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David Cameron: The choice isn't between economy and environment

In a speech today to environmental leaders, David Cameron said:

"Today, I want to tackle an argument that seems to be as cyclical as the economy. The argument that when times are good, we can indulge ourselves with a bit of environmentalism - but when the economic going gets tough, the green agenda has to be dropped.

"According to this argument, protecting the environment is a luxury rather than a necessity - and it's a luxury we just can't afford in an economic downturn. I want this generation to be the one that bucks that trend: to be the generation that finds a way to combine economic, social and environmental progress.

"We will only do that if we develop a strategy for realistic environmentalism - not ignoring economic realities and just pressing on regardless but understanding economic realities and using them as a spur to innovation and imagination.

"I understand that right now the cost of living is the number one concern for Britain's families. And I understand, with that backdrop, why people might think fighting climate change seems a costly diversion. But those who say we've got to choose either the environment or the economy, who say, "look, we can't tackle climate change. Going green will cost too much when the cost of living is already too high. Tough emissions targets will damage our industry and business…" they've got it exactly wrong.[1]

"The truth is: it's not that we can't afford to go green - it's that we can't afford not to go green. When oil is moving towards $140 a barrel, when families are being hit hard every time they pay their gas bill, fill up their cars or do the weekly shop, are you telling me we shouldn't - we can't - go green? We've got to.

"The era of cheap oil is well and truly over. So whether we need to cut our carbon or not - which we do. Whether you believe in climate change or not - which you should. For the sake of our future prosperity and our current cost of living, we must wean ourselves off our dependence on fossil fuels and go green.

"Today I want to make my position on this absolutely clear. We are not going to drop the environmental agenda in an economic downturn. But neither will we ignore the rising cost of living and the fact that people are hurting. So we will take forward our green agenda in a way that strengthens the economy - not 'green' or 'growth', but both. And we will take forward our green agenda in a way that strengthens family finances - as we said in the local elections last month: Vote Blue, Go Green, Save Money.

Scale of Change

"We won't achieve this with half-measures or a half-hearted attitude. We'll only get the big benefits of going green if we're really ambitious and really change the way we do things. What I'm talking about is one of the most radical technological and social shifts for generations. I'm talking about reconfiguring our whole economy and overturning our whole hydrocarbon dependency.

"I'm talking about completely changing the way we heat our homes, travel to work and produce our food. I'm talking about bringing into everyday use technologies that are still in laboratories and developing in the laboratory technologies that haven't even been thought of yet. Of course this won't happen overnight. But it won't happen at all without public and political will. That is the great challenge for our generation.

Blue/Green Charter

"And I believe it is a challenge that the Conservative Party is now ready to meet because we understand both the environmental imperative - the need for a green revolution and the economic imperative - the need to achieve this revolution in a way that strengthens our economy and strengthens family finances.

"There are five key features of our approach and I want to set them out today. They are, if you like, our Blue/Green Charter. First, we believe in harnessing the power of markets and creating commercial frameworks that give businesses the confidence to invest in innovation. Second, we believe in green taxes, but only if they change behaviour, and only if they are replacement taxes, not new taxes. Third, is the action we take must secure our energy supply. Fourth, it must prioritise energy efficiency. And fifth, we must renew our national transport infrastructure.

"Let me take each in turn.

Markets and Innovation

"The first point in our Blue/Green Charter is markets and innovation, and that's because they capture the optimism that I think we should all have when it comes to this issue. I've never believed that our fight against climate change should be approached with an attitude of 'can't': 'you can't fly, you can't drive, you can't buy a new TV'. It goes against the grain of human nature - and it just annoys people. Instead, we need to focus on what can be achieved.

"We can create the green products and services, the clean cars and the energy-efficient planes, that will transform our environment and our economy. All that needs to happen is for government to give our businesses, our industry, our innovators, the certainty they need to research, develop and invest. Let me give you two concrete examples of what I mean.

Green Cars

"The first is green cars. It's obvious we will never become truly green if our cars continue running exclusively on petrol and diesel. And it's equally obvious that we should never expect people to give up driving. So it's clear we that we should be doing all that we can to deliver the technology for greener cars.

"This won't happen through a retrospective tax on cars bought seven years ago. If you want businesses and individuals to make green choices, green plans and green investments, they need certainty for the future, not punishments for the past. That's why we've set an aggressive long-range target to bring the average emissions level for new cars down to 100 grammes per kilometre by 2022. This sends the clearest signal to the market - get researching, get developing, get producing, because if you don't, you won't survive.

"But I want us to go further. I want Britain to be the world leader in hydrogen fuel cell or battery powered cars. Can you imagine the impact, not just on our carbon emissions but on the quality of life in our towns and cities, if we moved en masse to such new, green technology? The Americans might have been slow in getting climate change - but they're anything but when it comes to getting the technology. They've committed so much effort to making battery cars a reality - why aren't we?

