The Conservatives launched their most recent Green Paper "The Low Carbon Economy: Security, Stability and Green Growth" on 16 January 2009 (the Green Paper). In it, David Cameron puts forward ideas which he claims were "just a few years ago…a pipe-dream, to be seen on Tomorrow's World…"

THE PROPOSALS

There are essentially three limbs to the paper; an 'electricity internet', 'new' low carbon energy sources and the reduction of emissions from non-energy sources of carbon.

ELECTRICITY INTERNET

The new "smart grid" forms the centre of the proposals. By introducing a grid which utilises an internet type technology of sophisticated exchanges between consumers and producers, the Conservatives say energy could be supplied according to demand and, therefore, wastage should be reduced.

The Green Paper compares the smart grid with the move from telephone systems to the internet. Based on this comparison, the Conservatives say such changes would dramatically change the way we currently deal with energy today.

Businesses and individuals could choose to use a "smart meter" which would allow energy supply to be controlled and would allow customers to feed power back into the grid from small-scale renewable energy production.

It is also claimed that the "electricity internet" would promote offshore wind power and large amounts of decentralised energy, by sophisticated load management. The Conservatives claim they would also work with the National Grid to examine the development of electricity storage facilities, using hydrogen or compressed air to balance the electricity generated by offshore wind turbines to provide a more constant and predictable flow of electricity to the grid. 'Plug-in' cars would be promoted through the new smart grid system, with widely deployed on-street plug points. The paper claims this would have a dual effect of reducing car emissions and cutting the everyday cost of motoring.

NEW SOURCES OF LOW CARBON ENERGY

The Green Paper promotes the addition of carbon capture and storage to all new coal-fired power plants. Another proposal envisages the replacement of up to 50% of residential gas heating with biogas produced by anaerobic digestion. Such gas would be fed into the gas networks, saving more carbon dioxide than if it was used to make electricity (as on an energy from waste plant).

The Conservatives intend to support all forms of low carbon heat generation and will give local authorities powers to establish new Combined Heat and Power district heating networks. As well as introducing 'new' products to the system, there are also plans to introduce binding rules for the sustainability of existing biofuels and establish a more ambitious Renewable Transport Fuel Obligation to promote the development of sustainable second-generation biofuels.

LOW CARBON BUILDINGS, TRANSPORT AND COMMERCE

Non-energy sources of carbon are also included in the Conservatives' plans.

Housing currently accounts for 27% of the UK's carbon output. Proposals outline an immediate entitlement of household grants of up to £6,500 for approved energy efficiency improvements. The Green Paper states that bills will instantly reduce, however, as the cost of the improvements will be recovered through increased energy bills over a period of up to 25 years – adopters of the scheme would arguably be taking out an 'energy efficiency mortgage'. Companies subject to mandatory emissions reductions schemes (such as the Carbon Reduction Commitment) would be allowed to help meet their carbon reduction requirements by sponsoring the energy efficiency improvements in their employees' homes. The Conservatives also propose to establish a new high speed rail network between cities in the North and South of England. This, they argue, will promote economic regeneration, generate jobs and negate the need for a third runway at Heathrow.

REACTIONS TO THE GREEN PAPER

David Miliband, of the Labour Party, has accused David Cameron of having "no idea" how he plans to finance the plans, in particular, making homes more energy efficient. Mr Miliband commented:

"He has actually promised to cut budgets across the board - including cuts which could fall on our programmes which help the poorest keep warm,"

Neil Bentley, CBI Business Environment Director, however, has said:

“The emphasis on improving energy efficiency and securing the UK’s energy supply is right. We agree that much needs to be done to develop renewable energy sources, such as tidal and wind power, alongside new clean coal and nuclear plants.

“A smart grid is an interesting proposal that may help businesses and consumers reduce fuel consumption but would need to be cost-effective."

Graham Meeks, Director of the CHPA commented:

“Decentralised energy will be central to our low-carbon future, and the Conservatives’ proposals set out a progressive and comprehensive pathway towards making this a reality. The industry welcomes the explicit support for all forms of low-carbon heat generation and the commitment to develop CHP in parallel with new, local district heating networks”.