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Ed Davey's speech to GLD Nottingham Conference 2018 - Green action the LibDems took when in Coalition with the Tories

March 14, 2019 12:08 PM

GLD Conference 2018 - Ed Davey enjoying a well earned cuppa (KNDaws)

See GLD Nottingham Conference webpage here

(Also see Ed Davey's speech to the 2018 LibDem Southport conference here

Introduced by Louise Harris

Sir Ed Davey was Secretary of State for Energy and Climate Change from 2012 to 2015 in the Coalition Government.

Ed: Its really good to be here, thank you for inviting me, Nottingham is my home city, so its nice to come back.

What I thought I'd do is not just give you a full history of Liberal Democracy, but talk about the coalition, and where we need to go from here, seeing the future in an immediate historical perspective

I joined the Liberal Democrats in 1989, and the reason I did was mainly about commitment to the environment.

Its good to see Green Liberal Democrats as strong as ever, even stronger.

The coalition, (people in the party often think 'oo that's difficult', failing to realise that we did some fantastic things in loads of areas: pupil premium, education, tax allowance, social care, mental health, a very long list.

I also think the environment is very much in that stellar list, particularly on renewable power, but on a whole rainbow of things too.
Stuff that Vince did on electric vehicles, things Norman Baker did at Transport on local transport hubs, the plastic bag tax ...

I'm going to talk about what I did in the department of energy and climate change because its what I know best.

I'm going to talk about two big examples, one domestic, and one international, related to climate change.

But please if you want to ask about other things,both the successes and the less successful things, I'm very happy to talk about them.

On the successful things which I won't cover- district heating, which we pushed ahead with across the country.

We launched the country's first ever community energy strategy.
We did stuff on fuel poverty that is not recognised.
Stuff on regulations on energy efficiency which has survived the Tory cuts, more or less.
Lots of little projects which were incredibly significant in taking the green agenda forwards.

The things that are big when you think about the climate change agenda is really what we were doing on electricity.

On climate change, you think about electricity, power, heat and transport.
When you look at how you're going to reduce greenhouse gases over a 20 30 40 year period, most people believe you have to start with power.

The reasons are :
A) that is technically ahead of the other technologies
B) Its physically easier because you're dealing with a small number of plants, three or four hundred power plants you're trying to replace or reinvent, rather than heating systems in 26 million properties, or 30 million vehicles.

So its easier to do, but even more importantly, if you green power, part of the solutions for transport and heating will be electric, but they're not green if the electricity isn't green, so you've got to start with getting electricity green.

If you do that then decarbonising heat and transport becomes a lot easier.

That's why we, when we got to power in 2010 focussed so hard on the power sector. It made sense, you could move fast, it was an enabler for years ahead.

In the big picture we quadrupled renewable power in this country, Liberal Democrats did.
Stuff we did in the coalition, contracts that we signed, (which the Tories couldn't get out of, for green power stations which are being built now), that was us.

Obviously you know statistics: when you're starting from a low base its easy to quadruple starting from a lower base - I get that - nevertheless it was a massive increase in a relatively short time.

It was everything from solar to biomass, to onshore wind, to offshore wind, and some tidal, a lot of stuff in that piece
of getting CO2 emissions down rapidly, as well as greening our electricity system.

A long long way to go, but I think our fundamental success was in greening electricity.

I'm just going to take off my sock, because this is a present from Greenpeace with wind turbines on. The reason Greenpeace gave me this sock was because of all the stuff we did on green electricity, the most significant was what we did with offshore wind. Because we've got offshore wind to a point in this country, and in the world, and in history, where offshore wind is now going to be a major low carbon source of power.

Now we weren't the first ones to think of this, indeed Ed Milliband did some good stuff on offshore wind in his time as Climate Change Secretary.

However, the really big decisions in changing the way we funded offshore wind farms, and industrialising offshore wind to get the prices down, so we can shut the Daily Mail up, and offshore wind become one of the cheapest form of electricity, those decisions taken by Chris Huhne and myself as Liberal Democrats.

