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As I said, this is a difficult and complex issue, and that is why we think that the Committee on Climate Change should address it. We will ask the committee, as part of its first task, to advise us straightaway on the impact of including these emissions in our 2050 target. It is also why, once the EU Emissions Trading Scheme rules are agreed, we will ask the committee for its detailed advice on a methodology for including international aviation emissions in our targets. We need to know whether there is a methodology which works and which is compatible with both the EU ETS rules and the wider international context, and what the impact of adopting it would be. Again, these are not straightforward questions, and that is why we believe the best approach is to wait for the committee’s advice.

That is also why the Government have tabled Amendment No. 120, which we will come to later. This amendment provides that, before making regulations to include international aviation or international shipping emissions, the Secretary of State must seek, and take account of, advice from the Committee on Climate Change. We think that this is the best way forward. If we were to include international aviation emissions in our targets immediately, as proposed by Amendment No. 117, how would that work in practice? For example, how would the UK’s share of international aviation emissions be identified? Would it be on the basis of the fuel sold within the UK? If so, what would be the risk of perverse impacts, such as planes filling up elsewhere and flying here with a heavier fuel load, which could

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increase emissions, or transfer traffic simply diverting from Heathrow to Amsterdam or Paris, with no environmental benefits whatever? These are practical issues. If we go unilaterally, it is no good us complaining if other countries take commercial advantage of us, as would be the case.

How would this fit with aviation’s inclusion in the European Union Emissions Trading Scheme, which we expect to start in 2012, and which will probably allocate emissions on a different basis? Would we have two systems running alongside each other? Or would we need to change systems almost as soon as started? This is not really the best approach to regulation on such an important issue. In addition, what would be the implications for the international negotiations if the UK decided unilaterally on a particular way of dividing emissions between countries? How would we avoid undermining our efforts to reach a global deal on this, bearing in mind that we all agree a global deal is required? Across the negotiating table we would be challenged that we had already done it: “You have chosen your own way; why are you here trying to do a deal with us?”. It does not make practical sense.

These are important, practical, questions. I do not say that the Government have all the answers, but we ought to pose questions that were not posed in the moving of the amendments, and then ask the Committee on Climate Change to agree to provide advice on this before we decide whether to include these emissions. We therefore do not think that the approach taken in the amendment is the right one.

The Liberal Democrat amendments would require the Secretary of State to define international shipping emissions within three years of Royal Assent. On the other hand, the amendments that we shall come to on this issue set a deadline of action under Clause 25, although I recognise that they take a different approach. However, our concern with the deadlines in these amendments, or indeed any arbitrary deadline, is precisely that—that they are arbitrary. We ought to look at the matter in the round. The Government have made it clear that they are determined to find a comprehensive solution in these sectors and we are pressing internationally to do so. That is the forum in which we have to get the decisions taken. Why create an artificial constraint? That would be the effect of approving these amendments.

Negotiations in these areas are incredibly sensitive and the possibility of reaching agreement sometimes hangs by a thread. It will make the negotiations which frequently take place—I am pleased to say I am not too involved in them, but I get involved—on the common agricultural policy among 27 countries look like peace on earth. These will be incredibly sensitive and we will be causing ourselves major problems if we put these amendments in the Bill and tie our hands. We must retain flexibility. To include the emissions in the European and international contexts is right and we are working hard to come to that kind of agreement on an international basis. Therefore, I sincerely hope that the noble Lord does not press this amendment.

4 Mar 2008 : Column 1010

Lord May of Oxford: My Lords, the reason we focused both in the Joint Committee and here today on aviation rather than on shipping is twofold: it is partly because shipping is much more complicated for attribution than the already complicated aviation sector, and partly, and largely implicitly, because aviation was thought to be a more important source as well as a more rapidly growing one. Work in the past couple of weeks has reappraised that and suggests what many have long suspected: that shipping may be twice the volume. Recognising that these are the early stages of a journey in five-year steps to 2050, is the noble Lord, Lord Rooker, satisfied that the Bill, as we are framing it, has flexibility so that we can deal with these things as and when both the international system and the greater knowledge and wisdom about how to include them make it possible?

