Think tank: Brown has a power failure

The Sunday Times
February 1, 2009

Gregory Barker

For nearly a decade Britain has “punched above its weight” on climate change. In his last years as prime minister, Tony Blair never travelled abroad without packing his climate change sermon. Sadly he never got around to sharing it with his own government.
Apart from the Climate Change Act, with its stretching future targets, the only serious environmental decision that Labour hasn’t ducked or dithered on in more recent years is building yet another runway at Heathrow. This, according to Greenpeace, has left Gordon Brown’s green credentials in shreds.
While Germany and other European economies have been busily building renewable energy infrastructure and spawning new technology leadership on the back of successful “feed-in tariffs”, new Labour’s best achievement has been international grandstanding.
But President Barack Obama, with his ambitious green strategy, is about to knock Britannia off her carbon pedestal.
The world’s greatest economy is waking up to the enormous potential of the clean energy revolution and is doing so with the zeal of a convert.
However, Labour has claimed one tangible success. After 10 years in office, the government was finally able to announce that the UK was getting serious about exploiting offshore wind. And about time too. Britain has more potential to harness the power of the sea than any other country in Europe.
The London Array in the Thames estuary is Europe’s largest offshore wind project and the flagship of the whole UK offshore effort: a huge source of clean energy, right on the capital’s doorstep. But while this project has been heralded by ministers as a firm step towards meeting our 2020 targets on renewables, decisions to invest in the project have, in reality, yet to be made. Only now is the project approaching final investment approval from the international companies behind the scheme. And it is by no means a done deal as ministers have suggested. The failure to expand the foundations of a modern manufacturing base over the past decade means that nearly 70% of the costs of London Array are billed in euros. The plight of sterling has more than wiped out any gains for the project from falling steel and commodity prices.
But the government cannot sit back and deploy its usual preferred brand of procrastination – ie, yet another consultation – because there is another big clock ticking in the Thames Gateway.
The national grid has made it clear that the engineering required to connect this iconic project to the network must take place early next year: after that, any disruption to the grid could fatally undermine preparations for the 2012 Olympics. After 2012, there will be other big demands on the network that make simply “booking another slot” much more difficult.
To get cracking with the essential engineering in 2011, the final decision to invest must be taken within the next few months, if not weeks. But the government’s proposals on how to improve the inadequate support for developing clean technologies such as London Array, currently provided by the renewables obligation, aren’t due until April.
Last week the energy minister was unable to answer parliamentary questions as to whether the government had considered the impact of the collapse in sterling on the viability of offshore wind and London Array in particular.
The real solution to expensive imports must be a renaissance in British manufacturing. Britain is still home to great world-class manufacturers, but not enough. The drive towards green energy independence and a low-carbon economy has the potential to help change that.
Over the next decade we must stick to our 2020 renewable energy targets. That will mean a huge expansion of large-scale offshore wind, wave and marine technology. However, to get the most from this energy revolution, we need to make Britain an attractive place to not only sell the world’s biggest turbines, but to build them too. We need to make sure that we create the modern networks and infrastructure that will allow private investment to flow into these new industries, foster innovation and provide the business-friendly conditions that will attract the engineers and manufacturers onto dry land.
President Obama has pledged to create 5m jobs by driving the US towards clean energy independence. For his administration, green is the new red, white and blue. But not here. Gordon Brown has his head stuck in the 1980s. Old coal power stations and big runways are Brown’s prescription for the low-carbon era.
President Obama is offering the US economy the prospect of genuine change and renewal. How long can we put that off in Britain, without seriously damaging our long-term prospects?
Gregory Barker is shadow minister for climate changeSend your ideas on this week’s Think Tank to think@sunday-times.co.uk