I frequently have talks with my German, Dutch and Irish counterparts. In April, for example, I attended informal energy and environment councils in Dublin, where discussions with other member states, including Germany, the Netherlands and Ireland, focused on the EU 2030 climate and energy framework.
The March European Environment Agency report confirmed that the UK’s per capita emissions are among the lowest in Europe, and in 2011 they fell at double the rate of those of the rest of the EU. Furthermore, the recent emissions trading scheme vote by the European Parliament means the UK has a carbon price six times higher than the rest of the EU, and now we are seeing several countries moving ahead to build coal stations that will not use carbon capture and storage. Is there a risk that we are increasingly acting unilaterally in this area?
Let me reassure my hon. Friend. We work very closely with our European colleagues, and I formed the green growth group, currently working with about nine other member states, including our German and Dutch colleagues. We need to reform the ETS to make sure we have a functioning and effective carbon market in Europe, and we also need an ambitious 2030 target for greenhouse gas emissions. The UK Government have agreed that we will seek a 50% target in the context of winning a global climate change treaty.
What is the point of us closing coal-fired power stations if Germany is opening 20 of them? What is the point of us having a carbon tax and reducing emissions if we thereby release trading permits for other countries in Europe to emit more carbon?
I am grateful to my right hon. Friend for his question. He is not right about the German position, and I refer him to the April 2013 report by Pöyry, which we commissioned and which is on our website. It examines the reality of what is happening with new coal-fired power stations in Germany, the Netherlands and Spain. Some 10 new coal and lignite coal projects are under construction in Germany, because the final investment decisions on them were taken in 2005 and 2008, when there was a very different policy environment, but four have been postponed and 22 have now been abandoned, so the situation in Germany is different from the one my right hon. Friend describes.
Carbon emissions per capita statistics fail to recognise the effect of imports and exports on consumption. Will the Secretary of State confirm that he will not seek to meet UK targets through policies that close down our energy-intensive industries, thereby exporting jobs and importing carbon?
My hon. Friend is right. We do not want to see carbon leakage; that would not help the climate, and it would not help our economy. That is why I agreed with my right hon. Friend the Secretary of State for Business, Innovation and Skills a very generous package, working with the Chancellor, to compensate energy-intensive industries for the indirect costs of the ETS and the carbon price floor, and it is also why we have exempted energy-intensive industries from the costs of contracts for difference. We want to ensure we make progress on climate change, but we also want to ensure we keep successful businesses in the United Kingdom.