Press Story

IPPR interviewed business leaders in British industries that are critical to the low-carbon transition, including energy firms, transport, manufacturing, and so called 'energy-intensive industries'. This was twinned with similar discussions with businesses, convened by IPPR and partner think tanks, in France, Germany, Spain and Poland.

The reports find that while some businesses in the UK and other European countries are starting to feel the pinch of rising energy prices and are worried about the impact of climate change regulations on competitiveness, others are taking advantage of green policies to develop new low-carbon technologies, reduce their energy costs and clean up their supply chains.

The global market for environmental goods and services is estimated to be $3.5 trillion and growing by 4 per cent a year. The report finds that businesses in Europe are well placed to capture new market opportunities with British firms leading the way in developing electric vehicles, offshore wind, hydrogen fuel cells and zero carbon cement. However they need stronger and more stable policy signals from government and the EU and an active industrial strategy to break down barriers to low carbon growth.

The reports recommend:

Manufacturers need a new Green Deal to help them save on their energy bills, kicked off by a pilot scheme for small and medium-sized manufacturers.
Serious consideration should be given to expanding the EU Emissions Trading Scheme to include imported energy-intensive goods in order to create a level playing field for European businesses in the global market. This should be done in a way that is consistent with World Trade Organisation rules to ensure it is not protectionist.
The Government's unilateral Carbon Price Floor, which is reducing British competitiveness, should be scrapped with efforts instead focused on creating a central EU carbon bank to ensure greater stability in carbon prices for business.
A 2030 target to reduce emissions in the energy sector should be introduced to speed up carbon reductions and provide longer term clarity for business as the EEF have called for.
The EU's multi-year budget should be refocused away from inefficient agriculture subsidies and structural funds and towards more funding for innovation. This should include greater coordination of major strategic low-carbon investments, especially for carbon capture and storage (CCS) technologies and offshore wind, in which Britain excels.

Will Straw, IPPR Associate Director, said:

"Long-term sustainable economic growth, productive British businesses and an ambitious decarbonisation policy go hand-in-hand. Sticking to a high-carbon growth path is an untenable and costly policy for the UK in the long-run.

"For many companies, climate change targets, policies and regulations are creating new market opportunities and boosting turnover. New clean-tech industries are sprouting up, while existing companies are switching their business models to take advantage of low-carbon technologies. Even for energy-intensive industries like steel there are opportunities to tap into supply chains for clean energy infrastructure projects."

Stephen Radley, Director of Policy at EEF, the manufacturers' organisation, said:

"Moving to a low carbon economy will create significant opportunities for UK manufacturers. But keeping a lid on energy costs must go hand-in-hand with exploiting green industrial opportunities. Uncompetitive energy prices are a major threat for manufacturers, including many of those developing low carbon technologies. The government needs to put the consumer the heart of its decarbonisation strategy by pursuing a policy that delivers the most cost-effective energy mix. IPPR's report focuses on the key issues that need to be addressed for this happen."

Notes to Editors

IPPR's new report - Growing pains: British Industry and the low carbon transition - is available to download from: http://bit.ly/IPPR9183. Over 60 British businesses were consulted in the research phase of this report in partnership with EEF

IPPR's new report - Europe's next Economy: the benefits of and barriers to low carbon transition - is available to download from: http://bit.ly/IPPR9182 Over 50 businesses and other stakeholders from France, Germany, Spain and Poland were consulted in the research phase of this report. IPPR worked with partner think tanks in each country including Terra Nova in France, the German Institute for Inter national and Security Affairs, Ideas Foundation in Spain, and the Institute of Public Affairs in Poland.

One of the business leaders interviewed for the research was Stuart Evans, non-executive director and entrepreneur in Cleantech & ICT, who isChairman of Novacem, a 'spin-out' company from Imperial College, London which manufactures a carbon negative cement. A more detailed profile of Stuart is available at www.linkedin.com/in/stuartevans and he can be reached at +44 7771 966297 or at stuart.evans@novacem.com">stuart.evans@novacem.com

Contacts:

Tim Finch: 07595 920 899 / t.finch@ippr.org

Tamsin Crimmens, 07800 742 262, t.crimmens@ippr.org