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Climate Change (Commercial and Public Services Sectors)

Volume 448: debated on Wednesday 5 July 2006

I beg to move,

That leave be given to bring in a Bill to make provision about the reduction of greenhouse gases; to promote energy efficiency and the consumption of renewable and low carbon energy in the commercial and public services sectors; to provide for the Secretary of State to report to Parliament on energy usage in the commercial and public services sectors; and for connected purposes.

The Bill is, in essence, a simple measure. It requires the Secretary of State to take reasonable steps to ensure that, by 2010, the amount of energy usage in commercial and public sector undertakings reduces by at least 10 per cent. compared with 2005, and by a further 10 per cent. by 2020. It also requires the Secretary of State to take reasonable steps to ensure that such reductions in energy usage are not at the expense of higher carbon intensity in the resulting energy use.

The measure requires the Secretary of State to produce a report on targets to be achieved for the production of heat and electricity for use in the commercial and public sectors from renewable sources, combined heat and power and microgeneration. It also requires the production of an annual report to set out progress towards those targets and state whether they are, in the Secretary of State’s opinion, likely to be met, and if not, what additional steps he or she proposes to take to ensure that they are reached. We are all aware of the pressing need to take action on climate change. The most effective way to reduce emissions from energy use that contribute to climate change is to use less energy, and to use what we do more efficiently. We know that the prime users of energy are in the domestic sector and in the commercial and industrial sector in heating and powering the daily life of business and industry.

We also know that we need to redouble our efforts to tackle climate change. That is now acknowledged with vigour in all parts of the political spectrum. Against that backdrop, it is worrying that the latest predictions about UK CO2 emissions are far from encouraging. The UK will reach and exceed its Kyoto commitments and I was proud that the UK Government aimed to go beyond that by introducing their domestic commitments on CO2 emissions.

In February, the Department of Trade and Industry published its updated projections to 2010 about UK energy use and CO2 emissions. According to those, the UK was, at that time, on course to undershoot by 9.4 per cent. its domestic target to reduce CO2 emissions by 20 per cent. below 1990 levels by 2010.

In the following month, the Government published their revised climate change programme, the purpose of which was to put us back on track to achieve that 20 per cent. CO2 reduction. That was acknowledged to be a challenging aim and the document that was produced included a comprehensive series of proposals about how to get back on track. However, the long-awaited document did not appear, at the time of its publication, to be able to achieve that. It was estimated that the new package of measures announced in the programme was sufficient to deliver emissions reductions of only between 15 to 18 per cent., leaving the UK still 2 to 5 per cent. adrift of its target.

More recently, Cambridge Econometrics added to what might be termed the gloom with the publication of the latest edition of “UK Energy and the Environment”, which contained its updated forecasts of energy demand and CO2 emissions. The forecast was extended for the first time to 2020. Its conclusion was that, even taking into account the additional measures announced in the updated climate change programme, UK CO2 emissions would reduce by only 14 per cent., compared with 1990 levels, by 2010. In other words, unless more is done urgently, we will undershoot our domestic CO2 target by 6 per cent.

Beyond 2010, Cambridge Econometrics predicts that carbon emissions are set to rise slightly in 2010-15, but to level off thereafter to 2020. The expected levelling-off between 2015 and 2020 is due to a decline in power generation emissions, but that is offset by the continuing growth in carbon emissions from the commercial sector and transport.

The Government already accept the primacy of the aim of ensuring that we use less energy. I hope that, when the energy review is published, measures to introduce energy management arrangements for consumers of electricity and gas will feature strongly. In 2003, the energy White Paper described energy efficiency as the

“cheapest, cleanest and safest way”

of addressing all the UK’s energy policy objectives. Subsequent Government pronouncements have continued to highlight the critical role that energy efficiency must play in reducing our carbon emissions.

Furthermore, in the energy efficiency implementation plan, which was published a year after the White Paper, DEFRA explicitly acknowledged that action on energy efficiency measures in the commercial sector had been “intermittent and restricted” and

“not achieving its full potential”.

It also acknowledged that the commercial sector had the fastest growing energy use apart from aviation, principally from space heating and lighting, ventilation and air-conditioning. Other drivers include the energy services associated with the use of information and communications technology. In addition, that sector is highly electricity intensive—electricity has an especially high carbon footprint. According to February’s Department of Trade and Industry projections, if no new policy measures are introduced to tackle energy demand in the commercial and public services sector, its use of electricity is projected to soar by a staggering 45 per cent. from 1990 to 2020.

In the light of the above, the Bill is clearly long overdue. I hope that it will be welcomed by all parties. Indeed, it has received support across the House. Early-day motion 2378 in support of the Bill was tabled only on 15 June, but has already attracted the support of 200 Members of Parliament. The Bill simply requires the Government to take reasonable steps to achieve the reductions in energy usage in the commercial and public services sector that they have already described as cost-effective and practicable. For 2010, that means a reduction in energy usage of at least 10 per cent. compared with 2005, and a further reduction in energy usage of 10 per cent. below 2010 levels.

The Government have already explicitly acknowledged the need for binding energy efficiency targets by introducing in the Housing Act 2004 a target to achieve a 20 per cent. increase in energy efficiency in the residential sector by 2010. The Bill simply completes the policy picture by introducing similar binding targets not only for the domestic and residential sector, but for the commercial and public services sector.

Question put and agreed to.

Bill ordered to be brought in by Dr. Alan Whitehead, Mr. Elliot Morley, Mr. Michael Meacher, Mr. Tim Yeo, Chris Huhne, Colin Challen, Helen Goodman, David Howarth, Mr. Nick Hurd, Bob Spink, Kitty Ussher and Mr. Edward Vaizey.