James Murray looks back on a year of climate deals, policy U-turns, and steady progress for the green economy
As the myriad end of year round ups have observed, 2011 defied expectation and explanation. The news agenda often appeared to spin out of control, globally significant story crashing into globally significant story, creating an overarching narrative of uncontrollable mayhem. To paraphrase the peerless Charlie Brooker, this was the year that Osama Bin Laden was killed, but you had probably forgotten that already.
The green economy inevitably found itself caught up in this frenzy of news on a number of fronts, some obvious, others far less so.
Most notably, the big environmental story of the year was a crisis. Fukushima followed in the ignoble footsteps of the BP oil spill, providing a tragic reminder of how vulnerable our energy infrastructure remains and how great the risks we take in order to generate the energy our economies need to function.
The crisis also sparked one of those all too frequent bouts of intra-environmentalist conflict, with those opposed to nuclear energy spinning the disaster as evidence of the technology's inherent fallibility and those in favour (including the high-profile convert George Monbiot) arguing that the scale of the nuclear threat was hugely overblown.
What is not disputed is that the fallout from Fukushima has had a huge impact on the short- to medium-term prospects of a global nuclear renaissance. The UK remains committed to a new fleet of reactors, but Japan, Germany, Italy, Switzerland and others quickly moved to roll back nuclear expansion plans or phase out nuclear power altogether. The long-term impact of these decisions should be a boost to investment in renewables, but in the shorter term these countries are likely to see emissions increase as they turn to coal and gas to replace lost nuclear capacity.
Fossil fuels were also evident in one of the other big stories of the year: the Arab Spring. The enthralling and admirable wave of revolutions across some of the world's key oil producers helped keep oil prices above $100 a barrel mark despite the continuing economic woes crippling the industrialised world.
They also provided a timely reminder of the huge energy insecurity the UK faces. Starting with the Libyan rebellion and ending with the first serious challenge to the Kremlin's power in over a decade, we were reminded time and again that the gas and oil imports of the UK and many other nations are supplied by a handful of deeply dubious regimes, many of which have secured power on the back of our fossil fuel payments and are perfectly happy to disrupt the supplies we rely on when challenged. There is a humanitarian, as well as an economic and environmental imperative, to delivering energy independence.
On the domestic front, the big story for the green economy was a non-story. Or rather the government's decision to, publicly at least, push green issues down the political agenda. From summer riots to eurozone crises, royal weddings to Libyan bombing raids, the sheer number of economic and social challenges the coalition faced meant that the green economy was too often denied the oxygen of publicity.
David Cameron did not give a single meaningful speech on the environment all year, Nick Clegg gave only one green speech that I can recall (and it was hardly that memorable), and George Osborne all but declared war on the green economy (and his Cabinet colleague Chris Huhne) with a staggeringly crass attempt to woo the Tory right by attacking the "burden" of environmental regulation and vowing that the UK would not lead the EU in cutting emissions.
This lack of focus resulted in some comically clumsy mis-steps. The U-turn on forestry sell off plans revealed the government's failure to properly understand the depth of public feeling on environmental issues and its willingness to be bounced into a U-turn when faced with well organised protests - it is a lesson ministers may be forced to learn again if they continue with planning reforms that lack the environmental safeguards a fearsome array of green NGOs are calling for.
Similarly, it is hard to imagine that a government that genuinely saw the green economy as a top priority would have allowed the chronic mis-handling of recent proposed cuts to solar feed-in tariffs. Leaving aside the debate over who is to blame for the market becoming over heated and to what level the tariffs should be cut, the handling of the changes has been laughably poor and the decision to effectively impose the cuts to incentives before the consultation period had ended appeared to be designed to invite a court case.
And yet, despite the green economy being frequently overshadowed by the ever accelerating news cycle, significant progress has continued to be made, albeit without much fanfare.
Recent government figures have shown that, despite the recession, the UK's green economy grew 4.3 per cent in 2010 and now employs over 900,000 people. These figures were backed up by a survey from the Co-operative Group showing that the green consumer market grew nine per cent last year. All the indications are that growth has continued this year with venture and capital investment continuing to flow towards clean tech firms and projects, and many green companies expanding rapidly.
On the policy front, the Department of Energy and Climate Change has quietly got on with its business, laying the groundwork for new measures that should be formally launched over the next 18 months. The Renewable Heat Incentive is already up and running and poised to be expanded next year, the Green Investment Bank should begin making investments in some form or another next year, and the Green Deal will launch next autumn providing a spring board for huge investment in energy efficiency. Most importantly, the department has won most of the battles it has fought over electricity market reform and it appears increasingly likely that the UK will deliver an integrated policy framework that drives huge investment in low carbon energy generation.
This gradual yet inexorable progress was mirrored at the UN's climate summit in Durban, where a deal was struck that finally commits all nations to delivering a legal treaty for tackling climate change. Similarly, we saw Australia finally agree its carbon tax, California move towards the launch of its long-promised carbon trading scheme, and China unveil a new five-year plan that will deliver an unparalleled increase in low carbon infrastructure investment.
Inevitably, business leaders have responded to this progress, although, like their political counterparts, they have not made a great fuss about it.
In the UK, we have seen companies such as Siemens, GE, Vestas, Nissan, Mitsubishi and many others announce plans to open clean tech factories in the UK, creating jobs and proving that the UK can play a major role in the fast expanding markets for wind turbine and electric car technologies. In particular, the UK's position as a global leader in offshore wind energy looks increasingly assured as work gets underway off the east coast on one of the largest engineering projects anywhere in the world.
This surge in offshore wind farm investment helped Scotland deliver a record year for investment in renewable energy with barely a week seeming to pass without the announcement of new wave, tidal, wind, hydro-electric, biomass or waste-to-energy plant.
In the much maligned City, we saw the first indications of how large-scale green finance could be mobilised through mechanisms such as the Climate Bonds Initiative, the increasingly influential Carbon Disclosure Project, and a growing realisation among insurers that they need to develop a coherent response to climate change, and fast.
Meanwhile, BT quietly continued with a major smart meter project that promises to slash emissions from its huge estate, while thousands of offices and households were convinced of the merits of solar energy, making renewable energy an increasingly common component of our towns and cities (interestingly a Sunday Times poll revealed that we were pretty happy about this progress with clear majorities supporting wind and solar power).
Electric cars made slower progress, but the Nissan Leaf and Mitsubishi iMiEV helped prepare the market for the emergence of a fleet of electric and plug-in hybrid cars over the next two years.
Finally, Facebook finished the year by making peace with Greenpeace and committing to switching wherever possible to renewable energy, increasing in one swoop global demand for clean energy and sending a clear signal to utilities around the world that progressive corporate clients want green power.
As with the wider news agenda, the green economy experienced a year where at times things appeared to be spinning out of control, a year where twisted priorities and vested interests conspired to create an unremittingly bleak outlook - and yet all the while people quietly continued to invest time, energy, and money in the creation of a green economy that will prove more resilient, more prosperous, and more sustainable than the polluting economy with which we are currently burdened.
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