If this is going to happen we are going to need an enormous effort on the part of both business and domestic consumers (where most of the potential for reducing our emissions lies). So where does this leave current climate change policy as far as business is concerned and, more importantly, where do we go from here?

EEF has carried out its own assessment of progress six months on from the publication of its own proposals at the end of last year in a report entitled, 'Green and Growth: Solutions for Growing a Green Economy'. The analysis also comes ahead of forthcoming decisions on the Carbon Reduction Commitment and Electricity Market Reforms. Its approach to both these issues will be a litmus test of how effectively government policy is achieving its Green and Growth ambitions.

Our analysis suggests there has been some positive progress in a number of areas to make policy more balanced and cost-effective. These include continuing efforts to encourage investment in nuclear power and signs of support for a 2030 Energy Decarbonisation target. There have also been efforts to pursue international agreement in sectors which are traded globally, steel and chemicals for example, so that everyone is on a level playing field, an issue of crucial importance for some facilities in these sectors based in the Midlands

But, despite these efforts to date government needs to redouble its efforts to improve the cost effectiveness of its climate change policies with official estimates showing that they currently add 20% to electricity prices for business, with this rising to a third by 2020 and just under half by 2030.

As a result, EEF believes that we now need a simpler and more coherent approach to climate change, starting with a full review of the current set of tax and regulation measures in the run up to the next Spending Review. Government must also ensure the measures announced in the forthcoming Energy Bill are cost effective and simplify, or preferably abolish, the widely disliked Carbon Reduction Commitment which is viewed as a tax on Industry.