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Last Updated: Thursday, 2 February 2006, 10:15 GMT
Whitehall in greenhouse gases row
By Roger Harrabin
BBC environment correspondent

M-way jam (BBC)
Whitehall is devising a strategy for all sectors of the economy
UK government departments cannot agree on setting greenhouse gas limits for business, the BBC has learned.

Ministers have pledged to reduce UK carbon dioxide emissions, blamed for global warming, by 20% by 2010.

The Department for Environment, Food and Rural Affairs wants companies to cut emissions by eight million tonnes, BBC Radio 4's Today programme reported.

But the Department for Trade and Industry wants a three-million-tonne cut, to protect firms' competitiveness.

EU matters

The government has settled on a compromise. Shortly, it will publish a range of cuts for big business within its climate change strategy review.

The eight-million-tonne target will form the top end with the DTI holding the bottom end of the range down at three million.

The move has the theoretical benefit of allowing the government to see how far its EU neighbours are prepared to cut their emissions before the UK commits to a final figure (although this may not help much if EU partners adopt a similar cat-and-mouse approach).

The disadvantage is the uncertainty it casts over the government's pledge to show world leadership by cutting CO2 by the 20% promise.

Recent calculations suggest that on the current trend, the government will achieve no more than a 10% cut.

Coalition call

Jeremy Nicholson, spokesman for the Energy Intensive Users Group, said that "the worst thing for British industry would be to lock us into a target that would be either unrealistic or left us at a competitive disadvantage".

The Conservative environment spokesman, Peter Ainsworth, added: "Industry are constantly telling us that they need clarity over emissions cuts so they can plan their investments.

"This is a classic dithering. It looks particularly bad in a week when the PM has added a foreword to a report saying climate change is even worse than we thought, and in which government figures showing CO2 is still rising not falling."

He and the Liberal Democrats have called on the government to join their cross-party coalition on climate change.

Stephen Tindale, of Greenpeace, called the situation "ridiculous", adding: "For the government to leave this hanging and say 'we haven't made up our minds' is making it impossible for the electricity supply industry to cut carbon emissions".

In a statement, the government said it was committed to a 20% CO2 cut and was approaching agreement on how it might be delivered.

Autumn report

The row matters enormously because although the UK produces only 2% of the world's CO2, it has a disproportionate profile in the global climate debate.

Other nations are looking to see if the prime minister can shift the UK's economy to the 20% cut without harming business. If he succeeds, others will follow.

Competitiveness is the key. The Chancellor Gordon Brown has asked a leading economist, Nick Stern, to investigate if CO2 cuts will damage an economy or stimulate it.

His verdict, due in the autumn, will help shape the course of policy in the UK and perhaps worldwide.

It is already clear he is not convinced by the case that by leading the way on CO2 cuts the UK risks damaging the overall economy.


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