Thanks very much.
I’m delighted to be here, on the first day of the European Future Energy Forum 2010.
And I would like to extend a very warm welcome to all our guests on behalf of Her Majesty’s Government.
Fifty-one years ago, the discovery of the Groningen field changed the European gas market.
It also changed the fortunes of the Netherlands, for better and for worse.
An unexpected natural resource boom warped the economy. A stronger currency depressed manufacturing and exports. And the resulting feedback cycle compounded the problem.
In time, the impact of Europe’s biggest gas field lent its name to a new economic problem: the Dutch Disease.
It shows how easily economies can be damaged by plentiful natural resources.
And it makes Abu Dhabi’s commitment to renewable energy all the more striking.
Despite sitting on the world’s seventh-largest oil reserves, the UAE’s political and capital investment in renewable technology is a lesson in forward-thinking.
In diversifying the economy, it shows considerable foresight.
In refusing to retreat behind protectionist national barriers, it shows real leadership.
And in pushing for international partnership on low-carbon growth, it shows an understanding of the scale of the challenge - and the importance of regional leadership.
From the World Future Energy Summit to the forthcoming Clean Energy Ministerial, the Emirates are leading the way within the Gulf.
With investment in renewables abroad, and an ambitious programme of electrification and clean energy at home.
And the creation of the world’s first sustainable, clean-tech city.
The challenge now is to maintain momentum.
Accelerating energy savings. Capitalising on first-mover advantage. Helping to demonstrate CCS as a working technology, to secure the medium-term future for fossil fuels.
And leading the region toward a more sustainable economic and environmental future.
These are our challenges, too.
But we are hampered by a toxic legacy.
In the UK, we suffered our own version of the Dutch Disease.
Overdependence on London’s financial markets hurt manufacturing and left us badly exposed to the credit crunch.
We are now nursing the biggest peacetime budget deficit in our nation’s history. We have been left an almighty mess to clean up.
Tomorrow, the Comprehensive Spending Review will set out a clear and credible path back to national prosperity.
It will be a difficult day. Inevitably, there will be some sacrifices. We cannot afford to fund everything we want to fund.
But over the coming weeks, you will see clearly the Government’s commitment to a low-carbon economy.
One founded on green growth. With new technologies, new jobs and new infrastructure.
As we meet to sort out the state of the nation’s finances, the contribution of low-carbon technologies, goods and services make a compelling case.
Promise of the low-carbon economy
Even in an era of record-breaking deficits, the numbers are impressive: a global low-carbon goods and services market projected to reach £4 trillion by 2015.
A UK domestic market worth over £100 billion, with a hundred thousand extra jobs up for grabs by 2020.
Two hundred billion needed to rebuild our energy infrastructure by the end of the decade.
The scale is breathtaking.
It is increasingly clear that the transformation of our economy is not just a consequence of the downturn. It is not just an option.
It is the solution.
Today, I want to look at how we can work together; how we can draw strength and knowledge from our collective experiences.
To secure a low-carbon transition on a global scale. With opportunities for investment in the UK, and for UK companies abroad.
When the Prime Minister promised we would be the greenest government this country has ever seen, he meant it. We will deliver the transformation we so desperately need.
To do so, we must build a new kind of economy; one that allows us to compete in the new global growth sector.
The Government’s role in the transition is clear.
Our job is to put in place the right policy framework: to secure investment, stimulate green growth, and manage the transition to a low-carbon economy.
Setting out clear, long-term commitments.
And delivering on our promises.
Demonstrating through our actions that the low-carbon transition is good policy, good value, and a good bet in a volatile world.
Our approach is simple.
We are committed to a radical programme of domestic energy saving. We are determined to clean our supply of energy. And we will continue to push for an international agreement to halt climate change.
What will that look like in practice?
First, we will spark an energy saving revolution.
The cheapest way of closing the gap between supply and demand is to save energy.
The UK has the oldest housing stock in Europe. Most of the homes we will live in by 2050 have already been built. We spend more energy heating our homes than our Scandinavian neighbours.
So we are launching a revolution in energy efficiency, a once-in-a-lifetime refit of our outdated homes to make them fit for 2050.
So we can close the growing gap between supply and demand for energy, and meet our ambitious emissions reductions target.
We will roll out smart meters, looking ahead to a future where our homes are fitted with smart appliances capable of reacting in real-time to fluctuations in the national grid.
Over the coming decades, smart management of electricity will be critical. From transport to heating, it is becoming ever clearer that our future will be electric. We predict a doubling of demand for electricity by 2050.
We cannot afford to let fossil fuel plants pick up the slack. So we are determined to clean our supply of energy.
Our power plants, like our houses, are drastically outdated.
Let me give you a sense of scale: the UAE have set a target of 22 Gigawatts of electricity production over the next decade.
