Today in Brussels, a large group of key EU Ministers and businesspeople, including UK Secretary of State for Energy and Climate Change Edward Davey, will meet to discuss green growth. They all have a stake in resolving a challenge which, although it is crucial to the countries represented, stretches far beyond them. How can countries in Europe tackle climate change, ensure secure and affordable energy supplies, maintain businesses’ competitiveness and, importantly, keep domestic bills down?
The Green Growth Group of Ministers from 13 like-minded EU Member States, including the UK, meets regularly to help drive Europe in a low-carbon, pro-growth direction. Together it represents 75% of Europe’s population, 85% of Europe’s GDP and 60% of the votes in the Council of Ministers. As set out in its joint publication today, Going for Green Growth: the case for ambitious and immediate EU low carbon action, the group believes that we can turn the necessary action to tackle climate change into an opportunity, not a burden.
The latest report from the International Panel on Climate Change makes the situation crystal clear. If we continue to pump greenhouse gases into the atmosphere at the rate we are now, we’re heading for a world potentially 4°C hotter than today. According to UK Government-commissioned analysis published today, to keep climate change within the 2°C threshold scientists agree will be manageable, by 2030 the EU will need to reduce emissions by at least 50% on 1990 levels.
Europe has made a good start in making the necessary transition to a low carbon-future. But more needs to be done. The 2020 climate and energy targets are fast approaching their sell by date and need to be projected forward to 2030 and beyond. The EU Emissions Trading System needs radical surgery if it is to achieve all that it was put in place to do. In two years’ time world leaders will meet to agree a global and comprehensive climate change agreement; we do not have long.
Constructing modern low-carbon energy infrastructure across Europe will provide jobs for EU citizens, profits for EU businesses and growth for EU economies. It will also improve the EU’s energy security, reducing dependence on expensive fossil fuels imported from risk-ridden regions, in favour of home-grown energy. In the long-term, this course we have chosen will help keep our energy bills down.
Low carbon business is big business: globally, it is worth around €4 trillion a year; 4% annual growth is expected for the next five years; it supports almost 8 million jobs across Europe, with the capacity for millions more. EU Member States have a 22% share of this global market, compared with a 19% share for the US, 13% for China and 6% for both India and Japan. This is worth over €900bn a year. So the prizes are significant.
But the EU’s competitors, led by China and the US, are aggressively targeting the low carbon goods and services market. Global clean energy investments have grown sixfold since 2004 to nearly €195bn. In 2009, the EU gained 40% of that investment. Last year that share had fallen to just 25%.
This is why we must act together - and ambitiously - to maintain and build on our leading position in clean technology.
As a priority, we need to provide confidence and stability for potential investors. Businesses want a good reason to continue investing in low-carbon Europe, which is why the Green Growth Group is clear on the need for an ambitious EU 2030 Energy and Climate Change package, which would give businesses and investors the confidence to invest now.
We will also need to complete the internal energy market. To function properly and integrate a new generation of low carbon electricity supplies, we must ensure the free and unhindered flow of low-carbon electricity across Europe’s borders.
And this must be done at a cost that is as low as possible – to our citizens and to our businesses. This means that countries need the flexibility to decarbonise in the way that best suits them. But specific help may also be needed. Like many countries, the UK has put in place measures to ensure that our energy-intensive industries are supported through the transition, in line with state-aid rules. We also keep under continuous review the impact our domestic green policies are having on energy bills. This is of primary importance in these financially difficult times.
There is simply no possibility of achieving our shared aims – energy security which both our societies and our planet can afford – without working together. When negotiating with the super-economies of the US, China and others, by acting as one on climate change, the nations of the EU are vastly more influential than if they were acting alone.
Countries whose Ministers are signatories to the Green Growth Group pamphlet are: UK, Germany, France, Italy, Spain, the Netherlands, Portugal, Belgium, Denmark, Sweden, Finland, Slovenia and Estonia.