Consumer Emissions (Climate Change) Bill [HL]

My Lords, the issue of carbon emissions has been a big topic of discussion both globally and within the House over the past few weeks and months as part of the whole debate on global warming and what the UK and Europe’s contribution should be to solving the problem. In 2008 this House discussed and Parliament passed the Climate Change Act, on which the Government had all-party support. The Government were very proud of their leadership in making carbon targets and budgets legally accountable and this has indeed been seen internationally as an important bit of legislation. As we would expect, it has also very much concentrated on the carbon emissions created by the production reflected in the UK’s gross domestic product. That is very much in line with the Kyoto process and the definition provided under the Rio agreement and Kyoto protocol. That definition excluded aviation and shipping—we will leave that aside for the moment—but included the carbon emissions produced by an economy as part of producing goods, services and various production processes. So if electricity generation creates carbon emissions, those emissions will be counted, and other areas will be treated in a similar fashion. However, what is not often realised is that that is only one way of looking at carbon emissions within an economy. It is not necessarily the best way but it is an important way. However, there are other methods, one of which is what this Bill intends to introduce, relating to emissions caused by the consumption within an economy. Many would think that in terms of environmental responsibility, that is a much superior indication to production. I shall not go into the argument at great length about which is best; I am simply saying that we should also include consumption within our measurements and give it similar weighting in government action and targets. What are carbon consumption emissions? Very simply, they are a national economy’s emissions as traditionally measured. However, we then remove the emissions connected to our exported goods and services while including the emissions caused by our imports of consumer and industrial goods and services used within the UK economy. That is the difference. One of the main reasons why I am bringing the Bill forward is that not only is that an equally important way of looking at the issue; there is a significant difference between the two. I shall come on to that later. Specifically, within the context of the Climate Change Act, the Bill gives equal weight to carbon consumption emissions and to production emissions. So in terms of responsibilities of government, one is now repeated for the other, particularly as regards setting targets and budgets, consultation and reporting back to Parliament. This is a very simple, short Bill and one that I hope the Government will see as being an important move forward in this area. I stress that the Bill does not cover individual carbon consumption. There is no move towards personal carbon budgets, which is a whole different area that has been discussed in this House on a number of occasions. Neither does the Bill replace the traditional Kyoto-based ways of measuring carbon footprint that we have in the Climate Change Act. Why is this area important? The Government undertook research through Defra that looked at this whole area, and a report was produced in 2008. It has also been looked at by a number of international climate economists. Dieter Helm of Oxford University is an authority in this area. Both reports are highly persuasive. The Defra report considered the position in the United Kingdom in 2004 and came to the conclusion—I was surprised by the accuracy with which the figures can be worked out by academics—that the consumption emissions of the United Kingdom economy were some 37 per cent higher than our production emissions. Professor Dieter Helm, looking at the figures for 2003, and taking the trend from the 1990 baseline which is used in the Kyoto Protocol, saw that although United Kingdom production emissions decreased over that period by some 15 per cent in excess of our 12.5 per cent Kyoto target, as regards the consumption level, they have actually gone up by 19 to 20 per cent, and no doubt by even more. That means that by just looking at our carbon footprint in the traditional way, we are highly underestimating what we as an economy and as a society are contributing towards global carbon pollution. The carbon consumption measures start to look at and account for areas such as offshoring. Why is there a big difference between trends of carbon consumption and carbon production? It is because British industry is more and more service led and we offshore a lot of our dirty industry. Our imports increasingly come from developing countries, particularly China and India. Imports from China have a particularly high carbon content. Although we may pat ourselves on the back, as we often do, and certainly the Government do, in terms of our national performance, in reality we are living in a completely different manner in terms of the way that the planet can cope with our consumption in the United Kingdom. Neither of the various ways of looking at Britain’s contribution to the fight against global warming is perfect. However, it is absolutely clear that we need to look at both and not just one. This Bill is about giving equality to both those measures. That is particularly important because I believe that this way of looking at carbon footprint will become more important internationally. Certainly, its profile has been raised considerably. I should like to see Britain lead in this area, as it has led in its climate change legislation, and this is one of the ways that we can do it. I should be particularly interested to hear the Minister give us the Government’s opinion on the divergence between the two figures and the two trends and to hear whether they will refer these matters to be considered in greater detail by their own Climate Change Committee. I should also be interested to hear their views on how they see the future of such indicators within the international context. I am glad to say that when the Defra report was published in 2008, the Environment Secretary Hilary Benn then said that, ""as we move to a low carbon economy, we must help businesses and individuals to understand and reduce the environmental impacts of the products and services they produce, sell or consume, wherever in the world they are made"." That is an endorsement of this way of thinking and this move in terms of how we look at these issues, which I very much welcome. Last month the Copenhagen accord was reached following the Cop 15 conference, which took place in Copenhagen and which we debated at great length yesterday. One of the areas of hope that came out of the lack of agreement or the light agreement that was reached at the conference, which we hope will be corrected in Mexico City at the end of this year, is that it gives an opportunity for new ways of looking at these issues, perhaps more equitable ones, particularly as between the developing and the developed world. I should like the United Kingdom be in the lead in looking at carbon consumption emissions as an important indicator in this area. I beg to move.