Climate Change (Scotland) Bill: Stage 3

Like Patrick Harvie, I acknowledge a degree of satisfaction that there has been universal acceptance of the importance of the climate change agenda, of the need for urgency and of the need for science to lead us. There has also been acknowledgement of the overwhelming contribution that human effects have made to the issue, so it is clear that we open our consideration of this important part of the Climate Change (Scotland) Bill with a broad agreement on principle, as Patrick Harvie said. We do not diverge from the need to contain the rise in temperature to the range 2° to 2.4°, and it is important that we keep hold of that.

Amendment 6 would raise the 2050 target from a reduction in emissions of at least 80 per cent to one of at least 90 per cent. It is identical to an amendment that Robin Harper lodged at stage 2, which only Patrick Harvie supported. There is no great division on the need for us to use expert advice. We need advice from the UK Committee on Climate Change that is specific to Scottish circumstances and which gives us targets that relate specifically to us. It is premature to deviate from the 80 per cent figure, which is founded on the Intergovernmental Panel on Climate Change's definitive and internationally recognised fourth assessment report. Similarly, the UK Committee on Climate Change has advised that the UK's 2050 target should be set at 80 per cent.

The 80 per cent target in the bill is, of course, a minimum requirement. The annual target for 2050 will not be set until 2036, which is 27 years from now. I am sure that we can all agree that our understanding of climate change has come a very long way over the past 27 years, and it will undoubtedly continue to grow over the next 27 years. We should not prejudge that future understanding. As it stands, the bill allows for an annual target of 80 per cent to be set for 2050. If we need to increase it, that is rightly a decision for our successors. I ask members not to support amendment 6.

I am entirely happy to publish the letter to which Sarah Boyack referred.

I have just been informed that we have already published the letter to which Sarah Boyack referred—it is on the Scottish Government website, with the response from the Committee on Climate Change. [Interruption.] The First Minister is saying, "Instant action", which is what he wants from his ministers.

This is an important part of the debate. The implications of the choices that we make during the debate fall on the real world of our futures. The wrong choices will cripple our economy and will mean that we no longer have the financial resources to fight climate change. The debate is therefore not an arid, possibly point-scoring exercise about numbers. The decisions that we make here will shape the bill and the future of Scotland. That is why politicians' decisions on targets must be based on expert advice whereby scientists, economists and others examine the evidence and make recommendations to which we should have regard.

The UK Committee on Climate Change, our present adviser, is funded by all Governments in the UK, but it is our independent source. The committee has advised the UK Government that a 34 per cent reduction by 2020 is necessary and achievable. A 42 per cent reduction becomes achievable, with considerable difficulty, when—I strongly doubt that it is "if"—the European Union amends its efforts through the EU emission trading scheme to raise the 2020 target to 30 per cent.

For the UK and Scotland, that change is vital to our ambition. Nearly half of all CO2 that will be booked to the Scottish and UK emissions accounts will come from the trading scheme. We changed the bill at stage 2 to incorporate the 42 per cent target, but we properly made that contingent on EU trading scheme change and provided 34 per cent as the target that we would absolutely commit to now.

Sarah Boyack's amendment 94 offers us the chance to promote 40 per cent as the target in the bill, with the power to revise that later if expert advice says that we should. We considered that approach at stage 2, but we thought that, in the circumstances, the UK Committee on Climate Change's 42 per cent figure remained one that we should make contingent.

In my amendment 94A, which I believe and hope the Labour Party will support, we recommend to Parliament that the UK Committee on Climate Change's 42 per cent figure be used. That is not about outbidding anyone, but about the integrity that comes from using only figures that are based on expert advice. Miss Boyack's amendment 94 would establish for the first time the ability, based on expert advice, to reduce a target in the bill. Such a power should be very carefully regulated and controlled. We have maintained that that can happen only if there is insufficient EU agreement to increase the level of effort that is required and capable of being put in place.

Miss Boyack said that a week is a long time in politics. Well, we are planning for the very long term. There is a challenge for us all in the period to 2050.

Let me therefore confirm now that this Government will not use any powers to vary the 2020 target by introducing a figure that is lower than expert advice; let me make the commitment now that this Government will not use those powers beyond a single occasion; and let me make the commitment now that this Government will not use the powers at all if the EU raises its 2020 target to at least 30 per cent. We are pleased that a broad if not universal consensus has emerged on this subject.

