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Climate Change Report Presented To The UK Prime Minister

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M2 Communications (UK) April 3, 1998

The Advisory Committee on Business and the Environment (ACBE), today published its report to the Prime Minister on how business can contribute to meeting the challenge of Climate Change.


It recommends a programme of measures, including increased take-up of new technology, voluntary agreements, market transformation, trading, support for renewables, and consideration of a carbon tax.

Prime Minister Tony Blair said the report sets out clear objectives and a comprehensive framework for planning the UK's response to climate change.

He said:

"This report is a major contribution in the campaign to meet the climate change challenge. It shows that UK business is taking the challenge seriously and coming up with concrete ideas to help reduce Greenhouse gases. This contribution is vital if we are to fully meet the commitments we signed up to at the Kyoto summit. As the report highlights, cutting global warming gases is a challenge, an opportunity not a threat."

The report follows up ACBE's interim advice presented on 4 December at the Prime Minister's summit with ACBE and other Business leaders, including Sir Colin Marshall, President of the CBI, on the eve of the Kyoto Conference and is intended to stimulate wider debate in business before the Government publishes it programme of measures for consultation later this year.

ACBE's report indicates that the challenge of meeting our energy needs as consumers by developing new products and services with less reliance on carbon can be met. This requires Government to create a long term flexible policy framework which stimulates innovation and new technology, while also providing sufficient incentive to change behaviour across all sectors including housing and transport.

David Davies, Chairman of ACBE said: "Behavioural change is needed in our approach to energy and there are substantial commercial opportunities available to the UK if we get our policy framework right. There is scope for early action on encouraging new technology and market transformation as well as voluntary agreements to cut carbon emissions in many business sectors but these may not be sufficient in themselves to meet the UK's legally binding targets.

"We have therefore recommended that if further measures are required, Government should consider the case for a carbon tax, providing it is set at a level which does not lessen UK competitiveness, that its revenues are fully recycled, and used to encourage low carbon technology, that it is targeted to achieve change in behaviour, and should not fall exclusively on business.

"In this context, I welcome the Chancellor's announcement of Sir Colin Marshall's Review looking at economic instruments for energy and I am today sending Sir Colin Marshall a copy of our report. Although this is only one of the areas we considered, it is extremely important that Government now looks at this issue in detail."

In reply, Sir Colin Marshall said: "ACBE's work both before and after Kyoto has been invaluable. I am looking forward to reading their new report and I am delighted that David Davies has agreed to help me in coming months so that we can build on the work of his Committee".

Except from the executive summary and main recommendations of the ACBE Report to the Prime Minister:

7. Economic Instruments - a Carbon tax. ACBE believes that in order to help secure a change in the approach to energy and to meet the Government's targets, an economic instrument in the form of a tax may be necessary. However if adopted, such a tax must be part of a comprehensive programme of measures and introduced on the basis that it does not lessen UK business competitiveness, that is revenues are fully recycled by encouraging low carbon technology and by being otherwise revenue neutral, that it is targeted to achieve changed behaviour and should not fall exclusively on business. This should be supported by clear Parliamentary undertakings with regard to fiscal neutrality and the recycling of revenues in particular.

10. These measures [voluntary agreements with industry and energy deregulation] may not be sufficient to deliver the legally binding target which the UK is likely to acquire as a result of the shareout of the "EU bubble" agreed at Kyoto.

In considering additional measures, Government should carry out further work on the potential of a carbon tax. ACBE's view is that, if additional measures are required, there is a case for such a tax providing it is set at a level which does not damage UK competitiveness, that its revenues are fully recycled, that it is targeted to achieve behavioural change and that it does not fall exclusively on business.


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FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Policy Forum distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.