Third runway at Heathrow increases our carbon bill

A third runway at Heathrow airport has been approved following a cabinet committee meeting today, a decision described as catastrophic by Tory MP Zac Goldsmith who plans to now resign and stand as an independent candidate in his southwest London constituency.

The transport secretary, Chris Grayling, claimed the economic benefits would be worth up to £61bn. However, the economic expansion of Heathrow was found to be not ‘economically viable’ following research carried out by The Stockholm Environment Institute.

The study found the largest share of economic plus points to be made up of 'generated user benefits' - an abstract economic value calculated by allowing people to fly more cheaply and frequently as a result of Heathrow’s expansion. If these benefits were not included, the government case would collapse, the analysis found.

The plans for expansion will now form a draft national policy statement to be consulted on in the new year.

Who will pay our carbon tax bill?

The additional 250,000 flights each year that will result from Heathrow expansion will have a significant environmental impact, both locally and globally. Such is the disparity between nations in their consumption of resources, it is useful to benchmark each country against an equal per-capita share of emissions over time. If we are to pay for pay for climate change mitigation equitably, then the international books need to be balanced. Environmental accountancy that could be used as a starting point to decide how much wealthy nations should pay towards the Green Climate Fund, which is used to help poor nations adapt to climate change.

H. Damon Matthews from Concordia University in Montreal has labelled individual countries as debtors and creditors in order to calculate relative balances given their historic CO2 emissions. He argues that if you live in America or Australia, you owe a £8,000 for your share of emissions between 1990 and 2013. Matthews found that America had over-polluted by over 100 billion tons of carbon dioxide in the thirteen years to 2013 – an amount equivalent to 300 tons per person. The US Environmental Protection Agency attributes a social cost of about £30 to each ton of carbon dioxide produced, so the debt per person is the equivalent of £8,000.

Whatever else we do in this country, the introduction of a carbon tax is an essential tool to combat climate change. The important point of the carbon tax is that it should be considered the last policy tool we should use and not the first. Other policy tools, for example: education; persuasion; regulation; cap and trade; and, targets can provide reductions but a carbon tax, which only increases if we are not meeting our target of an 80% reduction by 2050, tell industry and the public at large that the government means business.

How should the rate be set? The rate could be set by a commission with a single brief to set a rate that will enable us to reach our target on time. This would be rather like the way that the Bank of England sets the interest rate.

This rate would set five years in advance. When the ETA first suggested a carbon tax two decades ago we felt a £1 tax would be the initial rate. We wanted the tax to be introduced very gently. So that people got used to it before it began to bite. However, sadly, today we would recommend a figure very much higher. Even so, it is likely the commission would have to increase the rate significantly in the fifth year and beyond.

Most of the tax would be levied on the fossil fuel producers at the point the fuel arrives on the surface if produced in this country, or on the importers at the coast when the fuel arrives.

Some people say that the carbon tax should be hypothecated – in other words allocated to specific spending like public transport, insulating roofs, renewal technology research etc and other taxes could be lowered as the carbon tax kicked in. The first taxes to be lowered would be those that are currently regarded as climate change related such as aircraft tax and fuel duty, but later on other taxes could be reduced.

Ethical insurance

The ETA has been voted the most ethical insurance company in Britain by the Good Shopping Guide.

Beating household-name insurance companies such as John Lewis and the Co-op, the ETA earned an ethical company index score of 89.

The ETA was established in 1990 as an ethical provider of green, reliable travel services. Twenty six years on, it continues to offer cycle insurance, travel insurance and breakdown cover while putting concern for the environment at the heart of all it does.

The Good Shopping Guide each year examines the companies behind the brands - both big and small. In some cases apparently ethical insurance brands score much lower than you might expect because the holding company is involved in less ethical practices.