The Rt Hon Chris Huhne MP speech to GLOBE Forum, Tianjin

Thank you very much. It’s my pleasure to be here - and to be in Tianjin, the city that models China’s green ambitions. Those ambitions have…

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Rt Hon Chris Huhne

Thank you very much.

It’s my pleasure to be here - and to be in Tianjin, the city that models China’s green ambitions.

Those ambitions have a strong history. For nearly thirty years, energy efficiency has been part of the policy landscape.

The pace of economic development over those three decades has been truly breathtaking.

Only in China could single-digit growth in GDP be considered low.

Alongside world-leading economic development, internal migration has transformed China’s built environment.

People have moved into cities, part of the great global shift from the farm to the suburb.

Energy use, and energy generation, have soared.

The speed and the power of this transformation is unprecedented. But the story is familiar.

Britain, too, once lead the world in economic and industrial growth. We saw urbanisation on a massive scale as people sought new opportunities in emerging cities. We held and broke construction records; the biggest bridges. The longest tunnels. The fastest trains.

The first industrial revolution rewrote the story of Britain. It made us what we are today.

But now we are focused on securing the next industrial revolution: the green revolution.

We are determined to transform our economy.

We are dedicated to developing new clean energy.

And we are committed to international action to prevent climate change.

Globe Forum

On each of these priorities, we face a careful balancing act. To meet the global 2 degree target and create a greener future, we will have to take some difficult decisions.

We are not alone. The representatives gathered here today account for most of the world’s economic activity; and most of its emissions, too. Together, we consume most of the world’s energy, and most of its products.
As lawmakers, our work will be critical. We must get the mixture of legislation, regulation and incentives just right.

For the decisions we take over the next decade will shape the world for generations to come. We owe it to our nations to work together more closely in search of common solutions, and in pursuit of common aims.

That is why I am so pleased to begin my first official visit to China here. Over the past twenty years, GLOBE has made a very real contribution to energy and climate policy.

Now it brings us together in this beautiful city, to discuss the future of energy and climate legislation.

Separate, but together

The study of national legislation in major economies unveiled at this forum shows a diversity of approach, but a commonality of purpose.
From Mexico’s draft climate legislation to South Africa’s draft ‘zero climate’ bill. From China’s stronger renewables law to India’s levy on coal. From the UK’s annual energy statement to Korea’s Green Growth Law.

Around the world, governments are concentrating on - and legislating for - the green agenda.

In the absence of a global plan, each country is finding its own path towards a low-carbon future.

This is a huge multiplication of effort.

But provided we learn the lessons from each other’s experiences, that effort need not be wasted.

That is what this forum is all about.

Together, we can work to better align domestic policy.

In so doing, we can send a signal of our commitment to the cause of internationalism. We can maximise the potential economic benefits of low carbon development. And we can minimise the risk of competitive distortion between countries.

The economic benefits are clear. Globally, the low-carbon and environmental sector is already valued at £3.5 trillion; by 2015, it is projected to reach £4 trillion.

China’s market is the second biggest in the world. And amongst the top 10, the UK’s is the fastest growing.

So on a purely national level, this visitor and his host each stand to gain from allowing this emerging sector to blossom.

But in reality, the more players are involved, and the clearer the rules, the better the game.

By advancing legislation together in accordance with common principles we can maximise opportunity and create a fairer market. Aligning our domestic laws more closely will allow us each to share in the profits that are springing up around green goods and services.

That consistency of opportunity is the promise of the legislative principles on climate change that GLOBE secured last year, and which our host and Chairman Wang drafted together with US Congressman Ed Markey.

UK-China relationship

On each of the priorities I mentioned earlier - energy technology, energy investment and action on climate change - there are real opportunities for the UK and China to do more together.

Already, we have a close partnership.

We work together on more than 30 projects, from financing to emissions management.

Our job now is to take this co-operation further. On technology, research, planning and finance, there are opportunities for genuine bilateral working.

On a Government level, the links are strong. We run joint projects on impacts and adaptation, with a fund operating in three provinces. Our Research Council’s total portfolio of collaborative energy research is with China now stands at £20 million.

The private sector agenda is even stronger. British business is involved in 37% of all CDM projects.

And British companies are working with their Chinese counterparts on everything from better fuels to domestic energy saving.

This is no one-way relationship: the UK needs some £200 billion of investment in new power plants by 2020 to replace our ageing generators and meet our ambitious emissions targets.

We currently have the world’s biggest offshore wind capacity. That record will not stand long. Like us, China also hopes to have 30 Gigawatts of offshore wind capacity installed and running by the end of the decade.

The opportunities for each side are clear. And the desire for closer engagement comes right from the very top. The UK Prime Minister is fully supportive of the GLOBE agenda, and I will be briefing him on the progress we make today.

Dual motivation

The UK’s commitment to a sustainable energy mix is motivated by growing evidence that climate change is a tangible threat.
But it is also driven by more pragmatic concerns.

The first is purely economic.

For too long, our national prosperity was tied to the financial wizards in the City of London.

Risk-taking casino capitalism replaced manufacturing and production, hollowing out our industrial heartlands and creating an economy that was overly dependent on the financial sector.

