When British Prime Minister Rishi Sunak appeared before the hastily assembled press on September 20, the letter-filled slogan on his lectern raised eyebrows across the country: “Long-term decisions for a better future,” could -we read.
We now know, of course, that there was little in the speech that followed that offered hope. Certainly not regarding the technological struggle for our future climate.
Not so long ago, the UK seemed to be a rather brilliant model in the industrial transition aimed at reversing global climate breakdown. National targets have been defined. COP26 at least offered a forum and a spotlight. London has made great strides in establishing itself as a hub for green tech startups. On the narrow but viable path to carbon neutrality, leaders have at least taken the right steps.
Then came the nadir of recent weeks.
Last week, with the government’s already infamous reversal on its green commitments, the nation joined the dismayed chorus of world leaders to deplore the prime minister’s short-sighted choice. Sunak pushed back UK timetable for transition to net zero emissions within at least five years.
The first and most irritating concern obviously concerns the consequences for the future of our species on this planet. The next major problem, currently expressed by leaders in all sectors and particularly in the climate technology and climate finance sectors, this is the message it sends to those of us in the trenches, actually trying to build technology to change the world and enable a sustainable future.
This message is loud and clear: the UK government is unwilling to be consistent on policy in responding to the climate crisis, which, alongside capital and support for nascent technology markets, is one of the most important things critical for any player in our sector. can hope.
For entrepreneurs, innovators and businesses to thrive and unlock the economic potential that comes from creating new industries, we need a consistent approach from government.
This is of interest to me because, as Americans who have chosen to set up a biocatalyst engineering company here in the UK, we are acutely aware of the impact of such a policy reversal on every step of the way. existence of our sector. Any major technological innovation ultimately benefits from government support from the start. We wouldn’t have affordable solar panels, microchips, cell phones, or internet without government funding, government subsidies, government incentives, and government infrastructure. You can’t scale a technology that will have a huge impact without matching upfront capital.
In January this year, Chancellor Jeremy Hunt unveiled long-term vision to grow the economy, saying: “I want technology entrepreneurs, life sciences innovators and clean energy companies from around the world to come to the UK because it offers the best possible place to realize their vision . ” Unless its long-term vision is meant to last until the end of summer, to enable entrepreneurs, innovators and businesses to thrive and unlock the economic potential that comes from creating new industries, we We need a consistent approach from government.
We have enormous financial potential. As part of the UK climate technology community, we strive to create well-paid jobs and value for investors across almost every asset class. And collectively – or even individually – our solutions could truly change the world.
Of course, this is the common cause around which we should be united. Our company is trying to move the industry away from its reliance on fossil fuels to make chemicals, among other things. But the impact of these political spasms and contradictions in our climate commitments on, say, an electric vehicle battery company – which has just seen market demand for its production decline by five years – is not difficult to appreciate . If giants like Ford feel frustrated, imagine the atmosphere in a small green technology startup.
So what is the room? How can the government support those who are struggling in an increasingly uncertain (and insincere) context?
The response of any tech company affected by last week’s news must surely be this.
First, we need coherent macroeconomic policy. This has a major impact on startups raising and deploying capital in climate R&D. The global economic contraction has made it difficult for these companies to raise funds. Global approaches to economics have ripple effects on how we, as businesses, make money and manage our operations. Even salaries, which alone are difficult to keep up with in the face of salary increases based on inflation.
The second is a coherent tax policy. One of the most critical things for startups is research and development (R&D) tax credits. It was a lifeline that gave small, research-intensive companies months of budgetary room each year, because it allowed them to recoup a third of the money spent on R&D. The government announced it would abandon it last year, and it was only thanks to a lobbying effort led by the Startup Coalition that at the last minute, part of this tax credit was able to be preserved.
Which brings us to the third and most important point: a coherent climate policy. The impact of not having one is playing in real time, right now. Sunak’s public U-turn doesn’t just undermine science and play into the hands of climate skeptics. It also addresses the future of any climate technology company whose launch plans must be aligned with decarbonization timelines. This will harm economic confidence. People will lose their jobs. And the action, alas, will be further delayed.
Ultimately, it’s simple: inconsistency breeds uncertainty. So give us consistency. It is possible for our sector to succeed despite bad policies. But to thrive, we need consistent resolve and behavior from a government that truly cares about taking the lead in this crucial fight. Given the colossal stakes, which have been taken seriously at least recently, is this really too much to ask?