After the pandemic, the biggest challenge facing Boris Johnson is the Net Zero target: a 30-year plan to decarbonise the economy. The flawed way to do this is to tax energy so much that factories shut down and industry moves abroad. The net result would be fewer jobs at home but no great reduction in the amount of carbon emitted globally. An agenda to destroy jobs that does little for the planet would be a hard sell to the public. As one influential Tory warns, there’s little point in the government taking action on climate change if all you are doing is “outsourcing your manufacturing to China where carbon intensity is higher”. But this is going to become an increasingly big problem in years to come and there is mounting concern about it at the top of government. If you can’t address “carbon leakage”, to use the rather unattractive technical term, you can’t deal with climate change. The current political row over whether to allow a new coal mine in Cumbria — its supporters argue that if the coking coal isn’t dug up there it will be dug up in a country with lower environmental standards — is just an appetiser for the arguments to come. For Britain, the current situation represents both a threat and an opportunity. The threat is that each country slaps heavy taxes on cars and other industrial imports in the name of a level green playing field. The EU is meant to be coming up with its own proposals for a carbon border tax in June and the Biden administration is keen on the idea too. This could quickly descend into “green protectionism”, further undermining the international trading system. This would be particularly problematic for Brexit Britain which, having left the safety of a large bloc, needs that system to work. The opportunity for Britain is that as president of both the G7 and COP26, the UN climate change summit, this year, it is uniquely well placed to push for a multilateral solution to this problem. The first, albeit virtual, leaders meeting of the British presidency takes place tomorrow and the prime minister will have to decide whether to push the issue or to try and garner more allies before raising it.
Times 18th Feb 2021 read more »