Finally, I should explain that amendments 9 and 10 seek simply to consolidate the 42 per cent figure and that amendments 97 to 99 seek to strengthen the Government's commitment. I also support amendment 101 in the name of Shirley-Anne Somerville.

I should also point out that although Patrick Harvie has committed to following expert advice, the 50 per cent figure that is set out in his amendment 7 deviates from that commitment. Similarly, amendment 8, in the name of Alison McInnes, seeks to apply the 42 per cent target at the outset and in advance of expert advice.

I move amendment 94A.

The Scottish ministers have committed to seeking the UK Committee on Climate Change's advice on the most appropriate level for the 2020 interim target, and amendment 101 would make that commitment a statutory requirement. Under its terms, ministers would also have to publish the advice that they receive to ensure that the decision-making process is open and transparent.

At stage 2, we on the Transport, Infrastructure and Climate Change Committee were advised that we should not

"pick a percentage for Scotland but that we should pose to the relevant advisory body the right question—what is the most that we can do to make the bill as strong as it can be? We should make the figure—" [Interruption.]

We should make that—[Interruption.]

Thank you, George.

"We should make the figure that that body provides our target. … The target is not a subject for political point scoring; our objective in the bill should be the highest level that is consistent with what is achievable."—[Official Report, Transport, Infrastructure and Climate Change Committee, 26 May 2009; c 1770-1.]

I probably got the words mixed up, because they are not mine, but Des McNulty's. Perhaps his English is not as good as mine. Regardless of his use of punctuation and grammar, however, I support his point.

Amendment 101 sets out an appropriate way of ensuring that the 2020 interim target is as demanding as possible while still being based on the expert analysis of how it can realistically be delivered. After all, such targets must be challenging but credible.

The bill will lose credibility with the public and, more important, the policies that any future Administration will need to put in place to achieve these targets will struggle to carry their favour if people pick up nothing from the coverage of today's debate other than an argument over numbers. That is why I am pleased not only to speak to amendment 101 but to support the Government's amendment 94A, which seeks to ensure that the only numbers that appear in the bill are those that have been mentioned by the UK Committee on Climate Change.

Amendment 101 would complement the Government's approach and ensure that the UK Committee on Climate Change is given its rightful place in advising on the interim target. This is about the experts advising the politicians on what Scotland can achieve and the politicians listening to and acting on that advice.

Let me explain the logic of the Government's position to Mr McNulty. What the Government is setting out is exactly what we set out at stage 2—that we can achieve 42 per cent if we get the necessary support that we all hope for from the EU discussions later this year. What we propose today, with Mr Stevenson's clarifying amendment 94A, is to put a scientific target of 42 per cent in the bill. That can be realised if the agreement that we all hope for at the EU level is delivered.

Patrick Harvie said that he would open with the science, but he then appeared to ask us to disregard the science and the expert opinion on the 34 per cent and 42 per cent targets.

Of course we have to ask for the advice of the UK Committee on Climate Change in relation to Scotland's particular circumstances.

Alison McInnes said that the bill is the Parliament's signature piece of legislation. I am happy to agree with her and I suspect that there will be no dissent from that view.

Shirley-Anne Somerville must read Des McNulty's words more carefully.

Malcolm Chisholm made an important point. Of course we will be influenced by policy options that are presented, particularly on the subject of cumulative emissions. That is right and proper. It is also proper that the Government be challenged to bring forward policy options to address where the bill should take us after it has been enacted. However, we accept that, as Malcolm Chisholm pointed out, within our delivery programme we can go beyond 34 per cent, and the 36 per cent figure that has been used is an option. Further policy options will allow us to go forward.

Alex Johnstone made an important point about continuing engagement. This is not the end of the process; if it is anything, it is the end of the beginning.

Jack McConnell made good points. Given his involvement in the matter, I was surprised that he did not take the opportunity to say that part of what we are doing is making a moral case on behalf of nations that will be more adversely affected by climate change than Scotland will be, such as those in sub-Saharan Africa, in particular. There is a moral as well as a practical imperative to what we are doing.

