Green industry should be at the heart of Britain’s growth, says ffinlo Costain

In his first speech as Labour party leader Ed Miliband said, ‘No plan for growth means no credible plan for deficit reduction.’  He’s right. But where will growth come from?

When Miliband was energy and climate change secretary the answer was clear: it would come from delivering a low carbon economy in Britain.  But the framework for that transition, set in place by Labour when in government, is now under sustained attack by the treasury, despite David Cameron’s pledge that his would be Britain’s ‘greenest-ever government’.

Many fear that the comprehensive spending review on October 20th will be the death knell for the renewable heat incentive, the green deal, the green investment bank, essential port development, and even the department of energy and climate change (DECC) itself.

Politicians such as shadow energy minister, Emily Thornberry, representatives from greenpeace, friends of the earth, and the TUC, as well as business leaders from the micropower council and the federation of master builders have articulated the need for concerted pressure to ensure the Tories and Lib Dems live up to their pre-election and Coalition Agreement promises.

As DECC minister, Miliband developed Labour’s blueprint for a low carbon economy, which sought to ‘create 1.2 million green jobs in areas such as renewables, nuclear power and clean coal,’ and ‘change the way we produce goods, heat our homes and use transport. ‘

His vision for the future must be just as clear, now that as leader he has the power to focus and define Labour’s policy ambitions.

The ‘optimism’ he spoke of in his conference speech must centre on a low carbon economy, which will offer Britain the chance to create growth through research, manufacturing, employment and infrastructure, and maintain its competitive advantage in the world.

50% of DECC’s budget is currently spent dealing with nuclear waste. If it suffers further budget reductions of 40% it will essentially cease to exist. Chris Huhne is fighting hard to retain a viable department with a realistic budget, but there are fears DECC will be consumed by the treasury and become little more than a desk gathering dust in the corner of George Osborne’s basement.

Perhaps the most likely outcome is that DECC will retain its separate status, but that its budget will be savaged and its power lost. After all, shortly after taking office David Cameron told reporters he was the ‘fourth minister’ in that department.  If it were to be lost the prime minister would be seen as having ceded enormous power to the treasury.

The existence of DECC itself is perhaps less important than the future of its programmes.

The feed in tariff (FiT), designed to incentivise microgeneration, has been phenomenally successful.  Ofgem records more than 10,000 installations since the policy was introduced last April – a huge surge in micropower’s popularity.  But there’s concern that the reward for success will be a reduction in FiTS values even before the scheduled review in 2012.  This concern has created uncertainty, with potential loans and deals already falling through.

Similarly, despite initially warm words, the renewable heat incentive, which aimed to develop the market for small-scale combined heat and power, is also under threat and may be lost in the CSR.

The green investment bank was one of the biggest ideas of the last government.  The bank, which economists, businesses and NGOs suggest needs capitalising with £6bn, aims to generate £100bn in investment in low carbon industry from the private sector to help ensure Britain becomes a world leader in low carbon technologies.It looks almost certain that the GIB, if it’s created at all, will be capitalised with just a fraction of what’s necessary to produce the industrial jump-start it was poised to deliver.

Even the much-vaunted green deal, which aims to incentivise insulation and other energy-saving measures in the UK’s 26 million homes, has become little more than a glorified loan scheme, unlikely to be taken up by the vast majority of Britain’s fuel poor.  Nearly a third of UK carbon emissions come from people’s homes.  A Green Deal that fails to deliver incentives for the poor, the elderly, or those in rented accommodation will ultimately fail to deliver the emissions reductions it initially set out to achieve.

Perhaps the greatest illustration of the government’s attitude to green industry is the likely scrapping of the port development fund.  £60m was allocated in Alistair Darling’s final budget for port upgrades in the east of England. These upgrades would enable UK ports to handle the massive turbine blades that will be used to build enormous wind farms in the North Sea. The port development fund would ensure those turbines are manufactured in the UK, creating new British industry, construction work at ports, and service contracts for wind farm maintenance. Without the money, all this will be lost overseas.

Bad decisions in the CSR on October 20th could set Britain’s low carbon economy back by a decade.

In his speech Ed Miliband said, “taking the difficult steps to protect our planet for future generations is the greatest challenge our generation faces. When I think about my son, I think what he will be asking me in twenty years time is whether I was part of the last generation not to get climate change, or the first generation to get it”.

Miliband now has the chance to show he gets it. By leading a consensus of concerned NGOs, former ministers, business leaders and unions, he can win the argument that a credible deficit reduction strategy requires industrial growth at its heart; that the development of Britain as a low carbon economy provides the opportunity not just to grow our way out of recession, but to deliver the changes needed to help Britain mitigate the effects of global climate change.

ffinlo Costain is a professional grassroots campaigner.

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