I am very happy to have secured this short debate, Mr. Caton—not just on my own behalf but on behalf of the right hon. and learned Member for Devizes (Mr. Ancram) and the hon. Members for Nuneaton (Mr. Olner) and for Wealden (Charles Hendry). With them I recently travelled through several of the United States under the auspices of the British-American parliamentary group, and a very instructive visit it was.
Before I come to the main part of my speech, let me put on record my appreciation of the consular staff who made the visit possible. Not only did they ensure that the arrangements went smoothly, they provided excellent briefings to inform our discussions. I mention in particular Judith Slater, the consul general in Houston, and her aide for the purposes of our visit, Lindsey Bartlett. When we travelled on to North Carolina, the consul general from Atlanta, Martin Rickerd, was responsible. One member of his staff deserves particular mention—Cindy Groff-Vindman, who is the scientific officer. It was essential that we had the kind of informed briefing that she and others were able to give us.
The visit covered Santa Fe and Albuquerque in New Mexico. We then went on to meet “big oil” in Houston, and continued to Raleigh and Durham in North Carolina, where we met a variety of people from academia, the private sector and the US Environmental Protection Agency. I want to recount the experiences of the visit, because in its entirety it was very instructive as to the positive influence that Britain does indeed have on United States policy on this subject.
There is a great black hole in Washington. We often have the impression that the Administration’s game is the only one in town—and in that particular town, it is. However, it is certainly not the only game that we ought to be playing—there is already a much broader one to be played across the United States, and we are a part of it.
New Mexico is led by a dynamic governor—Bill Richardson. Unlike the President, he is well up to speed on global warming. New Mexico is in a western consortium that includes California, Oregon, Washington and Arizona and is intended to address what those states recognise as a major global challenge. Many of us would say that it is perhaps the foremost global challenge.
We had a host of meetings in New Mexico, including with the public regulatory commission, with members of the state’s climate change advisory group, with the very forward-looking mayor of Albuquerque, Martin Chavez, and with an excellent cross-section of locally based research and development institutions. As well as the three local universities, those institutions included the Sandia national laboratory and the famous Los Alamos national laboratory. The private sector was also well represented. The focus in all the meetings was on how to cater for climate change and for the changes that are taking place all around us every day, on how to mitigate somehow the worst effects of those changes, and on how to effect the switch to new technologies that are appropriate for the future. The meetings were very informative. All the bodies represented were working on climate change and global warming, or on energy policy, or on a combination of them.
We were left in no doubt of how seriously the bodies that were represented all took the problems that face the planet, and of their determination to overcome those problems in a considered and consensual way. All were appreciative of the lead that has been offered to the United States by the British commitment in the field. That was a constant refrain that was repeated time and time again both at a governmental and at an academic level. When I say “governmental”, I am talking about state and municipal government; unfortunately, the jury is out on what the present national US Administration might or might not do in its remaining term of office.
None of our party had any doubt about the sincerity of the people who were involved—either in their focus on the real issues behind global warming or in their determination to steer a new path for the United States, whether Washington is on board or not.
I congratulate my hon. Friend on securing a timely and enormously important debate. I wonder if he might say more to reassure my constituents, and those of other hon. Members, who are deeply concerned about climate change and who are very depressed when they look to Washington and to the attitudes of the current Administration. How does my hon. Friend think that our Government can work more closely with the positive and forward-looking state administrations to try to find more constructive ways to engage the United States as a whole in tackling climate change?
The short answer is that we already are, but we do not talk about it. People of my political perspective are often accused of being anti-American, but that is just not true. Because we take issue with the Administration on what we see as its sins of omission—as well as those of commission—we are portrayed as anti-American. That is absolutely not the case. I was deeply appreciative of what was happening outside of the beltway, in the rest of the United States. I shall come to that shortly, and I shall make some remarks about our effect on it.
Our meetings in Houston were different—they were meetings with the big oil companies. We met with Exxon, Marathon and BP. It was, I think, only a few days before our meeting with Exxon that it had at last accepted as a company that climate change is a major issue and a fact of life. It had been in total denial till then, but it remained remarkably laissez-faire about its own role in turning that danger round. It struck me as extremely complacent even about where its own interests lie, never mind those of the planet.
On the other hand, Marathon struck me as far more dynamic in its assessment of how to respond to the challenges. I was taken by the realism of the executives, although they still had a reflex obeisance, as it were, to the judgment of the boardroom—they still seemed a little in awe of whatever the board had decided. I understood why that was, but it seemed to be slowing down the genuine dynamism of their response. Nevertheless, they are doing a lot of good stuff.
