My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved accordingly, and, on Question, Motion agreed to.

House in Committee accordingly.

[The LORD SPEAKER in the Chair.]

Clause 19 [Targeted greenhouse gases]:

[Amendment No. 100 not moved.]

moved Amendment No. 101:

From these Benches, I certainly support this approach in principle in this instance. Our own view, as we debated yesterday, is that the Government should bite the bullet now and include all the Kyoto-listed greenhouse gases. That remains our point of principle and belief. Having said that, I fully accept that there may in future be other gases that are internationally designated or are particularly important to the UK economy. We would certainly welcome this extra degree of accountability and transparency in this area.

Presumably the targeted gases will have to be internationally scientifically agreed, will they not? There is no point in the United Kingdom saying “This gas must be targeted”—not being a chemist I cannot even name one gas, except CO₂—when nobody else does it at all.

I welcome the noble Earl back to our debates. If he looks at Clause 64, he will see listed the six Kyoto gases we are talking about. There is no dispute about the particular gases.

The effect of Amendment No. 101 would be that the Secretary of State could designate other greenhouse gases as targeted gases only following a recommendation of the Committee on Climate Change. Amendment No. 106 would mean that the Secretary of State would be able to define the base year for any greenhouse gas designated as a targeted gas under Clause 19 only following a recommendation of the committee. The effect of the amendments would be that the Government would have no discretionary powers; they would have to follow the committee. We have now discussed on at least four or five occasions the principle of why the committee should not be an executive body and why it is therefore unnecessary to seek parliamentary approval again where we have already made provision for orders to be made through the affirmative resolution procedure. It would not be useful for me to cover exactly the same ground, other than to say that the points which have already been made apply. That is why we do not accept the amendments.

We are, as before, genuinely willing to consider how we can improve the transparency of the whole process. We will shortly come to Amendment No. 105 on Clause 20. That will give us a chance to debate how these powers may be used. I can honestly say that I will have a more useful answer on Amendment No. 105 than the one I have just given.

I am tempted to move on quickly. I await with bated breath the Minister’s further contributions. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 102 not moved.]

moved Amendment No. 103:

I have one supplementary question to ask, following on from my noble friend Lord Cathcart. The Oxford English Dictionary gives three definitions of “expedient”. The first is, “‘expeditious’ or ‘speedy’”; the second is “Conducive to advantage in general, or to a definite purpose; fit, proper or suitable to the purposes of the case”; and the third, in a depreciative sense, is, “‘Useful’ or ‘politic’ as opposed to ‘just’ or ‘right’”. I quote in particular an example given in the OED of a predecessor of mine as Member of Parliament for Westminster, John Stuart Mill, who said:

“The expedient, in the sense in which it is opposed to the right, generally means that which is expedient for the particular interest of the agent himself”.

I realise that in Humpty Dumpty’s view, the words could mean anything one chose them to mean, but which particular interpretation do the Government have in mind?

I have yet to be compared to Humpty Dumpty in this House, but there is a first time for everything. I very much hope that I can offer Members of the Committee reassurance on this probing amendment, which I am sure is helpful. I thank the noble Earl for tabling it and allowing us to have this mini discussion.

Clause 19(3) allows the Secretary of State to make any consequential amendments to the Act as may be necessary or expedient as a result of including further greenhouse gases within the UK’s targets and budgets. However, the ability to make consequential changes to the Act is already extremely limited. Any amendment would have to be genuinely consequential to the inclusion of other greenhouse gases. It could not be used to do anything unrelated. I appreciate that it is important to put that on the record now. For example, the power would not allow the Secretary of State to amend the level of the 2050 target or the level of carbon budgets, as specific arrangements are set out in other parts of the Bill for those actions. In addition, the Delegated Powers and Regulatory Reform Committee considered the provisions of the Bill and did not raise any particular concerns about this power.

I turn to the question regarding the Oxford English Dictionary definitions of “expedient”. As far as I am aware, we are working on the third definition of the word, seeing it as useful, or just or right. If on reflection, having read the discussion and taken further advice, I need to come back to the noble Lord with a more specific definition, I will undertake to do that as soon as possible before the next stage of the Bill.

Before my noble friend rises to respond, I have to say that I am mildly surprised by the Minister’s answer. However, I look forward to her further investigations.

I thank my noble friend Lord Brooke for the three useful definitions which emphasise my point. I also thank the Minister for her explanation. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 104 not moved.]

Clause 19 agreed to.

Clause 20 [Base years for targeted greenhouse gases other than CO₂]:

moved Amendment No. 105:

The noble Earl raised the issue of Bali and talked about the onset of a new US Administration and what they might do. I have a calendar on my desk that tells me that there are 377 days to the end of George Bush, so we have a 377-day countdown on the issue that the noble Earl raised. I cannot comment on what a new US Administration might do, but I understand the reason why questions are raised about subsection (2). As I said earlier, Clause 20 builds on the provisions of Clause 19 and allows the Secretary of State, when including further greenhouse gases in the targets and budgets under the Bill, to designate the base year for those gases.

This power is necessary to take account of international practice. For example, the Kyoto Protocol currently allows countries to choose 1990 or 1995 as the base year for emissions of industrial gases. This flexibility was allowed internationally because not all countries have reliable emissions data for those gases for 1990. The UK has therefore chosen to use 1995 as the base year for those gases for the Kyoto Protocol. Clause 20(2), the subject of this amendment, is therefore intended to ensure that we are able to take a consistent approach between our domestic targets and our Kyoto targets. If we decided to include those industrial gases in our domestic targets, this clause would allow us to include them on the same basis as they are included in our Kyoto targets.

It is also possible—the noble Earl raised this point earlier on—that at some time between now and 2050 an additional gas or gases may be identified by the international community as contributing to climate change. It is possible that there could be no reliable data for emissions of that new gas—I shall call it “gas X”—in 1990. If that gas is included in the international climate change framework with a different base year, it would be helpful for our domestic approach to mirror what happens internationally.

Amendment No. 105 would remove that flexibility. It is not there for a fiddle—the noble Earl did not use that word, but he is right to ask the question. The removal of that flexibility would not be a good idea, which is why we cannot accept the amendment. However, recognising the arguments behind the noble Earl’s point, we are very happy to consider whether the safeguards in Clause 20 can be strengthened. The drafting is being looked at. We want to ensure proper scrutiny of this power. The Bill already provides that any orders made under this clause would need to be made by the affirmative resolution procedure. However, we are happy to look again at whether there are ways in which we can provide further reassurance to the House and to those outside that these powers would not be used inappropriately. We are at one on that and are happy to take this away and look at it again.

I thank the Minister for his full explanation and for looking again at redrafting this provision. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 106 not moved.]

Clause 20 agreed to.

Clause 21 [Carbon units and carbon accounting]:

moved Amendment No. 107:

I say at the outset that I am more than happy to take the amendment away to consider it, so that gets me off to a good start today. We had an interesting session last night about types of carbon units. The noble Duke read them out: the assigned amount unit, the emissions reduction unit—I also have the certified emissions reduction—the removal unit and then the EU allowance. We are considering whether to use the existing accounting system under Kyoto and in the EU Emissions Trading Scheme, where most of those are found, or whether to create a new accounting system.

Clause 21 states that carbon units can be counted only if they represent a reduction in greenhouse gas emissions, removal of greenhouse gases from the atmosphere or an amount of permitted emissions of greenhouse gases with a capped system. That mirrors the international carbon accounting rules, where those are the only types of carbon units allowed to be used.

I accept the strength of the argument. I cannot accept the amendment, but it is obviously important that any carbon units used under the Bill are of the right standing and environmental rigour. There is no question about that. We will certainly consider this point in advance of Report.

Which units are used in carbon trading? It is so obvious that it must be the same all the way around. We cannot have rods, poles, perches and centimetres et cetera all mixed up. This is too important to have those sorts of misunderstandings. How does a carbon trading system work? I ask that purely for information.

There are four types of carbon unit under the Kyoto Protocol and there is the EU allowance under the EU Emissions Trading Scheme that is unified within the European Union. They are all internationally accepted.

I am sorry to go on, but I do not think that I am probably the only person who totally fails to understand this. How different are these units, one from the other?

That is difficult because I can explain some but not all the units. While I am reading out these descriptions, perhaps I can get one on the EU. Under Kyoto, the assigned amount unit is issued by all developed countries which have targets; the emissions reduction unit is issued under joint implementation which relates to emissions projects in developed countries; the certified emissions reduction is issued under the clean development mechanism which relates to emission projects in developing countries; and the removal unit relates to land use, land-use change and forestry activities in developed countries. That explains the four units under Kyoto.

Under the EU Emissions Trading Scheme, my note says simply “EU allowance”. I would imagine that the noble Earl might be able to explain this better than I can.

I almost could go around the Chamber and say, “Hands up anybody who understood a single word of what that was saying”. Surely we are trying to make sure that the X amount of muck that goes into the air is reduced. How we measure it should be simple and comprehensible to everybody. Again, hands up anyone who understood that, because I certainly did not.