The main change was to change the way we subsidised renewable power to a new form called 'contracts for difference', the main impact of that was that it enabled competition to come in, to push the price down, to reduce the amount of subsidy much more quickly.

We created auctions where companies were competing for the right to get a contract of difference for renewable subsidy.

That created a massive stimulation innovation, in the supply chain, it pushed the price down.

So the second auction of for contracts for difference, which happened in October 2017, (would have happened earlier if we'd been in charge), under the model which we put in place, (not a Tory model, a Liberal Democrat model), the price of offshore wind for a farm opening early next decade is going to be basically as cheap as gas.

That is a historically dramatic reduction in the price of electricity in a relatively short period of time. The historic significance is that it means rather that the Daily Telegraph and the Times and the Mail and the rest of them saying the price of green power is expensive, they can no longer say that, and that is a dramatic shift.

Now were seeing offshore wind farms really take off, even the Tories are now having to realise that their best way of replacing old coal stations as they come off, old nuclear power stations as they come off, is offshore wind.

One of the big decisions which I personally had to make was we had a pot of money I spent a year negotiating with George Osborne on, a pot of money which is basically money that goes on peoples' bills to pay for these contracts of difference.

I had to decide how much of that to put into the first stage.

The submission form civil servants had 3 options.

The least ambitious option was giving less of these subsidies up front, would have meant we got one or two wind farms but nothing else, and the industry would have gone ' "well if that's what we can do we'll go away".

The second one would have got a few more wind farms up but not a supply chain.

The supply chain is really important, building turbines, building the nacelles that go on top of the wind towers, that critical supply chain, if we'd gone for the 2nd option which is what the Tories wanted, we'd have got no supply chain, we'd have got some wind farms but the future would not have been secured.

By putting a lot of money in this first round (which I got criticised by the national audit office but they were wrong and I was right) meant that we got Siemens to invest in Kingston on Hull. In Kingston on Hull they are now building a factory which will produce the wind turbines and blades for offshore wind farms for the future.

That is reviving a city which was in a hundred year decline (pretty good side effect).

This confirms Britain as the leader in in the world offshore wind, and has helped get the price of offshore wind down, thus defeating the Tories and the climate change deniers and right wing press, that means that offshore wind is here to stay.

Take nothing away from the history of Liberal Democrats and what we've done in decarbonising.

We have in the first stage of decarbonising electricity managed to get probably the most available and most high volume form of green energy, offshore wind, away, so its here to stay.

Clearly we need more onshore wind, As Secretary State I was in daily battles with Eric Pickles (a man on the dark side).

We were winning while in coalition, but since then they've stopped onshore wind - absolutely crazy!

Because onshore wind is now the probably cheapest form of energy in this country.

Tidal lagoons only came on my desk relatively late on, after the Severn barrage (which I'm very much against).

But tidal lagoons I think they are a strong existing technology, so less risk. You could probably get 10% of Britain's total power needs from tidal lagoons, and of course they're predictable and work very well in a system with wind and solar.

We pushed that very hard.
We were never going to get across the line because these things take years, a long time in policy terms, we were up against Tories and my own department, one or two civil servants did not want to do tidal.

We got to a point where to Tories even put it in their manifesto which was staggering.

Although they haven't made a decision on the Swansea Bay Tidal Lagoon yet, it is in the debate now.

So the next really big form of renewable electricity is still being debated, tidal lagoons, and that would not being debated if we hadn't had Liberal Democrats in charge to push it, no other idiot was going to push it: this idiot and Liberal Democrats were pushing it.

We had a huge role to play in renewable energy which was a big thing.

We could talk about lots of other things.

There's lots more on the domestic agenda we could talk about: energy efficiency, reducing energy demand, storage, consumer side, carbon capture storage, nuclear, fracking, whatever you like; but the really big story of achievement is offshore wind.

