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Peter Ainsworth: Speech to the Environmental Industries Commission Conference

Having supported EIC events over a number of years, it is great to see how the attendance has grown and the venues have got more and more up-market.

Those are signs of your success, but also evidence that the issues which you address have become mainstream.

An interesting indicator for me of just how mainstream a subject climate change has become is the number of reports that pile up on my desk on the issue.

Some of these are of greater merit than others; and they can come from surprising sources.

Take this quote from a book which has yet to be published in the UK:

"No person or entity, especially the business community, can afford to sit on the sidelines as our natural resources are squandered and degraded. The operating concept is remarkably simple: The business of conservation will generate revenue, whereas a high price will be paid if we ignore the warning signs of our troubled planet."

That was from A Contract with the Earth, by Newt Gingrich, the former Speaker of the US House of Representatives, and no shrinking liberal.

He is also surprisingly critical of the present Washington Administration, referring to a "timid and restrained" approach to global leadership on the environment. "Our country", he says, "needs to get back to the table".

I also get representations from people who take issue with the whole science of climate change.

Of course, I respect their views. In a way, in fact, I hope that they are right, and that the overwhelming consensus of scientific opinion is wrong.

But it would be imprudent not to work on the basis that the climate sceptics are probably wrong.

In any case, today, I want to address an issue which has been too little discussed in the context of climate change. And that is the issue of opportunity.

There was a line in Al Gore's Nobel Prize acceptance address which I really liked, when he spoke of the Chinese script which writes the word "crisis" with two symbols, the first meaning "danger", the second "opportunity".

I firmly believe that, in recognising the dangers posed by climate change, and meeting them, lies the greatest economic opportunity of our age.

We are looking at the industrial revolution of the 21st century. A revolution which is necessary, inevitable, and wholly desirable.

The low carbon revolution.

I read recently that we need only capture 1/10,000th of the sunlight that falls on the Earth in order to meet 100% of global energy demand.

Fred Krupp, the American author of Earth: The Sequel, put it another way: in one hour the sun provides the earth with enough energy to power all of human civilisation for an entire year.

All things being equal (and they might not be) the current pace of advances in technology means that the rate of progress will be 30 times faster in the next 50 years than it has been in the past - and just think of all that we have achieved in the past half century.

I used the word "progress" there. Perhaps we need to think about that.

There is clear evidence that the idea of human progress as an extension of gross domestic product is, at least in developed economies, out of date.

In the last thirty years we have, on average, got richer, but we have not become more contented.

This is a subject for another day.

But the political relationship between the state of the economy and the salience of the environmental agenda probably merits a comment in these troubled economic times.

There are those who believe that a difficult economic climate will knock the climate change agenda off the table.

I do not share their views.

Put simply, it's like saying that because we are in trouble with the bank, we no longer care about our children's security, education, or prospects.

And if it's recession you're worried about, let me remind you that the Stern review tells us that failing to address the economic consequences of climate change today, could result in an economic catastrophe on the scale of two World Wars and the Great depression combined.

If we relax our grip on the challenges and opportunities presented by climate change now, the harsh economic consequences will be a dreadful reality for our children long after the credit crunch has been forgotten.

But now the good news.

Whilst many of the reports piling up on my desk are depressing, even alarming, as they warn of the dangers of runaway climate change, there are other facts that provide confidence and cause for optimism.

The awesome power of nature can be our friend and not our enemy; and then there is the boundless ingenuity and enterprise of the human spirit.

On a more basic level, the even better news is that pretty well all the technologies necessary to avoid dangerous climate change already exist.

We now need to enable them to be deployed across the global market at scale, within the necessary time frame and at a competitive cost against traditional technologies.

There is no doubt that Britain can take a leading role in this.

We have the best natural resources of wind, wave and tide in Europe;

We have an enterprising business culture - embodied by all of you here today;

We have world class research and development in our universities;

And we have the world's largest resource of project finance in the City of London.

Why, then, are we not the Saudi Arabia of renewable energy?

With only 2% of our energy coming from renewable sources, only Malta fares worse than us in the European league tables.

What is going wrong?

I do not wish to question the Secretary of State's sincerity in tackling climate change. No one who knows Hilary could ever suggest that he is not entirely devoted to this task.

I commend him for introducing the Climate Change Bill into Parliament. We have already had much constructive improvement on the Bill from both the Conservative and Liberal Democrat benches in the Lords' and we look forward to debating it further over the coming weeks in the Commons.

But what is clearly missing from this government is joined up policies on climate change between Departments.

How can we be asked to believe that the Government is taking climate change seriously when, as Hilary is busily bringing a Climate Change Bill through Parliament, John Hutton is simultaneously pushing for a new unabated coal power plant to be built at Kingsnorth; and Ruth Kelly is busily facilitating the expansion of Heathrow airport?

Both of these developments would make a mockery not only of the Government's legally binding 2020 and 2050 carbon reduction targets, but they are already in danger of making a mockery of Britain's aspirations to global leadership on climate change.

And what of the RTFO? Is it not sheer madness to cut down the rainforests, or threaten food security in the name of the environment?