There was a hand up at the back. To put it crudely in black and white, under that list of units, some units are measured differently in developing countries as opposed to developed countries. It depends on the nature of the business and the environment—for example, whether it is deforestation or water. Therefore, there is bound to be a different set of parameters for developing countries and developed countries. Presumably they all work out to be the same, but the calculations are done differently. Some issues have been industrial and some are related to land use, but the end unit would be the same amount of carbon. The calculation of how it is arrived at would be different, but the unit would be worth the same amount of carbon.

Perhaps I may join this little party. I am sorry to ask my noble friend if he remembers that at Second Reading I raised the issue of tonnes. I have asked a lot of people and no one can give me a good explanation. Will he tell us whether, under his reference to “industrial”, there is a connection between these units and gigatonnes and tonnes of carbon dioxide?

I am getting into deep water here. I do not have the answer to that. I simply say to my noble friend that the tonne of carbon dioxide, which is probably the end result of what we are talking about, is arrived at in different ways and is calculated from different sources—for example, by developed countries and developing countries. If it is done under emission projects in developed countries as opposed to the clean development mechanism, which is specific only for developing countries, the tonne of carbon at the end is still a tonne of carbon, but it is arrived at differently. That is the only explanation given. Obviously, the calculation in terms of land use changes whether it is being used for deforestation or for growing other kinds of crops. Ultimately, the calculation of how it is arrived at will be different, but a tonne of carbon is still what one is trying to get to in the end.

I thank the Minister for the masterclass in this difficult area, one that I certainly do not understand. One of the key things to remember is that EU ETS carbon units are part of a cap and trade system in that they are limited and can be brought down, while there is potentially an infinite supply of the other units under joint implementation and the clean development mechanism. Once projects have been audited by the United Nations procedure, you can have an infinite allowance for them. The issue is that the units cannot be completely intertradable. If one could be substituted for another, all the caps on the EU ETS, which is why they have value, would effectively suffer from inflation and lose that value.

I want to bring up the issue of the different currencies we are talking about here, even though they all revolve around a tonne of carbon equivalent. Later in the Bill the Government introduce the carbon reduction commitment, which will itself have more units of its own. Given that it too will be a cap and trade system, I would like to ask whether it would not be much better if we kept to that commitment and did not invent another currency at that point. But I am assuming that for this part of the Bill, the CRC units will not be internationally tradable in any way. Presumably you cannot stop investment banks using them as a sort of derivative or whatever, and I am not sure how the CRC units would be treated in the UK carbon account. However, that is probably a matter for later in the Bill.

Before we finally leave this subject, I feel that we are in danger of reopening a debate that we have already had. The answers given by the noble Lord are absolutely satisfactory in themselves in that they give us an understanding that these units, while they may each have a different calculation base, in fact all result in the same tonne equivalent of carbon. That is enormously helpful. However, the discussion has also highlighted the fact that these different sorts of units, unless we are very careful, will mean that because of interchangeability we will be able to meet all kinds of targets by preventing or not permitting carbon dioxide emissions to take place in other countries. If the units are tradable, we may be able to meet our targets without reducing our own emissions at all.

I have nothing further to add, but that was the central theme of our earlier debates on buying allowances. Obviously there is consensus around the Committee that it is not a good idea for the Government to get out of this issue by simply buying allowances and then not changing anything we do in this country, so what the noble Lord said was absolutely right.

I am told that a briefing sheet has already been provided for Peers that explains further how to assess whether the UK has met its carbon budget. It is Climate Change Bill briefing paper No. 2. The masterclass can continue at one’s desk or over a cup of tea later.

This debate has been a useful way of opening up the area. However, I wonder whether we would be better saying that the carbon units we were most interested in were those approved under the UN Kyoto agreement. I know that there can be a problem in pinpointing things too much, but at the moment the position is much too open. So far as I understand it, we are signed up to the EU ETS, and presumably we will be able to trade carbon units throughout the EU. The noble Lord, Lord Teverson, talked about a cap and trade system. I believe that some people reckon that European countries will be able to buy in energy reduction units from the joint implementation. But until we have a deeper understanding, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

moved Amendment No. 108:

Obviously, as the noble Earl says, the amendments in the group concern the scope of the regulations on the carbon accounting part of the Bill. I note his initial term. I am sure that parliamentary counsel would have a far more elegant response than I have to his description of unparliamentary language, but there is a practical reason for it.

On Amendment No. 108, Clause 21(2) allows the Secretary of State to make regulations for carbon accounting and, as set out in the Explanatory Notes to the Bill, the intention is to establish an accounting system broadly similar to that which is used to keep track of the United Kingdom’s assigned amount units and other units issued under the Kyoto Protocol. Under that system, carbon units can be moved between accounts. They are tracked through a registry which is similar to an online banking system. Each account holder has an account where their allowances are stored, transferred to or received from other accounts. The registry also tracks which allowances have been used for compliance purposes and we intend to adopt a similar approach under the Bill. However, Amendment No. 108 would essentially prevent this by removing the Secretary of State’s ability to keep track of carbon units and there would be no way of knowing whether or not the Secretary of State held the carbon units he claimed to hold. The amendment would therefore undermine the transparency of the Bill.

As I said, we have a well established system for tracking carbon units under the EU Emissions Trading Scheme. It has an excellent record and has so far been licensed to 16 countries in addition to the United Kingdom. It is a well tried and tested system and therefore the use of the language “to register or keep track of” probably conforms to legally accepted practice.

Turning to Amendment No. 109, it is possible that the accounting regulations under Clause 21 may involve duties being placed on the Secretary of State and, as a matter of legal drafting, it is not usual to talk about these duties being “conferred” on the Secretary of State. The duties could be related to the need to register and keep track of carbon units—for instance, the carbon accounting regulations will need to reflect any decisions to bank or borrow under Clause 13—or to the establishment of a body to administer the carbon accounting scheme, which we will discuss when we come to Schedule 1. The establishment of such a body could involve a number of functions being imposed on the Secretary of State such as the appointment of members and other related matters.

On Amendment No. 112, the carbon accounting regulations are likely to be very technical and detailed and to require frequent updating. Clause 23, to which the amendment refers, takes a proportionate approach to the requirements for parliamentary scrutiny which is in line with the recommendations of the Delegated Powers and Regulatory Reform Committee as to what constitutes an adequate level of parliamentary control. The body appointed as the scheme administrator is only one aspect of the way in which we will manage our carbon accounts and there is no obvious reason why this aspect should be given a greater priority. However, I understand the importance of the issue. In addition, the Merits of Statutory Instruments Committee will scrutinise any orders made to transfer administrative responsibilities and would be able to report on any order which it considered to be of interest to the House—or, indeed, an order that it thought was inappropriate. That kind of scrutiny removes the possibility that any order made using this power could go unnoticed.

It is a complicated Bill and many orders will flow from it, both from the Government and from the recommendations of the committee. It is important, if I can use the word, that we keep track of them all and that none of them slips through. But we have got sufficient procedures in place to make sure that nothing goes by unnoticed and, as I say, the Delegated Powers and Regulatory Reform Committee accepted what was in the Bill.

Instead of using the words “keeping track of”, would it not be easier to use “tracking”? It would save two words.

I thank the Minister for his explanations on Amendments Nos. 108 and 109. I was slightly disappointed by his response to Amendment No. 112, because the authority of Parliament is part of the triangle and we wanted to see Parliament being much more part of the decision-making process. However, at this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 109 not moved.]

Clause 21 agreed to.

Clause 22 [Net UK carbon account]:

moved Amendment No. 110:

Clause 22 is crucial, because it relates back to Clause 1, around which the Bill revolves, and defines the UK carbon account. The lack of the required definition makes the Bill obscure, suggesting that it is our intention to reduce not greenhouse gases in the UK but a net UK carbon account. The definition could perhaps be set out earlier in the Bill, so that it would be easier for the general public to understand it.

I do not understand why—I am sure that there is a good reason—Clause 22(1) states:

“In this Part the ‘net UK carbon account’ for a period means the amount of net UK emissions”.

Why does it refer to “net UK emissions”? It should be the UK’s emissions, plus what we buy in and minus what we take out—perhaps I have got that the wrong way around. I do not understand why the clause refers to,

“net UK emissions of targeted greenhouse gases”,

because “net emissions” does not have an understandable definition. The Bill should refer just to “emissions”.

Before the Minister responds to that, perhaps I may add my pennyworth. Clause 12(2)(a) states,

“state the amount for the year of UK emissions, UK removals and net UK emissions of that gas”.

We are therefore talking about “net” after “UK removals”, which raises the question how one measures UK removals. We had a spirited discussion about how one measures emissions, and recognised that one reduces that eventually back to carbon. “UK removals” or any removals will become a much more critical issue as we take into account the brave decisions taken at Bali, which cover deforestation—that is greatly needed. However, if ever there was a need for the science to catch up with the aspiration, here it is. We all recognise that we have very little idea of UK removal rates. We are talking about carbon sequestration, mainly, and the ability of different forest systems and soils to sequestrate, according to different land management systems. Eventually, if we are to bring deforestation into carbon accounting, which in a global sense we would certainly hope would be the case, we will simply have to be able to measure much more precisely than we can at the moment what we mean by removals.