One thing that slightly irritates me in discussions in the party is everyone talks of the negatives not the positives … and offshore wind is a massive positive for us, so let's bloody talk about it.
I think of historic significance

Let's talk of the role we played, Chris Huhne first, and then myself, in international climate change talks

Don't forget we could be perfect in this country, we could be the best in the world, we could get 2 ½ percent of global greenhouse emissions down, but we still fry, and the earth is still submerged.

Domestic stuff great, it can help internationally, we can export that, and help other people.

But you've actually got to get out there at the EU, at the UN, with bilaterals, relationships with countries like China and India, to promote the climate change idea / agenda

Chris and I worked at all those levels.

I think the most important was the EU, and that's one of the reasons why Brexit is a complete and utter disaster for environment.

Let me tell you a story of EU climate diplomacy as I experienced it ...

When I became Secretary of State in February 2012 and I looked around the energy council at Brussels, it was pretty clear that of the six big states: UK, Germany, France, Italy, Spain, and Poland that none of those six besides ourselves was likely to really push the climate change agenda, for lots of domestic political reasons in their own countries.

Poland primarily because they want to burn as much coal as they can possibly burn, Germany because of their coalition ….

So it was clear to me if you were going to get climate change agenda pushed really hard on EU level, (which was critical for the world agenda because the EU are out there above China and the US in particular), Britain had to take the lead.

If your want anything done at Brussels you have to form coalitions, coalitions of member states, countries that think like you, that share the objective.

So I set up something called the green growth group.
We got a number of member states to come for dinners at the UK residency at Brussels, we got our officials together to discuss how we as member states who wanted to take action on climate change at the European level, could work together to make that happen.

Knowing that we have opponents in industry, knowing we had opponents around the table from places like Poland, and how we going to win those debates.

Round the table we got Germany, Italy, Spain, France, the Netherlands, the Scandis, Slovenia, a number of other countries, we started off with about nine of us, grew to about twelve.

We had about 80% of the votes. We knew if we could agree we could take it to the council and get a really ambitious agreement.

The problem was the Germans wanted to repeat the agreement we had in 2020, and update it to 2030 (the agreement reached in 2008 between Merkel and Blair, renewable targets, energy efficiency targets, and greenhouse gas targets for 2020; and the EU is going to meet those targets).

But the decision in our time was EU targets for 2030.

You need targets a long way off so that industry can prepare and invest to meet those targets.

So the real debate was what targets was Europe going to adopt for 2030 and take to the UN Paris summit, to get others to move globally, that was a real issue.

The problem was Germany wanted more renewable targets - the Tories weren't going to accept that.

Moreover eastern Europe wanted something with nuclear power as their low carbon electricity

Knowing that the winning coalition had to bring those sides together, I pushed for a technology neutral target for how you did it, as long as you did it.

My focus was being much more ambitious on the amounts of greenhouse gas emissions we were going to cut.

That's what matters for the climate, for the environment, for the planet, how much greenhouse gas emissions you get, how quickly you cut them.

That's what we discussed at the UN, you never discuss technology, you discuss greenhouse gas emissions, the output.

I decided we'd go really big on that, I tried to persuade the Tories that we should go for a 40% cut in greenhouse gas emissions in Europe by 2030.

That was on the outside of the climate change act 2008 requirements
- it already required the UK to cut our greenhouse gas emissions
on the way to reduce them by 80% of 1990 levels by 2050, but it still was a bit weak.

I wanted an EU international treaty to make sure we were locked into the climate change act, and was a little more ambitious than that, whilst making sure other countries had to do their bit as well.

I tried to go for 40% reductions. The Tories did not want to do this, they opposed it. Eventually we wore them down and they agreed to it, they sent an email to my office with a chain of emails, at the bottom they had emails to themselves not realising … (always be careful (classic mistake))) and in their email between themselves they said: "oh give him the 40% reduction he'll never get it".
We got it.
They were bloody mad.
It was not easy.

