Tuesday, May 17, 2011

British Government to Lead the Green Economy

A new legally binding green deal has been agreed upon by British cabinet ministers. The deal will commit the UK to two decades of drastic cuts in carbon emissions. The deal has major implications for citizens, transportation and business.

The deal was reached despite strong disagreements between those who supported the plan and those who were concerned about cost. The deal puts the UK ahead of any all other nations in terms of the legal commitments it is making to curb greenhouse gases.

Recently the heads of 15 green campaign groups wrote to British Prime Minister David Cameron expressing their concern about his environmental policy. Cameron responded by making good on his promise to lead the "greenest government ever." Britain is now the world leader in cutting carbon emissions as it is the only nation with legally binding commitments past 2020. The deal will also see Britain set up a green investment bank.

The new budget puts the government on target to meet a reduction by 2050 of 80% of carbon emissions compared with 1990 levels. The government has accepted the report from the independent committee on climate change which has said that to reach these goals carbon emissions should be cut by 60% by 2030. The committee also says 40% of the UK's power should come from wind, wave and tide sources by 2030

This will drive investment and stimulate new industries in offshore wind technology, tidal power, wave generators and carbon capture. In the wind sector alone we can expect to see significant investments from major companies like Siemens, Vestas and General Electric.

The opportunities for business are extraordinary. The independent committee says the new carbon deal will require that heat pumps be installed in 2.6m homes by 2025. It also says that by the same date 31% of new cars, and 14% of those on the road overall, will be electric. To achieve these ambitious goals a total of £16bn of investment will be needed every year to meet the commitment.

The British see the wisdom of investing in a low carbon economy now, rather than paying more later. We can only hope that North America will one day follow her lead.

© 2011, Richard Matthews. All rights reserved.

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