Lord Rooker: I think the answer to the noble Lord is yes. I saw the report of the work to which he has referred a couple of weeks ago. I think in Committee I gave some information about shipping which made it almost impossible for us to do the measurements at present. We cannot get an agreed methodology. The historic figures for UK shipping, based on the amount of fuel sold within the UK, demonstrate no discernible trend, which makes it very difficult for us to forecast future emissions as there is no evidence on which to base the forecast.

5 pm

Nevertheless, the nature of much of the international shipping industry is global and highly mobile and it operates without the need for permanent or continuous association with individual nation states. There is no agreed international methodology for attributing international shipping emissions to individual countries. A number of issues must be addressed before any methodology could be accepted, such as how to deal with the risk that vessels simply reflag to different countries or buy fuel at alternative locations; the lack of information about fuel efficiency of individual vessels or historic trade statistics; and the difficulties of calculating average emissions for a wide variety of vessels and engine types.

We are taking steps, as I said in Committee, to address these issues through the International Maritime Organisation, but we are not there yet. When we have done that, we will be in a position genuinely to ask the Committee on Climate Change to make some kind of assessment. So the answer to my noble friend is yes. The Bill will facilitate it and does not stop us doing that. We are currently working on that at an international level. Therefore, to get the information and an agreed international methodology to put to the climate change committee is vitally important.

Lord Greenway: My Lords, I reinforce what the Minister said about shipping. The International Maritime Organisation, which is responsible for all regulations regarding international shipping, has been urgently looking into the question of ship emissions. I spoke to the secretary-general last week, who told me that the

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work has been delayed for precisely the reason the Minster has just given: the complication of international shipping.

I also remind the noble Lord, Lord May, that, although shipping may on the face of it be responsible for large amounts of emissions, he should remember that the vast bulk of international trade goes by sea. In fact, shipping per tonne mile is way more efficient than both lorries and aviation.

Lord Teverson: My Lords, I thank the Minister for going through this again. We have had an excellent debate, but I should respond to one or two comments.

I was particularly surprised at the noble Lord, Lord Campbell-Savours. Strangely enough, we tabled these amendments because we believe in them. As my noble friend Lady Miller said—I do not want to spend too much time on targets—it was the Government who put a target in the Bill, not us. All the evidence is that they have the wrong target in the Bill, so we thought that it might be a good idea if we put what is likely to be the best target in the Bill. That seems remarkably straightforward to me.

Strangely enough, we believe that aviation is an important industry. It is also growing and has significant carbon emissions. We therefore have a number of choices. Do we—as I got the impression that the noble Lord, Lord Dixon-Smith, suggested—ignore it and get on with the rest that we can absolutely define? That is not the right thing to do, because this is an important sector. Do we, as the noble Earl, Lord Selborne, said, say that including aviation will not do anything about the future and we should therefore not do so? Well, if that is true for aviation, it is true for every other sector covered by the Bill. Aviation is no different.

Perhaps the only two reasons requiring more explanation are, first, whether we can measure it and, secondly, as the noble Lord, Lord Woolmer, said, whether it affects the EU ETS and international trading. On the first, the EU ETS will not help us in our national definitions. It will not allocate UK aviation emissions. When we get to 2012, this problem will not be solved. It will not be any easier. Therefore, on the basis that it is better to act now than in the future when the problem of climate change becomes worse, the answer is surely to act now rather than five years later. Why procrastinate?

Lord Campbell-Savours: My Lords, does the noble Lord accept that operations abroad would benefit if unilateral action were taken in the way that he suggests?

