Blueprint for a Green economy – the Conservatives’ paper on the economy, energy and the environment

I have been reading a document published by the Conservative Party called “Blueprint for a Green Economy, written by John Gummer and Zac Goldsmith as a submission to David Cameron’s shadow cabinet. I have been very critical of the Labour government’s energy policy and in the interests of balance I thought that I should turn my attention to that of the party that hopes to form the next government, probably in two or so years’ time.  

I should say at the start that there is much useful work and some good insights, but writing submission papers is a whole lot easier than formulating and enacting policy.  I think that Mr Gummer and Mr Goldsmith have identified the problem, but have not proposed a solution.  

They point out that energy policy was traditionally founded upon “four pillars” – that of carbon reduction, security of supply, competitive markets and affordable energy. They now assert that carbon reduction is the foundation upon which the remaining three pillars rest.   The Labour Government’s Energy White Paper in 2003 talked about four cornerstones – decoupling economic growth from energy use and pollution, security of supply, affordability and abolition of fuel poverty.

That analysis was foolish and wrong, and the present Conservative submission paper is a better analysis but is also flawed, but not as flawed as the White Paper. Slowly we seem to be getting somewhere, but it seems to take an age.  I think that energy policy has to rely on principles of energy use – which I set out in “the Energy Age” and also in my essay of 31st December 2007, which you can find on this website.   

If you are going to found energy policy on reduction of carbon emissions then you have to realise that heating will be less affordable than it is today. If you are going to found energy policy on carbon reduction then you also have to either regulate the production of carbon or else you come into conflict with the pillar of “competitive markets”.  Unless you discover new sources of oil and gas in the United Kingdom you will only get a genuinely secure supply if you base your energy policy around green microgeneration – solar panels on very house providing heat, local PV panels producing some electricity, lots of wind turbines and similar measures required by law.  

Mr Gummer and Mr Goldsmith write in their Blueprint for a Green Economy that the Government must send a clear and unambiguous message that it is committed to changing our economy into a low carbon economy. Despite the spin and despite the initiatives and publicity, I write as someone who runs the United Kingdom’s largest flat plate solar panel company and I know that this message has not been sent by the Government.  I deeply worry that the Government “speaks with forked tongue” because the real policies – like the zero carbon new home stamp duty allowance worth £15000, that no one will be able to claim, or the highly flawed Low Carbon Building Program, or the earlier suggestion to abolish the Merton Rule, or new nuclear power stations do not provide any route into a low carbon economy.

They simply are the same old policies, with no desire to change and no cash to change.  

Traditionally and as a matter of philosophy, the Conservatives like free markets and choice. I like free choice, but free choice does not enable someone exercising it to do so at the expense of someone else. There is no right to pollute or harm others and so I think that the Conservatives had better embrace this fact if they are to be taken serious on the environment.  It is a shame, but I am sure that energy supply is rapidly moving out of the free market and beyond consumer choice. A free market will take the lowest cost option in money terms, not in carbon emission terms, as will choice.   Energy has to be as regulated and as state controlled in the same way that the armed forces have always been in modern times. We do not hire mercenaries and auxiliary armies but we control our own, pay for them ourselves and run them ourselves as a nation. That might create some efficiencies but we do not want the army to be under the control of a multi national companies, and nor do we want our energy to be under such control.  So we have to control all our energy; it is as important to us as our defence.

There is a place for the free market within what has to be done, but it must operate within very strict guidelines and regulations. The submission paper recognises this; it talks of the need for “absolute” enforcement of energy standards. They talk about the need to invest and stimulate and to encourage decentralised energy. It recognises that the present institutions, designed in the 1990s no longer “support the new commitment to reducing carbon” and the need to resolve conflicts – and there are many of them – so that the energy economy may be reformed.  The time has past for sending signals as to what people should do. The Conservatives, as I said have identified the problem very accurately and I commend them for that. The Blueprint for a Low Carbon Economy identifies and correctly describes much of what those involved in the low carbon economy have been saying for some years. They now have to grasp a nettle which may be very unfamiliar to Conservative hands.