So…..how safe is that Husky?

Huskies

Well it’s not going very well on the renewables and low carbon front is it.? Ed Davey, until recently in charge of the whole business, doesn’t think it is, asking recently in a tweet:

‘does Cameron plan to strangle a husky given green deal cuts after wind and solar hits, end to Ccl exemption and zero homes abolition’

Must have been a titanic feat of character editing to get all that in 140 characters, I must say, but it does perhaps encapsulate the central question: why is all this suddenly happening? As Ed says, we have had in very short order, the apparent termination of support for onshore wind, a radical deflation of support for solar (both the cheapest renewables currently around by the way) the rug pulled smartly under the whole zero carbon homes programme, in that ..er.. there won’t be one anymore, and the clever juggling of the climate change levy so that it is now quite simply a levy, with the involvement in climate change abruptly terminated. Oh and to add to that, we have the prospect of the levy control framework being bust and quite possibly (Amber Rudd, Ed’s successor as DECC  SOS was conspicuously coy when I asked her about it this week) no more auctions for the award of contracts for difference for renewable technologies until after 2020.

So is it just about strangling a husky, or to put it another way, getting on with ‘cutting the green crap’ now that Conservatives can make the decisions all by themselves and without those pesky coalition partners to think about? I’m not sure it is as simple as that, because what is clear at the same time, is that the new government remains, it says, fully signed up to Britains ‘leading role at the Paris climate change summit in December’, and apparently committed to the achievement of the carbon budgets that go along with Britain’s offer (40% reduction greenhouse gas levels over 1990 by 2030, or effectively, the achievement of the fourth carbon budget, presently on its own admission, difficult to do on the basis of present measures). So you might expect some new measures, or at least an indication of which measures will get top billing over the next period.

Well as we know, despite the explicit indications that ‘ action is needed in this parliament to ensure that the pace of emission reductions accelerates whilst supporting economic growth’ from the committee on climate change in its 2015 progress report to parliament, the initial actions of the new government have been to take a machete to a number of support schemes, ostensibly on the grounds that they are too expensive to support and will impact adversely on customers bills.

And the striking thing about the machete-ed measures is that each of them represent, essentially, a different way of changing behaviour in a green and lower carbon direction. You might expect a government reviewing what direction it best wants to take in meeting carbon budgets to refine what kind of measures it wants to support – and in effect which measures it believes are most compatible with its philosophy of government and which are not. Measures to change behaviour , we might schematically represent as follows (in descending order of intervention).

  1. Put a tax on ‘ bads ‘ and exempt ‘goods’ so that behaviour changes towards the ‘goods’
  2. Put an obligation on companies to do greener things as part of their operating codes.
  3. Encourage people to invest to save using their own bills by greening their environment or energy use.
  4. Introduce regulations that at minimal cost introduce a largely unnoticed ‘green shift’ in the ways people live.

We can fit each of the machete-ed measures  into this:

  • we are no longer going to tax ‘bads’ (1) since the collapse of the climate change levy doesn’t perversely save any consumers money: it merely equalises payments across the board into treasury: it is just free money for government, with no behavioural purpose behind it.
  • We aren’t going to place obligations on companies (2) with the constraint on the levy control framework and the end of renewable obligation to advantage renewables.
  • We are not going to encourage people anymore to invest in their own energy savings by using the power of their present bills (3) with the ending of the Green deal.
  • And finally, we are not even going to introduce relatively mild and cost effective regulation (4) that moves the market in a more energy efficient and lower carbon direction by requiring a general framework for building homes that are increasingly energy mean in their operation.

So that leaves a rather frightening conclusion. If we believe that the government is sincere in maintaining its carbon change objectives and it’s willingness to address the consequences of its own carbon budget commitments, then at some stage it will have to introduce measures to change behaviour or investment patterns that look rather like the measures they have just abandoned. Alternatively it may now be that the single and sole mechanism they think will bring is change about is….the market. And since Lord Stern, as I remember notably described climate change as ‘ the worlds biggest market failure’ I’ m not sure right now that it is a strategy that will reliably deliver.

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Finally – energy efficiency regulations emerge un-pickled

Finally, stumbling over the line six weeks or so before pre-election purdah puts everything into mothballs, the regulations requiring landlords, by 2018,  to ensure their rented properties exceed a very basic test of energy-worthiness before they can be rented out have been laid before Parliament. Now lest that first sentence sound a bit churlish, let’s be clear: hooray. The regulations themselves are sound. OK it’s only energy efficiency band ‘E’  (the bands go from G – meaning your house, energy efficiency-wise, is more like a gazebo than a property, to A – which envisages homes that are so efficient they don’t use much energy at all to heat and power, and may anyway create their own energy to do so) so it’s not that far up the scale. But since private rented homes are among the least energy efficient properties as a group it represents a real step forward for tenants warmth and property efficiency across the country. And the penalties for non-compliance are proportionate to the cost of actually doing something – i.e. more than it is likely to cost landlords to do up their homes to conform (which as the Association for the Conservation of Energy and others have shown is, in most cases, a pretty modest sum – perhaps £1500 or so).

