'The environmental Taliban': George Osborne slams Parliamentary climate change campaigners as Treasury fights to water down Energy Bill commitments

 

Oliver Wright
Thursday 18 October 2012 14:41
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George Osborne has started referring to Parliamentary climate change campaigners as the “environmental Taliban”, it emerged today, as the Treasury fights to water down renewable commitments in the Government’s flagship Energy Bill.

Members of the Coalition’s quad of decision makers including the Chancellor, David Cameron and Nick Clegg met today in attempt to thrash out details of the bill which is due to be published within weeks.

Ed Davey, the Climate Change Secretary, is pushing for the legislation to contain a specific legally binding commitment on the total amount of carbon that can be emitted by powers stations by 2030 to “bind in” the Government to renewable energy.

He is also arguing that the Treasury should be the ultimate guarantor of the loans that renewable energy companies will need to take out to invest in new renewable and nuclear power stations. These so-called “contracts for difference”, it is argued, would give investors the confidence that there will be long-term revenues in renewables and reduce the cost of upfront capital expenditure for new low-carbon projects.

But Mr Osborne and the Treasury have been opposing both measures. Senior Conservative sources said that Mr Osborne’s objections to the plans reflect his growing scepticism about the need to take immediate action to decarbonise the economy during a time of recession.

“I think that George’s position reflects a growing scepticism about current climate change policy across the party,” said one MP.

“It was fine to be talking about spending money on climate change in the good times but when energy bills are going up it doesn’t seem like good politics.”

Another source added: “George has started referring to the green lobby in Government and Tory party as the environmental Taliban. It’s meant as a joke but it shows where he’s coming from.”

Mr Osborne is also pushing for the creation of a ‘levy control framework’ which would, in effect, put a cap on the total subsidy from tax payers and energy consumers going towards green power.

This would allow the Chancellor to claim he is helping keep energy bills down at a time of recession. However critics claim it will result in a “dash for gas” and higher, less green energy in the longer term.

It is understood that yesterday’s quad meeting was inconclusive. Downing Street is thought to have sympathy with Lib Dem demands for a specific carbon commitment in the bill but backs the Treasury on the contract for difference guarantees.

“The devil is in the detail,” said one source close to Mr Davy. “Discussions are still on-going.”

Senior Lib Dems fear that unless they are seen to get a “win” on the energy bill they could pay a heavy electoral price. At the party’s recent conference in Brighton Greenpeace targeted the party warning them “not to let Osborne kill green growth”.

Last night a Greenpeace spokesman said they would continue to keep up the pressure.

“We’ve had warm words and big promises from Ed Davy and Danny Alexander. Frankly it’s now up to them to deliver.”

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