Carbon Emissions Reports: Clegg’s Gift From Rio

The Rio+20 Summit was never going to be a big success, despite the green lobby’s determination to get something out of it. More than 45,000 people descended on Brazil for ten days and the outcome was a document that environmentalists have called “shameful” in its lack of ambition in cutting greenhouse emissions.

In that context, Nick Clegg should be right at home. How better to underline the  ineffectual junior role he and his Liberal Democrat party have in the UK coalition than to pack the hapless deputy Prime Minister off to a failed international summit, notable for its lack of big-league international heads of state, while the Government gets on with the serious business of ruining – sorry, running – the country?

Counting carbon emissions

And yet, there was something in what he said at Rio. It is hard to say this without sounding patronising, but Nick Clegg’s announcement of mandatory carbon reporting is a good thing.

Like much of what he does, it may well not make a blind bit of difference in the long term, but at least he tried. That’s more than can be said for other Lib Dem ideas which have quietly disappeared.

And we can’t deny the fact that this is the first time carbon accounting has been made mandatory in this way, in any country.

From the next accounting year, all the firms quoted in the London Stock Exchange will have to include an account of the carbon emissions they have been responsible for producing in their annual reports.

There is no carbon tax or carbon credit system attached to this. The CRC Energy Efficiency Scheme, which was originally supposed to reward firms that reduced their greenhouse gas emissions, is now in an apparently teminal condition following a savaging in George Osborne ‘s budget.

Interestingly, Osborne backed away from carbon schemes saying that business wouldn’t bear it in a recession. “The Carbon Reduction Commitment is cumbersome, bureaucratic and imposes unnecessary costs on business,” he said, giving me, at least, the clear impression that business leaders had told him to forget it.

Clegg’s initiative, by contrast, is apparently backed by business groups, including the partisan-but-solidly-based Aldersgate Group. It also has support – perhaps surprisingly – from the Confederation of British Industry (CBI).

The CBI has been “calling for mandatory carbon reporting for some time,” according to Rhian Kelly, CBI director for business environment policy. “It is an important way to help businesses save money and emissions.”

How come the CBI supports it? Well, it has been a fervent opponent of the CRC scheme, calling for green taxes to be abolished. Accepting mandatory carbon reporting, it can actually argue more strongly against the CRC which would actually cost its members real money, saying the CRC would actually be a duplicated effort alongside the reporting.

“To avoid unnecessary duplication, the government now needs to scrap the Carbon Reduction Commitment,” said Kelly.