Cars must be electric, says climate tsar

Britain's ambitious policies to cut carbon dioxide in the fight against global warming are still not enough, the official climate change watchdog warns today in its first annual report.

Even though the Government has created a detailed plan for transition to a low-carbon economy, a "step change" is still needed in the pace of reducing carbon emissions, and in fact the rate should be more than doubled, says the Climate Change Committee.

This will have to involve everything from a comprehensive national home insulation strategy to creating a fleet of 1.7 million electric cars with the infrastructure to support them – otherwise, says the committee, on current rates of progress, the "carbon budgets" to which the Government has committed itself are unlikely to be met.

The report is a timely reminder, as the world prepares for the Copenhagen climate conference in December where the international community will try to construct a new emissions-cutting treaty to replace the Kyoto protocol, of the scale of the climate problem governments now have on their hands.

By most measures, Britain is doing well – it is the only country in the world to have a binding framework for getting its CO2 emissions down, established with considerable fanfare under last year's Climate Change Act. Yet this is far from enough, the committee says.

Ministers are now legally committed to bringing down UK carbon emissions to 34 per cent below their 1990 level by 2020, by using three five-year-long budget periods where the reductions can be monitored. The Climate Change Committee – chaired by Lord Turner of Ecchinswell, who as Adair Turner was director general of the Confederation of British Industry – is the progress-chasing part of the process, and each year it will report publicly on how the Government is doing – and if necessary, deal out criticism which could be politically embarrassing.

Its first annual report, placed before Parliament today, cannot yet assess progress, as precise CO2 emissions figures for 2008, the first year of the first budget period, are not yet available.

However, the committee warns starkly that the current rate of reduction is inadequate to meet the Government's own targets – and says that it will have to be more than doubled.

"In the five years before the first budget period (ie in 2003 to 2007), greenhouse gas emissions were falling at less than 1 per cent annually," says the report, adding that emissions of CO2, the most important greenhouse gas, were only falling at 0.5 per cent per year. "They now need to fall at 2 per cent annually on average in the first budget and thereafter, and 3 per cent following a global deal at Copenhagen."

To enable this to happen, the report proposes a series of radical measures to make even deeper cuts in emissions from homes, transport and electricity generation throughout Britain.

The energy efficiency of Britain's housing stock should be systematically tackled in a national programme, neighbourhood by neighbourhood, so that 10 million lofts and 7.5 million cavity walls are insulated by 2015 and 2.3 million solid walls by 2022. And a national electric charging system should be set up so that 240,000 electric cars can be on the road by 2015, rising to 1.7 million by 2020.

In the power sector, the amount of CO2 needed to produce a kilowatt of electricity in Britain should drop from 540 grams today to 300g in 2020, says the report, and to make this happen we need two new nuclear power stations (with a third by 2022), four new coal-fired plants fitted with the emerging carbon capture and storage technology, and 23 megawatts of wind power – which equates to about 8,000 new wind turbines across Britain.

The report issues two significant warnings. The first is that Britain's CO2 emissions are actually likely to fall anyway in 2008 and 2009, simply because economic activity has dropped enormously in the recession. This could give an "over-rosy" picture of progress in cutting carbon, the report says, and might undermine the tough steps needed to keep on track. It suggests that if Britain does outperform its first carbon budget, these savings should not be "banked" against the second period.

The second warning is that the drop in economic activity worldwide has led to a drop in demand for permits to emit carbon under the EU's emissions trading scheme – and thus a fall in their price. A high price of carbon will be needed in future as one of the principal drivers of investment in low-carbon technology, so the committee says that governments may need to act to underpin the carbon price, and may need to intervene in the electricity market to ensure that investment in low-carbon energy continues.

Blueprint to save the environment

*1.7 million electric cars by 2020 and infrastructure to support them

*10 million lofts and 7.5 million cavity walls need to be insulated by 2015; 2.3 million solid walls insulated by 2022

*CO2 emissions from producing a kilowatt of electricity must drop from 540g today to 300g in 2020.

*8,000 more wind turbines

*Two new nuclear power stations must be built by 2020, a third by 2022

*Four coal-fired power plants with carbon capture and storage technology must be built by 2020.

*By 2022 the nation's CO2 emissions must fall from 2007's 636 million tonnes to 495 million tonnes.