Lord Teverson: My Lords, that question shows the misunderstanding of the amendment. It is about measurement. If we started an emissions trading scheme that applied to UK aviation only, I would back the noble Lord in rejecting it. As he said, all the Bill does is provide a mechanism. That mechanism is measurement; the Bill does not include any element of policy or implementation of policy. Measuring these emissions has zero effect on what happens, as in every other sector of the economy. Measuring is followed

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by government policy. It is clear that we might as well include it now as later. The mechanism for measurement will be no more straightforward or easy in the future than it is now. The EU is not going to provide us with a method of calculating UK international aviation emissions. It does not do that. International aviation emissions are separately treated outside member states in the post-2012 regime put forward by the Commission and endorsed by the Council of Ministers.

Aviation is important. Let us get on with it now. I regret that the noble Lord, Lord Taylor, cannot follow our approach. He made strong speeches at Second Reading, but I understand that he wants to approach this matter in a different way. I think this is fundamental to the Bill; otherwise we leave out a sector that needs to be in from the beginning. I recognise that the Government had the sector in the Bill from the beginning but that it would come in at a later date; do not believe that is good enough. I believe we need to act now. Therefore, I wish to test the opinion of the House.

5.06 pm

On Question, Whether the said amendment (No. 64) shall be agreed to?

Their Lordships divided: Contents, 52; Not-Contents, 169.

Division No. 2


Addington, L.
Alton of Liverpool, L.
Avebury, L.
Barker, B.
Bonham-Carter of Yarnbury, B.
Bradshaw, L.
Carlile of Berriew, L.
Chidgey, L.
Clement-Jones, L.
Cotter, L.
Dholakia, L.
Dykes, L.
Falkland, V.
Falkner of Margravine, B.
Garden of Frognal, B.
Greaves, L.
Harris of Richmond, B. [Teller]
Jones of Cheltenham, L.
Kirkwood of Kirkhope, L.
Lee of Trafford, L.
Livsey of Talgarth, L.
Luce, L.
Mackie of Benshie, L.
Maclennan of Rogart, L.
McNally, L.
Methuen, L.
Miller of Chilthorne Domer, B.
Neuberger, B.
Northover, B.
Razzall, L.
Redesdale, L.
Roberts of Llandudno, L.
Rodgers of Quarry Bank, L.
Roper, L.
Russell-Johnston, L.
Scott of Needham Market, B.
Shutt of Greetland, L. [Teller]
Smith of Clifton, L.
Steel of Aikwood, L.
Taverne, L.
Teverson, L.
Thomas of Gresford, L.
Thomas of Walliswood, B.
Tonge, B.
Tope, L.
Tordoff, L.
Tyler, L.
Vallance of Tummel, L.
Wallace of Saltaire, L.
Wallace of Tankerness, L.
Walmsley, B.
Williams of Crosby, B.


Acton, L.
Ahmed, L.
Alli, L.
Anderson of Swansea, L.
Andrews, B.
Archer of Sandwell, L.
Ashton of Upholland, B. [Lord President.]
Bach, L.
Barnett, L.
Bassam of Brighton, L.
Berkeley, L.
Bernstein of Craigweil, L.
Best, L.
Bew, L.
Billingham, B.
Bilston, L.
Blood, B.
Borrie, L.
Boston of Faversham, L.