I do not expect the Minister to answer or to give us a masterclass on this, but I draw attention to the fact that most of us do not understand how we will measure precisely UK removals.

I thank the noble Lord for his excellent explanation of my question. I am now fully satisfied that it has been answered.

I was going to be much more mundane in answering the noble Lord’s question by saying that he needs to read Clause 22(1)(a) and (b). I do not know why it is done this way round; only parliamentary counsel could answer that. It has been drafted so as to say that,

“net … emissions … for the period”,

will be “reduced by the amount”, and “increased by the amount”. One would normally think that you would get the net after you had done the additions and reductions, but the Parliamentary Counsel Office has drafted it that way and I am sure that, knowing the expertise of that office, it has done so for a good reason. If I am wrong, I shall write to the noble Lord.

Amendments Nos. 110 and 114 relate to how the emissions will be calculated. That will be complicated; it is certainly not the easiest thing to explain across the Dispatch Box. We appreciate the sentiment behind Amendment No. 110, but it would not bring clarity to the issue. Clause 22(1) defines the net UK carbon account as the total net emissions of greenhouse gases in the UK, taking into account carbon units that are to be credited to or debited from the net UK carbon account. The general convention under the United Nations framework, within the EU and in domestic practice, is for greenhouse gases to be measured in terms of tonnes of carbon dioxide equivalent. This is set out in more detail in Clause 65.

Amendment No. 110 would define targeted greenhouse gases in terms of carbon units. However, carbon units are defined in Clause 21(1) in terms of greenhouse gases, and we believe that this is the best way in which to approach the issue. Ultimately, the problem we are seeking to tackle is caused by greenhouse gases, not by carbon units.

While that is being digested, I turn to Amendment No. 114. Clause 24 defines the terms “UK emissions”, “UK removals”, and “net UK emissions” of greenhouse gases. These are to be determined consistently with international carbon reporting practice, which is defined in Clause 66 as,

“accepted practice in relation to reporting for the purposes of the protocols to the United Nations Framework … or such other agreements or arrangements at European or international level as the Secretary of State may specify by order”.

We touched on that matter briefly yesterday. This is a tribute to the British Civil Service, because I have an update to a note on a debate that we had last night, in which we discussed the amendment proposed by the noble Baroness, Lady Miller of Chilthorne Domer. We discussed the clause yesterday in the context of her amendments, but that has been looked at again overnight and I reassure the noble Baroness that there will be very clear separation throughout between the emissions that take place within the UK and the carbon units which represent activity and which took place outside the UK. If the noble Baroness would find it useful, officials would be more than happy to discuss the point further with her.

Again on Amendment No. 114, I reassure noble Lords that UK emissions and removals of greenhouse gases will be determined in accordance with international practice—for instance, the Intergovernmental Panel on Climate Change greenhouse gas inventory guidelines, which the UK is required to follow under the United Nations framework convention on climate change. This is not something that the Government have invented on the back of an envelope.

The UK already produces an annual emissions inventory, which is produced to a high standard in line with international reporting practice. I explained last night how that was done. The amendment would mean that UK emissions could be determined only in accordance with international agreements. It is not clear that that would always allow us to keep up with international best practice as it develops over time. For example, best practice could continue to evolve between formal international agreements, because this is obviously a continuing issue that is being debated around the planet. I hope that that explanation is sufficient for the noble Lord to withdraw his amendment.

The Minister is being as helpful as he possibly can, but I noticed when he was explaining that even his brow was furrowed with concentration to grasp the extreme complexity of this system of measurement. If we are going to make it clear to the public, we must, if we can, have the correct language in the Bill, more as a tribute to the late Lords Brightman and Renton who used to go on about clarity in legislation. When you see clever people such as the noble Lord, Lord Rooker, and other clever people in this Committee really struggling with the meaning, how on earth will people outside the House, who are not trained in law, get their heads around this incredibly complicated and very important issue?

Before the Minister answers that question, may I add a supplementary? My noble friend has just said that it is important that people understand this. What it all adds up to is that it must be clear to individual members of the public at the end of the day because they will suffer low emission light bulbs and so forth. They will feel this on their skin and want to know exactly what is being done. Amendment No. 110 quite simply says that the net UK carbon account should be expressed in terms of carbon units. It does not make sense for an account not to be expressed in terms of the units that it is worked out in. Could the Minister not try to amend the wording so that, at the end of the day, people can see we aim to arrive at a net total of carbon units expressed in carbon units? That makes sense; then we need not have these elaborate explanations which we all find so difficult to follow.

I know that we are legislating for and on behalf of the public, but the idea that a copy of the Bill will go through every letterbox is palpable nonsense. What needs to go through every letterbox— and that is the sort of thing that should happen—is information in language that is easy to understand and that people can connect with their daily activities about the actual effects and consequences of the changes that will come about because of the Bill. The drafting of legislation must be done under our procedures in a specific way.

The reasons for that are well known. The courts are out there and through the structures that we are setting up we are requiring business and individuals to change their behaviour in due course, and that must be done in a fair way. The legislative process does that. How the legislation is translated to inform the public is, I say with respect, another matter altogether. We need an overhead projector and a chart so that we can understand what we are doing as we legislate, but we cannot include the way we operate in legislation. I am sorry: I am defending the status quo, which I never thought I would do, because it needs modernising, which is why we have the legislative programme. I understand that we must do things in this way, but how it gets translated to the public, business, industry and other organisations is another matter altogether. Better brains than we have on this Bill must be used to translate that information to make it meaningful and understandable to the public. Otherwise, we are wasting our time.

What we are all trying to do is to bring the letterbox issue as near to the statute as possible because otherwise the only people who really benefit are my learned friends, and they are quite well enough paid already.

I thank the Minister for defining the basis on which we are looking at the matter when he spoke about the IPCC and the Kyoto agreement. I almost feel that we ought to have that in the Bill to explain that that is what we relate this whole to. It is difficult to get the public to understand this because we are talking about generating carbon which has not been emitted. You cannot say, “I have captured that carbon and there it is, you can weigh it”. We are not even giving people bits of paper but credits on an international database. There is a worry about whether these things are properly verified at source or whether somebody in the depths of a jungle somewhere is churning them out and feeding them into the database.

The Minister needs to explain in a little more detail—perhaps not tonight but some other time—why the net UK carbon account referred to in Clause 22 does not mean that in future somebody might think that it applies only to carbon. We have tabled this amendment because we want to make sure that these other gases can be included in the net UK carbon account at the levels at which they are internationally recognised as having a carbon equivalent. At the moment there is a slight danger that the Bill’s wording does not allow for that.

I shall take that away and look at it but I believe that I said yesterday that some 85 per cent of our emissions comprised carbon dioxide. There are other gases but the others are assessed on equivalence. However, there must be clarity in the legislation and I am certainly happy to look at the matter again.

I thank the Minister and beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 111 and 111A not moved.]

Clause 22 agreed to.

Clause 23 [Consultation and parliamentary procedure for regulations]:

[Amendments Nos. 112 and 113 not moved.]

Clause 23 agreed to.

[Amendment No. 113A not moved.]

Clause 24 [UK emissions and removals of greenhouse gases]:

[Amendment No. 114 not moved.]

Clause 24 agreed to.

Clause 25 [Emissions from international aviation or international shipping]:

moved Amendment No. 115:

I agree with a great deal of what the noble Lord has just said in moving his amendment. He said that these were very complicated issues, and indeed they are. In the Joint Committee, as he will well remember, we spent a great deal of time considering these matters. On the fact that no emissions are included in the carbon count from international aviation, the Joint Committee said:

“We consider this to be a serious weakness which, in view of the significant likely growth of such emissions, has the effect of reducing the credibility of the 60% carbon reduction target. Given the clear expectation of the Secretary of State that international aviation emissions could be included in the net UK carbon account once they are incorporated within the EU ETS, we expect the Government to take all necessary steps to ensure that this is achieved. The draft Bill should be amended in such a way that it requires both the Government and the Committee on Climate Change to include separately international aviation emissions within the scope of their monitoring and reporting, including projections of future emissions—in a manner similar to the parallel reporting we are recommending in relation to non-CO₂ greenhouse gases”.

We went on to make other parallel recommendations. The final one was that,

“the Government should make it a priority to address these issues, and both it and the Committee on Climate Change should include international shipping emissions within their annual projections and reporting processes”.

In the first place, is it not incumbent upon the Government to try to get an agreement through ICAO and the IMO?