The amendments in my name in group 3 are concerned with correcting drafting anomalies and inconsistencies that have crept into the bill as a result of amendments at stage 2. Section 18A introduced the concept of periods of individual net Scottish emissions accounts, rather than an overall net Scottish emissions account that would have covered the entire period from 2010 to 2030. The approach more accurately reflected the concepts that are enshrined in the bill.

Amendment 13 will amend section 3(2)(b) to refer to multiple net Scottish emissions accounts, rather than to a single account. Amendment 14 will extend the scope of an amendment that Des McNulty made at stage 2, so that the annual targets for 2011 to 2019 are set at amounts that are consistent with achieving the 2050 target as well as the interim target. Amendment 16 will apply to the annual targets for 2020 to 2050 requirements that are similar to those that section 3(2)(b) applies to the targets for 2011 to 2019.

Amendment 18 will delete section 4(3). I am not seeking to remove the important provision that the Scottish ministers "must … have regard" to annual targets. The amendments that were agreed to at stage 2, and the amendments that have been lodged at stage 3 in relation to section 3(2) of the bill will require that annual targets be set at amounts that are consistent over time and which will allow the interim target and the 2050 target to be met.

The duty is now stronger than the duty that was in the bill as originally introduced. The requirement in section 4(3) is that, when setting annual targets, ministers "must … have regard" to the interim target and the 2050 target. However, the duty in section 4(3) has now been superseded. The subsection is therefore unnecessary, and amendment 18 seeks to delete it.

I will now consider the group 3 amendments lodged by Alison McInnes and Patrick Harvie—which I note were not supported in the Transport, Infrastructure and Climate Change Committee.

The effect of Alison McInnes's amendment 11 would be that the annual target for 2010 was "at least 3%" lower than the estimated emissions for 2009. In a similar way, Patrick Harvie's amendment 17 would include the figure of "4.5%".

As I explained to the Transport, Infrastructure and Climate Change Committee at stage 2, accelerating our annual reductions, from the current average of approximately 1.2 per cent to a figure of 3 per cent or more, is simply not immediately possible. I whole-heartedly agree that we have to build towards the level of annual reductions suggested as soon as possible, but we cannot make it happen overnight.

I will welcome any and all reasonable suggestions as to how we can achieve the reductions in emissions as quickly as possible. We published our climate change delivery plan last week; I have yet to see the plans of the Scottish Green Party or the Liberal Democrats. We will continue to draw on the expert advice of the UK Committee on Climate Change, which will be valuable as we set our annual targets at challenging but realistic levels, designed to meet both the interim and the long-term targets that are set out in the bill.

I am sorry that I will be unable to support amendments 11, 12, 15 and 17.

The question is, that amendment 11 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 18, Against 104, Abstentions 0.

Amendment 12, in the name of Patrick Harvie, has already been debated with amendment 11. I remind members that if amendment 12 is agreed to, it will pre-empt amendments 13 and 14.

The question is, that amendment 12 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 18, Against 103, Abstentions 0.

The question is, that amendment 15 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 19, Against 103, Abstentions 0.

The question is, that amendment 17 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 2, Against 120, Abstentions 0.

The question is, that amendment 18 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 79, Against 43, Abstentions 0.

Group 4 is on setting annual targets—criteria. Amendment 102, in the name of Shirley-Anne Somerville, is grouped with amendments 103 to 105 and 116.

During the passage of the bill, we have heard a lot about the need to take early action to tackle climate change. We have already taken such action by agreeing to certain amendments this morning. However, we must also consider the total amount of greenhouse gas emissions that we will produce between now and 2050.

I very much welcomed the amendment that was lodged by Cathy Peattie at stage 2 to place a duty on ministers to report on cumulative emissions. As a result, the bill contained—for the first time—a duty on cumulative emissions. The amendment picked up on a great deal of evidence that the committee heard on the need to take cumulative emissions into account.

I am keen for the bill to be even more ambitious, and I want to build on Cathy Peattie's good work. That is why I have lodged amendments 102, 105 and 116, which will oblige the Scottish ministers to request and consider advice from the UK Committee on Climate Change on what the cumulative amount of net Scottish emissions should be for Scotland for the duration of the effect of the bill. The Scottish ministers should be obliged to request such information each time they set annual targets, so that we can obtain advice at the earliest opportunity.