When I went to Connie Hedegaard, the European Commissioner for Climate Action from 2010 to 2014, when I said we were aiming at 40%, she said "ha ha you'll never get it, good luck, I hope you do"

We got it because we organised politically at the E.U. level
we had this coalition, we had this green growth group.

We sat for two years amongst the people who believed in action on climate change, listening to each others positions, working out how we could get a deal together, which got the objective, but gave everyone else the ways that they could do it.

It took a long time, about two and a half years actually to get all the climate change ambitious countries like Germany France and so on together, so we could go to the council and sideline Poland, which is what we did.

(Although actually we worked hard with Poland because I don't believe in a politics which is just hostile. (So by the end of the negotiations with Poland I knew the inside leg measurement of the aunt of the climate change minister - you had to get to know them very well to be able to persuade them ) ).

The point I want to make is that at Europe, if you're there, if you're ambitious and you work with other countries doing real politics, like we do in councils, parliament and so on, you can get ambitious things.

The heads of government, the European council in October 2014, signed a deal where the EU was committed to 40% reductions in in greenhouse gases by 2030.

That didn't get any headlines - you won't be surprised to know the British press weren't interested in anything on Climate Change at a European level linked with the Liberal Democrats, a combination they didn't want to report, and so they didn't.

We got one piece in the Guardian on what was actually the most significant EU deal on climate change ever.

But the rest of the world noticed, they were very surprised at the level of ambition.

A month after the EU heads of state signed that deal, the US and China did a joint deal saying they would be more ambitious.

And all that was the year before Paris.

So you had a glide into Paris, to the climate change summit in Paris.

You've got to give huge amounts of credit to Obama, huge amounts of credit to Prime Minister Narendra Modi of India, you've got to give huge amounts of credit to President Xi Jinping of China..

But also the E.U. and the Liberal Democrats in the UK at the EU table.

So you know, the success at Paris, (we weren't there, it was after the coalition), that would not have happened if the Liberal Democrats hadn't been in coalition.
I'm absolutely sure of that.

So whether its on wind turbines, or whether its on EU and climate change agreements, that is what the Liberal Democrats have achieved.

And we wouldn't have achieved that if we didn't have Liberal Democrats and Green Liberal Democrats talking about it and campaigning on it and making it a high priority in the party, which we did.

It's a history I think we should be proud of

Now where do we go from here?

The Tories have rowed back on some of the stuff we did, of course, but they can't dismantle the power plants that we built, they cant dismantle a lot of the progress, they can't dismantle the agreements, but they've gone much weaker: we've seen a massive decline in solar growth, no onshore wind effectively, much weaker energy efficiency performance, a whole range where they've really slowed the pace of change down; we've got to campaign to quicken that up, particularly on regulations on energy efficiency on buildings, and on tidal lagoons.

What were the challenges that we were not able to deal with?

I talked about greening power, but we didn't deal with greening heating and greening transport.

Its not that we didn't do things on those, we did, a lot.

But the technologies are in a much more nascent infant state,
particularly in heating.

Transport as you'll have heard is going a long way, electric vehicles are beginning to take off, that's partly because of another supportive technology: batteries. Storing electricity for use in cars when the wind is blowing, the sun is shining is a critical part. Huge amounts of money globally have been pushed into storage technologies, that is what will fuel green transport.

Yes there'll be a role for hydrogen cars, yes there's a role for fewer cars more trains and buses and cycles and walking, but, if we don't have green cars we wont solve climate change simple as that.

And that is beginning to happen globally, and whilst the UK should have a role in that its going to happen with or without the UK.

Americans and Germans and Chinese and the Koreans and Japanese are there and leading the way. We've got to go on the journey with them.

So transport is sort of happening, we can do more, particularly at local government level.

But the real challenge is to decarbonise, particularly in the northern hemisphere, (less of a problem near the equator).

The real challenge, which we have not solved, is heating.

Most of the gas we use is for heating our homes. Most of the carbon emissions are from the building sector. That is very much unfinished business.

We need to do a lot on energy efficiency so we're not wasting so much energy in the home, that's a no brainer, but even if you take a leap of faith, even if you insulated the building stock as best as we could, we'd still need a heating source.

