"This might just be the world's first truly ethical offseting scheme."
John Grant, Author of The Green Marketing ManifestoEd Miliband responds: we won't earmark auction funds
You might remember that we wrote to Ed Miliband a couple of months ago (download a pdf of our letter here) to encourage the government to ringfence the money it raises from selling EU Emission Allowances (the credits that we retire), which could be £1bn to £2bn between 2008 and 2012.
We felt that if the government sells rights to the global atmosphere, the money should be spent on global environmental causes.
He has replied (download a pdf of his letter here), emphasising that the government will not ringfence the money it raises, and also highlighting some of the government's emission reduction projects. He also mentions that EU member states have committed to spend half the auction revenues on climate change projects from 2013.
We don't think this is enough. At the moment, the vast majority of allowances are given away for free. From 2013, many more will be auctioned, and according to the Committee on Climate Change the annual revenue could reach £8bn by 2020. That's a lot of cash! The current financial crisis will create a fiscal squeeze from around 2011, and we think auction revenues should be used for reducing our reliance on fossil fuels rather than plugging holes in the budget.
