Environment, Food and Rural Affairs CommitteeWritten evidence submitted by The Association of Electricity Producers (AEP)
About AEP
1. The Association of Electricity Producers (AEP) represents large, medium and small companies accounting for more than 95% of the UK generating capacity, together with a number of businesses that provide equipment and services to the generating industry. Between them, the members embrace all of the generating technologies used commercially in the UK, from coal, gas and nuclear power, to a wide range of renewable energies. Members operate in a competitive electricity market and they have a keen interest in its success – not only in delivering power at the best possible price, but also in meeting environmental requirements. Contact details for the Association are provided at the end of this paper.
What actions are required across Government Departments, from local government and by civil society to deliver the White Paper’s proposals to grow a green economy and reconnect people with nature?
2. The Natural Environment White Paper provides a high level framework for future policy and legislative developments to protect the natural environment. However, more information on the overarching goals and the proposed measures for implementation of new initiatives, including government funding, is required to enable a detailed response.
3. As policy is developed, we urge prioritisation of the key challenges addressed by the White Paper, such that activity is focused on those sectors responsible for the greatest impact on ecosystem services (eg controls on housing development, agriculture, fisheries and transport policy), rather than those over whom the greatest direct control can be exerted (eg, the industrial sector).
4. Actions to improve the environment need not and should not hamper sustainable economic growth. We do not consider that it is coincidental that the improvements in environmental quality over the last 20 years occurred during a period of sustained economic growth and growth in prosperity. The issue is therefore how to react to and address the overarching challenges identified in a way that does not hamper a recovery of sustainable economic growth.
5. Industry needs a clear sense of policy direction over time, and an understanding of when policies will be implemented in legislation and regulation. The introduction of new legislation should take account of industrial investment cycles by providing a long-term framework of priorities and targets to avoid the possibility of stranded assets. Full implementation of existing and currently drafted legislation is the most appropriate way to continue to reduce power sector impacts on ecosystems. In particular, legislation and regulation such as that arising from the Habitats Directive, Water Framework Directive, Ambient Air Quality Directive, Industrial Emissions Directive and National Emissions Ceilings Directive sets challenging emission reduction targets and permit conditions on operators. As a sector we are on a trajectory to low carbon electricity generation, and this will help to mitigate one of the pressures driving future changes in ecosystems.
6. The White Paper aims to establish voluntary biodiversity offsetting change in a number of pilot areas. For this to be successful, the limits of what can be offset and the metrics used to assess the goal of “no net loss of biodiversity” need to be clearly defined. We support the approach of a voluntary trial in pilot areas to determine the feasibility of this approach and would welcome stakeholder consultation on the future development, if any, of this approach.
7. We would welcome the promotion of environmental education within schools. Power companies would willingly play their part in delivering this.
Will the institutional framework outlined for delivering the proposals (in particular Nature Improvement Areas and Local Nature Partnerships) be effective? Does the proposed Natural Capital Committee have sufficient powers?
8. The new initiatives could make a valuable contribution towards protecting and enhancing ecosystems. However, the White Paper does not contain sufficient detail on how the Nature Improvement Areas and Local Nature Partnerships will be established and function to enable assessment of how effective they may be. The reliance on a voluntary local approach adds further to the uncertainty.
9. To ensure that the initiatives are as effective as possible in delivering national targets, a national strategic framework is necessary to provide guidance on environmental priorities and ensure consistency with the National Planning Policy Framework and forthcoming Water White Paper. Such a framework would also ensure consistent decision-making across the country and would, therefore, ensure a “level playing-field” for industrial development.
10. There is very little public domain information available about the proposed Natural Capital Committee. In our view, at this early stage in the process, this should be an expert advisory committee to Government, tasked to provide an evidence base to inform future policy decisions. It should not have powers.
What further research and/or evidence is required to develop practical programmes sufficiently detailed to deliver the White Paper’s ambition to fully embed the value of nature into policy delivery?