"Of course there are challenges of scale, affordability and viability. But let's be optimistic - and ambitious. As John F Kennedy said of his vision of an American on the moon by 1970 - a goal that at the time seemed impossible to achieve: "We choose to go to the moon in this decade not because it is easy, but because it is hard, because that goal will serve to organise and measure the best of our energies and skills." We need a JFK vision for clean cars today. And in the months ahead, we will be publishing our proposals to transform the shape of car travel in Britain by 2030.

Carbon Capture

"The second example of the potential power of markets and innovation is carbon capture and storage. Right now, our generation has the chance to change our whole relationship with coal and transform the way we generate energy. By capturing the carbon dioxide produced in generation and burying it underground, CCS could reduce our coal-based carbon emissions by up to eighty-five percent. We really could get the energy we need without harming our environment.

"This isn't a distant dream. CCS is truly within our grasp. And we in Britain have got what it takes to make that a reality. We've got an army of experts who have worked for decades in the energy sector. We've got a manufacturing and energy industry that wants to invest and get things going. What's more, we've got the depleted oil and gas fields in the North Sea in which to store the carbon.

"But again, all industry and business are getting from the Government are mixed messages. They're saying "yes" to unabated coal at Kingsnorth. But "well…maybe….erm…we're not sure" to BP and Scottish and Southern's planned gas CCS plant at Peterhead, before seeing it go to California. Oh…but they want a single CCS demonstration project competition. No wonder that E.On announced they would make no further decision on Kingsnorth until the Government made it clear what their policy on it was.

"Compare this confusion to the clarity in California. Governor Schwarzenegger's made it explicitly clear that new coal plants cannot be built without CCS. And as a spur to CCS innovation, he's brought into law the California Greenhouse Gas Emissions Performance Standard. It requires all new power generation serving that state to have emissions no greater than 500 kg of carbon dioxide per megawatt hour. That's the equivalent of a modern gas-fired power plant - the cleanest and most efficient of the hydro-carbon technologies.

"The thinking is simple: just like we have standards set for fridges and other appliances, so too should the energy industry have its own minimum performance standards…and then it's up to the market to compete. That's the right solution for the post-bureaucratic age: non-prescriptive, setting a standard, letting the market do its job. It sends a clear signal that dirty energy has no future in the market, that the cost on carbon pollution is here to stay and that long-term investment decisions must take this into account. This is what we need here - the certainty for businesses to invest in new technology.

"So that's why I can announce today that a Conservative Government will follow the Californian model, and implement an Emissions Performance Standard. This would mean the carbon emissions rate of all electricity generated in our country cannot be any higher than that generated in a modern gas plant. Such a standard would mean that a new generation of unabated coal power plants could not be built in this country.

"And I can also announce that a Conservative Government would take money from the auctioned EU Emissions Trading Scheme credits and use it to fund at least three CCS demonstration projects over the next five to ten years. But I don't just want to wait until we're in government to us on the path to CCS. I want to do all that we can in opposition.

"Right now, there's a massive barrier to the development of CCS in our country. The work to establish which potential sites could be used for storage is very technical, very expensive and there is limited expertise to do it. What's more, there is also no agreement on who should pay for this scoping work - the government or the oil and gas companies? As a result, it's not being done.

"So we're going to set up a panel of experts to advise on how to move matters forward - that way, CCS can be a reality sooner, rather than later, and in Britain rather than everywhere else. And be clear what that means. By making Britain one of the world's test-beds for CCS, we could be global pioneers in both pre- and post-combustion technologies and export our expertise worldwide.

"By funding three demonstration projects, we could have the beginning of a CCS pipeline system which future British - and European - companies could plug into. And by sending out the clearest market signal yet to UK power developers that their product must be clean, we can propel further innovation within our energy sector. So harnessing the power of markets and innovation by giving businesses a secure framework for investment.

"That's the way we'll get greener cars. That's how we'll get greener coal. That's what I mean when I say we can go green and strengthen our economy at the same time.

Green Taxes

"The second point in our Blue/Green Charter is the use of green taxes to change behaviour. Let me tell you what this isn't. Two words: Gordon Brown. He just doesn't get it. He gives green taxes a bad name because he just sees them as a way of raising revenue.

"Just look at the complete mess he's made of vehicle excise duty. Forget, for a minute, that he's penalising people for a choice they made seven years ago. Just do the maths and you understand his priorities. This will raise £1 billion for the Treasury but have a minimal affect on cutting emissions.

"We will be different. We understand that green taxes, properly used, are a key way of encouraging investment in - and take-up of - green technologies. But we also believe that any revenue raised should be offset by tax reductions elsewhere. Higher taxes on the things we want to discourage - like pollution. And lower taxes on the things we want to support - like families.

