Over half a million new jobs over the next two decades could be at risk from the UK's opposition to new EU targets for green energy, according to a leaked official report from the European commission.
Since last spring, European countries have been battling over what new climate change targets should be set to follow the existing ones for greenhouse gas emissions, renewable energy and energy efficiency, which run out in 2020.
The UK, along with the Czech Republic, is strongly opposed to setting a new renewable energy goal for 2030, favouring an overall target for greenhouse gas emissions instead – which would entail an ambitious cut of 50% on 1990 levels. They want countries to be allowed the freedom to reach the target as they choose to, for example by relying heavily on nuclear power.
Energy and climate secretary, Ed Davey, has said: "We need a technology neutral approach to how individual countries meet their emissions targets ... we will therefore oppose a renewable energy target at an EU level as inflexible and unnecessary."
But a draft report, commissioned by the European commission on the impact of setting different targets and seen by the Guardian, says that including renewable energy and energy efficiency targets in addition to a greenhouse gas emissions target would create around 568,000 more jobs across Europe by 2030 than an emissions one alone. However, the cost of having renewable energy and efficiency targets would be 2.6% higher than with just an emissions target alone, the report notes.
Germany, Denmark, Austria and Finland back a renewable energy target. A new energy efficiency target is considered unlikely.
The wind industry said that not setting a renewable energy target would make it harder for developers to attract investment. Maf Smith, RenewableUK's deputy chief executive, said: "The EU needs to show leadership here and set a 2030 renewable energy target as a matter of priority. It would send a crucial political signal on the continuing direction of travel away from fossil fuels to clean energy sources across Europe. If the EU were to fail to step up to the mark on this, it would be more difficult for renewable energy developers to attract much needed investment in their projects, as it would push up the cost of raising capital."
But a spokeswoman for the Department of Energy and Climate Change said: "The UK's view is that a single, greenhouse gas target is the most effective way of combatting climate change, keeping energy prices down and strengthening energy security. A binding renewables target would not allow individual countries the flexibility to meet their emissions target."
Chris Davies, a Liberal Democrat MEP who sits on the EU committee on the environment, public health and food safety, warned against the cost of an "almost religious commitment to renewables."
"Overall, having a renewable energy target is an expensive way of reducing CO2 emissions, and rules out other long-term options such as carbon capture and storage. If Europe wants to reduce emissions at the least significant cost, it needs to be left to countries to decide how to do it," Davies told the Guardian. "You have to have to consider energy costs. What is the subsidy per job cost?"
He also said the UK's ambitious 50% carbon target was unlikely to be politically palatable in Europe. "With people concerned about the reduction in energy prices in US compared to relatively high cost of energy in Europe, getting above 40% is going to be enormously difficult, people just won't sign up for it."
Labour also said it was opposed to a fresh renewable energy target. Tom Greatrex, shadow energy minister, said: "Tackling the complex challenge of climate change requires policies and targets which are sufficiently flexible to accommodate ever-evolving solutions. We remain unconvinced that a 2030 renewables target provides this necessary optionality, since it overlooks a number of low-carbon but non-renewable technologies, such as carbon capture and storage."
Companies have stepped up their lobbying ahead of the European commission laying out its thinking on the targets towards the end of January, when the assessment on the economic, environmental and social impacts is expected to be published.
Gamesa, Dong, Vestas are among eight energy companies who called earlier last month for a target of more than 30% of energy coming from renewable sources by 2030, saying: "It will bring down our energy and electricity bills, and help remove the need for renewable energy support in future."
Pitted against them is the European power industry association, whose president and the CEO of energy company E.ON, Johannes Teyssen, has come out backing an emissions target but says Europe does not need a new renewable energy or energy efficiency target.
The new German government has already set a target of 40-45% of its electricity supply coming from renewable sources by 2025, higher than the 30-35% EU-wide target being discussed. By contrast, the UK has been one of the worst performers for share of energy generated by renewable sources, near the bottom of the European league table along with Malta and Luxembourg.
22 Jan 2014 The Guardian