Exactly, but a noble Lord on the Cross Benches with great experience of foreign affairs commented in the Joint Committee on the tortoise-like progress of those discussions in the international arena. The noble Lord who has just intervened has particular knowledge and experience of the timescales involved in such discussions. After all, in this Bill we are trying to give a lead and do things before there are agreements. It seems that at the very least, on Report, this clause should be amended so that it places on the Secretary of State and the committee the task of urgently examining the way in which this should be dealt with. It seems a serious omission from Clause 25 as it stands that no role is given on this matter to the Committee on Climate Change. Surely one of the priorities for the Committee on Climate Change and for the Government should be to address the issue. I shall certainly put forward—I should have done it sooner so that we could have discussed it today—an amendment for Report to make it a priority for the Government and for the Committee on Climate Change to examine the issue, to examine the problems as they exist and to come up as quickly as possible with solutions.

One other factor that needs to be looked at as we discuss this issue was a matter of concern to the Joint Committee: once we have agreed that the definitions are right, what would the effect be? Would the effect of including aviation in the reported numbers, targets and budgets—I leave shipping on one side for the moment—be to put extra pressure on reducing the emissions from all other sources? Because we were adding something, did that mean that we would then have to make further reductions elsewhere, or, as the witnesses from the government departments seemed to argue, did we simply increase the grand total and go on from there? The Joint Committee felt that that issue also needed some urgent consideration, analysis and clarification from the Government in relation to their intentions.

I support the various amendments put forward because they deal with an issue which needs to be raised. I do not believe that they solve the problem and I do not expect that my noble friend, when he comes to speak about his amendments, will think that he is solving the problem. These issues are complicated, but surely we need to emphasise today the importance of getting aviation and, as soon as possible after that, shipping included in the budgets and targets, and the importance of the Government and the Committee on Climate Change addressing that jointly as a matter of priority.

I thank my noble friend Lord Crickhowell for his contribution. I always like his blend of cautious impatience, if I may put it like that. However, I do not share his pessimism about the outcome of this debate. It may not be necessary for an amendment to be tabled on Report. These Benches are party to this group of amendments, except Amendment No. 118, and we think that the exclusion of international aviation from the Climate Change Bill is illogical and, frankly, not easy to understand. Amending this clause should surely be a priority for anyone concerned with ensuring that the Bill works.

Due to the seriousness of the issue, I want to reiterate, for the record, the scope of the problem. Aviation is the fastest growing source of greenhouse gas emissions in the UK. The Department for Transport projects that aviation will emit 17.4 million tonnes of carbon in 2050—equivalent to 26 per cent of the total UK carbon allowance—in the unlikely event that the target stays at a 60 per cent reduction. This of course means that in the face of an 80 per cent target, aviation emissions will account for more than half the UK’s carbon emissions. The difficulty with aviation, as has been pointed out by the noble Lord, Lord Crickhowell, is that it also has a range of non-CO₂ effects on climate and emits a number of gases. Additionally, emissions at altitude multiply their impact.

In its 1999 report Aviation and the Global Atmosphere, the Intergovernmental Panel on Climate Change put the multiplier effect at two to four times the actual emission because it is emitted at high altitude. If this is taken into account and aviation remains excluded, aviation will account for well over the total UK allowance by 2050, assuming a target of 80 per cent. That is painting the most dramatic picture but it shows the key role that solving this problem has in achieving a reduction in carbon emissions. It is simply too serious to ignore and it is illogical. If the goal is to reduce the contribution that the UK makes to global warming by genuinely reducing carbon emissions, how can the Government ignore one of the biggest contributing factors? To use a simple analogy, it is like passing a drink-driving law that sets a limit on the alcohol level but then excludes whisky from being counted.

The inclusion of international aviation has been recommended by major environmental lobbies and, as the noble Lord, Lord Crickhowell, said, by the Joint Committee on the draft Bill. Is the Minister content to ignore those recommendations? As it stands, the illogical exclusion of international aviation from the carbon budgets could lead to the Bill being interpreted in a rather perverse way in the sense that carbon emissions could be reduced by encouraging people to fly as opposed to going by road or any other form of transport. As the Bill is currently drafted, a policy that would help to reach the budgets would be to close the Channel Tunnel, for example, and transfer passengers on to international flights where the emissions would not count. I am not suggesting that that will happen, but it is the issue in a nutshell. We live in an integrated transport world and if we want people to make proper decisions to reduce their carbon footprint at a personal level, international aviation must be included in the system.

The Government maintain that the international aspect makes it hard to establish how to include those emissions, but they are already reported. Indeed, the Bill includes a report of our contributions without including them in the budgets. Will the Minister explain that discrepancy?

I am grateful to the noble Lord. I intervene briefly, and say, first, that as I have not spoken on this Bill before—not in public anyway—I welcome it greatly. Some of us have argued for it over a period; it is profoundly important and very much a step in the right direction. Secondly, I declare an interest as the campaign director for Future Heathrow, which is a coalition of trade unions, business organisations, airlines and others associated with the airline industry, although I am not speaking about that particularly today. Like many others, we have given attention to the issue of climate change in aviation.

I congratulate the noble Lord, Lord Teverson, on the way in which he introduced the amendment, as he is basically on the right lines. He recognises the difficulty of including it straightaway in carbon trading. I was slightly surprised by the noble Lord, Lord Taylor, on the Conservative Front Bench. If I understood him properly, particularly if he forces the amendment to a Division, we will have to assume that any future Conservative Government would immediately include aviation and shipping in carbon trading, regardless of what else is done in Europe or the wider world. The implications of that are very serious.

I speak as someone who has been concerned about climate change for 20 or more years, when I wrote my first article about it. Those of us who are worried about it recognise that there are two dangers. One is the danger of doing absolutely nothing and carrying on as we have done for many years, and the other is going into panic mode and closing down industries or creating crises for major and growing industries because we have not thought through the consequences. Sometimes the figures given across the board, by people both for and against, can be misleading. That perhaps serves as a warning on this amendment and clause. Late last year, the Mayor’s office was issuing figures which showed aviation in London to be particularly bad, because it had counted the aviation emissions from the aircraft’s point of departure to its arrival in London, and counted that as a London emission. Yet the train emissions were counted only as far as the GLA border. That sort of thing ultimately undermines people’s confidence in statistics on these complex issues.

The noble Lord, Lord Teverson, was right that aviation and shipping must be included. Some people underestimate how fast industry is now moving on this. People underestimate across the board the willingness of people, both individually and as members of organisations, to make a major effort on climate change. I was impressed, as I am sure others were, when the cement industry suddenly stood up in class and said, “Hey, don’t forget we’re a bad boy, too!”. It announced it when none of us knew it. Similarly, the aviation industry and, now, the shipping industry—although I know less about that—are working hard to reduce their carbon emissions.

Yes, the answer is to get an international trading agreement which includes aviation and shipping, but we must first get it in Europe. You could argue a case for aviation and shipping being included for Britain and the rest of the world outside Europe, although it would not be that convincing. But if you try to exclude the European Union and just go ahead and do it, as the noble Lord, Lord Taylor, seemed to suggest, the implications for major industries in Britain would be severe. We must face that. It is a matter of getting the balance right. UK aviation is the second biggest aviation industry in the world, second only to the United States; it is cutting edge technology and we ought to be proud of what it is doing and its efforts to address climate change. Half a million people work in the aviation industry. They do not think that climate change is not happening. They are not people who do not care about their kids’ futures or their own futures. They are not people who do not care about the future of the planet. They do care, and noble Lords would be surprised how many of them are thinking hard about this issue. We ought to give them credit for that.

I do not support the amendment as it is, but the noble Lord, Lord Teverson, understands the problems here. I would certainly like to hear, and I am sure the Minister will want to tell us, how we engage with the European Union and elsewhere to try to get shipping and aviation counted. I suspect that it will be slightly easier within rather than outside the European Union. Having said that, it will not be easy in the European Union either. That is another of the great problems of our day. International organisations like the EU, and the wider ones, govern so much of our lives and yet our influence on them is slow to work. Any country, no matter how powerful, is slow to get agreement because they must do so with the slowest ship in the convoy.

Does my noble friend agree that UK or European legislation cannot address this issue by itself? Is it not essential, because of the international nature of shipping and aviation, that we try to get international agreement?

My noble friend, with his knowledge, has managed to sum up rather more rapidly than I some of the things I have been trying to say.

My last point is that the noble Lord, Lord Taylor, should be careful of these figures that say aviation will contribute half of our carbon output by 2050. Yes, if aviation does nothing about it, sits back and continues with things as they are, using existing aircraft, that will probably be true. However, no one pretends that that will happen. It is difficult to predict the pattern of development, but there is much more that we, and particularly Europe, can do. I do not want to digress because I would then go down other paths that are not directly relevant. But, for example, we are still operating dog-leg flights, instead of direct-line flights, all over Europe simply because there are so many air traffic control organisations operating within Europe. The same geographical area is covered by just four air traffic organisations in North America. There are about 50 in Europe and one can see that in continental flights, all of which dump more carbon into the atmosphere.

