Britain jumps 13 places to seventh in low-carbon electricity league
Jillian Ambrose THE Treasury’s carbon tax has propelled Britain into the top 10 of a global low-carbon electricity league table faster than any other country, igniting calls from the clean energy industry for the forthcoming Budget to keep the support in place.
The fresh research shows that Britain has climbed from a 2012 ranking of 20th out of 33 industrialised countries to seventh on the low-carbon electricity league table.
The top three include Norway and Sweden, which use vast amounts of hydropower, and France, which relies mainly on nuclear power generation.
Britain’s 13-place leap in just four years is the fastest ascent of any country, according to Imperial College London, which produced the report.
“Britain is reducing its carbon emissions from electricity faster than any other major country, and this has happened because the carbon price and lower gas prices have forced coal off the system – the amount of coal-fired power generation in Britain has fallen 80pc between 2012 and 2016,” said Dr Iain Staffell, from Imperial College.
The tax, known as the carbon price floor, was introduced in 2013 to charge fossil fuel power plants for their carbon emissions.
The market-based measure is currently set at £23 a tonne of carbon until 2020, and is designed as a “top up” to the European emissions trading system, which has languished at £5 a tonne on the Continent over much of the year. The Government has pledged to give further details on the carbon tax in next week’s Budget, but is caught between calls to maintain or lift the tax to boost Britain’s green economy, and fears that it may saddle heavy industry with a competitive disadvantage as the country leaves the European Union.
UK businesses already have the second highest energy bills in the EU, even though British households have some of the lowest across the bloc, because carbon-cutting and social policies add 20pc to the bill. The Major Energy Users Council (MEUC) has warned that many will find the impact swell to 40pc by 2020.
But calls for the tax to continue into the 2020s are strong from low-carbon electricity generators including renewable power operators, nuclear giant EDF Energy and Drax Power, which collaborated on the report.
Drax operates the largest single power generation site in the UK, supplying around 7pc of the nation’s electricity. In the past the plant was fuelled entirely by coal but Drax now produces around 70pc of its electricity by burning renewable biomass pellets.
Andy Koss, the chief executive of Drax Power, said it is “vital” that the Treasury maintains the carbon price in the Budget if the UK is to meet its climate change targets.
“Without it we could see a reversal of the impressive results achieved so far – look at what has happened elsewhere,” he said.
While coal generation has fallen in the UK, Dutch coal-fired power plants have ramped up due to the sluggish European carbon price, causing emissions in the Netherlands to rise by 40pc between 2012 and 2016. By Lucy Burton ZURICH has become the latest insurance giant to cut ties with coal-intensive businesses, bringing the amount insurers have pulled from these companies to around $20bn (£15bn) in just two years.
A growing number of insurers are trying to distance themselves from fossil fuels amid climate change concerns, with coal mining the biggest single source of carbon dioxide emissions from human activity. Zurich has decided to pull money and stop offering insurance to companies that depend on coal for more than half of their turnover, announcing a change to its policies months after Greenpeace wrote to the world’s largest insurers urging them to take action.
French insurance giant Axa was the world’s first financial institution to divest from coal, removing hundreds of millions of euros-worth of coal investments in 2015, with Allianz following suit some months later. Swiss Re and Lloyd’s are set to unveil new policies in the coming months. Fifteen insurers with over $4 trillion in assets covered by coal divestment decisions have now changed, or are planning to change, their policies around coal, with $20bn-worth of investments so far pulled, according to a report published by the Unfriend Coal campaign.
“Coal needs to become uninsurable,” said Peter Bosshard, Unfriend Coal coordinator. “If insurers cease to cover the numerous natural, technical, commercial and political risks of coal projects, new coal mines and power plants cannot be built and existing operations will have to shut down.”
He added that because insurers managed around $31 trillion of assets they had the power to shift money away from coal and towards clean energy, accelerating the change towards a lowcarbon economy by blocking the funding for new coal mines.
Backed by a number of organisations including Greenpeace, Rainforest Action and ClientEarth, the report also ranked the world’s biggest insurers by their climate change policies.