The regulations don’t of course cover a large part of the private rented scene, which is where parts of properties in which people are living jointly are let out on individual tenancies: Houses in Multiple Occupation or HMOs. This remains a real gap in provision, since it means that thousands of properties in most large towns and cities will simply be exempt. This raises the not entirely fanciful prospect of some landlords straying into letting properties out as HMOs and not single tenancies over the next few years so that they do not have to improve their properties to let them.  I shall certainly continue to pursue this gap in the regulations, which surely, a future government more interested in energy efficiency across the piece will have to fill…which brings me to the slightly more churlish bit of the piece.

The Energy Act 2011, from which these regulations derive, received its Royal Assent on 10th November 2011. That’s a piece of legislation passed by Parliament, supported generally all-round, although there were moves during its passage to move the qualifying date for landlords to comply forward to 2016. No, we were told, 2018 is a better forward date, because after the regulations are in, that gives five to six years to move towards compliance, instead of about three if the date is met at 2016.

So, a mere three years and three months later, regulations (which were probably written and ready to go by early 2012) finally emerge, giving landlords, yes, about three years to move to compliance.  So why the inordinate and otherwise inexplicable delay?

Introducing the measure yesterday, Ed Davey gave it away, although when he was in undifferentiated mode as Secretary of State, he played a straight bat when I enquired, repeatedly about the non-appearance of the regulations. ‘Well’ he said, ‘’I wish the regulations had been brought in earlier.’  Battles within the coalition had apparently delayed them. ‘Not everyone in this government wants more regulation. But in energy efficiency regulation plays a crucial role’. Quite so Ed.

So who might it be that the battles were with? Not the Ministry of Defence obviously – the finger very rapidly and accurately points at our not very green at all friend in DCLG, Mr Pickles. Quite scandalously, in fact, that a modest follow on measure from an Act agreed by Parliament which would make a big difference on housing fitness and tenant welfare at small cost, and even endorsed by the National Landlords Association, has been blocked. Blocked by the head of the department that is supposed to be all about housing and standards therein, and only eventually unstitched because, I understand No. 10 very belatedly told them to stop messing around.  In another system someone ought to be accountable for that kind of attempted extended sabotage on a measure agreed by Parliament. Not in this one though.

Down with reshuffles!

Rather a lot has been written about the recent Government reshuffle, most of it of the ‘who’s up/down/in/out’ variety. I don’t want to add to that, but I do want to have a brief last word on the process, and what better Department to focus on for that than the Department for Energy and Climate Change. That Department has suffered quite a grievous loss with the departure of Greg Barker. I have had my disagreements with Greg over the years on a number of his policy directions, and one of his main initiatives, the Green Deal, effectively lies in ruins as he departs. But overall I thought he was a great minister for the Department – he fought the DECC corner assiduously, cared passionately about climate change and its consequences, and was quite fearless in pursuing that agenda in government, often against the rumbling and grumbling about it all from many of his own side. He linked and defended the energy and policy priorities of the department on renewables and low carbon energy at a time when it would have been easier to capitulate to the siren voices (also often from his own side) suggesting that the whole process should be put in a bottle and floated out to sea.

But there are two points in this little paean that stand out. Firstly, that Greg came to his post having had a substantial record of commitment and interest in the subject beforehand, and secondly, he stayed in the same post for almost the whole term of the present government. That’s a two edged sword of course in that you often have to deal with the consequences of your own policy initiatives when they return to bite you and not your successor. But it is quite a simple idea that maybe if you are appointing Ministers to positions it would be good if they knew about or had some interest in what they were being tasked with beforehand. And an equally simple idea is that probably, far better policy outcomes are likely to result from square pegs being able to occupy square holes for an extended period rather than almost continuously being uprooted and jammed into some round hole somewhere else.

Certainly, neither of those two simple plans has been in operation just across the corridor from Greg’s erstwhile office. Since this time two years ago no less than four nameplates have been nailed to the Minister of State’s door: Hendry has given way to Hayes, who has given way to Fallon (with two other jobs to occupy him anyway) who has now given way to Matt Hancock, incidentally, all during a time when the brief to steer Electricity Market Reform through all its stages was of crucial importance. I would have thought that just catching up on the vicissitudes of that particular programme probably occupied the waking hours of both of Charles Hendry’s successors until, still immersed in trying to get to grips with capacity payments and Contracts for Difference, they were set free and packed off to pastures new. I’m sure both the new recruits to the Department will be hard working and attentive, but try as I might, I cannot find much of a trail of interest or knowledge about what DECC is doing, other than, perhaps that neither of them like wind farms very much.

But I also ought to say that this is not particularly their fault; all too often it is just how the system works. Posts are allocated and occupied as if they bear no relation to what they are supposed to be about, but instead simply signify (where I came in) who is up, or down, who is in or out, and who is just visiting on the way to somewhere else better and more ‘in’. That cannot help good governance or policy-making, or the welfare of the important Departments subject to the merry-go round.

So my final word on reshuffles is this: that there ought to be less of them. And that there ought to be more Greg Barkers, enabled to do a job in a Department that they value and allowed to stay there for long enough to make a difference in the way that for all his idiosyncrasies and occasional rushes of blood to the head, Greg undoubtedly did.