11. The UK National Ecosystem Assessment sets out a conceptual framework for an ecosystem services valuation approach to nature protection. However, the science base and economic methodologies to value nature are not yet adequate as a sound basis for regulatory or business decision-making. A robust process for the valuation of ecosystem services should be developed that:
is founded on peer-reviewed and credible science;
is accepted as credible by all parties;
is open and transparent; and
enables prioritisation, so that control measures are proportionate and cost-effective.
12. Economic efficiency should be at the heart of any green economy roadmap. It is essential to recognise that the investments needed must be economically efficient, and therefore economically rational, for those investing the very significant sums that will be needed.
13. In Section 4 of the White Paper, the statement is made that “the effects from particulate pollution alone are estimated to contribute to the equivalent of 29,000 deaths per year”. It should be noted that there remain significant scientific and medical uncertainties about the relative toxicities to humans of different components of atmospheric particulate matter, and in particular in linking this to emissions of NOx. There is little evidence that secondary nitrate aerosols formed from NOx emissions are associated with human health effects. Effective policy needs to be more subtle in identifying the key pollutants responsible for human health effects and in correct targeting of policies.
What evidence is there from other countries that the approaches proposed in the White Paper can be successfully applied in practice?
14. There is no evidence from other countries that the ecosystems approach encouraged by the National Ecosystem Assessment and Natural Environment White Paper (with systematic valuation of all ecosystem services) is currently a viable basis for general regulatory or business decision-making. However, other more specific initiatives proposed in the White Paper, such as payments for ecosystem services (PES) and biodiversity offsetting, have been successfully applied in other countries, eg payments for watershed services and wetland mitigation banking in the United States.
What resources will be needed to fully deliver the White Paper’s ambitions and how can these best be provided? How might the value of “services” provided by ecosystems to beneficiaries be translated into spending that will enhance the natural environment?
15. Specific national goals for ecosystem protection will have to be developed before resource requirements and suitable mechanisms for raising and delivering funds can be determined.
16. At the current time we consider that neither the science base nor the economic methodologies are robust enough to fully embed the value of nature into policy delivery. However, as part of any programme of investigation into ecosystem services valuation, we feel there is potential advantage in exploring the role, benefits and options for market mechanisms for the protection of valued ecosystem services.
Does the White Paper set out an accurate assessment of the barriers to public engagement with the natural environment and make the most effective proposals for re-engagement?
17. There are a number of factors that are common to the recent success of consumer-driven campaigns:
A simple and compelling aim/objective.
They do not harm the economic prosperity of the individual.
Clear and transparent communications and appropriate feedback, ie it is clear how individual actions of consumers produce tangible, and valuable, results.
The campaign objective is at a scale that is commensurate with the actions of (multiple) individuals.
18. This suggests the need for all initiatives arising from White Paper proposals to be absolutely clear on both what the objective is and how the actions that are prompted can deliver the objective.
19. There are many examples of good practice in harnessing and building on public enthusiasm currently in the power sector which are consistent with White Paper proposals. Many power plant operators are already proactive at a local scale in sustainability initiatives at their power stations, the construction of environment and education centres on power station sites, and in environment and energy initiatives in schools on issues such as climate change. Power stations often set up local liaison committees to ensure that the views and comments of stakeholders are understood and taken into account when operating or developing a power station. Companies may also set up volunteering days to enable staff to engage with local environmental and education organisations and will often support the work of bodies such as wildlife trusts.
Related Matters
20. Where certain products can potentially have a large footprint on the natural environment abroad, the Government should encourage suppliers to provide information on the sustainability of their sources. Where this information is made publicly available, it can act as an incentive to improve sourcing policies without the need for regulation. In the electricity industry, the use of imported biomass for renewable generation has the potential to impact biodiversity abroad if not sourced sustainably. The requirement to report sustainability information under the Renewables Obligation has prompted many electricity companies to adopt voluntary sustainability policies for the procurement of biomass and has demonstrated that generators are already acting responsibly. The provision of such information for large footprint products would enable the Government to monitor the extent of unsustainable practice and the impact on natural resources abroad. If an impact was shown to be large, regulatory instruments which targeted the specific products could be used to prevent such impacts.
26 September 2011