There are multiple heating sources: air source heat pumps, water source heat pumps, ground source heat pumps, biomass, various forms of district heating (depending on what you use to heat the water), and there's non fossil fuel gas.

Let me rest on that for a moment.

In government we were experimenting with electrified heating, heat pumps, experimenting with biomass, and district heating. But at relatively low volumes. There's a reason for that. That is that there's a real challenge if you use those technologies to replace methane gas, it looks like it will be very expensive, take a long time, and have a lot of political reaction. Most people are used to their gas boilers and central heating systems, nice and simple with north sea gas. To rip out all that? I call that politically brave. We haven't quite worked out how to do that.

Instead there's a lot around Hydrogen (which really wasn't happening when I was Secretary of State).

Whether or not hydrogen or some other form of hydrogen mix or a biofuel could be used as a replacement for fossil fuel gas. We're a long way off from knowing if that is going to happen, so don't rush off say Ed says hydrogen's the way of the future. it may be, it may not, we don't know.

What we should be doing is very large scale pilots of all these different low carbon, zero carbon heating options. All these heating options. We've got to get cracking on this, the government's being far too slow.

We could crack up the pace in our time, but we weren't able to fix that as well as all the other stuff we were doing.

So, to conclude: we did a load domestically on power, (particularity offshore wind), we did a load internationally.

The challenges for the UK are without doubt around heating.

But let me end on this for the world, about environmental issues globally

Although we've had some successes here and elsewhere, both Liberal Democrats and other people who care about climate change, the threat of climate change is if anything as bad as ever.

The science shows that global warming and human impact on the environment is probably worse than we thought just a few years ago.

I don't want to you to run way with the idea that because we have had some successes that we are anywhere near to fixing this problem. This is going to be with us for several decades, I regret to say, if we don't take action this decade and the next decade we'll be in real problems, too late. This has to remain a top priority.

But the prize for doing it is massive. We've shown that green can be cheaper than a fossil fuel. But there are other massive benefits too.

The first is the way that renewable power can tackle poverty, particularly for the poorest people in our world

I am so excited by the impact of solar energy. We don't have a comparative advantage in this country but they do in other countries, in rural Africa and rural India, solar will bring electricity to villages for the first time which have never had it, it will massively change their lives, keep their medicines cool enable them to be involved in the wider economy, help their children study…

Rural solar power will be one of the big things this century to tackle global poverty. That's good enough in itself for me, as well as helping fighting Climate Change.

But it's even better.
One of the most disruptive conflict full parts in the 20th century is the fight for energy resources. Obviously in the middle east but tensions elsewhere, Russia and so on. Wherever there's oil and gas there's corruption, there's oligarchies, nasty dictators, war and conflict, unfortunately.

If we can get rid of oil and gas, if we can get rid of fossil fuels, if we can have energy systems that you don't have to pay money to import it, that is available to anybody in the world, wind or solar or tidal, whatever, wow - have we made a good impact for the cause of peace and security.

Let's keep going on this agenda.

We have to because of climate change, but the prize is even bigger, things we want to achieve as Liberal Democrats


QUESTIONS: 5 or 10 minutes for questions:

1) Leon Duveen: the N word - nuclear power
Do you think we will get another nuclear power station in this country?

Ed: The short answer is no but I'll give you a longer answer ...

2) Tom Gerhaity? Newham capacity of offshore and onshore, why are we spending so much on ???

3) Why arent we encouraging general members to become Green Lib Dems?

On the last one that, its for all of us, I'm very happy to recommend green lib dems, to come to conferences.

On the nuclear questions Let me give you a bit of background
You've got to remember we had a coalition agreement where nuclear was in it, the Tories love nuclear, but we had to get renewables.
It was part of the deal, if we didn't do nuclear we wouldn't have got renewables.

When I was signing the first contract for offshore wind they were £140 per mega watt hour, Hinkley Point C is 92.5 or 89.5.

