Clean Growth Strategy: strong on sentiment but short on detail
Eagerly awaited policy documents often result in major disappointment. So, following publication of the Clean Growth Strategy by the Department for Business, Energy and Industrial Strategy (BEIS), should we be impressed or underwhelmed? Encouraging industry to curb emissions and develop a more circular economy requires a pro-active policy framework. Manufacturing companies need support as they invest in the transition – not just fine words.
The Strategy rightly recognises that low carbon investment will drive productivity, job creation and growth. But for the industrial sector, BEIS seems to be leaving details on how this will be achieved to the Industrial Strategy White Paper, to be published later in 2017.
The 165-page paper states: “Our aim is to become one of the best places in the world for low carbon innovation. We understand the need for Government funding that is accessible to private, public and community sector organisations with all playing key roles in supporting and harnessing innovation.” It also recognises that state funding can stimulate “private sector investment from the UK and overseas, both through direct leverage and by creating confidence in the potential to attract follow-on investment for particular innovations.”
Other aspirations include industrial decarbonisation and energy efficiency action plans, and support for recycling heat generated in industrial processes. However, smaller businesses need to be motivated to adopt existing low carbon technologies. At present, the delay in the reform of the RHI is inhibiting industrial investment in low carbon heat solutions.
In the agri-food sector (a key part of Britain’s bio-economy), demand for clean sources of energy should extend across the supply chain, from production processes to transport of final products. If Ministers want to encourage business to invest in better resource use they need to establish an incentive regime that supports industrial low carbon solutions.
After the 2015 Paris COP21 Climate Change Convention, leading food and drink multi-nationals committed to changing their practices, with this statement of intent: “We want the facilities where we make our products to be powered by renewable energy, with nothing going to waste, as corporate leaders, we have been working hard toward these ends, but we can and must do more.” Two years later, with global food companies setting ambitious targets for limiting their greenhouse gas emissions, British companies of all sizes must match these aspirations.
A more circular economy requires novel raw materials, resource-efficient manufacturing and low-carbon fuels for production and product distribution. Smaller businesses that proliferate in the food sector can match investment by larger multinationals. Investing in bio-energy solutions on industrial sites will boost engineering jobs, inspire innovation and create export opportunities.
According to a recent BBSCR report, the bio-economy contributes £36 billion in gross value added (GVA) to the UK economy, of which over 80% is from food and farming. Industrial biotechnology and bio-energy contributes about 5% to the sectors’ GVA, accounting for about 7,000 jobs. With a supportive policy framework, businesses in the sector can do much more.
Installation of multiple bio-energy plants should be encouraged alongside resource-efficient carbon saving and bio-refinery technologies. Seed funding and investment in demonstration sites will help smaller British companies cut emissions. If we are to develop cleantech export markets and show global leadership in industrial carbon reduction, British industry needs policy stability and funding support for commercial adoption of low carbon solutions
The UK may be leading research on carbon reduction, but it is commercial exploitation that will drive clean growth. Leadership requires more than research investment; it needs a long-term bio-energy policy, plus more effective engagement with industry on their future needs, to create confidence and develop suitable policy levers. With effective support for smaller companies with on-site projects, the bio-economy can become a growth sector for the post-Brexit economy.