Memorandum submitted by the RSPB
SUMMARY
The RSPB believes that forecasting greenhouse
gas emissions can be a valuable tool in designing policy but believes:
— ultimately the Government should
be seeking to set absolute limits on emissions through a carbon
budgeting process linked to targets;
— aviation and shipping emissions
should be included in these projections; and
— cost-effectiveness analysis
should be a tool to assist with selecting the right policies,
and not a means of determining whether or not a previously agreed
Government target should be met.
The RSPB welcomes the publication of the draft
Climate Change Bill, believes that it represents an important
landmark on the path to a low carbon economy but believes that:
— there should be recognition
in the bill that the UK should assume an equitable share of reductions
needed to limit the average global temperature rises by two degrees
above pre-industrial levels;
— trading schemes should be restricted
to those sectors where they will be cost-effective;
— five-year carbon budgets should
be complemented by annual reporting against milestones;
— emission reduction targets should
be identified for particular sectors;
— the Committee on Climate Change
should be subject to a sustainable development duty to ensure
a sustainable approach to addressing climate change; and
— provision of the investment
at home and abroad necessary to ensure that wildlife survives
the ravages of human-induced climate change.
FORECASTING
Is the Government's current approach to forecasting
"fit for purpose"
1. Projections are an important tool in
designing policies that will allow the UK to meet emission reduction
targets. However, we must not perpetuate the current situation,
where emission reductions are calculated as a percentage reduction
from business as usual (BAU), and where no means exist to increase
that percentage promptly, in line with the absolute limits on
carbon emissions established through a carbon budgeting process.
2. To illustrate this, we would like to
draw the attention of the Committee to the way in which National
Allocation Plans under the EU Emissions Trading Scheme make use
of projections. At present, the UK National Allocation Plan is
established by identifying a range of potential percentage reductions
from the projected BAU case, initially without reference to the
absolute reductions necessary to achieve relevant targets. Whilst
the top of this range was chosen for the current National Allocation
Plan, in an effort to bridge the "carbon gap" left by
other policies, this approach could not ultimately address the
problem of rising BAU emissions resulting in a still greater gap
as time went by.
3. We welcome the Committee's interest in
this subject, and in the future would like to see a system of
greater consistency and transparency in developing projections,
with regular revisions allowing rapid adjustment of policies to
keep emissions on target. Projections should also include all
significant sources of emissions, including aviation and shipping.
How should the Government deal with whether there
can be a greater role for independent assurance; unavoidable uncertainties
in forecasting; and whether targets and forecasts should include
international aviation and shipping
4. The Committee on Climate Change, proposed
in the draft Climate Change Bill, could usefully oversee the work
of the Government in relation to projections.
5. Unavoidable uncertainties in forecasting
could be better managed by adjusting for optimism bias, and taking
the upper part of the range of projected emissions as the model
for establishing policy. The urgency of the climate crisis should
dictate that we err on the side of making greater savings, rather
than over-shooting targets. We also believe that this makes economic
sense—early savings are likely to prove cost-effective,
whilst missing targets at this stage passes on an increased burden
for the future.
6. Aviation and shipping emissions should
be included in projections. Their exclusion from Kyoto targets
is widely acknowledged as a policy failure. Action to include
aviation within the EU ETS will go some way to address this, but
not far enough. Including air and shipping emissions in UK projections
would demonstrate international leadership and bring forward early
measures to help UK carriers adapt to future market conditions.
Allocation methods may need to be adjusted to reflect international
agreements as these are made; provision for this should be included
in the Climate Change Bill.
What improvements are needed in long-term forecasts
their production and use
7. We are not qualified to comment on the
design of models to improve long-term forecasts about the scale
and direction of economic growth. However, it is important that
budget allocations over the next fifteen year period, as proposed
in the draft Climate Change Bill, do not leave those in the future
with a mountain to climb, to achieve medium to long-term targets.
Gains made now are likely to be more cost effective than "back-loading";
to the extent that our best (and possibly only) chance of staying
below the two-degree global safety limit, depends on seeing emissions
peak and decline by 2015.
COST-EFFECTIVENESS
ANALYSIS
8. We recognise that cost-effectiveness
analysis can be a useful tool in designing the best policy mix
to achieve government goals. However, the 2006 Climate Change
Programme's failure to establish policies capable of achieving
the 2010 CO2 target raises questions about the partial
manner in which it was applied.
9. Cost-effectiveness analysis should be
a tool to assist with selecting the right policies, and not a
means of determining whether or not a previously agreed government
target should be met. The 2010 target could have been achieved,
if the Government had given a clear signal to those engaged in
the review, that they should find the most cost-effective policy
mix to achieve the outcome. Instead, different work strands appraised
policies singly, using different methodologies, and rejected many
on the grounds of inadequate cost effectiveness, political difficulties,
uncertain outcomes, or limited carbon gains, leaving a "carbon
gap" which could not later be filled. These problems must
be addressed in future.
