Colin Challen MP

New Ground 68
Spring 2005

Carbon rationing

The European Union's carbon Emissions Trading Scheme (ETS) started on the 1st January this year, and like the launch of the single currency has been met with a predictably polarised response. The UK's contribution has been marred by the fact that despite having started its own ETS voluntarily in advance of any other EU state, it has been unable to set a national carbon allocation plan without making controversial changes which appear to weaken our carbon reduction targets. We should by now have had a clearer idea what was both accurate and achievable, as well as more demanding. As it is, there is a real sense that after our own scheme subsidised industry some £200 million in taxpayers' money to do what they were quite able to achieve anyway, they now stand to make more money from the EU ETS without much effort.

But the effort is still worth it - we start from where we are, not where we would like to be. Provided the ETS can be made to work in its early years - and this is by no means guaranteed - we will have a 'cap and trade' mechanism which will offer a way to seriously reduce carbon emissions. In addition, it will be the basis on which we search for the successor to Kyoto in just a few year's time. The EU ETS will in my view be the main weapon in our armoury to ensure the serious participation of the US in the fight against climate change. In that sense we have very few, if any, alternatives.

We also need to extend the reach of the ETS in other ways. It should not be limited to the industrial sector, but should involve individual energy consumers. At last year's SERA AGM a motion was adopted in support of Domestic Tradable Quotas (DTQs), which would give individual adults a share of the national carbon allocation, which they could trade depending on whether they needed more or less energy than the per capita allocation. If they were profligate energy consumers, they would have to pay more for extra carbon units. Poorer people would have surplus units which they could sell.

DTQs is the only proposal I have seen which would give meaning to the oft repeated sentiment that 'we must all do something' about climate change. Yes, of course we must, but since more carbon taxes are ruled out, nobody seems to know what to suggest. DTQs provides the answer, and it is highly equitable to boot. It is complementary to what the government is already doing with ETS.

Until politicians of all persuasions learn how to grasp the nettle of how our consumer society can be made to engage with climate change, it is unlikely that existing policy measures will be sufficient to head off the global warming calamity which admittedly may not harm us so much today, but will become intolerable in 30 to 40 years time. DTQs provides one answer to the short term/long term dilemma by placing most of the decision making processes into the hands of consumers themselves.

If any New Ground reader is interested in learning more about the campaign to introduce DTQs, they should contact Colin Challen MP at colinchallenmp@parliament.uk