Defending government’s green credentials before the Commons Liaison Committee, Cameron said that if CCS didn’t work, unabated gas generation might be necessary.
“Those arguing for a firm decarbonisation target are betting that carbon capture and storage is available,” he said. “If not, you are in quite serious water, because you would be only relying on nuclear and renewables.”
The right time to determine a decarbonisation target for 2030 is when the fifth carbon budget is set in 2016, he argued. Many in the renewables industry had called for a goal to be fixed now, to give investors certainty.
“We should have an open mind” on gas, Cameron went on. “It may be that this gas revolution is really quite transformative and there is going to be a lot more gas, and the price won’t be as expensive as some people say.”
Adrian Bailey MP questioned why, if government was committed to greening the economy, the Green Investment Bank (GIB) would not be allowed to borrow until public debt is falling.
Cameron said the GIB was to provide “seedcorn finance” to attract equity investment. “Because it has got £3 billion in its bank account, it does not need to borrow to start with,” he insisted.
The draft Water Bill was also mentioned, with Anne McIntosh MP raising concern that the discretion it gave to regulator Ofwat over upstream competition was damaging investor confidence.
“I am very alert to the problems you mention,” said Cameron. However, he said: “If you want everything written into the Water Bill about what a more open market could look like in water and greater choice for businesses and charities and so on, if you try to write down what a market looks like, you can get yourself into quite a lot of trouble, because the point is that you want this market to develop.”