25 Jul 2012

Mid-term coalition gas and wind

Just been speaking to one of the eminent scientists on the government’s own Committee on Climate Change. He was extremely sceptical about the compatibility of the government’s dash for gas with the government’s existing carbon reduction commitments.

He was also, unsurprisingly, concerned to read George Osborne’s 9 July letter to Ed Davey rubbishing any setting of further emissions targets as “inflexible” and “inefficient.”

Ed Davey was trumpeting today’s agreement to cut taxpayers subsidies to onshore wind farms by 10 per cent as a victory for evidence-based policy-making, but some might see it as a lesson in how Coalition decision-making works in the middle years of the government.

A difficult row over energy costs has at its centre the Tories’ desperate desire to focus the government like crazy on living standards (even if it means jettisoning green commitments) … and the Lib Dems desire not to be the wrong side of the public concern on living standards while still trying to stick to some of the green commitments.

The Lib Dems end up, as usual, with a trophy to wave (fighting off bigger wind power subsidy cuts that Tory backbenchers might’ve liked).

But in return they have to concede a dash for gas, a review of the wind subsidy starting potentially as soon as next year (to include a look at how to consult better locally before wind farms are built) and a carefully co-announced £500m subsidy to the gas industry that towers over the £20m or so wind subsidy that Ed Davey’s been defending.

As so often in current rows, and in contrast to the early Coalition phase, this row wasn’t sorted out at department to department level but had to be referred upstairs to Messrs Clegg and Cameron. As so often in current rows there’s a big George Osborne sub-plot that people mutter about – Lib Dems saying that he’s trying to curry favour with his own anti-wind, pro-gas backbenchers to re-establish lost standing after the Budget that unwound, they say.

They also say the Chancellor’s much more hostile to the green agenda than other Tories, including the PM.

You end up with a series of trade-offs possibly quite unloved anywhere in government, though the Energy Secretary was doing a good effort at sounding pleased with the measures at a briefing this morning.

Here, by the way, is the view from the roof of Ed Davey’s department, DECC, where Mr Davey did his interviews and – yes – that is the beach volleyball stadium in Horse Guards you can see in the background. Not quite a good enough view to see it all for free, alas.


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