Happily, I can also report that BP has taken a lead in the oil industry in looking for alternatives to oil and coal for power generation. Under the aegis of its alternative energy section, BP now has alternative power generation options that are operative on five continents, and I was genuinely and pleasantly surprised by how well it is doing. Its practical lead includes an investment of $8 billion over 10 years that aims to reduce its own carbon emissions by some 24 million tonnes per year. That will not be the end of the problem, but it is a hell of a start, and it certainly points in the right direction. Hopefully, BP will tow the rest of the oil industry behind it. BP operates in Texas, California, Colorado and North Dakota, and it is setting the agenda on carbon-neutral power generation in each of those states.
At that stage of the visit we were in Texas, which is a remarkable place, as anyone who has ever been there will know. I have been there several times, and it is a state apart from the rest—literally and metaphorically. On its own, it is the sixth-largest emitter of carbon in the world, and it has a reputation for not giving a damn what the rest of the world thinks. The current governor has fast-tracked the process for the building of 19 new coal-fired power stations. Happily, however, if somewhat unbelievably, a venture capital company has now put in a bid to take over the plans for the power stations and turn them into green installations. I have to say that, if venture capital is going in that direction, that is where the future lies, and it is a good sign for all of us.
Nevertheless, there is a battle going on with the climate troglodytes in Texas, as elsewhere in the States. The major cities are all on board and are taking their lead from here. The mayors of Houston and Dallas are among the mayors of 17 Texan cities—including the beacon city of Austin, the state capital, which is very green—who are challenging the carbon-producing utilities. Indeed, Houston has modelled its climate change partnership on that of London. That is a practical example of how what is happening in Britain is having a very benign effect on thinking in the States.
I congratulate the hon. Gentleman on securing the debate, because there is nothing more important to the evolution of an international solution to climate change than the evolution of policy at superpower level, in the United States. The defining feature of his narrative so far is the freedom to manoeuvre that local states have within the US system. Did he come home with any strong feeling about what changes we need to implement in this country to give local authorities more responsibility and more power to seize the agenda and innovate?
The short answer is no, because we are comparing chalk and cheese, to be honest. Even when we talk about Texas, we are talking about a very light-handed governorship. They are very good at executing people, but not at executing positive changes in respect of policy on, for example, climate change. I should mention that representatives of both Houston and Austin were at the US-UK climate change and urban areas conference, which was held in London, so I can say to the hon. Gentleman that there is an interchange. There is obviously a community of interest, but whether we can pick up positively from a completely different system is another question.
Finally, we went to North Carolina, where we met politicians, academics and, interestingly, representatives of the Environmental Protection Agency. That was only a couple of days after President Bush had made his totemic visit when he finally seemed to recognise, in his very particular way, that there was a problem that had to be faced. It remains to be seen what he does about it, but the evidence of state and municipal level eagerness to seize the moment was stark. The inertia of Washington was not seen as an excuse for doing nothing. Time after time, in North Carolina as in Texas as in New Mexico, appreciation was expressed for British influence and groundbreaking British initiatives on carbon emissions.
There is a natural historical affinity between North Carolina and the UK which is reinforced by regular interchange between academics in the field of climate change and environmental issues generally—and probably in many other fields—at institutions such as Duke university and Cambridge university. That reinforces a very powerful and positive message from the UK. In fact, we constantly heard people at that level, including the civil servants in the EPA, saying how embarrassed they were by the failure of the federal Administration to act. That is the key. They see us as willing to act and to tackle the problems, while their own Administration appear to be in denial.
That is changing, however. Names such as Kerry, Lieberman and McCain are appended to one or other of the five pieces of legislation before the US Senate to deal with the issue. We also know that every declared candidate for the forthcoming presidential election states that they will prioritise climate change in their Administration if they are successful, so it is only a matter of time—although we do not have much time on our side—before the world’s hyperpower gets on board, and I have every confidence that once it does, things will shift.
Companies are also engaged. BP is in a consortium with DuPont, Duke Energy and others in the US climate action partnership. Such engagement is not entirely disinterested on their part. They can see the business opportunities, and we should emphasise more that there are great business opportunities for companies in changing their own policies.
We should forget our mythical special relationship with the US regarding foreign policy and military strategy. It just does not work, but on the issue that we are discussing today, the special relationship is special and does work, and we could have a very beneficial effect, greater than we are currently having, if we focused on this area. That would be good for progressive Americans—believe me, there are many of them—it would obviously be good for the planet, and it would be rather good for British businesses if they got behind the changes that are taking place at the grass roots.
