Recent press coverage of climate issues culminated in the announcement yesterday by Environment Secretary David Milliband of the Government’s intention to introduce new climate change legislation in the UK. The announcement coincided with the release of the Stern Review on the Economics of Climate Change, a review commissioned by the Chancellor last year. This article considers the new legislation to be introduced in the UK.

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Recent press coverage of climate issues culminated in the announcement yesterday by Environment Secretary David Milliband of the Government’s intention to introduce new climate change legislation in the UK. The announcement coincided with the release of the Stern Review on the Economics of Climate Change, a review commissioned by the Chancellor last year. This article considers the new legislation to be introduced in the UK.

The Stern Review concluded that not only is a shift to a low-carbon economy essential to address the fact that climate change threatens the basic elements of life for people around the world but that early action on climate change will also bring huge opportunities. The damage that will be caused by emissions if no action is taken – the Business-as-Usual path – is significant and the impacts are unlikely to be evenly distributed between countries. Experts predict that the poorest countries and people will feel the impacts earliest and most. The Stern Review emphasises both the national and international "policy challenges" of moving to a low carbon economy. Carbon pricing, technology policy and a global policy response are three key elements that the Stern Review considers essential for an effective response to climate change, described as "the greatest market failure the world has seen."

The UK already has a mixture of legislative and policy measures in place to deal with climate change and has adopted an ambitious target for reduction of CO2. The 2006 Climate Change Programme and the Energy Review set out the domestic programme, which is designed to achieve reductions in CO2 emissions that go beyond the Kyoto Protocol requirements. The UK has already taken legislative steps to tackle climate change, through the Climate Change and Sustainable Energy Act 2006, which came into force on 21 June 2006. From 2007, this Act will require the Government to report to Parliament on an annual basis on the level of greenhouse gas emissions in the UK and action being taken to reduce it.

At a European level, it has recently been announced by the European Environment Agency that the EU’s 15 oldest member states are expected to meet their joint Kyoto protocol greenhouse gas reductions targets by only a very slim margin. Achieving the targets will, however, require full implementation of existing and planned climate policies as well as several countries making use of Kyoto flexible mechanisms to buy emission credits abroad.

The Minister’s statement to the House on 30 October 2006 highlighted some of the actions being taken to address the international issues raised by the Stern Review, including discussions to seek to ensure the security of the EU Emissions Trading Scheme (the government also published yesterday document entitled "Emissions Trading: UK Government Vision") and steps to increase energy R&D support and the deployment of low-carbon technologies. The Minister made the point that the UK is committed to showing international leadership as well as domestic leadership. New legislation designed to "provide a clear, credible, long-term framework for the UK to achieve its long term goals of reducing carbon dioxide emissions" will be introduced to underpin that leadership.

Little detail about the proposed new climate change legislation has been provided but the Minister highlighted four key elements that it will address:

  • To give a legislative basis to the long term goal to reduce carbon dioxide emissions by 60% by 2050 from 1990 levels. Interim targets will also be considered.
  • To establish a body, to be known as the Carbon Committee, to provide advice for and work with Government, to reduce emissions over time and across the economy.
  • To provide for enabling powers to put substantive legislative measures in place to allow the introduction of "emissions reduction measures".
  • To assess what additional reporting and monitoring arrangements are necessary to support the aims for a "transparent framework for emissions reductions."

The Government has committed to widespread consultation about the contents of the legislation. No firm timescales have been provided; however the Minister referred to the legislation being introduced "as soon as parliamentary time allows".

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

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The original publication date for this article was 31/10/2006.