I’ve been at Leeds Royal Armouries today at an event run by the Major Energy Users Council. I hate being at a venue like this one and not be able to have a look around, but I am reliably informed that one of the exhibits allows you to mow down Johnny Foreigner with a WWI Vickers machine gun. Tasteless, but fun – according to my source.
Anyway, the great battle today has been the UK budget – the first full budget of the coalition Government. It has been very interesting to get the response from two quite different sides – the green lobby on Twitter and industry/commerce from the stage. Neither likes the budget – the former doesn’t think it goes far enough, the latter far too far. I grew up in Northern Ireland during the troubles and we used to say that if both sides hate a proposal, it’s probably a fair one.
Part of the dislike is politics, part perception. Left-leaning greenies are waiting for the Government to fail to live up to its aim of being “the greenest ever” (hardly a high bar to clear IMHO), whereas industry instinctively dislikes interference in its markets. So a small reduction in fuel tax to soften the blow of oil prices is leapt on by the greens (when the price at the pumps is still way above where it was 5 years ago), but industry is having a heart attack over the floor price of carbon. This boosting of the price of fossil fuel energy will favour investment in low carbon energy  and energy efficiency – or drive energy intensive industry overseas (aka carbon leakage), depending on your viewpoint. And I was hearing a lot of the latter today.
This latter argument is a real conundrum. Unless we can get global agreement on carbon reduction, there will be an incentive for poor countries to try to attract investment by lowering standards – the same ‘race to the bottom’ we have seen in labour standards and local taxation. On the other hand, that global agreement appears as elusive as ever. Personally I think we have to show leadership and cajole industry to follow the decarbonisation route, making the argument that it is good for their business to wean themselves off volatile fossil fuels.
The budget also illustrates the old problem of significance versus newsworthiness. The carbon floor price will have much more effect on the country’s carbon emissions than tweaking fuel tax, but the latter will dominate the media channels, formal and social. This constant need to keep those channels happy can make politicians reluctant to act. Given that industry can face up to four different taxes on the same kWh of energy, there is a good argument for simplification, but simplification means scrapping current schemes and that always attracts negative headlines, so we trundle on with a hodge-podge.
The same problem exists with corporate programmes – scrap a high profile programme which has run out of steam and the hyenas will pounce, no matter how good the reason why. No wonder we live in a world of spin, PR and brand protection – it’s a battle of messages as much as a battle of ideas. Dig those trenches and get the machine guns ready!