Climate Change Bill [HL]

My Lords, I have not spoken previously in the debate, so I apologise to the House for speaking. First, I consider that if we have a global target, as in Kyoto, we start with the assumption that one tonne of carbon emitted here or elsewhere has the same price. For various reasons, with which I agree, the noble Lords want to fix a different price so that a tonne of carbon not emitted here can be a tonne of carbon not emitted there. From what the noble Lord, Lord Turner, has told us, given what the EEC arrangements are, there is a further consideration—that price within the EEC may be different from the price outside the EEC. This takes me back to the glorious days of multiple exchange rates that we used to have in developing countries, which were I am afraid not a very good way of allocating resources. My mind is open on this. All I want to say is that the best way to set multiple shadow prices is not in a Bill. Secondly, even if you set them, they will have to be flexible, as the noble Lord, Lord Crickhowell, said. We have to find a mechanism whereby we have a wording that allows us to achieve what the noble Lords want to achieve, which I quite agree with—that we have to change our behaviour, but at the same time not put in such a rigid framework that it will lead to misallocation, rather than a correct allocation, of resources.