The answer to the problem is international. I very much want to hear the Minister describe how we are working on it, but it would be unrealistic merely to state in the Bill that we are going to make this provision regardless of what others do. I also want to sound a note of warning. The danger with climate change in the public perception is that the public either think that it is too big for them to do anything about and so give up; or, when the figures are contradictory and confusing, and unrealistic or unjustifiable claims are made, again they just give up.

When I saw adverts for the carbon-free train to Europe, I was very struck and thought, “Terrific, but don’t tell anybody that when you travel across France 80 per cent of the electricity for that train comes from nuclear power”. The green movement is not too enthusiastic about that. I do not have a problem with nuclear power—I think that we need it—but my point is that the figures we use and the way in which we use them are important. We must accept that climate change and carbon emissions are major problems and that we must do what we can as individuals and organisations, and as a country. However, as regards this clause, my noble friend on the Front Bench and the Government must work within the European Union and with international organisations.

Whether we can agree with the noble Lord, Lord Soley, that it would be unrealistic to pass these amendments to the Bill depends on one’s confidence on the timescale both at European and international levels. We would all accept that the ideal solution would be international agreement, but perhaps we should look at the fora within which such agreements are being discussed. We have had for some time, at the United Nations Framework Convention on Climate Change, and particularly at the conference in Bali in December, discussions on allocating international aviation emissions. My impression is that we are still some way from resolving that framework discussion until well after 2012.

Furthermore, the International Civil Aviation Organisation met in September 2007. It is seeking to produce international comprehensive measures to address aviation emissions. The Government, in their comment on this in response to the pre-legislative scrutiny, said that the discussions had not been as conclusive as they would have wished. In fact, they said that they had produced an outcome that was not as ambitious as they would have hoped. That leaves the European dimension, and we are pressing for the inclusion of aviation in the EU Emissions Trading Scheme as soon as possible—ideally within phase 2 in 2008-12.

If I had confidence that any three of these initiatives on the European and international scale were going to achieve reasonably quick results, perhaps I would be less supportive of these proposals. But until I hear evidence from the Minister that any of them have much prospect of success, I would be willing to support these rather brave—rather heroic, I admit—amendments.

There is an important issue on this. I do not like phrases such as “giving a lead”, “showing an example” or “sending a message” because they are slightly political clichés which are flavour of the month. However, if we set an example by including this provision, we can look firmly in the face those people we are telling not to chop down trees. It is difficult to say to people in poorer countries which do not have their own airlines, “Don’t chop down your trees, but we will go on flying to your beach on an easyJet holiday to sit and look at it”. Technology will solve these problems. We are going to be able to find technical methods of driving motor cars and producing power stations that will not produce carbon dioxide. We have to challenge the world to be as technologically brilliant as we know it can be. However, Ministers have accepted that we must use a bit of stick and carrot.

We cannot do other than keep this provision in. I agree with the noble Lords, Lord Teverson and Lord Soley. No one is saying anything very different—it is just a question of degree—but we ought to keep this in because it is at least a start. The next cliché concerns acorns and oaks, but the noble Lord knows what I mean.

It is an illusion to believe that accepting these amendments will solve the problem. It will not. Problems are difficult and complex. The noble Lord, Lord Taylor of Holbeach, to whom I always pay due regard, alleged that the Government are ignoring the effects of international aviation. That is far from true. Apart from by Ryanair and some companies outside Europe, this situation is being taken seriously. All airlines in this country have said that they have to address this problem and are doing so as best they can, but international legislation is needed to do anything serious about this. That is why the Government are rightly expressing the view that we have to do something positive in ICAO and the IMO about these issues. It is patently untrue that they are doing nothing. It is right that they do not act with enormous speed, but it is instructive to understand—I come to the contribution made by the noble Earl, Lord Selborne—that we are making some progress. Already Australia, which was implacably opposed to any advance, has come into line and there is reason to believe that China and India will also do so. We should not write them off as being implacably opposed to any advances.

Domestic aviation and shipping are already included in the permitted emissions. It follows that we are concerned with international activities. I do not think that any responsible Government of any hue could act outside those international aviation and shipping bodies initially. I am concerned that the Government have said that, despite the best efforts they are making, they will act to include aviation and shipping if no agreement is forthcoming. I ask my noble friend to embark on that in rather more detail, because I found it very difficult to comprehend that argument. What limit is being placed on it? Are we talking about 2012 or 2015? What are we saying?

I was concerned by the remarks of the noble Earl, Lord Onslow, in which he implied that curbing aviation would be some sort of example. I draw his attention and that of the Committee to the speech made by the high commissioner for Ghana a couple of months ago in which he commented on the nature of the debate emerging, where there would be curbing of air transport of products that contribute greatly to the development of his African country and a number of others. That is part of the general story. Aviation is part of the modern world; it is part of enabling many countries to participate in globalisation, increased growth in their economy and standards in health and so on.

We should also recall that aviation is and is likely to remain a small proportion of total emissions produced by the burning of fossil fuels. If we envisage, as I hope we do, a prosperous and clean future for our country and for all the countries of the world, it will probably be based on clean forms of power, especially nuclear power and renewables. If that is the case, in this prosperous and international future, carbon emissions may be associated with transportation. But if the only emissions are associated with transportation in a modern way and with the high growth of technology, we would easily be able to meet the 70 per cent cuts that we are looking for in emissions. We must keep in mind the total world picture that we envisage for the future, which was the subject of our debate yesterday. We do not want to go back to a world that is different; we want to move forward. Therefore, we should keep this point in mind as we consider aviation.

In my experience of meteorology, I have worked very closely with other countries on aviation and meteorology, and there have been good examples. I have just mild reservations with the noble Earl, Lord Selborne, with whom I normally agree on almost everything in environmental matters. There were some extremely interesting examples of the way in which international civil aviation, meteorologists and vulcanologists came together in the 1990s to introduce better warning systems that greatly improved the safety of aviation. ICAO is a responsible body which works with other international bodies. It will take some time. We are dealing with the long-standing 1944 Chicago Convention, and should work within that framework. Partly because meteorology is an essential part of aviation, meteorology and climatology work together, and environment, meteorology and climatology work together. This is a strong forum for that and we should have confidence in the Government’s use of it to help to promote their general objective.

I hesitate to join this discussion after so many contributions because virtually everything has been said and the logic is impeccable. I have one plea. We should not burden the Committee on Climate Change with this problem. We have heard enough now to be aware that the implications go far wider than its remit possibly could, although it will have a very powerful lever to use. As long as the matter of aviation in particular is excluded, the problems for the rest of the economy are commensurately greater. The real question behind this is whether technological change can see us through the rest of the issue. While one cannot be absolutely certain about anything looking this far ahead, it is almost certainly the case that it can.

However, there is a further problem which it is worth introducing at this stage. Many people are inclined to believe that we can do so much by economising in energy. Two years ago, our Economic Affairs Committee produced a report on energy efficiency in the British economy. It contained a very interesting graph, which has stuck in my memory. For anyone who chooses to look it up, it is on page 27. The graph related the economic performance of our economy to the energy cost of a unit of output. Over the previous 30 years, we enormously improved our energy efficiency per unit of output. That trend will continue. But some economists have come up with a rather embarrassing economic theory, which suggests that as we develop more efficient ways of using energy, so we also develop new ways of using energy. The graph had one line indicating economic output rising and another indicating units of energy per unit of economic output falling. The third line on the graph showed actual energy usage. It showed that as we became more energy efficient, we used more energy because we thought of new ways of using the energy that we had saved.

I throw that into the discussion not because it is particularly relevant to this item, although it seems to be the only place where I might get a change to raise it, but in order that we appreciate the depth of the technological change which is going to be required if we are to begin to have any hope of meeting the targets we are setting so blithely without thinking about the consequences, and the changes that will have to take place if we are to succeed.

I have a great deal of sympathy with the arguments which have been made by the supporters of this amendment, but on the whole I am inclined to leave the clause as it is, simply because it is a very complicated matter. We all agree that we have got to do something about aviation, but I certainly take the point made by the noble Lord, Lord Soley, that merely to extrapolate the present rate of growth and assume no technological advances is not a reasonable way of looking at the future. However, we have to do something.

It is worth bearing in mind that the Secretary of State would have to make water vapour a designated gas because a significant contribution made by aviation to the greenhouse effect comes from the water vapour associated with it. That is only because water vapour is emitted at high altitudes, whereas when it comes out of a car exhaust, it does not have that much effect. So there are complications. Indeed, given the complications—getting a major international agreement and incorporating it into international carbon trading arrangements—I wonder whether in the short term we could do something at the EU level. Although it may be untidy, I know that there have been discussions between our Government and the German Government in particular on the question of whether we should not preferentially tax aviation fuel within the European Union. We could do that without involving the significant number of international aviation bodies that I suspect would otherwise be involved. As I say, it would be untidy, but there are shorter-term ways of tackling the problem. I therefore suggest that we leave the clause as it is.

