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Low carbon industries need support say IPPR

The Government needs to do more to support low carbon growth according to businesses, who increasingly feel there is a disconnect between government ambition and policies supporting growth.

According to the IPPR think tank, businesses critical to the low carbon transition are beginning to feel the pinch of rising energy prices, and are worried about the impact of climate change regulation on competitiveness. However, other are beginning to take advantage of green policies to develop new low-carbon technologies, reduce their energy costs and clean up their supply chain.

IPPR interviewed business leaders from energy firms, transport, manufacturing and energy intensive industries, and after discussions with partner think tanks, found that they shared the same concerns as businesses in France,Germany, Spain and Poland.

Will Straw, IPPR Associate Director, said: “Long-term sustainable economic growth, productive British businesses and an ambitious decarbonisation policy go hand-in-hand. Sticking to a high-carbon growth path is an untenable and costly policy for the UK in the long-run.

“For many companies, climate change targets, policies and regulations are creating new market opportunities and boosting turnover.”

The global market for environmental goods and services is estimated to be $3.5 trillion and growing by 4 per cent a year.

The report finds that businesses in Europe are well placed to capture new market opportunities with British firms leading the way in developing electric vehicles, offshore wind, hydrogen fuel cells and zero carbon cement.

However they need stronger and more stable policy signals from government and the EU and an active industrial strategy to break down barriers to low carbon growth.

He continued: “New clean-tech industries are sprouting up, while existing companies are switching their business models to take advantage of low-carbon technologies.

“Even for energy-intensive industries like steel there are opportunities to tap into supply chains for clean energy infrastructure projects.”

The report recommends that the Government consider introducing a new Green Deal to help them save on energy bills, whilst also considering the expansion of the EU emissions Trading Scheme to include imported energy-intensive goods.

The IPPR have also asserted that the Government’s unilateral Carbon Price Floor is reducing British competitveness, and are calling for it to be scrapped, and for efforts to be focussed on creating a central EU carbon bank to ensure greater stability in carbon prices for businesses.

Stephen Radley, Director of Policy at EEF, the manufacturers’ organisation, said:
“Moving to a low carbon economy will create significant opportunities for UK manufacturers. but keeping a lid on energy costs must go hand-in-hand with exploiting green industrial opportunities.

“Uncompetitive energy prices are a major threat for manufacturers, including many of those developing low carbon technologies.

“The government needs to put the consumer the heart of its decarbonisation strategy by pursuing a policy that delivers the most cost-effective energy mix. IPPR’s report focuses on the key issues that need to be addressed for this happen.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .