Is Cameron about to terminate green economy critics?

The Prime Minister could not have given a more ringing endorsement of the green economy - now he must fight to advance it

04 Feb 2013, 17:37

This afternoon's Energy Efficiency conference may have started with a rather bizarre video message from Arnold Schwarzenegger, replete with a couple of Terminator gags and a giant ring in the shape of a skull, but it was the Prime Minister's commitment to the green economy that received the Terminator-style resurrection.

In his pre-recorded message, Schwarzenegger praised David Cameron and Climate Change Minister Greg Barker for their commitment to green businesses, recalled how California had embraced policies that ensured it is 30 per cent more energy efficient than the rest of the US, and, perhaps most importantly, reminded everyone that centre right politicians can win elections with an unashamedly pro-green agenda.

Then it was over to Cameron for what was undoubtedly his most important public intervention on the green economy since taking office. The short speech had echoes of last summer's address during which he declared his "passionate belief" that renewables are "vital to our future". But this was a significantly better speech, more bullish in its support for the entire green economy, and more explicitly building on work undertaken by Green-minded Conservatives to highlight the financial, economic, and security benefits that flow from clean infrastructure.

The explicit integration of the need for a greener economy and the need to ensure the UK is more competitive in what the Prime Minister repeatedly refers to as "this global race", only served to demonstrate how central the low carbon agenda is to Cameron's long term thinking.

Equally, the focus on the "opportunity" presented by green industries and the need for businesses and government to work together to promote the many environmental and energy policies that are now in place also hinted at a desire to pick up on the message green business leaders have been pushing for months - namely, that the green economy can deliver some much needed growth to the wider economy.

Finally, it was a speech with real political backbone. Cameron did not exactly slap down his Chancellor and those backbenchers who have taken to booing the Climate Change Act in Parliament. But despite the oh so reasonable tone he always deploys, the audience was left with no doubt that he disagrees fundamentally with those voices in his own party who regard the green economy with disdain.

"My argument today is not just about doing what is right for our planet, but doing what is right for our economy too," he said. "The economies in Europe that will prosper, are those that are the greenest and the most energy efficient... To those who say we just can't afford to prioritise green energy right now, my view is we can't afford not to... Far from being a drag on growth, making our energy sources more sustainable, our energy consumption more efficient, and our economy more resilient to energy price shocks - those things are a vital part of the growth and wealth that we need... When I become Prime Minister I said I wanted Britain to have the greenest government ever and I am as committed to that today as I was then... Together we can make Britain a global showcase for green innovation and energy efficiency."

The contrast in both tone and content with George Osborne's Party Conference argument that environmental regulations are a "burden" and the UK should not lead Europe in the pursuit of emission reductions could not have been starker. At a time when the Tory right is bruising for a fight with the Prime Minister over his support for gay marriage, this speech was a brave, timely, and hugely welcome restatement of his modernising credentials.

There was also plenty to cheer green business leaders, not least in Cameron's response to a question on when a big set piece speech on the environment could be expected. He got a laugh for suggesting he had "learnt his lesson" about pre-advertising big speeches, but he went on to make the important point that thanks to the UK's policy landscape low carbon energy investors in the UK can be 100 per cent confident in the returns they will generate over the next 20 years. "What other industry or business anywhere in the world has got that sort of certainty?" he asked.

The big question now is whether this represents a one-off bit of red meat from the Prime Minister for green business leaders or whether his actions will now match his green growth rhetoric.

Cameron, Barker, and those Lib Dems who have made a similar point over recent months are right to argue that the coalition has underplayed its green policies and achievements over the past two years. But ultimately they only have themselves to blame for not presenting a more unified front in support of the green economy and not trumpeting the opportunities offered by policies such as the feed-in tariff, the Green Deal and the Green Investment Bank. Even today's speech was not press released by Number 10, no copy of the speech was made available, and hardly any of the influential lobby journalists were present (they were probably too busy engaged in paroxysms of schadenfreude over Chris Huhne's guilty plea).

If Cameron wants to attract international green investors and help the UK win the global race, then both he and other senior figures within the government now have to talk up its green economy at every opportunity and simplify a green policy environment that is often too complex and diffuse. A few more set piece green interviews, speeches, and Lobby briefings would be a good place to start, while at a practical level the Department of Energy and Climate Change's new Energy Efficiency Mission needs to be replicated for all aspects of the low carbon economy.

More important still, Cameron's public commitment to green growth needs to be backed up with more ambitious policies and much greater consistency across government.

Green businesses and NGOs frustrated by Cameron's silence on these issues over the past year will welcome this speech, but they will be forgiven asking how, if the Prime Minister regards green investment as critical to our economic and environmental health he won't follow the Committee on Climate Change's advice on decarbonisation of the power sector; continues to sign off on tax breaks for fossil fuels; can appoint Ministers to the departments of environment and energy and climate change who clearly disagree with his stance on green growth; and, most important of all, is failing to orchestrate a response to climate change that is any way commensurate to the scale of the threat we face.

These questions and many more need answering. But for today at least, green business leaders should celebrate such an unequivocal commitment to the low carbon economy and such a clear indication that Cameron is willing to face down his anti-green detractors. They should also reflect on the Prime Minister's argument that government cannot deliver green growth alone and that the onus is on them to start igniting low carbon investment.

There is a long way to go for the government to fully restore green investor confidence after the battering it has received from numerous mixed messages and policy U-turns, but for now it looks like the Prime Minister has said "hasta la vista" to his reticence on the green growth. And for that, it is not just the "Governator" who should be grateful.

  
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