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Private finance will help solve green energy problem: Edward Davey
Private finance, rather than public funds, will solve the issue of technology transfers from developed to developing countries such as India, UK’s secretary of state for climate change and energy Edward Davey said. “In the UK, we are attracting billions of pounds into renewable energy from the private sector, and not the public purse, and I am sure this can be replicated in India,” he said.
Davey, who visited India recently, said the UK government is looking to increase its partnership with India in sectors such as gas, petroleum and renewable energy. He said all countries need to work to counter climate change, but it is important that developed countries commit to do a lot more than developing countries.
Edited excerpts from an interview: What are the primary areas where the UK is looking to increase its engagement with India? The UK government wants to partner with the new Indian government across the board—economy, business, trade, and commerce. We have lots of huge ties already and Britain is one of the biggest investors especially in the energy sector—Shell, British Petroleum, British Gas and so on. I think energy is an area which is critical for both the countries. We have energy security issues and we need to make sure our import bills aren’t rising. Renewable energy and energy efficiency are areas we are working on and I know PM (prime minister) (Narendra) Modi is very keen on that and has got a fantastic record in Gujarat. We also need to see how both countries can reduce their carbon emissions and yet can meet energy needs of their people and country. And, of course, we need to see how the partnership is going forward at international negotiations. Even though they have been ongoing, we have a critical year in Paris in 2015 and need to understand what India needs in those negotiations, what India wants. We can work together to get a successful international agreement. What are some of the steps the European Union will take to ensure countries like India and China come on board an international agreement? First of all, if we are going to have a fair agreement, everyone needs to be involved, and it needs to be applicable to everybody. But different countries are going to have to take different responsibilities. We have completely accepted that the developed world needs to cut our emissions, and the UK has done that and wants to do more and we are leading in Europe to make sure Europe is going to cut its emissions in very ambitious ways. We are working with developed countries like the US, who I think have really turned a corner on this issue. So we have got to really ensure that the developed world is stepping up to the plate and is supporting the developing world. And I think we can’t expect countries like India and China to cut their emissions in the short term; we accept they need to grow and reduce poverty but, in the medium term, emissions will have to peak and then decline if we are going to benefit everyone. We have a joint interest to tackle climate change, so we do have to act together; but I accept we will have to act in different ways. When will finance and technology begin to get transferred from developed to developing countries? We have an international climate fund in the UK that’s worth over £3.87 billion, which is over $6 billion, and we have been spending that in many developing countries to help them to begin tackling climate change by adapting to it. So we have acted but, of course, we need to do more and Britain will do more. And the green climate fund (GCF) is what we are keen to see established and working. The working of GCF was finalized very recently and we hope to commit substantial resources for it by the end of this year. But I believe private finance will solve this issue. In the UK, we are attracting billions of pounds into renewable energy from the private sector, and not the public purse, and I am sure this can be replicated in India. Technology follows from finance and it is developing rapidly. So many new technologies are coming through and we need to figure out how can we deploy them and how can we innovate further so they are appropriate for different countries. Who are the people you are meeting and what is on your agenda? Meeting the gas and petroleum minister, environment, forest and climate change minister and can already see signs of Modi’s government wanting to go further. He has made it clear he wants to tackle climate change and has been successful in Gujarat with energy efficiency reforms, too. The budget was also clear on tackling these issues. I want to understand plans and see if we can work together and see how we can work together. The meeting with the power, coal and new and renewable energy minister Piyush Goel was fruitful. He came across as a minister who wants to get something done and is keen on power sector reforms. He sees that it is important to deal with transmission, distribution and generation capacity issues. I think there is a lot we can take further. Which business houses are keen to invest in India? There is a desire from medium and small British industries to come and invest here. We want to set up a deputy high commission in Gujarat, partly to enable trade relations, and the UK trade investment team is focusing on it. We have made it clear that India is the country of choice to do business with. What can Indian businesses learn from British businesses to tackle climate change? Business has been one of the strongest advocates of action on climate change. The Confederation of British Industry published a recent report called The Colour of Growth is Green. Hard-nosed financial institutions are saying there are huge risks and we can’t afford to take the risk by doing nothing. It will affect their supply chain globally, risk premiums for insurance, affect crop yields. There are so many challenges from climate change to our current business models that our businesses believe that we have to act and the government is encouraged to do more. Business is coming up with a lot of solutions, including carbon markets. Business says “give us clear signals, long-term frameworks, stability and certainty to know what your climate policy is so that we can plan”. And that is the message back to Indian businesses—take climate change clearly, act now, and support international agreements to have clear long-term policies. India will need huge amounts of money (to tackle climate change) and so an international agreement is in favour of India.