4 Mar 2008 : Column 1013

Boyd of Duncansby, L.
Bragg, L.
Brett, L.
Bridges, L.
Brooke of Alverthorpe, L.
Brooks of Tremorfa, L.
Browne of Belmont, L.
Campbell-Savours, L.
Chorley, L.
Christopher, L.
Clarke of Hampstead, L.
Clinton-Davis, L.
Corbett of Castle Vale, L.
Corston, B.
Craig of Radley, L.
Darzi of Denham, L.
Davidson of Glen Clova, L.
Davies of Coity, L.
Davies of Oldham, L. [Teller]
Dean of Thornton-le-Fylde, B.
Dear, L.
Desai, L.
Dixon, L.
Donoughue, L.
D'Souza, B.
Dubs, L.
Eatwell, L.
Elder, L.
Elystan-Morgan, L.
Evans of Parkside, L.
Farrington of Ribbleton, B.
Finlay of Llandaff, B.
Foster of Bishop Auckland, L.
Foulkes of Cumnock, L.
Fyfe of Fairfield, L.
Gale, B.
Golding, B.
Gordon of Strathblane, L.
Gould of Potternewton, B.
Grantchester, L.
Greengross, B.
Greenway, L.
Gregson, L.
Grocott, L.
Hameed, L.
Hannay of Chiswick, L.
Harris of Haringey, L.
Harrison, L.
Hart of Chilton, L.
Haskel, L.
Haworth, L.
Hilton of Eggardon, B.
Hollis of Heigham, B.
Howarth of Breckland, B.
Howarth of Newport, L.
Howells of St. Davids, B.
Howie of Troon, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Hylton, L.
Janner of Braunstone, L.
Joffe, L.
Jones, L.
Jones of Whitchurch, B.
Jordan, L.
Judd, L.
Kennedy of The Shaws, B.
King of West Bromwich, L.
Kingsmill, B.
Kirkhill, L.
Layard, L.
Lea of Crondall, L.
Levy, L.
Lewis of Newnham, L.
Lipsey, L.
Lockwood, B.
Lofthouse of Pontefract, L.
Macdonald of Tradeston, L.
MacKenzie of Culkein, L.
Mackenzie of Framwellgate, L.
McKenzie of Luton, L.
Maginnis of Drumglass, L.
Massey of Darwen, B.
Maxton, L.
May of Oxford, L.
Mitchell, L.
Moonie, L.
Morgan of Drefelin, B.
Morgan of Huyton, B.
Morris of Aberavon, L.
Morris of Handsworth, L.
Morris of Manchester, L.
Morris of Yardley, B.
Murphy, B.
O'Neill of Bengarve, B.
O'Neill of Clackmannan, L.
Palmer, L.
Patel, L.
Patel of Blackburn, L.
Patel of Bradford, L.
Paul, L.
Pendry, L.
Pitkeathley, B.
Plant of Highfield, L.
Prosser, B.
Prys-Davies, L.
Puttnam, L.
Quin, B.
Radice, L.
Ramsay of Cartvale, B.
Rea, L.
Rendell of Babergh, B.
Richard, L.
Rooker, L.
Rowlands, L.
Royall of Blaisdon, B. [Teller]
Sawyer, L.
Scotland of Asthal, B.
Sewel, L.
Sheldon, L.
Simon, V.
Slim, V.
Smith of Gilmorehill, B.
Soley, L.
Stewartby, L.
Stoddart of Swindon, L.
Strabolgi, L.
Sutherland of Houndwood, L.
Symons of Vernham Dean, B.
Taylor of Blackburn, L.
Tenby, V.
Thornton, B.
Truscott, L.
Tunnicliffe, L.
Turner of Camden, B.
Vadera, B.
Wall of New Barnet, B.
Warwick of Undercliffe, B.
Watson of Invergowrie, L.
Wedderburn of Charlton, L.
West of Spithead, L.
Whitaker, B.
Whitty, L.
Wilkins, B.
Williams of Elvel, L.
Woolmer of Leeds, L.
Wright of Richmond, L.
Young of Hornsey, B.
Young of Norwood Green, L.

4 Mar 2008 : Column 1014

Resolved in the negative, and amendment disagreed to accordingly.

5.18 pm

Lord Taylor of Holbeach moved Amendment No. 65:

The noble Lord said: My Lords, in moving Amendment No. 65, I shall also speak to Amendment No. 116, which is grouped with it. I hope that noble Lords will understand that the amendments seek to introduce a new idea on this vexed topic. I recognised in the previous debate the earnestness of the views expressed and noble Lords’ desire to seek a solution. I hope that the House can find such a solution in these amendments.

Our amendments would provide a framework for the inclusion of emissions from international trade, travel and transport, but in a way that would get around some of the problems to which the Minister referred in the debate on the previous amendments. They are also designed to address the problems arising from the vocabulary of the debate—the serious and possibly detrimental policy implications of just talking about aviation on the one hand and shipping on the other. Our proposal switches the focus to transport more generally. It addresses it in a broad and general fashion and, by doing so, provides a way in which the least carbon-intensive method of moving goods or people to and from the UK will be favoured.

