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Autumn statement: Osborne delivers a win for social investment but omits environment

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Investors will receive tax reliefs from April 2014 when they invest in social enterprises and social impact bonds, George Osborne revealed in an autumn statement on Thursday that on the whole disappointed the sustainability space.

The chancellor’s speech also included announcements on further tax benefits for the shale gas industry and extra funding for start-up businesses, as well as support for the science, engineering and technology sectors.

The social investment tax relief – which was proposed in the form of a government consultation that closed in July – will be available for equity and some debt investments in vehicles such as charities and community interest companies.

Further details on the tax relief and its regulatory make-up are set to be revealed next week, with the government also set to publish a social investment road map early next year.

Simon Howard, chief executive of the UK Sustainable Investment and Finance Association (UKSIF) welcomed this aspect of the chancellor’s speech, but described it as “a great shame” that he failed to provide long-term policy support for renewable energy investors.

He said, “While we welcome both the more environmentally sustainable projects highlighted in the Treasury’s new infrastructure plan and the measures announced today on social investment, recent statements by the prime minister on so-called ‘green levies’ and the lack of any real support for the low-carbon economy in the chancellor’s speech today demonstrate a worrying lack of understanding in the Treasury and No 10 of the impact that long-term megatrends like climate change and resource security can have on the UK’s growth and financial stability.”

Measures to alter the distribution of renewable energy subsides had already been made public so Osborne’s speech included nothing new for the green economy. He confirmed a £50 reduction in energy bills by cutting back some of the environmental and social levies that are currently in place.

The chancellor did, however, say, “Going green doesn’t have to cost the Earth.” This represents a small step in the right direction – at least in terms of his rhetoric – after he told the Conservative party conference in 2011, “We’re not going to save the planet by putting our country out of business.”

In his autumn statement, Osborne revealed that the government would be offering further tax breaks to “encourage investment in shale gas that halves tax rates on early profits”.

Friends of the Earth’s executive director Andy Atkins said this proved the chancellor “hasn’t done his homework: [fracking firms] won’t lower bills, MPs say they are unjustified – and they could be illegal”. Meanwhile Paul Ellis, chief executive of Ecology Building Society, described the move as “shortsighted”.

Investors and savers will be disappointed that changes to individual savings accounts (ISAs) – which had been rumoured before the statement – weren’t mentioned in Osborne’s speech. It had been speculated that peer-to-peer lending and crowdfunding would be allowed into the products.

Meanwhile, Mark Hoskin of London-based financial advisory firm Holden & Partners said, “The great news is that the government did not tinker again with pension allowances, though the pension landscape remains incredibly complicated.”

Despite the positive moves in social investment, the overall picture was a familiar one for the sustainability space.

Osborne described science as a “personal priority”. If that were truly the case, his autumn statement would have included greater measures to cut the UK’s carbon emissions, strong rhetoric, backed up with similarly robust policy, on the important of clean energy and a blueprint for sustainable growth.

Speaking in September, the chair of the Intergovernmental Panel on Climate Change (IPCC) Rajendra Pachauri urged governments to “see the scientific reality of [climate change] inaction and what this will lead to in terms of impacts and the kinds of threats it is going to pose”. Meanwhile, the government’s climate change advisers the Committee on Climate Change said in a study earlier this year that investing in clean energy would bring about significant financial benefits, to the tune of around £1,600 per UK household, while also helping slash greenhouse gas emissions.

As it was, climate change remained a subject not touched upon by Osborne, in another speech that failed to recognise a healthy environment underpins a prosperous economy.

Further reading:

Autumn statement: the reaction

Autumn statement: financial advisers talk social investment tax relief

Autumn statement: sustainable investment industry calls on Osborne to back renewables

Autumn statement: green NGOs reveal their wishlist

Economy

New Zealand to Switch to Fully Renewable Energy by 2035

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renewable energy policy
Shutterstock Licensed Photo - By Eviart / https://www.shutterstock.com/g/adrian825

New Zealand’s prime minister-elect Jacinda Ardern is already taking steps towards reducing the country’s carbon footprint. She signed a coalition deal with NZ First in October, aiming to generate 100% of the country’s energy from renewable sources by 2035.