The other thing that the Government can do is to appreciate the work being done by our consuls general, who are taking our message to the American heartlands. That work should not simply be supported; it should be boosted. Washington and New York are not the only games in town. States such as California and Texas are global players in their own right and may well lead the United States down one path or another. It is rather odd when somebody such as Arnie Schwarzenegger is way in advance of much of the thinking that seems to take place, even in official circles in the UK. Nevertheless, he has been driven on by a state that is somewhat enlightened on these issues. I remember that back in the 1970s I got a shock when I had to take my New York-registered car for a test on its emissions. Even then, California set the trend for the whole of the United States. I suspect that that is what will happen: the states will lead the federal Government by the nose down the righteous path, if you like.
This is not a party issue in the United States. In our own small way, our delegation could easily present a unified view on the issues to our American hosts. What was most important was to convey to them the reality of the situation from a British perspective. For their part, the Americans were equally bipartisan on the salience of the issue. Of course, there are backwoodsmen there at all levels, as there are here, but our emphasis and the diplomatic efforts should be reinforced. Those efforts would be seen as more relevant and would certainly be far more productive if the pretence that everything can be done inside the beltway were dropped—it cannot. At times, inside the beltway is in a state of atrophy, and certainly on this issue it has been for quite some years, but that has not stopped what is going on elsewhere.
Anybody who has read Sir Christopher Meyer’s account, “DC Confidential”, would come away with the belief that our ambassador in Washington spends half his time looking after his personal interest rather than looking after the interests of Britain and pushing British policies. That charge cannot be levelled at the people we met out in the field, who were working incredibly hard and doing a tremendous job, making the linkages, bringing people together and selling a very positive message on this issue. When I spoke to colleagues about our visit, that was the impetus behind our attempts to secure this debate: to ensure that the Government recognise not only what is happening on the ground in the United States, but the work being done on their behalf out in the sticks—out in the heartlands. We want the Government to reinforce those efforts.
I congratulate my hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle) on securing the debate and thank him for sharing the experiences and insights gained from his recent British-American parliamentary group trip to the United States. He is surely right to point out that the complex web of contacts that we have at state and local level in the United States is a key feature of the special relationship that we have with that country and it is, I think, not always as widely appreciated as it should be.
Climate change is an international issue, with a truly global impact. The United States is responsible for approximately 20 per cent. of global greenhouse gas emissions. Its domestic emissions are forecast to rise by up to 30 per cent. over 1990 levels by 2012. Although it decided not to ratify the Kyoto protocol, it participates in the United Nations framework convention on climate change, and many countries, both developed and developing, pay close attention to its position on climate change. As such, it is a key country in negotiations on a future framework to follow on from the end of the first commitment period under the Kyoto protocol.
In the UK, we passionately believe that the scientific and economic case for action to avoid dangerous climate change is clear. Continuing with business as usual will mean that emissions continue to grow and that the stock of greenhouse gases in the atmosphere could reach 550 parts per million as early as 2035. That concentration is likely to lead to a temperature increase of between 2 and 4 deg C, which would have profound implications, although I do not have time to go into them today.
For the first time, last year’s Stern review demonstrated conclusively that we must meet the challenge of taking action in both economic and environmental terms.
On that point, part of the great value of the Stern review was that it gave us an opportunity to export the message that the Minister has just outlined to the United States, where concerns about the economic cost of dealing with climate change appeared to be holding people back from engaging with the Kyoto process. Sir Nicholas has been to the United States since his report was published to preach that message, but is there any evidence from his trips to suggest that the message, particularly as regards economic action, is hitting home?
The economic message is hitting home in the United States and, indeed, elsewhere across the world. The Stern report has been hugely influential and has proved quite conclusively that the costs of inaction, which it put at between 5 and 20 per cent. of global GDP, are far more than the costs of taking action to reduce greenhouse gas emissions in a timely and efficient manner, which would be in the region of 1 per cent. of global GDP. That is a really powerful message.
The UK’s strong action domestically has enabled us to be at the forefront of the international debate on tackling climate change. Since 1990, the UK economy has grown by 40 per cent., while greenhouse gas emissions have fallen by 15 per cent. We are therefore on course to achieve double our Kyoto commitment of a 12.5 per cent. reduction in greenhouse gas emissions.
The draft Climate Change Bill, which I am delighted to say was launched this morning, proposes that we put into statute the UK’s target to reduce CO2 emissions by 60 per cent. by 2050 and by 26 to 32 per cent. by 2020. That will be the first time that any Government have legislated to put into statute a legal framework for managing CO2 emissions. The Bill provides a clear, long-term, credible framework and gives businesses and individuals greater clarity about their planning and investment so that we can deliver changes and achieve a low-carbon economy.