Of course, it will not be enough simply to request advice; ministers will have to act on it. The amendments cover that point too. Once available, that information will prove to be a significant factor in determining the level of future annual targets, and will focus the minds of future Administrations on their obligations for the years right up until 2050.

The amendments in the name of Alison McInnes are along the same lines and, indeed, take us a step further. They are a welcome addition to the amendments in my name, and I urge the chamber to support them as well.

I move amendment 102.

The amendments in the names of Shirley-Anne Somerville and Alison McInnes are concerned with Scotland's cumulative emissions over the period from 2010 to 2050. I recognise the widespread desire for the bill to acknowledge the issue of Scotland's cumulative emissions. I believe that the amendments in the name of Shirley-Anne Somerville provide a way for cumulative emissions to be incorporated in the bill in a way that is sufficiently flexible not to interfere with the emissions reduction trajectory that will be published in line with the batches of annual targets that ministers must set. I am therefore content to accept amendments 102, 105 and 116.

We have considered the amendments in the name of Alison McInnes. Although, from a technical point of view, we would have preferred some aspects of the amendments to be drafted differently—there might be some small practical difficulties with them—they basically express policy positions that we wish to pursue, so we are happy to commend them to the chamber as well.

This is an important section. It ensures that we approach our early action with an eye to 2050 in a way that ensures that we do not emit more than our fair share in the years to come. As Alison McInnes has said, the section ties the two parts of our efforts together. It ensures that, when we set our annual targets, we focus on our cumulative and total emissions up to 2050. I urge the chamber to support all the amendments in the group.

Group 5 is on the role of the relevant body in relation to annual targets. Amendment 19, in the name of the minister, is grouped with amendments 20, 20A, 20AA, 21, 106, 29 and 30.

Amendments 19 to 21 and 29 are necessary as a consequence of the amendments that require annual targets to be set at amounts that are consistent with achieving the interim and 2050 targets. That is necessary as a result of changes that were made at stage 2—and, perhaps, at stage 3—to section 3(2).

Amendments 19 to 21 amend section 5 to require that the Scottish ministers ask the relevant body for appropriate advice in that respect and publish it after they receive it.

Amendment 29 has a similar effect, in that it places a corresponding duty on the advisory body to provide that advice, as opposed to the duty on the Scottish ministers to ask for it.

On amendment 30, at stage 2, Des McNulty inserted paragraph (ba) into section 22(3) of the bill. The effect of the new paragraph is to require the advisory body, when providing advice under section 22(1)(a), to express its view about the respective contributions towards meeting the annual targets that should be made by energy efficiency, energy generation, land use and transport.

At stage 2, I indicated that I was broadly content with the proposal, and that remains the case. There is, however, a risk that paragraphs (a), (b) and (ba) of section 22(3) could be read as limiting the total extent of the areas about which the advisory body can give advice. Clearly, that is not meant to be the case, so amendment 30 seeks to insert a paragraph after paragraph (ba) that makes it clear that the advisory body has the freedom to express its views on any area in which it considers that there are particular opportunities to reduce the emission of greenhouse gases.

The Scottish ministers are comfortable with the first three paragraphs that amendment 20A, in the name of Patrick Harvie, proposes, as they simply cover the same subject matter areas as section 22, which sets out the things on which the advisory body must express a view. However, we have a difficulty with the last three proposed paragraphs. Two of them would in effect require ministers to seek advice from the relevant body on an emissions performance standard for electricity generating stations in Scotland that could be different from any equivalent standard in England and Wales.

As I explained to the Transport, Infrastructure and Climate Change Committee at stage 2, the Government has not ruled out the introduction of an emissions performance standard for new electricity generating stations. However, that would need to be done in line with the UK approach to the development of carbon capture and storage technology. The UK Government is currently consulting on a CCS levy, which could be used to fund the substantial investment that will be necessary from the public sector. That levy will require new UK legislation, but spending it will be a devolved process. The Scottish Parliament will have its opportunity to give its consent to that in the autumn, when there will be an opportunity to discuss the matter in detail.

I intend to say more on this subject when we debate amendment 54 in group 15 but, for the reasons that I have outlined, the two paragraphs on electricity generation in amendment 20A are unnecessary, given the on-going work on the emissions performance standard.

The language that is used in the paragraph about cumulative emissions budgets is inconsistent with the language that is used about cumulative emissions elsewhere in the bill, and we should exercise caution in that regard.

