in the longer term. However, none of these options offers
the potential to put UK CO2 emissions back on target
by 2010. This is because a) based on current forward prices for
coal and gas, the price of CO2 allowances would need
to rise above
20 per tonne to drive the decision to switch, b)
it would take more than a decade for sufficient new gas-fired,
renewable or nuclear generation to be brought on line and c) it
would run counter to policies that have already encouraged operators
to invest heavily in other technologies, such as FGD. The Updated
Energy Projections published by DTI in November 2004 show a reduction
of coal-fired generation from 116 TWh to 90 TWh between 2005 and
2010; even that may prove to be ambitious if gas prices remain
high.
These observations suggest that there is no
merit in a knee-jerk reaction to the failure to reach the national
goal for CO2 reductions in 2010. Instead, the Government
should focus on measures that are consistent with achieving its
long-term objectives for climate change mitigation. It is clear
from the above that this will require the engagement of other
sectors, including transport and domestic (households).
Q 170. One final question to you, which you
do not have to answer now. We have heard a lot of information
from both groups, but perhaps you could just jot down on the back
of the proverbial envelope or postcard, the one thing that the
government should be doing that would help to get it back on track
to meeting the target that it set itself.
A. The Government needs to look beyond seeking
short-term emission reductions from the Power Generation Sector
towards the implementation of a broad suite of measures that will
encourage other sectors to contribute to moving towards the UK's
long-term goal of 60% reduction of CO2 emissions by
2050. Government must develop a better understanding of what is
both technically and economically achievable across all sectors
if it is to develop a credible and coherent policy framework.
12 January 2005
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