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Green Gas has made the headlines this week - it has reached a milestone whereby it supplies 1 million UK households. According to the G...

Monday, February 16, 2009

The credit crunch has hit at a time when the economy needs to become low carbon. While this is now more difficult, working to protect the environment could offer a way out of the downturn, argues Paul Bettison.

The debate about how we kick-start the economy and equip the country for when it emerges from recession is going on up and down the country at the moment.

Councils are facing the most challenging set of circumstances for a generation. Unemployment is forecast to continue to rise, and local authorities are facing a triple whammy of squeezed funding, declining income and ever greater demand for essential services.

At the same time there remains an urgent need to press ahead with action to tackle climate change ' the greatest long-term threat to our future prosperity and security. This makes economic and environmental sense. If we do not start to act, the economic consequences will be far graver in the future ' recession or not.

Creating a low carbon economy will develop new markets and new businesses. At a time when we are seeing redundancies on an almost daily basis, the LGA estimates that thousands of new green jobs could be created ' jobs that would help save carbon, reduce fuel poverty and protect those parts of the country at greatest risk from climate change.

Delegates from councils across the country recently gathered in Manchester for the LGA's annual climate change conference, the central theme running through the event being our call for a 'green New Deal' to provide a pathway out of recession. It used to be said that councils were inactive and complacent about the threat posed by global warming, but the sector demonstrated it has both the policies to deal with the effects of climate change and the innovation to seize the opportunities it offers.

People are concerned about job losses, home repossessions and the tight lending policies of the financial sector. LGA analysis has shown that the recession will have a tougher impact on some economic areas compared to others. Recession comes at a time that our economy needs to undergo a structural transformation to become low carbon. The credit crunch will make it more difficult to secure the investment necessary to make this transition, but it does nevertheless offer a route out of the downturn.

We are facing a historic economic challenge. Local government has many vitally important roles to play in helping businesses and residents through the economic downturn. Equipping the country to come through the recovery in a better position to combat climate change is also one of the most important challenges we face. Councils are already doing a great deal to promote 'green growth' through the creative use of planning, purchasing decisions, partnerships with energy suppliers, public sector apprenticeships and ' of course ' leading by example.

But there is an inescapable need to do more ' particularly in those areas at greatest risk from recession and where unemployment is already at high levels. The LGA will be calling on the government this week to give councils the powers they need to unlock the job creating potential of the low carbon economy.

Firstly, we need to tackle the problem of energy inefficiency in our housing stock. There are 10m homes in this country which lack basic insulation, and this is not only contributing to carbon emissions but driving up people's energy bills and trapping families in fuel poverty.

We want the government to introduce a national loans fund to allow residents to invest in solid wall insulation (where they have an older home) and install other measures like solar power. Led by councils, householders would receive an interest-free loan of up to £10,000 that would be secured through a second charge on the property. Up to 600,000 people could benefit from the scheme, collectively saving households in England and Wales £180 million each and every year.

Reform is also needed of the carbon emission reduction target to make way for a council-led national home insulation programme. This drive to make millions of homes more energy efficient would provide a much needed boost to semi-skilled employment.

We estimate there is the potential for 20,000 new jobs in home energy efficiency alone. At the opposite end of the spectrum, there will also be new positions in managing the risks associated with climate change, such as investment in new flood defences. Councils and community groups can help realise the benefit of renewable development by voluntarily identifying areas to the private sector that would be suitable for investment in certain types of renewable generation.

Our research and analysis shows that the job opportunities will differ from area to area. This is a result of the way different industrial sectors cluster, the varying opportunities for energy generation, the penetration of home energy efficiency measures, the nature of the building stock and proposed development and the variation in the risk areas face from inevitable climate change. Additionally, if the government devolved the employment and skills budgets ' including Train to Gain ' to councils this would also give local partners the flexibility to support people to undertake courses that meet the skills needs of the low carbon economy.

Collectively all of these measures that help reconcile the challenges of both a quick recovery from the recession with the imperative to structurally transform the economy to reduce the emissions that cause climate change ' a green New Deal at a time when the country needs it most.

Paul Bettison is chairman of the Local Government Association's Environment Board.


Article Date: 17 February 2009

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