I rise because my name is added to the amendment. The issue is that, as many noble Lords have pointed out, this is the elephant in the room when we talk about the amount of CO₂ being emitted by aviation and shipping. We have only to look at a map of the shipping lanes in the English Channel to see that it is one of the busiest waterways in the world, while projected flight paths across British and European air space make us realise the amount of carbon being emitted. The noble Lord, Lord Oxburgh, has made the salient point that this is such a complicated issue that we should leave it out of the Bill. However, the purpose of including it is to address a major point that has been raised, that of the flag of convenience. If we do not register the emissions, which Government will do so? We will find that certain airlines start registering their business in Panama just because it is easier to register emissions in areas which have low emission rates at present, thereby reducing their potential tax burden.

The purpose of these amendments is clear. The Government could answer the point that while this part of the Bill covers “carbon targeting and budgeting”, if we leave out this massive quantity of carbon being emitted in European airspace, is there a point to the Bill at all? We would be leaving out a major aspect of carbon dioxide emissions, and that is a fundamental weakness. I understand why the Government have taken the position they have and I believe that the noble Lord, Lord Rooker, will reject the amendment. However, I hope very much that even if the Government disagree with this proposal, they will provide that these emissions should at least be recorded in this country if they are emitted in the English Channel or in British air space.

We should not forget the implications for us of these emissions. The noble Lord, Lord Crickhowell, discussed the issue of bunker fuel emissions from shipping. Bunker fuel is the dirtiest substance imaginable and the cause of most of the acid rain that falls in this country. Those emissions come from international shipping. We should not underestimate the effect on our environment that this enormous level of transportation is having.

The point that the noble Lord has just made about the busiest shipping lanes in the world brings out the difficulty with which we are confronted. The question is: how much of that shipping has anything to do with this country? A great deal of it is pouring goods into the continental ports, and it is exactly that kind of problem of definition with which we are confronted in the Bill.

I owe my noble friend on the Front Bench an apology for rising before he did when he has put his name to the amendment. I heard him press the case but, much as I should like to see a reference to aviation emissions in the Bill, I did not hear him explain how they will be defined and measured and therefore placed in budgets and targets. That is precisely why I suggested that there was a role for the Committee on Climate Change, which would be able to form judgments about the practicality of moving forward in this area. Simply passing these amendments would achieve very little because that would not produce a practical solution to the question of how to define the emissions and ensure that they are emissions and carbon contributions which relate to this country and for which we should be responsible. It would not provide an answer to how we avoid getting landed with burdens that should fall on other countries.

Friends of the Earth produced the rather interesting example of Switzerland—a landlocked country, which receives goods that pass in ships and aircraft through our waters and airspace. How are we to deal with exactly that kind of international sharing problem? It is no good saying, “Well, we’ll include them”. We are entitled to demand—and I think the Joint Committee demanded this—a system for reporting the measurable factors in the aviation field that can arise, even if at this stage we cannot include them in the budgets and targets. We should find a way of reporting the scale of the emissions so that, when we can move forward to agreed international ways of acting, we can move quickly to bring them into a practical solution.

Therefore, my anxiety about my noble friend’s position is that he finishes up with a clause which demands something that is almost impossible to produce. I do not know who would say, “These are the factors that can go into the budgets and truly represent what the British should be contributing”. That is why I think we need a system for looking at this matter and why we should press the Government and the Committee on Climate Change to address these issues urgently, even if we cannot find an immediate solution.

Has anyone made an effort to produce a scheme, or the skeleton of a scheme, which could be worked on? Is anything happening at all?

Only in the sense that the Europeans have produced a scheme which deals with one particular aspect, but that is only a partial solution. Therefore, the answer to my noble friend is probably that there is no practical scheme or solution at present, and that is our difficulty. I hope that we can continue to press the Government for urgent action, and I wish that I could see a way of including what we want in one nice comprehensive and quick process, but I fear that I cannot.

What has characterised the discussion so far is that everyone in this Chamber seems to agree that aviation emissions are an issue and that they need to be addressed. That is a common point. The question is: how should they be addressed? If I have one disagreement with the noble Lords from the two Front Benches who have put their names to the amendment, it is that the tone of their introduction implies that, because those emissions are not included in the Bill, the UK or the Government do not care about them and nothing will be done unless they are included in the Bill. We know that is not the case. For some time now this has been the subject of intensive negotiations in Europe. The Minister will no doubt tell us in more detail when he replies. On 20 December the European Council reached an agreement—the draft is now toing and froing and is to be dealt with by the European Parliament—to introduce a European scheme in 2012. I ask the movers of the amendment: what on earth is the point of seeking to put something in the Bill and asking the Committee on Climate Change and the Government to start doing something when a scheme is going to be introduced in 2012 for the whole of the European Union? If each of the 27 member states were of the same mind and passed legislation this year—all with different schemes, all applying to different airlines—it would be chaos.

As members of a legislative Chamber of this Parliament, we owe it to people to tell them that this is best tackled at a European level. The issue is being tackled, it is being addressed, and robust and workable proposals have been agreed by the Council of Ministers. As I said, I am sure the Minister will speak to that. So it is not the case that the Government are sitting on their hands and that nothing will happen: the European scheme will start in 2012.

It makes no sense to try to put something into the Bill in this form. If it was in the Bill—whatever the figures were—targets would have to be included in the first three budgets; by law, the climate change committee or commission, depending on what it is called, would have to include them. What is it going to include? Which flights? The noble Lord who introduced the amendment said that you would not include all departures and all arrivals. Why not? That is the proposal in the European scheme. His noble friend referred to overflights, many of which do not land here but simply overfly United Kingdom airspace. This is not the way to make legislation.

My first point is that things are being done. It is not reasonable to convey and portray to the people who watch these debates and read about them in the press and Hansard that nothing is being done about this. To say that if it is not in this UK Bill it means that aviation is not being tackled is simply not true.

The noble Lord, Lord Woolmer, has repeated that charge two or three times but it is not the case. I specifically mentioned, as he has, quite rightly, the EU ETS agreement and the European Council, of which the UK Government are a part. I clearly understand the message and I intervene only because the noble Lord has mentioned it about three times. I am not saying that the Government are complacent or that they are not taking the matter seriously. In fact, it is already on the face of the Bill. All we are saying is let us get on with it now because it is so important.

I had in mind the noble Lord, Lord Taylor. A careful reading of Hansard tomorrow will certainly show the vigour with which he expressed his views on this point.

The whole issue of what flights to include is a real one. In due course, shipping will present the same problem in spades, if not an even more difficult problem. I am addressing why the amendment is not logical or workable. When the European scheme is introduced, and if it takes the form that is being proposed—that is, to include all arriving and departing flights—it is possible, if not likely, that it will be challenged by America, China and India at the very least. They are very powerful countries, which will object to the scheme covering departing and arriving flights. It is rather like being taxed on imports and exports, because one is effectively importing and exporting services. If this country tried unilaterally during the first three or four years to impose something, without the security of it being done by the whole European Union, which is a much stronger negotiating force with America, China and India—

The noble Lord is talking about taxation and trading. This section of the Bill refers to measurement. We are more interested in measuring the outputs than in taxation. The amendment does not suggest anything that has to do with taxation.

Amendment No. 115 states, “leave out ‘do not’”. I was drawing an analogy with other goods and services. By introducing restrictions and allowances for departing and arriving flights, we would be taking a decision that related to citizens and airlines of other countries coming here, as well as to airlines departing this country. We know that European proposals are the subject of vigorous discussion with the United States, China and India, which is another reason why the Government’s proposed way forward, through the European scheme, is much more sensible and will bear early results.

Should the climate change committee include aviation emissions in targets, which I think we all agree would be the consequence of the amendment, if it is not possible for the Government unilaterally to do something about them? If something is included in a target, the Bill requires the Government to produce policies to address it. What policies do the movers of the amendments believe that the Government and climate change committee can between them put together in the next four years to do something about it before the European scheme is introduced? One should not through these amendments include aviation emissions in targets at this stage—when the European scheme comes in, it will be a different issue—if it is not possible to do something about it.

There is widespread agreement, both outside and inside Parliament, that aviation and shipping emissions are important and have to be addressed. We are discussing in these amendments whether the Bill should be changed so that those emissions are included now, which means in the first three- or four-year budget periods, by the climate change committee, with the Government having to produce policies within a few months to address it. They are not good amendments.

The Government’s proposed alternative in the Bill is to wait until a European scheme is introduced. Some two or three years ago, Sub-Committee B of the European Union Committee, whose chair I had the honour of occupying before my noble friend Lord Mitchell took it over, looked at the emissions trading scheme and aviation. It was the view then of members of the committee that we should join in. Since then, the Government have taken the lead among member states in advocating pushing forward those changes. I hope that the amendments are not supported. If they are withdrawn, I hope that it is done in a way that indicates confidence that the European ETS is the way forward.

