16 March 2007
Local authorities and NHS trusts might be forced to reduce their carbon count through a mandatory emissions trading scheme, under legislation published this week.
The draft Climate Change Bill, launched by Environment Secretary David Miliband on March 13, contains 'enabling provisions' that will allow the government to introduce a mandatory scheme in the future.
The Department for Environment, Food and Rural Affairs' consultations on a proposed scheme, called the Energy Performance Commitment, closed in January.
The EPC would cover all large organisations, both public and private, that use at least 3,000 megawatt-hours of electricity a year, drawing many councils and NHS bodies into the scheme.
Paul Bettison, chair of the Local Government Association's environment board, endorsed a mandatory scheme as the best way of achieving the legally binding target included in the draft Bill, of a 60% reduction in carbon emissions by 2050.
But he warned that the design of the scheme would need to be sufficiently sophisticated to reflect the substantial progress that many local authorities have already made.
'Otherwise, those that have already done well would be penalised because their targets would be much harder to achieve than those for authorities who haven't really left the block,' Bettison told Public Finance.
'Implementation of the EPC would present a financial burden on them with little obvious direct benefit.'
Despite including powers to set up a mandatory trading scheme in the Bill, the government has not made public its final conclusions on the issue.
But Miliband, appearing at the launch with Prime Minister Tony Blair, said: 'A robust system for reducing carbon requires the allocation of effort across the economy: the public sector, business, and individuals.'
He added that the overall package of measures would provide 'incentives for the public sector to live up to their aspirations, whether it's the town hall or the local hospital'.
The legislation, which will be subject to a three-month consultation, would also require the government to set five-year 'carbon budgets', which would act as staging posts to the 2050 target.
It would also set up an independent Committee on Climate Change to audit the government's performance against the carbon emissions targets and report to Parliament.
The draft Bill came just days after a study of 19 government departments' performance on environmental issues by the Sustainable Development Commission, which found they were failing against a range of targets.
Despite a target to cut carbon emissions by 12.5% by 2010, 15 departments have actually increased their emissions since 1999 – including Defra.
The SDC report also said the government had missed targets for reducing water consumption and waste generation.
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