Emissions Performance Standards - Energy and Climate Change Contents

1  Introduction

1. The Coalition Agreement contained a commitment to establish an emissions performance standard (EPS). This will prevent coal-fired power stations being built unless they are equipped with sufficient carbon capture and storage to meet the required standard. In July 2010, the Secretary of State, Rt Hon Chris Huhne MP, announced that the electricity market reform project would hold a consultation in the Autumn of 2010 to consider, among other things, the role that an EPS could play in delivering an energy system that delivers secure, low carbon and affordable electricity for the 2020s and beyond.[1]

2. For our first inquiry, we decided to look at emissions performance standards, focusing particularly on the potential impact on energy markets and investments, and examining whether they could encourage the deployment of carbon capture and storage (CCS) technology. We also looked at the consequences and opportunities at an international level, especially with regard to international climate change negotiations.

3. We announced our inquiry on 21 July 2010 and sought evidence on:

  • the factors that ought to be considered in setting the level for an EPS, what an appropriate level for the UK would be and whether it should be changed over time;
  • the benefit an EPS would bring beyond the emissions reductions already set to take place under the EU Emissions Trading System (ETS);
  • the effectiveness of an EPS in driving forward the development of CCS technology;
  • the possible threats posed by an EPS to the UK's long-term energy security and climate change agendas;
  • the likely impact of an EPS on domestic energy prices;
  • whether any other European countries are considering an EPS and if so, whether standards should be harmonised;
  • whether unilateral action by the UK to introduce an EPS could contribute towards global climate negotiations in Cancun in November 2010; and
  • whether greater use of EPSs internationally could help to promote agreement on global efforts to address climate change.

4. We received written evidence from 35 individuals or organisations and held two oral evidence sessions in which we heard from: Lord Turner and Dr David Kennedy of the Committee on Climate Change; Professor Jon Gibbins of University of Edinburgh; Nick Molho of WWF; Simon Skillings of E3G; Chris Littlecott of Green Alliance; Dr John McElroy of the Association of Electricity Producers; Matthew Farrow of the CBI; Dr Jeff Chapman of the Carbon Capture and Storage Association; Charles Hendry MP, Minister of State at the Department of Energy and Climate Change (DECC); and Jonathan Brearley, Director of Energy Markets and Infrastructure, Energy Strategy and Future, DECC. We are very grateful to all those who have assisted us during the inquiry.

1   HC Deb, 27 July 2010, col 868 Back

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Prepared 2 December 2010