"That's why with a Conservative Government every additional penny raised from green taxes will go into a separate pot - a Family Fund which will be used to finance tax relief for families. Green taxes as replacement taxes, not new taxes. That's what I mean when I say we can go green and strengthen family finances at the same time.

Energy Security

"The third part of our plan is to increase our energy security. We've got to wake up to the fact that relying on oil and gas isn't just bad for our wallets, isn't just bad for our environment, it's also bad for our national security.

"Let me put it another way. Say we could start our economy from scratch. Would anyone suggest creating a system in which we're dependent on a fuel that not only has wild fluctuations in price that are almost entirely beyond our control but a fuel that comes from some of the most unstable areas of the world and is often under the control of autocratic governments? Of course not. And we shouldn't put up with it today, either. That's why we have to diversify our energy supply.

Decentralised energy and micro-generation

"One important way of accelerating that move away from dependence on imported oil and gas is to increase domestic renewable energy. Last year, we announced our plans for a decentralised energy revolution.

"Make no mistake about what a massive change this is. For decades, producing energy in Britain has largely been the responsibility of government and big energy companies, and largely been reliant on fossil fuels.

"Our way is different. Not one based solely on large energy providers but based also on small, local providers - homes, businesses, hospitals and schools - producing energy for their own use, and getting paid for it. Not one based on fossil fuels…but one based on cleaner - and cheaper - energy sources like combined heat and power, and solar.

"We will introduce a new system of 'feed-in tariffs', by which people are paid for the energy they produce. It's worked in Germany - where they now have over 200,000 people working in the renewable industry sector. And it can work over here: a huge increase in micro-generation thanks to our decentralised energy revolution.

Tidal Power

"But real diversity and security of energy demands more large-scale renewable energy as well as small-scale domestic renewables. We must make better use of the great natural benefits we have: and there's one area in particular that I'm really excited about. Britain's coastline is over 11,000 miles long and has some of the highest tidal ranges in the world. And tapping into this free, continually renewed energy source could, according to some research, provide us with up to 20 percent of our electricity needs.

"We're already world leaders in marine renewables technology. In March this year, the first commercial tide turbine in the world was installed in Strangford Lough in Northern Ireland. And later this year, the first wave energy power station in the world - developed in Edinburgh - will be installed off the coast of Portugal. But now's not the time to sit back - now's the time to hammer home this advantage.

"You know how much money the Marine Deployment Renewables Fund has given out in the past four years? Not a single penny. Where's the ambition? Where's the vision? Where's the leadership? I don't believe that we can wait around for years before we invest in developing new and cost effective technologies to harness wave and tidal power in Britain.

"That's why I am today committing a Conservative Government to making this research and development a priority for Britain - right at the top of our green agenda. The next Conservative government will put rocket boosters behind this area of research. We will insist on finding the best prospects for development and on using the Marine Deployment Renewables Fund to invest in that development without delay.

"But we can't wait until Mr Brown calls the election. The need for research and development in tidal and wave power is too urgent for that. So we are going to apply pressure on the Government right away. That's why I have asked Alan Duncan to force the Government to come to the House of Commons and explain why so little has been done for so long. We will use the parliamentary time we are allocated to make sure that debate happens. We're going to do everything we can to make Britain the force for clean, green, marine energy.

Nuclear

"But energy security is not just a question of renewables - whether on a small or large scale. This is an area where we have taken a responsible long-term view, avoiding ideological posturing. We have set out a framework in which nuclear power stations can be built, but not with blank cheque subsidies from government.

"Gordon Brown, by contrast, has just been playing politics, calculating that this can be some sort of macho political 'dividing line' all from someone who has been in government for a decade and hasn't actually commissioned or built a single nuclear power station. Instead of endless posing on this issue - I've lost count of the times I've woken up to hear a rehashed announcement from this government on nuclear power he should be doing things now like feed-in tariffs that could deliver the real energy security of a more decentralised energy system.

"But of course he's not interested in real change - just using policy making to try and make a political point rather than solving problems. 10p tax, 42 days, nuclear power - with Brown it's always about the politics, never the policy. And at heart that's why he is proving to be such a bad Prime Minister.

"So, making our energy supply securer and cheaper through a decentralised energy revolution and a real vision for marine renewables. Both are strong examples of the principles behind the Blue/Green Charter I'm setting out today: both examples show how we can go green, strengthen our economy and help people save money.

Energy Efficiency

"And that certainly applies to the fourth part of the plan: energy efficiency. The amount of energy we use in our homes, and the carbon this emits, has two components. The first is the mechanical efficiency of everything we use - from power stations to our PCs. Through regulatory and other interventions, government can influence these mechanical efficiencies, and the next Conservative Government certainly will.