Amendment 20A is also flawed in that it places a duty on the Scottish ministers to ask the relevant body for advice on cumulative emissions but places no equivalent duty on the body to provide that advice.

As I stated at the outset, we have no difficulty with the first three proposed paragraphs of amendment 20A. Accordingly, I have lodged amendment 20AA, which will allow those paragraphs into the bill while excluding the ones that create difficulties. If members are willing to agree amendment 20AA, ministers will be happy to support amendment 20A. If not, we cannot do so.

Amendment 106, in the name of Patrick Harvie, imports the definition of trading schemes from section 44 of the UK Climate Change Act 2008 and applies it as a definition of the traded sector in amendment 20A. Similar provision is already included in section 22(5) of the bill, and it also appears in the equivalent advice provisions in the UK act. Therefore, the Government is content to accept amendment 106.

I move amendment 19.

I call the minister to wind up. Does the minister wish to wind up? It is not compulsory.

The minister was so enthralled by the debate that he was continuing to listen, in the expectation that Mr Harvie had more to say.

Everything has been said. I encourage members to support amendment 19 and, when we come to it, amendment 20AA.

The question is, that amendment 20AA be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 101, Against 18, Abstentions 0.

Group 6 is on the achievement of annual targets. Amendment 22, in the name of the minister, is grouped with amendments 23 to 27 and 90.

I will move amendment 22, but I intend later to seek permission to withdraw it, because we do not intend to proceed with it. I will move it only to allow the debate to proceed.

Amendments 22 to 24 and 90 relate to the domestic effort target that was added to the bill at stage 2 in section 7A. Ministers have gone on record many times to state that our preference is to reduce emissions from sources in Scotland rather than to purchase offset credits. Money that is spent on international credits is money that is not spent on investing in Scotland. However, as Sir Nicholas Stern emphasised in his report "The Economics of Climate Change", global carbon markets are a key component of attempts to curb rising global emissions. Members will appreciate that the use of carbon units to offset excess emissions will be necessary, within statutory restrictions, at certain points up to 2050.

In response to a recommendation in the Transport, Infrastructure and Climate Change Committee's stage 1 report, the Government introduced amendments to the bill that set limits on the total amount of carbon units that ministers may credit to the net Scottish emissions account. However, those limits do not apply to carbon units that are derived from the European Union emission trading scheme, for good reasons, concerning how that scheme works. More than 40 per cent, or perhaps as much as half, of Scotland's emissions fall within the traded sector and therefore are affected by carbon markets such as that created by the EU scheme. The fundamental problem with the domestic effort target in section 7A is that it makes no distinction between carbon units that the Scottish ministers use and the units that Scottish companies use in the scheme.

Amendments 22 and 23 offer alternative ways of addressing the problem. The important point is that the 2050, interim and annual targets are achieved in the first place. Placing disproportionate emphasis on a flawed domestic effort target could risk those targets being missed.

The Government's preference is for amendment 23, which is the best way of fixing the issue. The carbon units that are surrendered by Scottish installations within the EU emission trading scheme would fall within the 20 per cent allowance that the domestic effort target gives the Scottish ministers for using carbon units. The challenge is that we do not use those units—individual installations such as power stations throughout Scotland do so. The Scottish ministers will simply carry out the accounting in relation to the EU ETS, ensuring that its operation in Scotland is not ignored when calculating progress towards the targets that are set in the bill. If Scottish installations bought a large number of units in one year—which is understandable practice, as there is a finite number of credits within the scheme as a whole—the domestic effort target would almost certainly be breached and the Scottish ministers simply could not do anything about it. It is therefore vital that the power companies ensure that they make a strong contribution to delivering on their obligations.

The importance of carbon reduction not interfering with the EU ETS is also recognised by the expert Committee on Climate Change. In its advice to the UK Government that was published last December, the committee recommended that any restriction on the use of carbon units should not extend to units generated within the EU.

We have already voted to raise the 2020 target to 42 per cent. In lobbying for that, WWF Scotland indicated that the purchasing of carbon units could cover any shortfall. As it stands, the domestic effort provision in section 7A means that it would be impossible for the Scottish Government to buy sufficient credits to cover the shortfall between the expected reduction and the interim target.