We have had an excellent debate in just over an hour on a crucial issue. Some of the speeches made the point about the practicalities, which were not mentioned by those who tabled the amendments. I almost apologise for coming forward with some of those practicalities; however, this is not an intellectual argument but one in which we decide how we measure and get agreement. I shall do my best to respond to many of the points.

It was made clear early in the debate that everybody understands that emissions from domestic aviation and shipping are already included in the Bill and that it is only international aviation and shipping that we are talking about. At the moment, there is no international agreement on how to allocate these emissions to individual countries, which is why they are excluded from the UK’s targets under the Kyoto protocol and the Bill.

I have some general points that are very important for the context of the debate—because, obviously, we will return to this matter. First, the Government believe that unchecked growth in aviation and shipping and in emissions from these sectors is unacceptable. We are working to ensure that those sectors meet the full cost of their climate change emissions and that they play their role in achieving climate stabilisation. However, as virtually every speaker has said, the issues are complex. These are by definition international industries governed by international rules, which require global solutions. For example, when a plane flies in from Sydney to London and refuels at Dubai, how do we allocate the emissions?

We are working at international level; it is not as if we are waiting for things to happen. We are working through the United Nations framework, the International Civil Aviation Organisation and the International Maritime Organisation to achieve agreement on the best way forward. However, we recognise that we cannot wait indefinitely for this, so we have tried to lead the debate in Europe on including aviation in the European Union emissions trading scheme. Noble Lords will be aware that EU environmental Ministers reached agreement on that just before Christmas; the deal agreed at the Environment Council is a step forward and will place a fixed cap on total aviation emissions. Those emissions over the cap, set at the average of the 2004-06 levels, will be covered in one of two ways—either through reducing emissions in the sector or through the purchase of reductions that can be produced more cheaply and easily by other sectors. The deal that was agreed will now go to the European Parliament and we are hopeful that there will be a final agreement before the end of this year.

The inclusion of aviation in the European Union emissions trading scheme was supported by all 27 member states. That will come into effect in 2012 and will apply to all flights between EU countries as well as those taking off from or landing in an EU member state. This is a considerable prize and a move forward, but we need to be careful that whatever we do at UK level through this Bill does not undermine the agreement that we have in Europe, which is certainly one of movement.

The question of international shipping is even more complex, as the Joint Committee recognised in its report on the draft Bill. Shipping companies can and do easily reregister vessels between countries, or buy fuel at alternative locations, including from tankers moored in international waters. Although I do not have the figures—I can provide them later on—I can illustrate the difficulties by the fact that the amount of shipping fuel sold in the United Kingdom has remained broadly the same since 1990, but we know that shipping levels in and out of the UK have increased significantly over that period. Therefore, on what basis should the UK's share of international shipping emissions be calculated and what policy levers could be used to reduce those emissions, which would not simply displace the problem somewhere else?

During the debate, I was asked about recording emissions from planes in UK airspace and ships in UK waters that may or may not land here. In response to the Joint Committee report, we have committed to report on UK emissions from international aviation and shipping. That is precisely why Clause 12 (5) is in the Bill. We did not debate that last night because everyone was thinking that as we were going to have the debate today anyway, it did not make sense, but that is why that clause is in the Bill. We can keep the commitment to the Joint Committee to report on UK emissions from international aviation and shipping.

The figures will be based on fuel sold within the UK, which is in line with international guidance from the IPCC, and we would not report on emissions from UK waters or UK airspace. Even that method has practical difficulties, which I will come on to.

One further point that is worth raising, which I dug deep out of the Q&A, is that there is no agreed international methodology for attributing international shipping emissions to individual countries. I have four examples. Allocation based on fuel registration or fuel sales may not be robust because shipping companies can easily reregister or buy fuel at alternative locations, as I mentioned. Allocation based on fuel consumption requires detailed commercial information on vessel efficiency, which is not available. Allocation incorporating the location of vessel activity certainly adds to the complexity and cost. Allocation based on the destination or origin of the vessel's cargo raises further issues of complexity, for example, for container ships with multiple destinations and the cost of data collection, not to mention the practicalities of how you collect data. You cannot do that on your own: there has to be international agreement.

Forecasting future shipping emissions is hampered by data constraints because, typically, we forecast the future using models from the past. Historic data needed, for example, on fuel consumption by UK vessels are not available. In addition, historic trade statistics provide some insight useful for modelling historic shipping emissions, but since 1992, they are no longer collected within the European Union. There is a range of practical problems regarding shipping, so it is hardly surprising that there is no agreed international methodology on this issue.

The Joint Committee itself said that:

“We recognise that both the methodology required to allocate international shipping emissions to individual countries, and the policy mechanisms which individual governments could use to constrain emissions from this sector, may need further thought”.

You can say that again. Certainly, that will be the case.

We also need to make sure that decisions on whether to include these emissions are based on the best possible analysis of the economic and environmental impacts. The Government's view is that the best way to do this is to get independent advice from the Committee on Climate Change. That will ensure that we are ready to take a decision quickly when the time is right. That is why we will ask the Committee on Climate Change to look at the implications of including international aviation and shipping emissions in the UK's targets as part of its overall review of the UK's 2050 target. We have already said that that will be the committee's first task, alongside its advice on budgets, so we will have that analysis quickly.

I now speak way outside the brief, because I have no negotiating role. We are asking the climate change committee to do several things: to look at the 60/80 target and to look at this matter. I got the message from previous debates, as did the rest of the Government, that noble Lords are not comfortable with the 60 per cent figure in the Bill. However, I plead with noble Lords, even on Report, not to include in the Bill any measure on international aviation and shipping but to leave that matter to the Committee on Climate Change. Noble Lords may want to include other things in the Bill but such a measure would cause us the most damage internationally. As regards changing the figure, clearly there is international consensus on other figures. I am not inviting noble Lords to defeat the Government. I have been told, “Don’t let them include aviation and shipping in the Bill”. But to be able to make a case for that, one has to show willingness elsewhere. We need to be practical and not include such a measure, because of the agreements that we have secured in Europe which are due to go through the European Parliament. We do not want to upset that because all 27 countries have signed up to them, but noble Lords can decide other matters.

Having listened to this debate, I believe that there is consensus on this issue because nobody putting forward the case for the amendment explained how it would work in practice. This is not a case of a noble Lord saying, “I’m changing the Bill. You’re the Government; you go off and make it work”. In this case, we cannot do that. We need global agreement to overcome some of these practical difficulties. However, I hope I have also made the point that we are not standing idly by. The UK Government are actively involved in pursuing this. As I said in my opening remarks, unchecked growth in aviation and shipping emissions is unacceptable. When the EU Emissions Trading Scheme’s rules on aviation have been finalised, we will ask the Committee on Climate Change for its advice on a methodology. We need to know whether there is a methodology for including international aviation emissions that is workable, compatible with the EU Emissions Trading Scheme and takes account of progress in the United Nations framework and the wider international context. We shall need to know the impacts of adopting such a methodology. That is the point that we shall need to put to the Committee on Climate Change, which is dealt with in the next part of the Bill. The committee has been behind the rationale of every clause, but we have not yet reached the part of the Bill where it is set up. That is why I cannot accept these amendments. I and my Defra colleagues shall be more than happy to facilitate meetings between noble Lords and Department for Transport Ministers before Report, if there is a desire to nail Transport Ministers.

Can I draw from that that, deep in the bowels of the ministry of transport, somebody is devilling away at trying to produce a scheme which everybody acknowledges is fiendishly complicated? Please do not think that those of us who instinctively prefer to have the measure in the Bill underestimate the complications, which are obviously vast.

This runs across more than one department. As I say, the Government are already involved in international negotiations on this matter in Europe. That is absolutely crucial. The climate change committee’s secretariat is already in being. We need the climate change committee to be established as soon as possible. Its members will have expertise. We want to put this matter before them. However, it is not as though we start with a blank sheet of paper. We have already started discussions with the International Civil Aviation Authority and the International Maritime Organisation on how we can tackle this. We have an objective to tackle international aviation and shipping emissions, but it must be a practical measure that is adopted globally. We are not waiting for a solution to turn up. As I say, we are already involved in discussions on this. I cannot say how many people are working on this, but work is already under way.

What we are trying to do, once we have the Committee on Climate Change set up, is have a body that is trusted by Parliament and by the public to look at the methodology and take account of what was agreed in the European context, so that we do not disturb what has been agreed by the 27 countries of the EU Emissions Trading Scheme. That is the basis on which we cannot accept the amendments, but I hope that I have made that case in a wholly positive spirit.

I thank the Minister for the fullness of his response. I have two questions. At the end of his speech, he mentioned that the committee would have as its priority the seeking of advice on methodology. What happens if it comes up with no methodology; in other words, if it cannot find a solution? Where would that leave us on the Bill? He also said that data were not available on the way that international emissions work. Presumably, those data would need to be found before the committee could attempt to give advice on methodology. I am slightly perplexed. I think all of us wish to have international aviation included, accepting that it will, we hope, be agreed at European level. I am worried that we are nearly not tackling the issue at this stage because it is insoluble. Can the Minister come back on that?

