Government climate change policy could force firms to quit UK

27 July 2010 00:01  [Source: ICIS news]

LONDON (ICIS news)--Chemical companies could be forced to quit the UK under the burden of increased energy costs driven by the government’s climate change policy, the UK Energy Intensive Users Group (EIUG) and the Trades Union Congress (TUC) said on Tuesday.

Cumulative electricity, gas and emissions reduction schemes costs could be 141% higher by 2020, the employers and workers groups say in a report on the UK’s climate change policies. The higher costs would burden a number of energy-intensive industries including chemicals.

“Government needs to ensure a better balance of policy on emissions reductions between the industrial, commercial, transport and domestic sectors," EIUG director Jeremy Nicholson said.

Chemical Industries Association (CIA) chief executive and EIUG chair Steve Elliott said: “The cumulative impact of climate change policies hits manufacturing particularly hard and does not reflect the vital role that sectors such as chemicals have in reducing society’s carbon footprint such as better insulation, lighter car parts and low-temperature detergents.”  

“The chemical sector has already improved its efficiency by 35% since 1990. It is time that climate change policy recognised the importance of retaining manufacturing in the UK and incentivising innovation in low-carbon technology," he added.

The report calls for the UK government “to undertake a full cost-benefit analysis of energy-intensive sectors to understand the direct impact on the companies and the GDP benefit to the UK and its regions”, the two groups said in a statement.

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By: Nigel Davis
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