New Zealand is already one of the greenest countries in the world, sourcing over 80% of its energy for its 4.7 million people from renewable resources like hydroelectric, geothermal and wind. The majority of its electricity comes from hydro-power, which generated 60% of the country’s energy in 2016. Last winter, renewable generation peaked at 93%.

Now, Ardern is taking on the challenge of eliminating New Zealand’s remaining use of fossil fuels. One of the biggest obstacles will be filling in the gap left by hydropower sources during dry conditions. When lake levels drop, the country relies on gas and coal to provide energy. Eliminating fossil fuels will require finding an alternative source to avoid spikes in energy costs during droughts.

Business NZ’s executive director John Carnegie told Bloomberg he believes Ardern needs to balance her goals with affordability, stating, “It’s completely appropriate to have a focus on reducing carbon emissions, but there needs to be an open and transparent public conversation about the policies and how they are delivered.”

The coalition deal outlined a few steps towards achieving this, including investing more in solar, which currently only provides 0.1% of the country’s energy. Ardern’s plans also include switching the electricity grid to renewable energy, investing more funds into rail transport, and switching all government vehicles to green fuel within a decade.

Zero net emissions by 2050

Beyond powering the country’s electricity grid with 100% green energy, Ardern also wants to reach zero net emissions by 2050. This ambitious goal is very much in line with her focus on climate change throughout the course of her campaign. Environmental issues were one of her top priorities from the start, which increased her appeal with young voters and helped her become one of the youngest world leaders at only 37.

Reaching zero net emissions would require overcoming challenging issues like eliminating fossil fuels in vehicles. Ardern hasn’t outlined a plan for reaching this goal, but has suggested creating an independent commission to aid in the transition to a lower carbon economy.

She also set a goal of doubling the number of trees the country plants per year to 100 million, a goal she says is “absolutely achievable” using land that is marginal for farming animals.

Greenpeace New Zealand climate and energy campaigner Amanda Larsson believes that phasing out fossil fuels should be a priority for the new prime minister. She says that in order to reach zero net emissions, Ardern “must prioritize closing down coal, putting a moratorium on new fossil fuel plants, building more wind infrastructure, and opening the playing field for household and community solar.”

A worldwide shift to renewable energy

Addressing climate change is becoming more of a priority around the world and many governments are assessing how they can reduce their reliance on fossil fuels and switch to environmentally-friendly energy sources. Sustainable energy is becoming an increasingly profitable industry, giving companies more of an incentive to invest.

Ardern isn’t alone in her climate concerns, as other prominent world leaders like Justin Trudeau and Emmanuel Macron have made renewable energy a focus of their campaigns. She isn’t the first to set ambitious goals, either. Sweden and Norway share New Zealand’s goal of net zero emissions by 2045 and 2030, respectively.

Scotland already sources more than half of its electricity from renewable sources and aims to fully transition by 2020, while France announced plans in September to stop fossil fuel production by 2040. This would make it the first country to do so, and the first to end the sale of gasoline and diesel vehicles.

Many parts of the world still rely heavily on coal, but if these countries are successful in phasing out fossil fuels and transitioning to renewable resources, it could serve as a turning point. As other world leaders see that switching to sustainable energy is possible – and profitable – it could be the start of a worldwide shift towards environmentally-friendly energy.

Sources: https://www.bloomberg.com/news/articles/2017-11-06/green-dream-risks-energy-security-as-kiwis-aim-for-zero-carbon

https://www.reuters.com/article/us-france-hydrocarbons/france-plans-to-end-oil-and-gas-production-by-2040-idUSKCN1BH1AQ

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Economy

How Going Green Can Save A Company Money

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going green can save company money
Shutterstock Licensed Photot - By GOLFX

What is going green?

Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.

The first step in going green

There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.

Making needed changes within the company

After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.

Reducing the common paper waste

paper waste

Shutterstock Licensed Photo – By Yury Zap

Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.

Make money by spreading the word

Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.

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