When the credit crunch struck, were hit hard. We have had to cut public spending to pay down our budget deficit.

In the face of fiscal austerity, is it clear that greening our economy is the best way build a more balanced economy - and to secure more sustainable growth. With thousands of jobs in whole new industries, it is one of the brightest prospects not just for economic recovery, but for growth.
The second reason for our low-carbon transition is security.

As an island nation with dwindling fossil fuel resources, we are increasingly reliant on imported energy. Our energy import dependence could double by 2020.

Energy security is a prime concern.

Our winters are nowhere near as cold as those in Beijing. Nor are our summers as hot as Sichuan.

But we depend on scarce natural resources to keep our people warm and our economy moving.

Regardless of the public consensus on climate change, it is clear that relying on increasingly rare fossil fuels is not a long-term option. We cannot be exposed to the risk of resource conflict. Nor can we afford to remain at the mercy of volatile fossil fuel markets.
Not only are we vulnerable to interruptions in supply, we are also exposed to fluctuations in price. Oil or gas price shocks could reverberate throughout our fragile economy, hampering growth.

A more sustainable supply of energy is not an expensive luxury. It is a critical component in our national and economic security.

We are committed to clean coal with carbon capture and storage. To new nuclear power without public subsidy. To a radical nationwide programme of energy saving.

And to improve drastically our uptake of renewable energy.

Because thanks to a decade of under-investment in renewables by previous governments, we have a lot of ground to make up.

EU-China opportunities

As anyone who has experienced a typical British summer’s day will know, we do not have huge reserves of sunshine.

But the UK is blessed with a large coastline. Strong wave and tidal resources. Shallow seas and plentiful wind. We also have world-leading research and engineering sectors.

Some of the technology we need is already onstream. And some is still in development.

One way we can bridge the gap between our green energy resources and our growing energy demand is by working more closely with our European partners. Already, some electricity is shared between the UK and Europe.

In the future, with better interconnection, we can look toward a European supergrid.

With smarter demand management, so we can use Germany’s wind power and Spain’s solar reserves, balancing loads across borders and sharing our differing natural resources. For UK energy and climate policy, it is clear that our future lies with Europe.

After all, Europe has the world’s most successful emissions trading scheme, and a strong emissions reduction target.

Together with my French and German counterparts, I have argued for an even more ambitious reductions target and a higher carbon price, to drive the carbon savings and green investments we need.

And actually, the EU and China can become real partners in low carbon development.

It is a matter of scale. As the world’s largest economy-in-waiting and the world’s largest single market, we have considerable power if we work together.
The potential for greater EU-China strategic cooperation on climate change is clear.

We can drive down the costs of new technologies, build the green industries of the future and create millions of high-tech jobs.

Like Europe, China’s geographic diversity demands innovative solutions. From the mountains in the East to the sub-arctic North, getting the policy framework in place to encourage sustainable green power generation is a similar challenge to the one facing Europe.

And as China considers a form of emissions trading system to help deliver its ambitious domestic targets, UK and EU experience could prove a valuable resource - including technical and political support for domestic data management and reduction verification.

Global perspective

That verification will be important when it comes to reassuring the developing world that major emitters mean business when it comes to an international deal.

Better, more consistent domestic legislation - and clearer measurement and verification - can help create the right political conditions for such an agreement.

It is important that domestic legislation and targets are brought within the UNFCCC process.

The UN is the right place to ensure that national principles translate into an ambitious global deal.

Such a deal must be firm and fair, so that every nation plays its part. It must be based upon an accurate picture of global emissions, so we know the scale of the challenge and size of the right solution.
And it must be grounded in responsible monitoring and verification mechanisms, so that each country is confident that reductions aren’t just happening on paper, but in the atmosphere, too.

The deal must also make concrete commitments on climate finance. Earlier this year, I spoke at the launch of the Capital Markets Climate Initiative, a new programme to bring private sector finance together with national governments to address challenges on a global scale.

And I will continue to use my membership of the UN Advisory Group on Climate Finance to push for a sustainable, long-term solution to the climate finance problem.

One that breaks down the barriers of understanding between the developed and developing world, and acknowledges the special responsibility that comes with historic and national prosperity.
We have already committed £1.5 billion of fast-start climate finance to help developing nations respond to the challenges of climate change. It is a marker not just of our legacy, but of also our commitment to a greener, cleaner future.

Next steps

Here, in ‘the city where the Emperor crossed the river’, I have seen for myself China’s strengths.

Unparalleled growth. An unprecedented economy of scale. The capital to invest in new projects on a vast scale. And the ability to set a clear strategic direction.

China’s determination to embrace those strengths and plan for the long-term is clear.

First in the world in clean energy capital, with over $34 billion already invested - up 50% in 2009.
Second in renewable energy capacity, with over 52 Gigawatts already up and running and a 79% five-year growth rate.

And an ambitious domestic target; the 40-45% reduction in carbon intensity per unit of GDP by 2020.

This nation has long seen the importance of energy security to economic security.

It was the sixth five year plan, back in the 1980s, which first established energy efficiency as fundamental part of secure and sustainable economic growth.

As Chinese legislators meet to shape the next five year plan, I would encourage them to build on that tradition.

Thank you very much.

Published 1 January 2012