That is exactly how much capacity we will lose by 2020 as our ageing power stations shut down.
With £200billion of investment needed to secure low-carbon energy supply by 2020, the UK presents a unique challenge - and unique opportunities.
A few weeks ago, I opened the world’s largest windfarm, off our southern coast. Over a hundred turbines, each taller than Nelson’s column, and to my mind just as impressive.
Of course, windfarm records don’t last long. Masdar have put half a billion pounds into the London Array, set to become the next record holder, with three times as many turbines - and a Gigawatt of capacity.
As new generation like the London Array comes online, so a new generation of supply and support will spring up.
In engineering, manufacturing, and maintenance, the opportunities will keep growing as our energy portfolio expands.
As in the 1930s, during the last recovery from a depression, new businesses must lead the way. But they must have the confidence to invest in long-term projects for new generation; confidence built on stable regulatory and market frameworks.
We will reform the electricity market, ironing out uncertainties and building a stronger market framework to encourage investment in new clean power.
And we will create a Green Investment Bank, to harness private finance to decarbonise energy generation.
This is one of the best places in the world to invest in low carbon. We have the right structure, the right incentives, and the right market.
We have clear long-term targets. Commitment from government. Incentives, infrastructure and grid investment plans to support low-carbon generation. Deep finance markets to mobilise capital.
An open and clear competition regime. And a welcome attitude to foreign investment in UK energy.
Because to succeed on a global level, we cannot act alone.
To secure the third industrial revolution - the low-carbon revolution - we will have to work together. Across borders, and across sectors.
From the big picture to the small scale, from public sector to private finance, we each have a role to play in delivering the partnerships we need to meet the defining challenge of our age.
On the domestic front, where we must lead by example and create the right conditions for green growth.
In our regions, where we must use our positive influence to work better with our neighbours.
And in international negotiations, where national interest must be tempered by global responsibility.
From the home front to the global stage, there is real scope for collaboration. With our partners in the UAE, in Europe, and beyond.
Take the first ever Clean Energy Ministerial in Washington. 24 countries, together accounting for 70% of the world’s emissions, setting out practical initiatives from smart grids to smart appliances. Next year, the Clean Energy Ministerial moves to the UAE - before you pass the baton to us for the 2012 meeting.
That progression is fitting. The Government is committed to a real, two-way relationship with the Emirates.
One that spans academia, business, and government.
It should come as no surprise that the architects who designed Masdar City are based here, in London.
Nor that a British university, Imperial College, is part of the Masdar Research Network.
And just as Masdar is contributing to the UK’s renewables target, with investments in low-carbon technology, so I expect some of the small and medium sized enterprises at this conference will contribute to the UAE’s low-carbon drive.
The business relationship that sees Masdar funding flow into UK renewables will also see British enterprise and expertise pouring into the UAE.
This exchange will happen at government and international level, too.
Following the successes in Washington DC, the UAE will host the Clean Energy Ministerial in 2011 - before handing over to us for 2012.
The UAE / UK taskforce will meet again in a month’s time, with energy firmly on the agenda. The UK government will be represented at the next World Future Energy Summit.
And we fully support the International Renewable Energy Agency, and will continue to work closely with our partners in the UAE and beyond to ensure its long-term success.
On information, best practice and deployment, the agency is a vital part of the fight to push renewables up the agenda - in the developing world and beyond.
In the absence of a global plan for the low-carbon transition, it is essential that we work in genuine partnerships, sharing and learning from each other.
Until we have an established framework, countries will follow different paths to the low-carbon future.
Our success on a global level depends on our ability to learn from the progress of individual nations. And to apply those lessons on a larger scale.
For us, the European agenda is vital. Just as Masdar can lead the Gulf towards a more sustainable economic and environmental development path, so we can show leadership with Europe.
Together with my colleagues in France and Germany, I have called for a stronger emissions reduction target in Europe, moving from the achievable - a 20% reduction by 2020 - to the ambitious.
A 30% emissions reduction target will send a much stronger signal to investors: that Europe is a great place to do low-carbon business.
And crucially, it puts us on surer footing as we look toward our 2050 targets.
We should not fear ambition.
In setting our sights high, we can not only strengthen the investment potential at home, we can also make a more convincing case on the world stage.
To meet our ambitious renewable energy targets - and protect ourselves and our planet from the impact of climate change - we need co-ordination on policy. Collaboration on finance. And co-operation on the international stage.
The European Future Energy Forum can help make these ambitions a reality.
It is the realisation of a particular vision. One of international co-operation in the journey toward a greener future.
For the low-carbon challenge is a global one.
Just as the problems resulting from unsustainable energy systems will affect us all, so the opportunities for green growth are open to all.
It is up to us to work together to make it happen.
Thank you very much.