Illustration by David Simonds

AS THE December Copenhagen conference on climate change approaches, the world's attention is focused on international negotiations. But they are not, ultimately, what will determine whether the planet boils or not. International agreements are helpful only in so far as they encourage individual countries to control their own emissions. What matters most is the domestic policies which those countries put in place, and their governments' success in implementing them.

That's why the report by Britain's Committee on Climate Change (CCC) is important. It shows how weak policy has been, and suggests ways of strengthening it (see article). Most of their ideas are good, and one of them is bad.

Careful, it's sensitive

Britain's headline figures are fairly impressive. Its greenhouse-gas emissions have fallen by 15% since 1990—comfortably inside its target under the Kyoto protocol—compared with a 2% drop in the EU as a whole and a 14% rise in America. Most of the decline in Britain, however, is the result not of a big policy effort but of the “dash for gas”—the move away from coal-fired power stations that followed the end of coal mining. The decline has now almost stopped. Emissions are falling by less than a percentage point a year, and the government has admitted that it will fail to meet a self-imposed target of a 20% reduction in carbon-dioxide emissions on 1990 levels by next year, even though the recession has cut economic activity. Policy, in other words, is not driving emissions reductions.

It was to change this that the government set up the CCC. Cutting carbon is politically sensitive because it involves pushing up energy prices. The CCC is independent enough to criticise the weakness of existing policy and come up with ideas for strengthening it.

There are three sorts of policies in place now to help cut carbon emissions—carbon pricing, regulations to encourage efficient use of energy and subsidies for renewable energy. None of these is having much effect in Britain. The carbon price, set by the European Emissions-Trading Scheme (ETS), is too low to make a lot of difference—not just because economies have been in recession but also because governments have resisted the European Commission's attempts to impose tighter emissions limits. Britain has become a little more energy efficient, year by year, but there's plenty of scope to push that further. Attempts to encourage renewable energy have had so little effect that its contribution to Britain's electricity supply increased from 1% in 1995 to only 1.3% in 2005. Among EU countries, only Luxembourg and Malta did worse over the period.

How to strengthen policy? The CCC has plenty of ideas. The best of them is to raise the carbon price. That is hard within an ETS controlled by the European Commission: the most Britain can do is argue against the countries (Italy and most of eastern Europe) that want looser emissions caps. But Britain could perfectly well introduce a carbon tax on top of the EU scheme, as France has done.

Another good idea is for the government to audit the housing stock and tell householders how to cut their emissions and their bills. Buildings waste a huge amount of energy, and since the market does a bad job of making them more efficient, some government intervention may be necessary. The committee's only really bad idea is feed-in tariffs—hefty subsidies to renewable energy—of a sort used in many European countries. They are less efficient than a carbon price and distort the market—witness Spain's solar feed-in tariff, which caused a boom in the industry, followed by a bust this year.

Governments regard subsidies as easier, politically, than taxing carbon. In the short term, they are right; but in the long term, bad policy will raise the costs of decarbonising the world economy, thus increasing the danger of a taxpayers' revolt—which would be the biggest political difficulty of all.