The choice was: while I'm selling contracts at 140 for the wind we want, they wanted nuclear at 90 odd.

The reality of the politics.

The reason why Chris I and others thought this compromise was worth going for, was at least nuclear is low carbon.

Moreover when I was secretary of state, technology around storage of electricity, either overnight short periods or long periods, was, when I used to ask officials about it they said ten, fifteen years away.

If electric storage had been ten years away, intermittency, when the sun isnt shining and the wind isnt blowing, becomes a massive problem, no lights on, no industry

Hence the attraction of nuclear to low carbon necessities, when storage technology didnt look like it was going to happen, and other renewables looked very expensive.

Actually nuclear didn't look such a bad deal then.

Energy is the most innovative sector in the world, its moving really fast.

When you start talking to companies out there, see what happening, and its moving fast.

I think nuclear is losing the battle quickly.
I wouldnt say totally, climate change is a massive threat to the planet.

At the moment. in the last 4 or 5 years , declining cost of wind and solar
and the in increasing likelihood that cheap storage ..

Nuclear looks like its not answering any questions, doesnt look like its got a particular use.

So, to Leon's question, its not just the cost of nuclear that rules it out, the way that energy technology is going, since the coalition, suggests that nuclear doesnt answer the needs for the future.

In terms of why we still pay money on it, the contract's been signed, by Theresa May.

Would I have signed it?

Back in 2013, 2014 the world was as I'd just described it, renewables very expensive, no storage technology, I'd have signed it then at that price.

Historically I'd challenge people on the evidence available at that time to say they would have done otherwise.

If they care about climate change. I don't think we had that choice

When they signed it about 3 years later I think it was a lot more marginal.
But they signed a contract which is enforceable in courts, so I think wtheyve got to proceed with Hinkley Point C.

Three things to think about :
1) I think the chances of Hinkley Point C ever being completely built and generating electricity is about 50%

The good news is the contract that we developed
( I finalised it - I don't know if the Tories changed it, I very much doubt it)
is that they only get paid on the electricity they generate.

So if it doesn't get built, or it gets built and doesn't generate electricity, they receive no money.

Thank you French.
They take all the risk.

That actually increased the price

What you're hearing in the press now
subsidise ???
tax payer ??
in order to get the price down

so thinking of building a Wilbur??? power station in
we were deliberately avoiding that
I think nuclear is highly risky
always go over budget
we needed to shift the risk to the developer
which is what we did

Hinkley Point C might never get built
if so you and I dont have to pay a penny

Is it worth it if it gets built paying that money?

Its not a disaster, having some base load energy you're generating all the time, about 5 to 7% of Uk energy is actually very helpful

I wouldnt go more than that because solar is increasingly a base load, especially in summer,
if you have too much nuclear you squeeze out solar.

There's quite a strong argument for having about 5 to 10% of your energy system in nuclear.
So having Hinkley Point C will not be a bad long term decision


George Miles:
at Southport Vince asked for a green policy for the front of our manifesto-making just one?
Could it be onshore wind? - The Tories are against it

Mary Paige
Microgeneration - a big aspiration

a leaflet came through the door to install a charging point

Ed - I know nothing about that

Louise - there was a pot of money, the intention was to get lots of charging points where people would use them ..

Ed: Let me try and link the answers, big idea…

Buy the big ideas book

Your home, your power plant, no energy bills

I think thats better than onshore wind because they want to know how its going to effect them, if you talk about their energy bills they can more relate to that …

I dont do much business now, but ive kept three
I'm chairman ??

I do some advice workshops

a solar developer

One of the models they're looking at is in the domestic market, putting in a combination of smart meters, electric vehicle charging points, batteries, as a package, so you buy energy when its cheap and fill up your battery, the technology is evolving really fast, the rules and regulations on micro generation need updating.

With the roll out of smart metering

other technologies- Block Chain allowing people to trade electrons, electricity, among themselves

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Ed Davey's speech to GLD Nottingham Conference 2018