10. Cost-effectiveness analysis in future
should be undertaken under the supervision and guidance of the
Committee on Climate Change. A single method should be applied
to all policies, including fiscal policies within the domain of
HM Treasury. Sufficient time must be allowed to appraise all potential
policy ideas, including those are not part of the current mix.
Policies should be appraised for their effectiveness across a
number of time-scales, including the target for 2050. Finally,
further efforts must be made to understand the full range of ancillary
costs and benefits associated with a particular approach; for
example, the net social and environmental costs of renewable energy
supply and biofuels.
Is the social cost of carbon an appropriate basis
for future policy appraisal
11. There is intense debate around the social
cost of carbon (SCC) which will continue as long the impacts of
climate change are uncertain and the methods use to calculate
costs vary. We are therefore broadly in agreement with the decision
not to use the SCC as means of appraising individual policies.
Moreover, by setting its own emission reduction target, the Government
has clearly signalled that action to achieve it will, in its view,
be broadly cost effective. If this is the case, it should not
be left to individual appraisals of different policies, to decide
whether or not to use SCC as a determinant of cost effectiveness.
Despite the uncertainty surrounding the SCC, however, it remains
a powerful means of communicating the external costs associated
with carbon emitting activities.
Has the Government's approach to evaluating cost-effectiveness
in the context of the Climate Change Programme Review been too
short-term in focussing on the 2010 target
12. The rejection of policies likely to
be crucial in achieving a low-carbon economy in the medium to
long term, is a particular weakness of the current approach to
cost effectiveness analysis (CEA). The continuing increases in
emissions from key sectors such as transport, send out warning
signals about our ability to meet targets at 2050. We must therefore
begin to consider, and implement, more radical approaches with
longer pay-back times.
13. It is instructive that at the time of
the Climate Change Review CEA, policies for amending the building
regulations to achieve carbon zero new build were rejected prior
to CEA being applied, on the grounds that it would be difficult
to achieve "buy-in" from the house building sector.
Subsequent events have proved this to be false—a forward-thinking
regulatory approach has seen house-builders embrace new environmental
challenges with relish. It would appear that in certain cases,
therefore, the Government did not even reach the point of applying
CEA, because of political reluctance in key departments. The Climate
Change Bill must address this, by recognising that our long-term
ambitions will require action in all sectors; and determining
patterns of carbon reduction in the short, medium and long-term
which enable this to happen.
ACCOUNTABILITY, TARGETS,
AND REPORTING
What additional reporting and monitoring arrangements
are required to support the aim of a transparent framework for
emissions reduction
14. The draft Climate Change Bill makes
considerable progress towards establishing a more transparent
reporting and monitoring framework. However, it is vital that
whilst budgets are set on a five-year cycle, reporting against
annual milestones drives policy adjustments when these become
necessary.
What should be the roles and responsibilities
of the Interdepartmental Analysts Group, the newly created Office
of Climate Change, and the proposed Carbon Committee
15. The Committee on Climate Change should,
in our view, have overall responsibility for advising on:
(i) Appropriate targets to enable the UK
to make an equitable contribution towards avoiding dangerous climate
change (that is, limiting global temperature rises to no more
than two degrees average above pre-industrial levels; and ppmv
CO2 equivalent to 450).
(ii) A reduction trajectory that enables
the UK to meet its targets in the most economically, environmentally
and socially efficient manner, determining budget allocations
for five-year cycles within this, and annual milestones.
(iii) The balance of reductions between sectors,
to ensure that they are achieved in the most economically, environmentally
and socially efficient manner.
16. It should also inform government reporting
against annual milestones; five-year budgets; and progress towards
national and international targets (short and long-term). To do
this, the Committee on Climate Change must include members with
expertise on climate science; economics; social sciences; and
environmental policy. It must also have a duty placed on it, to
undertake its work according to the principles of sustainable
development; with guidance outlining how this duty should be applied.
What approach should the Government take towards
setting short-term targets as a means of ensuring progress towards
its long-term goal of a 60% reduction in carbon emissions
17. We agree with the Government's proposal
in the draft Climate Change Bill, to approach short-term target
setting through budgetary cycles, but believe this must be supplemented
with reporting against annual milestones. The nature of the budget
allocations themselves must be determined by establishing a rational
emissions reduction trajectory, of the kind described above.
RSPB POLICY PRIORITIES
FOR THE
DRAFT CLIMATE
CHANGE BILL:
A SUMMARY
Climate science and level of effort
18. The Government has committed itself
through the Energy Review 2003, and through its membership of
the EU, to help limit average global temperature rises to two
degrees above pre-industrial levels. Evidence from the Intergovernmental
Panel on Climate Change has demonstrated that to have a reasonable
chance of achieving this goal, ppmv CO2 equivalent
must rise no higher than 450. Yet the Government has neither acknowledged
the need to aim for 450 ppmv, nor set its long-term target in
relation to this goal. This must be addressed in the Climate Change
Bill, by requiring that future targets will be established on
the advice of the Committee on Climate Change, in line with the
UK assuming an equitable share of the reductions needed to keep
within the two-degree and 450 ppv limit.
