CBI proposes carbon prices...

And support for new eco-tech firms…

British businesses are committed to do what it takes to tackle climate change but the UK effort will only succeed if it becomes an urgent, shared national priority for companies, consumers and the government, a groundbreaking new report said today.

The CBI Climate Change Task Force report is the culmination of ten months’ intensive work by 18 Chairmen and Chief Executives from some of the UK’s biggest companies, under the independent chairmanship of BT Chief Executive Ben Verwaayen.

Analysis developed specifically for the report by consultants McKinsey shows the UK’s carbon reduction targets for 2020 are likely to be missed but that 2050 goals, whilst stretching, can be achieved at a manageable cost – provided a greater sense of urgency is now adopted. It identifies priority areas for action that would put the UK back on track to meet its targets by 2030. Today’s report explains how business will play its part, and commits the CBI to continue to play a leading role, both nationally and internationally.

The report says that firms will have fundamentally to change their business models to meet consumers’ and society’s needs in an era of climate change. The Task Force says the longer we wait the higher the cost will be – but that if we act early, the cost for each household can be limited to around £100 a year by 2030.

It stresses that alongside the risks, the shift to a low carbon economy offers the UK a unique opportunity to develop innovative environmental technologies of the future and prosper in new, multi-billion-dollar world markets – but only if research funding is better co-ordinated and prioritised.

Within the report, ‘Climate Change: Everyone’s Business’, Task Force member companies make a series of pledges to adapt their businesses for the new low carbon world. These include:

A promise to develop new products and services that will empower households to halve their emissions by 2020.

A commitment to work in partnership with our 2 million employees to achieve major cuts in their emissions both at work and at home – our initial aim is to identify and promote action that will save an extra one million tonnes of CO2 emissions within three years.

Ben Verwaayen, Task Force Chairman, said:

“Today the CBI Task Force has demonstrated its commitment to tackling climate change. This is a call to action to the wider business community whose support we need, an offer of partnership with government, and a commitment to empower consumers. They are key to any solution because of their power to demand environmentally friendly goods, and their influence on government as voters.

“We need to support the consumer with better information and more choice. We have to involve our employees and we must report transparently our own carbon footprints. This is not just a challenge, it is also the chance to become leaders in a new low carbon economy. In business, in government, as consumers and citizens we are all part of the solution.”

Richard Lambert, CBI Director-General, said:

“This report makes clear that in the future, businesses will have to be green to grow. To manage their costs and to maintain the trust of their customers, they will need to build carbon management into their corporate DNA.

“To get to a secure future, both environmentally and economically, we also need the Government to build on the leadership role it has already carved out on climate change. Critical decisions need to be taken now if we are to have a chance of hitting our emissions targets, let alone achieving tougher ones.

“It must see through legislation that allows low carbon power plants – of all types – to get through our planning and regulatory systems, and it must keep the pressure on our international partners to commit to agreements that deliver a robust world price for carbon.

“And, with most taxes and regulations designed for the old economy, it must oversee a fundamental redesign that gives businesses and consumers the incentives to do the right thing – avoiding at all cost the temptation to rake in more revenue, which would be seen as a fundamental breach of trust.

“But this is a story of opportunity as well as risk. With the right focus on R&D, we can be at the forefront of new low carbon technologies that will power the world economy. We don’t have to return to the dark ages or live joyless lives to cut our carbon footprints – we just have to learn, together, to do things differently, with carbon becoming a new currency in our economy.”

Commenting on the report, Sir Nicholas Stern, author of the authoritative report for the UK government on the economics of climate change, said:

“Business has shown real leadership in publishing this report. It provides a rigorous and realistic analysis of the issues and identifies the key policies, emphasising the importance of clear price signals over the short, medium and long terms.

“It rightly emphasises the importance of collaboration between government, business and households, and demonstrates clearly the importance of timely action. At the same time it shows that effective action can be taken at acceptable cost.”

Tom Delay, Chief Executive of the Carbon Trust said:

“This report is further evidence that shows UK business has not just woken up to the climate change debate but is on the move to engage and tackle it. Our own research shows that more and more businesses of all sizes are acting to reduce their carbon footprints and this new report from the CBI will provide extra momentum to this new important business movement.

“Importantly the CBI report concludes that our 2050 targets are in reach, but require urgent action now to deploy existing technologies and approaches, and to invest in developing new low carbon technologies. There is a growing acceptance that if the UK takes early action then we can become a world leader in developing new business approaches and low carbon technologies and in turn benefit from the export potential estimated to be worth some £240bn per year by 2050. The CBI taskforce identifies the massive financial opportunity available to both large and small businesses that play a leadership role in the move to a low carbon economy.

“We welcome the pledges that will deliver major benefits for the environment and the bottom line of UK Plc and will continue to work alongside the CBI and their members to support their implementation.”