Surely, in a rational world quotas should not be imposed for the use of biofuels, at either an EU or UK level, without ensuring that they can be obtained from sustainable sources?

And no decision should be taken on expanding Heathrow without an honest consideration of the true balance between the real (rather than inflated) economic benefits of expansion and the real costs - economic, social, local and global - of demolishing communities and building new runways and terminals.

And, as David Cameron has said, we would not allow the construction of any new coal fired power stations in the UK unless there is carbon capture and storage technology applied to it from the outset. This contrasts with the current Government's meaningless pre-requisite of 'CCS ready'.

We also need a policy to revolutionise our energy supply system in favour of small scale renewable technologies. Feed in Tariffs will provide a twenty year price guarantee to microgeneration technologies, which we believe should, if given a fair chance to compete in the market, be able to provide a substantial proportion of our national energy needs in the years ahead, as well as significantly reducing our carbon pollution, enhancing our energy security, and strengthening local communities in the process.

Feed in Tariffs have worked to great effect in other EU countries, Germany in particular, which can now boast up to 300,000 people working in the renewable industries.

Germany has 10 times the installed wind energy capacity of Britain, and 200 times as much solar capacity.

Which is interesting; because, as you may have noticed, Germany is neither 10 times windier nor 200 times sunnier than the UK.

But there's nothing mystifying about this.

The difference between us and Germany is that they have the right policy mechanisms to encourage their industries to grow at a rate commensurate with the economic opportunity ahead; and we don't.

We must put that right.

My colleague, George Osborne, the Shadow Chancellor, has also set out a range of measures to encourage the development of low carbon technologies. They include the establishment of a new share trading market for green companies; and the creation of a Green savings account: the Green ISA, or GISA. This would provide tax breaks for geezers (or anyone else for that matter) who want to save and help the green economy at the same time.

The Stern Review estimated that the global climate change markets will be worth US$500 billion a year by 2050.

Other estimates put the figure much higher, at around $3 trillion.

The scale of the economic opportunity is immense.

But how much of this huge green economy will be located in the UK?

The Climate Change Bill alone will not convert the economic goals.

The Bill is an important piece of legislation but it is only a framework, a road map for the next 40 years that helps to tell us where we need to get to.

It is not the vehicle to get us there.

The vehicle will be policies. Policies that give the market long term certainty, and correct our existing market failure by internalising the cost of pollution, so that what we pay for goods and services today at least approximates to the price that will be paid by our children and grandchildren for the damage we are doing to the places where they will live.

When these costs are accounted for, when the market begins to tell the truth, then the goods and services which your businesses provide should, and will, prosper.

The Climate Change Bill can play a vital role in this, by setting our overarching emission reduction targets.

But we have a way to go yet.

The Bill has been through the House of Lords and, as I have said, has already seen some significant improvements thanks to the work of the Opposition benches:

For example, the Bill now says that 70% of our emissions reduction must happen at home in the UK and that purchased overseas reductions attributable to us should be limited to 30% of the overall effort.

We didn't defeat the Government on that amendment because we believe in wearing a hair shirt; but because we believe in creating a business environment which will give British entrepreneurial spirit and drive the chance to succeed. We want to help create first mover advantage.

It is amendments such as this that will give businesses like yours the opportunity to prosper as Britain moves towards a low carbon age through dynamic changes at home; rather than paying other countries to do our cleaning up for us.

Another key amendment to the Bill requires the Prime Minister, rather than the DEFRA Secretary, to respond in Parliament to the advice of the Committee on Climate Change.

Since emissions reductions must happen right across every sector of our economy, from housing to transport to public procurement, how could the Secretary of State for DEFRA be expected to be answerable for so broad a remit?

The LibDem Environment spokesman this week described Defra as "a piddling little Department". Whilst I can understand why he said that, it isn't and certainly shouldn't be true.

Under new management Defra has the potential - despite its well known troubles - to be a vital force for improving the quality of life.

I want it to succeed; and we all need it to succeed.

But the truth is that no single Government Department can realistically be charged with delivering the outcomes needed from the Climate Change Bill.

The buck has got to stop at the top.

Yes, it is unprecedented to require the Prime Minister to report in this way, but the nature of the threat - and of the opportunity - is unprecedented too; so Government must respond as never before.

I should add at this point that I am making the assumption that we will, at some point, have a Prime Minister who is actually capable of taking a decision.

There have been many significant changes made to the Bill - but the task of the House of Commons now, and for all of us who care about the future of our environment, global security, and our economic potential, is to keep the pressure up on the Government to prevent them removing or watering down the improvements already made.

And when we make sure that we have the framework right, in the shape of a robust and effective Climate Change Act, I would expect you to push whoever is in Government to ensure that the appropriate policy mechanisms are followed to enable us to meet these targets which we have set ourselves.

So the challenge for public policy makers is to unlock the enormous economic opportunity for businesses like yours. Then, it is over to you.

I hope that you share my aspiration to make our country, and our world, safer, greener, and more prosperous.

If the scientists are right, we don't have much time to do this.

The challenge is great; but the opportunities are greater.

All we need to do is find the courage, vision, enterprise and political will to meet the challenge, and to seize those opportunities which are just there; waiting for us; right now.

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