Not really, because on the first point we ought to leave it to the committee anyway. Let us not assume that it will not be able to do anything. We are putting a lot of trust in the committee, and we ought to leave it to give the Government and Parliament advice on methodology. We should start off on the basis of leaving it to come up with a methodology.

What I said about data was in the context of giving examples of there being no agreed international methodology on attributing international shipping emissions. I gave four examples of why it might be difficult. I also went on to talk about the forecasting of future emissions being hampered by data constraints, because there are missing historic data on shipping emissions. Since 1992, those data are no longer collected in the European Union. Trade statistics do not necessarily collect information on the mode used or the route taken which would help maritime modelling. There are some gaps there in the data. I have just given an example that means that sometimes the data are lacking for what we want now as opposed to what we were collecting in the past.

I have not intervened in the Committee before, but I have been listening to the Minister and I reinforce what he said in respect of shipping. Shipping is not unaware of its obligations in respect of emissions and a lot of work is going on in all sorts of different areas to try to reduce emissions at sea. A committee of the International Maritime Organisation is looking at the matter urgently and is expected to report some time later this year.

The problem is that shipping is a very complex operation and there is no one size that fits all in terms of reducing emissions. There are a lot of proposals on the table, such as reducing the sulphur content in fuel or burning distillate fuel, which puts more pressure on the oil refineries. Another alternative that has been taken up on the west coast of America in California is cold ironing, which is using shore power when a ship is in port. That still requires power to be generated somewhere else. It is a very complex situation, and I take comfort from what the Minister has said.

I am extremely grateful to the noble Lord, Lord Greenway, for bringing in a practical voice, so it is not just me as a hack politician reading out some of the difficulties. We are hearing the practical realities of the industry.

I thank the Minister for his response. If the amendments have served no other purpose, they have at least provoked the Committee into a good and thorough debate on a central and important issue. We have to have a very good reason for not including aviation and shipping in this part of the Bill. Let us hope that the Minister’s advocacy of what the Government are doing is transmitted into action so that it reinforces our decision not to pursue the amendments. The debate has been excellent, and we have heard some really good and invigorating speeches drawing attention to the importance of the issue.

This has been an excellent, and long, debate. The best comment was that of the noble Lord, Lord Crickhowell, who charged me with talking about the problem but not coming up with a solution. I thought, “That is the best description of the Climate Change Bill as a whole; it describes the problem but does not come up with the solutions”. We all accept that because that is around policies that flow from the obligation to get to percentage changes.

I say to the noble Lord, Lord Crickhowell, and to the Minister, that we have to be a little careful about getting too tied up with the fact that no one here has come up with a formula. We could all do that, and I expect that many of us here could come up with quite a reasonable formula. Even the Committee on Climate Change, if it pontificates for five years, or the international organisations, will come up with solutions none of which will be perfect and none of which will perfectly describe the equitable distribution of the emissions between nation states; because there is not a perfect solution or formula. What concerns me and many noble Lords is that if we attempt for too long to find a perfect formula we will get nowhere.

There is also confusion, which we had earlier in debates on the Bill, about emissions trading systems and actually doing the accounts and the budgeting on emissions. They are importantly related things, but they are not the same. I welcome entirely that the EU ETS will take account of international aviation emissions in 2012, subject to all sorts of threats of litigation from the United States. That is a trading scheme. I take the Minister’s point that it would always be better if how we measure those allocations for that purpose was the same as how we measured it for the purposes of this Bill and accounting, but the amendment is about accounting and budgeting; it is not about trading. The two are separate. I would love the definitions to be the same, and I think that is a serious question.

With respect, that is a little too woolly. If you do the counting and find a way of doing it, you try to avoid trading.

Perhaps I am misunderstanding the noble Lord, but we already have all sorts of targets in other areas, around which there is no trading. Trading is a separate activity. You do not have to have trading and targets. You have to have measurement to have trading, but you do not have to have trading with measurement.

Coming back to the comments made by the noble Lord, Lord Soley, on the aviation industry, I am certainly not in any way—he did not accuse me of this—a headbanger against the aviation industry. I see it as an important industry now and for the future. One of the experiences that I have had was in the south-west at a major regional airport. Its investment plans took into consideration all aspects of legislation. I asked those people whether they had taken the Climate Change Bill into consideration and they said no. That was a multinational organisation. There is still the requirement or need for top management to understand that this will be a pressure in the future. At the moment I do not see that evidence in some practical investment decisions.

I have not often seen the Minister quite so passionate about a plea as he was in this matter. We feel very strongly about this area, which I am sure he understands. From these Benches I would welcome between now and Report an opportunity to talk through with his department those practical areas so we can ensure that we are not involved in political rhetoric here but are trying to solve a common problem. On that basis—I stress that we see this as a core issue—I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 116 not moved.]

moved Amendment No. 117:

These Benches also identify with this amendment. I hope that the Minister, in keeping with his response to the previous debate, can accept it. Discussions on the introduction of changes that involve aviation or shipping should be subject to debate in a proper and full way. That would be very much in keeping with what the Minister was trying to impress on us—that he felt that government decisions would be in accordance with the spirit of the debate on the previous amendment.

I need not take long. I recognise the arguments and, in fact, agree with them. I am in no position to accept the amendment because this is the Committee stage. We need to look back and I am happy to take this away and come back with something positive at Report stage. I could not be clearer than that.

I thank the Minister for a late Christmas present. We on these Benches rarely receive such a response. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 118 not moved.]

moved Amendment No. 119:

On this related matter I have come armed with an incredibly long speech, much of which was covered by what I have already said. We cannot accept the amendments as they stand. What I would say goes with the grain of what we have said about the committee and the way we want it to work. As we have said throughout the consideration of the Bill, we do not want the committee to be executive. Amendment No. 120 would, in effect, give the committee a veto. We could not accept that. However, I am prepared to take the matter away and consider what role the committee might have as regards the thrust of the amendment.

I do not wish to be repetitive in terms of what Britain is doing internationally and we want the committee to take account of what we are doing internationally as well. While we do not think that the committee should be executive or that it should have a veto, on the other hand there is a case for reconsidering whether the committee might have a wider role than that provided for in the Bill. On that basis, I am happy to take the matter away. Otherwise, I am going to go over a lot of detail of what I have just said and that would be superfluous. I am not trying to cut short the debate. The caveat is that we certainly would not agree to the committee having a veto, but we certainly are prepared to look at the circumstances in which we can consider a better role for the committee in this context.

Perhaps I can comment on that. It seems to me quite important, when considering the role of the committee, that the Government should look at the different kinds of advice that it can give. I was taken aback earlier when the noble Lord, Lord Taylor, withdrew his amendment. It seems to me that on a strictly technical matter—such as what is a greenhouse gas—the committee should give very clear advice which the Government should follow. On matters where policy is concerned, it is important that the committee simply gives advice and that the Government put in their political considerations. It is important that there is not one rule which fits all the sorts of advice that the committee can give. On some sorts of advice it really should have the dominant role but on others it should play a subordinate role.

I note what the Minister has said on this. When he talks of the committee not having an executive role, I think he understands the nub of the difference on this issue. In much of our thinking, we see the Committee on Climate Change as being the driver of government across the departments. That has been a point of difference in many of the debates that we have had. Perhaps I may take him back to the discussions that we had on the previous sets of amendments which I felt summarised very well the necessary practical approach that the Government had to bring to the inclusion of aviation and shipping. At that stage, he made a key point: that he felt he needed to use the Committee on Climate Change to provide the information and the determination of these matters to guide the Secretary of State in what to do. In his response he recognised that, in many ways, the Government need to bring into the decision-making process another party, which is what these amendments seek to do. I do not know whether the Minister has any comment to make on what I have just said.

I know the precise point I made on the previous debate, on the point to which the noble Lord has just referred, because the paragraph in front of me was in bold. If officials want me to use certain words they print them in bold, and years ago I made a pledge that anything in bold I would repeat word for word—for the rest, I do not make it up as I go along, but I do not simply read out the essays, well drafted though they are. That is serious because that was the issue of trying to find a methodology to advise the Government.

At the end of the day, we believe that the elected Government should be responsible for taking the decisions. That is why the role of the Committee on Climate Change is crucial. Because of the expertise, the stature, public confidence and the acceptability of the committee that will be put together, we would get to a point where advice is given and one would have to be very unwise not to accept it. I cannot say that that will always be the case, but that can become de facto over a period of time. It is the same in this case, not as regards an executive role but as regards the stature of the committee. That is why it is crucial that we get its role, functions and membership right. We would not want the committee to have a veto, but, on the other hand, we would like to take this matter away and, between now and Report, have a look at it and come back with something that is a little better than we have now.

With that assurance from the Minister, I am happy to withdraw the amendment. I thank him very much for the opportunity to discuss aviation and shipping between now and Report.

Amendment, by leave, withdrawn.

[Amendment No. 120 not moved.]

Clause 25 agreed to.

I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.