In the United States, climate change has risen significantly up the political agenda over the past two years, and, as my hon. Friend clearly outlined, the UK has participated in the debate that has been going on there. The significant focus that we placed on climate change during our G8 presidency led us to host the “Avoiding Dangerous Climate Change” conference in February 2005. The Gleneagles dialogue process that we set up following our G8 presidency has created a helpful space in which to have informal discussions about how to tackle climate change and the United States has been a key participant in that process. The US has also continued to participate in discussions on climate change as part of the G8 process and it took part in discussions during the 2006 Russian presidency and the preparatory process for this year’s summit at Heiligendamm under the German presidency.
The past year has seen the debate on climate change intensify in the US. That is true not only of the science of climate change, but, as I have outlined, the economics of action on climate change. Stern has played a pivotal role not only in the US, but worldwide in stimulating the debate that we need about the costs of delaying action as against the costs of acting now.
The ambition that the UK has demonstrated in its plans for phase 2 of the EU emissions trading scheme, and the European Commission’s work in enforcing tighter caps on other member states, have shown that action can be taken now. It is important to remember that although there is no coherent federal problem to reduce greenhouse gas emissions, individual US states are leading the way in addressing climate change.
The UK is pleased to be involved with and to support the development of initiatives such as the regional greenhouse gas initiative, a collaboration involving nine north-eastern states in a cap-and-trade scheme. The RGGI is intended to be expandable and flexible, and it is open to other US states and Canadian provinces.
I will not, because I need to answer some of my hon. Friend’s points.
We are collaborating effectively with California on climate change and energy following the Prime Minister’s visit there in July 2006 and his joint announcement with Governor Schwarzenegger. In particular, we are offering practical help and experience on emissions trading.
We very much support the western regional climate action initiative that California, Washington, Oregon, New Mexico and Arizona announced in February. We and the European Commission are also exploring the potential for linkages with the EU emissions trading scheme. We want to see the emergence of a genuinely global carbon market, but if that is to happen, it is important to ensure that trading systems have the capacity to be linked. The UK will receive a delegation from California in early April to continue our close work on the development of emissions trading and other climate change policy instruments.
The UK’s perceived global leadership on climate change means that we have also been asked to respond to interest at city level in the United States. In 2005, the UK played a role in promoting action at city level in the US and internationally, when London hosted the first large cities climate change summit, with participation from five major US cities. The initiative has now grown to include 40 cities globally, and 12 US cities will participate in this year’s summit.
I should also mention the Clinton climate initiative, under which former President Clinton and the mayors of San Francisco and Los Angeles are taking forward work on climate change.
The changing political environment internationally and domestically—particularly at state and sub-state level, as my hon. Friend highlighted—is leading to a shift in business opinion in the US. American industries are beginning to take steps in the clean energy and green technology marketplace, and my hon. Friend mentioned several examples. The US business community is developing its position on climate change, and business leaders such as Jeff Immelt of General Electric and Jim Rodgers of Cinergy have called for long-term regulatory certainty and market-led mandatory policies. Although the majority of US industry still favours nothing beyond voluntary action, a number of blue-chip businesses, such as Caterpillar, Johnson and Johnson and Intel, argue that it is not enough. Therefore, it is not only the general political climate in the US, but the business climate that is changing, and the business community rightly sees increasing opportunities not only in developing new technologies, but in the carbon market.
I should also mention the work of major UK business groups and our contacts through international business, because organisations such as the CBI and the corporate leaders group reinforce the positive and progressive stances that US industry is increasingly taking. Our religious and faith leaders have also taken up contacts and discussed responsible stewardship of the planet’s natural resources with their US counterparts.
British legislators have also engaged in the debate on climate change. Last month, the president of GLOBE International from the UK chaired the third G8-plus-five legislators forum, which was hosted in the Senate in Washington. The forum brought together legislators from around the world, plus business leaders and civil society organisations. The discussions were positive, and I hope that they will help to prepare the political space for action on climate change by the G8-plus-five Governments. UK ministerial and official visits have also reinforced the UK’s message in the US on the wider implications of climate change.
Across a range of issues, therefore—at the legislative level, the state and local levels and the business level—we have a web of contacts. We are working with, and giving appropriate support to, those who want to take action on climate change, and we shall continue to do that.
In addition, we have a UK-US energy research and development memorandum of understanding, and my hon. Friend mentioned the importance of energy. There are currently three active projects under the memorandum of understanding and they are jointly funded by the US and UK. The US is also interested in collaborating with the UK to harmonise standards on renewable fuels and particularly biodiesel, and we continue to work closely with the US on those issues.
It is clear that there is a lot more work to be done if we are to secure international agreement on a post-2012 framework.