"But the second component of energy efficiency is how efficiently we actually use the things in our homes. Our behaviour is more difficult for government to influence. But it's not impossible - and again, technology can help.

"Smart meters have the power to revolutionise people's relationship with the energy they use. They give more accurate bills. And they give real-time energy displays in your home- letting you know your energy use, cost and carbon emissions. No more craning your neck with a little torch as you try and find your electricity meter at the back of some cupboard but the information you need to slash your energy consumption right there at your fingertips.

"This is the kind of power people want - real-time, responsive and putting them in control. That's why we have made a commitment, as part of our decentralised energy revolution, to ensure that smart meters are installed in every home in the country. But there's another way - a post-bureaucratic way - we can try and influence behaviour and encourage people to be more energy efficient.

Social Norms

"In the jargon - it's called positive social norms. In plain English - it's the idea that one of the biggest influences on our behaviour is what we think is expected by the society around us, and what we see other people doing. So, if we see that all our neighbours' recycling bins are full, we end up recycling more ourselves. And research in America has shown that the same is true for energy efficiency. If we find out that our neighbours, or households similar to ours, are using half as much energy as we are, then we're much more likely to bring our own consumption down in line.

"So how can we help people find out how much energy they're using compared to their neighbours? There's a simple answer: energy bills.

"So I can announce today that a Conservative Government will make sure every gas and electricity bill contains information that allows each household to compare their energy consumption with other households. This isn't government telling people what to do. It's post-bureaucratic policy making - not pulling bureaucratic levers from above and imposing a centralised view on the world, but understanding why people behave in certain ways, and then giving them a nudge in the right direction. Our drive for energy efficiency, with a smart meter in every home and real life energy use comparisons on every bill - these are simple and effective ways of going green and saving money.

Transport

"The fifth part of our Blue/Green Charter - and a vital part of the change we want to bring - is to renew our national transport infrastructure. We've got to transform the way we get travel in our country - not just because of the environment but because of our economy.

"Gridlocked roads. Slow, packed and expensive trains. Our country is grinding to a halt - and we need big changes in our infrastructure. High speed rail to connect the country quickly. Giving parents a real alternative the school run to ease congestion. Tackling our worst road bottlenecks. Opening up the capacity of our ports. These are all part of a serious long-term national transport plan. What is not serious is the Government's approach to another vital part of our transport infrastructure - Heathrow Airport.

"Why on earth are they so hell-bent on pressing ahead with a third runway at Heathrow without a proper and rigorous analysis of whether we need it? Just like their approach to 42 days detention, this is about political positioning, not getting the substance right. Gordon Brown says a third runway for Heathrow is vital for the future of our economy - that we won't be able to compete without it.

"But if you get behind the headline, his argument falls apart. For example, the case for a third runway is based on Heathrow as an even bigger hub airport with a massive increase in the number of transfer passengers. The economic value of transfer passengers is hotly disputed. And there are so many examples of the hub model going wrong.

"It contributed to the bankruptcy of almost every US airline that has gone out of business over recent years. And it contributed to European failures like Sabena as well. Why? Because passengers are people, not statistics.

"Faced with airport inefficiencies like missed connections, lost baggage and delayed flights, passengers will vote with their feet and go elsewhere. After the recent fiasco at Terminal 5, there must be severe doubt about whether the Government and BAA are even capable of managing the expansion of Heathrow to cope with over 700,000 flights a year by 2030.

"I think the whole country can agree that the most important priority for Heathrow is making it better, not bigger - and yet Gordon Brown is pig-headedly pursuing a third runway just to try and prove a political point. What a ridiculous way to plan for the future.

"The Heathrow argument is not one where you have the economic case on one side and the environmental case on the other. There are now increasing grounds to believe that the economic case for a third runway is flawed, even without addressing the serious environmental concerns. The important decisions for our economic competitiveness - and for ending the national embarrassment of the state of Heathrow are the competition issues around BAA, looking at how our airports are managed, and seeing what can be done to make them better.

"If we get those decisions right, as part of a serious long-term strategy for renewing our transport infrastructure, we can go green while strengthening our economy.

Conclusion

"So now is not the time to lose our nerve over the green agenda. With the right political and business leadership we can go green while strengthening our economy and saving people money.

"If we harness the power of markets and innovation, we can create the products and services that will transform our economy as well as protecting our planet. If we use green taxes to change behaviour and see them as replacement taxes not new taxes, we can get people off fossil fuels without increasing the cost of living. If we diversify our energy supply we can have cheaper, cleaner and more secure energy. If we drive for energy efficiency, we can reduce emissions and cut people's bills. And if we renew our national infrastructure, we'll be helping our economy to compete as well as helping to improve the quality of life today and into the future.

"The choice really isn't between the economy and the environment. The choice is between progress and the past. And it is entirely in our hands."

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