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Climate Change Bill [Lords]

We warmly welcome the Government's change of heart and measured response in including emissions from international aviation and shipping in the Bill. We support new clause 15 and its accompanying amendments Nos. 36, 42, 43 and 50, which I understand are important tidying-up measures. Although we also recognise the real and practical difficulties, which the Minister has explained, of including aviation and shipping and although we acknowledge the danger of perverse incentives if we get the issue wrong, we think it right that aviation and shipping should be included. Conservative Front Benchers have consistently argued that aviation and shipping should not be exempt from accounting for the pollution for which their sectors are responsible. Furthermore, as the Minister said, not including aviation in the Bill would have perverse incentives. For example, it would incentivise an individual passenger, from a carbon point of view, to take a short-haul flight to Paris rather than the Eurostar. That cannot be right. We should also be mindful of the positive way in which the shipping sector and certain responsible airlines have contributed to the debate: they have made important and constructive suggestions on the way forward. We must not forget that shipping is among the most carbon-efficient forms of heavy transport. Sea freight emits between 30 g and 90 g of CO2 per tonne of freight per kilometre, whereas the equivalent figure for road freight is between 130g and 190g, and that for aviation is obviously much, much more. We must therefore be cautious about always twinning aviation and shipping in this debate, as their carbon efficiency profiles contrast and they face different challenges specific to their sectors. We all acknowledge that there are difficulties with the measurement and apportionment of these emissions. However, it is important that we do not allow such issues of methodology, complex as they are, to let us lose sight of the principal aim of the Bill: to achieve a net reduction in emissions across the whole UK economy in sufficient proportion for us to play our fair part in keeping man-made global warming below the dangerous 2° level. The necessity of eventually including all sectors of our economy in that task was reconfirmed to us earlier this month by the advice of Lord Adair Turner's Committee on Climate Change. Mindful of that advice, we are sympathetic to amendments Nos. 68 and 69, tabled by the hon. Member for Edinburgh, South (Nigel Griffiths). We are also sympathetic to amendment No. 3 and new clause 14, tabled by the hon. Member for Northavon (Steve Webb). Methodology is crucial, so the Government need to publish their methodology for making their aviation and shipping emission projections, as would be required by new clause 14. That is particularly important to us. We welcome the announcement just now that the Government have taken on board the intent embodied in amendment No. 72. The right hon. Member for Scunthorpe (Mr. Morley) has done a great deal of work: he has campaigned outside the House and brought together a large consensus on the measure. We welcome the fact that the Government are prepared to take the issue on board and, having redrafted it with the help of parliamentary counsel, bring it back to the House of Lords. That is typical of the spirit in which the Bill has gone through the House. Having made our support for this proposal clear, I should like to sound a note of caution regarding the definition of aviation and shipping that the Government have chosen. Although we welcome the fact that they intend to include emissions from aviation and shipping, the measurement of emissions from the movement of goods and passengers should account for all stages of the journey rather than merely singling out the carbon footprint of flights and sea journeys to and from the United Kingdom. In that way, we could avoid unintended consequences such as encouraging more polluting methods of travel outside the UK. My party is committed to working with the Government in their efforts to secure the all-important international agreements on aviation and shipping emissions that are crucial if we are to crack this problem. The Bill has come a long way since it was first introduced in another place last year. Now, on Report, one of the last outstanding totemic issues is finally being dealt with. If we can come to an agreement on this, it will turn the Bill from good legislation into world-class legislation. However, the caveats on definitions that Conservative Members spoke about at length in Committee and in the other place still remain. Although we are concerned about the definition of aviation and shipping, rather than our chosen definition of international trade and transport, we are not opposed to including aviation and shipping in the carbon budgets from the outset. Our concern is rooted in our wish to ensure that we do not, through well-meaning but poorly designed legislation, offer a perverse incentive to use more carbon-intensive modes of transport, such as road freight, over the more efficient moving of goods by sea. For example, if shipping becomes heavily regulated, particularly unilaterally, there might be an incentive for ships to dock at Rotterdam—or worse still, Istanbul—and then drive across the continent to enter this country via the channel tunnel. That is why we argued in Committee for aviation and shipping to be described as international trade and transport. We wish to prevent any system of measurement from being skewed in favour of more carbon-intensive methods of transport, which could happen if shipping and aviation are included without reference to other modes of transportation. Let me give some practical examples. If one were importing oranges from Spain into the UK and sent them over on lorries, only the short leg of the journey, by ferry, would be included in the UK's carbon allowance. If one sent them by sea, the whole journey would be counted, making transporting oranges from Spain by sea far more carbon-expensive. That would create a significant incentive for the use of road freight over sea freight, despite its being many times more carbon-intensive. If national-level emissions trading schemes were in existence through the transit states, the disincentive to use road freight would be strong enough to deter that, but if we introduced our system before some or all of our neighbouring European transit states, Britain would perversely incentivise the movement of goods away from direct shipping and towards the more polluting form of road transport. Similarly, when importing goods from China, the best way in terms of cost and the environment is for the container to be shipped directly to the UK. If we define only aviation and shipping without reference to other means of importing goods, that could mean it would make economic sense to ship goods only as far as Rotterdam and then move them by lorry into the UK in order to minimise the amount of carbon officially being counted. I hope I have made the point sufficiently clear without sounding as though we are opposed to the inclusion of aviation and shipping, as per the amendment, but it is very important. We are in favour of these measures, and we have always argued that there should be no sectoral exemptions for aviation and shipping, but the definition of the process can still be improved. We would be keen to work closely with the Government on establishing a means of description that is more effective and would secure the international agreements on aviation and shipping that are vital if we are to find a truly holistic solution to this very important international problem.