It is no accident that the government has seemed paralysed in responding to the Deepwater Horizon crisis, not knowing whether or not to defend BP in the face of politicians’ and public opprobrium. The reason is that it is unable to understand that the root causes of the crisis are ideological.
To blame or not blame BP is really not the point. BP must take its share of responsibility along with other US private companies involved. But the deeper lessons of the oil spill concern the future of our energy supplies, of regulation, and the shape of our society and economy.
All of us should pause and reflect. This crisis will wreak long-term environmental damage. It has dealt a hugely damaging blow to a successful British company, in which many people’s savings are invested and on which thousands of jobs depend. It will cost BP billions that could have been invested in renewables and low-carbon fuels of the future.
Out of crisis comes damage, but also opportunity. This is the opportunity to make a decisive turn in the road towards a post-oil economy: for the US, and for the world. But it needs politicians on both sides of the Atlantic to say it with gusto, rather than spend their time attacking BP. We cannot stop our reliance on oil and gas tomorrow. They are an essential bridge to our energy future. But the question is whether they are a bridge or a stopping point. Sadly for the US, before President Obama, it seemed like a stopping point.
For us with our North Sea supplies, it is a warning. We should maximise our output from those fields but when it comes to new ones like the west of Shetland, the place where drilling of Deepwater Horizon depth would take place, we need to show extreme care. The Conservatives proposed at the election to “streamline government … We will offer exploration companies a simpler, clearer and more transparent licensing process”. The new energy secretary should quickly clarify that there will no weakening of standards, and that this policy will not be pursued.
But the lesson for our future goes beyond this. Deepwater Horizon has exposed a more fundamental short-termism – in the energy industry, in finance energy projects and in governments. The truth is that even despite the known risks, and limitations, there is comfort and security about investing in old-fashioned hydrocarbons. The renewables industry struggles for finance – while investments in tar sands and other projects get the green light. It is the worst of short-termism: for the planet and for all our economic futures.
But there is no point in railing against the short-termism of markets: it is what they do unless the rules are right.
The job of government is to change this short-termism. The obvious opportunity comes as we consider the future of our banking system. The Green Investment Bank we established at the last budget is important, but as we restructure and reform the system we should seek to properly capitalise it with the finance it needs.
As the oil gushes into the Gulf, this is the time to stand proud and declare that we want a hi-tech clean-tech future faster than ever before. The countries that make the leap first will be the successful economies of this century, exporting technology around the world to cities seeking cleaner air and lower emissions.
In the last 18 months, the previous government pursued an active industrial strategy. Four of the world’s biggest offshore wind manufacturers all said that they were coming to Britain, and we have the chance to be at the centre of the nuclear supply chain through Sheffield Forgemasters.
These commitments came because we had a plan that recognised that government must nurture new industries that the private sector will not invest in on its own. The coalition is now threatening to cut this investment. This would be the worst short-termism of all, and it must make its commitment clear.
The environmental movement has been quiet since Copenhagen. Now is the moment to mobilise – to pass a US energy and climate bill, get Europe to commit to steeper emissions cuts and sign an international treaty in Cancun in December. Out of the darkness of Deepwater, let’s create a positive legacy.
Ed Miliband, the coordinator of the Labour manifesto, the former energy and climate change secretary and MP for Doncaster North.