Balance of effort between international and national
action, and role of international and domestic trading schemes
19. The Government has indicated its interest
in creating a series of linked trading schemes, capable of delivering
reductions in CO2 emissions in the most cost effective
manner. In theory, we support approach. However, we have grave
reservations about the ability of the international carbon market
to deliver the reductions needed now. Our principle objections
take three forms.
20. Firstly, the caps in place as Kyoto
targets, and as National Allocation Plans in the EU ETS, are demonstrably
inadequate. Trading with these schemes, therefore, is trading
in a context where the market cannot drive significant cuts in
emissions.
21. Secondly, trading with "uncapped"
players, unless strictly limited, undermines the market and its
ability to drive emission reductions. In the case of the EU ETS,
Kyoto credits (CDM and JI) are available in sufficient numbers
to undermine its effectiveness.
22. Thirdly, we are not convinced of the
efficiency of adopting a cap and trade scheme in some sectors,
for example surface transport. In this area, improvements in vehicle
efficiency and fuel quality are likely to be a more cost effective
way of tackling climate change. We would be similarly concerned
about the introduction of cap and trade scheme focussed on farming
and land-use.
23. We would therefore prefer government
to place limits on trading with international carbon markets where
possible,[2]
until those markets have a cap commensurate with achieving the
two-degree/450 ppmv limit, are not distorted by trade with uncapped
players. We also wish it to restrict new trading schemes to those
sectors where they will be demonstrably cost effective. These
conditions should be reflected in the provisions of the Climate
Change Bill, along with a signal from Government that it intends
to achieve the great majority of its domestic targets through
efforts at home.
24. We recognise that one danger of restricting
international trading to meet UK commitments, is to cut off the
flow of capital to developing countries to help them decarbonise.
In our view, this problem should be addressed either by increasing
our level of ambition (in which case we could afford to be more
relaxed about achieving a greater proportion of our domestic target
through international trading), or by using funds from auctioned
credits in cap and trade schemes, to fund clean development.
Budgetary cycles and annual reporting
25. We warmly welcome Government's decision
to place carbon budgeting at the heart of the draft Climate Change
Bill. We also welcome the five-year budget cycle, in line with
commitment periods under international agreements. However, we
will argue strongly for annual reporting against milestones, to
ensure that policies and emissions reductions stay on track in
the budget period.
Ensuing that policies deliver on targets
26. At present, the draft Climate Change
Bill is proposing a national framework of targets, which do not
drill down to sectoral level. Whilst we sympathise with the need
to ensure flexibility in delivery, we are not convinced that this
approach will overcome the failures in the 2006 Climate Change
Programme, in particular, the failure to consider long-term goals,
and the risk of "lock-in" to high-emitting policies.
We recognise that advice from the Committee on Climate Change
will take into account these issues, but wish to see this carried
through into policies, by obliging the Government to identify
sectoral targets, under Section 6 of the Climate Change Bill.
Ensuring sustainable delivery
27. Climate change is a massive environmental
problem requiring urgent solutions. However, it is not the only
threat to our natural environment and resources, and the people
who depend on them. We believe that at present there is a risk
that all other environmental considerations will be subsumed in
the drive to reduce emissions, and that the wider environment,
and specifically biodiversity, may be harmed as a result. Examples
include the inappropriate location of large-scale windfarms; and
the promotion of biofuels produced in ways which displace important
habitats, damage wildlife, or threaten local livelihoods.
28. To ensure a sustainable approach to
addressing climate change, we believe that the Committee on Climate
Change should be subject to a sustainable development duty, to
be defined by guidance from the Secretary of State. We also propose
that representation on the Committee on Climate Change includes
experts in environmental policy.
Investing in adaptation at home and abroad
29. The draft Climate Change Bill includes
a reporting requirement in relation to adaptation, but very little
else. In our view, the Bill represents an important opportunity
for the Government to build and implement a robust programme of
action on adaptation.
30. Wildlife in the UK and abroad is facing
a massive threat from human-induced climate change. A recent paper
in Nature predicted that up to one third of land-based species
could be committed to extinction by the middle of this century,
if we do not act to mitigate and adapt.
31. We will be seeking a commitment from
the Government during the passage of the Climate Change Bill,
to provide the investment at home and abroad necessary to ensure
that wildlife survives the ravages of human-induced climate change.
Devolution
32. The RSPB is a UK organisation, with
country offices in Northern Ireland, Scotland and Wales. The powers
to create targets and implement policies in relation to climate
change are a complex mixture of the reserved and devolved, and
we are aware that additional legislation at the country level
will be required to ensure that we reach our environmental goals.
Like others, we will work closely with colleagues across the UK
to ensure an appropriate mixture of UK and country-level law and
policy, capable of supporting rapid and significant emission reductions
and robust action on adaptation.
March 2007
2 We acknowledge that companies currently trading
within the EU ETS must continue to do so, but do not believe that
further links should be made with domestic trading schemes and
international markets until the market itself is working efficiently
to drive down emissions. Back
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