Low-carbon economy worth ￡3 trillion – UK government

www.environmental-finance.com/
London, 12 March:

The global low-carbon and environmental sector was worth ￡3 trillion ($4.1 trillion) last year, according to research commissioned by the UK government.

The UK is the sixth-largest economy for low-carbon and environmental goods and services (LCEGS), such as renewable energy, nuclear energy and recycling, analysts Innovas found, in market research carried out for the country's Department for Business, Enterprise and Regulatory Reform.

The sector's turnover was ￡107 billion in the UK in 2007/8, midway between the size of the country's healthcare and construction sectors, and was responsible for 880,000 jobs. Innovas predicts it will grow by another ￡45 billion in the next decade. The total UK economy was worth ￡1,600 billion in 2007/8.

The report breaks down the LCEGS sector into three parts: traditional environmental services, such as recycling, and water and waste management; renewables, such as wind, hydropower and biomass; and 'emerging low carbon', including nuclear energy, carbon finance and building technologies.

Worldwide, Innovas found that low-carbon businesses account for nearly half of the market value of the LCEGS sector, or ￡1,449 billion. Renewable energy accounts for another 31%, or ￡940 billion, with traditional environmental activities making up the final 21%, or ￡657 billion.

The biggest slice of the LCEGS pie is in Asia, which represents 38% of the global total, followed by the Americas, with 30% and Europe with 27%. However, LCEGS are worth worth ￡629 billion to the US economy, giving it the biggest market share of the emerging sector of any country. China comes in second, with ￡411 billion of LCEGS.

The research was published at the launch of the government's proposed Low-Carbon Business Strategy, intended to guide UK efforts to take advantage of the opportunities presented by low-carbon and other environmental industries.

Speaking at the launch, UK Business Secretary Peter Mandelson said: "Low carbon is not a sector of our economy, it is, or will be, our whole economy, and a global market." The proposals aim to create a "step change" in four key areas: increasing energy efficiency; putting in place the energy infrastructure for a low-carbon future; the UK's role in developing and producing low-carbon vehicles; and making the UK an attractive place to locate low-carbon businesses.

The UK government has set up an interactive website to engage with business over the plans.