First let me explain the necessity of addressing this problem. Although the problem was to some degree covered in the previous debate and although, as the Minister recounted, we had a good and thorough debate on it in Committee, it is too serious for me not to reiterate the issues briefly. Not having a provision for the emissions caused by trade and transport is unjustifiable. If there is to be progress towards addressing climate change, these emissions need to be counted. The analogy constantly and aptly used is that it is like going on a diet but not counting the chocolate. To ignore trade and transport emissions is to ignore climate change.

I know that the Bill has provisions to enable the Secretary of State to make regulations on aviation and shipping, but there is no duty for him so to do. Simply waiting around until the EU proposes a way of solving the problem or forces the UK to address it is, frankly, a bad way of governing. We appreciate that a lot of the regulation will require international co-operation and will depend on international agreements; that is the nature of the beast. However, if we truly intend to take a lead on climate change, we need to take a lead on addressing some of its biggest contributors. Therefore, our amendment would place a more positive duty: we specify that the Secretary of State must address these emissions in a five-year timeframe.

On the essential difference between our amendment, which refers to goods and passenger travel, and the formulation in the Bill—namely, aviation and shipping—the problem with discussing emissions from trade and

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transport solely in terms of aviation and shipping is that that runs the risk of placing a disincentive on shipping, which is a relatively carbon-efficient method of transport in terms of tonnage. The emissions caused by air travel are relatively easy to count by using bunker fuels in the country of origin or in the country where the airline company is registered. Indeed, we record much of that information already. Shipping is much trickier to regulate, especially as goods brought into the country by ship might have taken a variety of routes before being loaded on to a ship or small boat and being brought into the UK.

When discussing transport emissions, we need to be careful not to exclude other carbon-intensive modes of transport, such as haulage by truck, which have a direct bearing on our imports and the shipping industry. For example, if shipping becomes heavily regulated, there might be an incentive to have ships dock at Rotterdam or, worse, Istanbul, and then to drive across the Continent and into this country via the Channel Tunnel. The Minister has referred to the problems that might arise from such a transposition of trade. Conversely, if the regulations on shipping are not sophisticated enough or concern shipping without any regard to the entire carbon footprint of the transport of goods, it might prove economical to have goods driven across much larger stretches of land and then simply loaded on to ferries to make the Channel crossing, when a large ship could have delivered the goods to England with a fraction of the carbon footprint.

These amendments go to the heart of the problem by addressing the purpose of shipping and aviation, as well as of transport more widely—moving goods and people to and from the United Kingdom. By expanding our view of transport, we stand a better chance of having regulation that addresses the problem systematically instead of including certain bits and not others, which may in the end create greater confusion and contribute to global warming more substantially than was originally intended.

Let us consider the other more minor but still important emissions that are excluded from the Bill as it stands and which would still be excluded if we spoke only in terms of aviation and shipping. Ferries carrying passengers to France, the Netherlands and Ireland would have to be included under our scheme, as would international rail travel. The purpose is to provide a framework within which regulation can be made that will provide incentives to use the least carbon-intensive method of moving goods and people while ensuring that the entire scope of the problem is taken into account.

That might sound daunting or idealistic, but I am assured that there are potential mechanisms for addressing the issues that I have outlined. I do not pretend that it will be easy, but I have been assured by maritime experts that it is possible. At the moment we have the T1(L) form, which is mandatory for every piece of freight coming in from outside the EU and which accounts for the entire journey and method of transport used at each stage, for tax and duty purposes; within the EU, CMR forms are regularly used. The T1(L) form could be amended to take

4 Mar 2008 : Column 1016

account of carbon emissions or could be used to create a database. Our amendments do not propose specific policies and I mention this only as an example to noble Lords to show that our amendments are not pie in the sky but have a basis in sound policies.

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