There will be times when buying carbon units is the most cost-effective way of ensuring that Scotland's climate change targets are achieved, but forcing ministers to take unnecessarily expensive measures to tackle emissions would, in effect, be a new tax on the people of Scotland.

Amendment 23 will avoid that problem by removing EU ETS credits from the restriction on the use of carbon units inherent within the domestic effort target. The domestic effort target is intended to encourage ministers to focus on reducing emissions in Scotland. It would be perverse if it acted to prevent all the other targets in the bill from being met.

I should also highlight that section 7A contains a flaw, as it refers to the Scottish ministers "making an order". The power is subject to the affirmative procedure, so advice should be sought before ministers lay a draft, rather than make an order. Amendment 24 will correct that drafting flaw by referring instead to the Scottish ministers

"laying a draft of a statutory instrument containing an order".

As regards domestic effort, amendment 90 simply adds the term "domestic effort target" to those listed in section 65, "Interpretation".

Amendments 25 and 26 are tidying-up amendments, which move section 18A(A1) into section 12A. Essentially, the distinction is that section 18A as a whole is about all limits on carbon units for multiyear periods, while section 18A(A1) is about capping at 20 per cent the amount of carbon units that may comprise the reductions in individual years. Section 12A, which was introduced by one of Des McNulty's amendments at stage 2, does essentially the same thing as section 18A(A1), so it makes sense to move section 18A(A1) into section 12A.

When section 18A was amended at stage 2 to insert subsection (A1), Des McNulty also deleted section 18A(2)(b), which would have required the Scottish ministers to set a limit on the net amount of carbon units that may be credited to the net emissions account during the period 2013 to 2017. Mr McNulty might have thought that section 18A(2)(b) was unnecessary on the basis that new section 18A(A1) would define the total amount of carbon units permitted for that period anyway. However, in practice, that might not be true. For example, if the annual target in 2013 were missed, the amount of emissions reduction required to meet the annual target for 2014 would be greater than if the 2013 target had been met.

Under section 18A(A1), 20 per cent of the reduction required to meet the net Scottish emissions account for the target year may be achieved by crediting carbon units to that account. However, there is no absolute limit on the quantity of carbon units that may be used, as would be the case if section 18A(2)(b) had not been deleted. That weakens the bill, which we do not think is what Mr McNulty intended.

In addition—I am coming to a conclusion, Presiding Officer—given that the years 2010 to 2012 are covered in section 18A, as are all the years from 2018 to 2050, it could be inconsistent and confusing for ministers not to set a limit on the total amount of carbon units that they may use in respect of the period 2013 to 2017. Amendment 27 seeks to correct that anomaly.

We will listen carefully to the debate on this complex and technical group of amendments and we will see where we get to.

I move amendment 22.

We have to be careful about the use of the word "must", because it limits the ability to do things on occasion. However, that is a drafting issue.

Amendment 23 remains vital. The power companies have engaged significantly in the debate, so we know that they are very much up for it. However, we have to be careful not to allow ourselves to be hostages to the traded sector, which in Scotland—and for that matter the UK—accounts for 40 to 50 per cent of total emissions. Amendment 23 is necessary at this stage. We cannot postpone the discussion, although we will have a discussion in the autumn on a legislative consent motion. That is the proper time to visit the matter in the context of what we know is happening. If we do not pass amendment 23, we will be unable to make amendments, except by primary legislation, in the light of what happens at UK level. This is one policy area where we can barely put a cigarette paper between UK and Scottish ambitions, although there is difference in the detail. Therefore, we will work closely with the UK Administration on this subject.

I have said all that I have to say. I seek Parliament's leave to withdraw amendment 22.

The question is, that amendment 23 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 60, Against 59, Abstentions 0.

Group 7 is on the type of carbon units that may be purchased by the Scottish ministers. Amendment 107, in the name of Malcolm Chisholm, is grouped with amendment 113.

I respect absolutely the principle that underpins amendment 107. Broadly, I think that members in the Parliament do not differ on the policy objectives that they wish to pursue. However, the amendment is unnecessary, because ministers can act at their own hand on the matter. Also, the amendment has a flaw that makes it impossible to agree to.

I will explain the flaw. Paragraph (a) in amendment 107 would mean that ministers could credit the net Scottish emissions account with carbon units that represented

"a reduction in greenhouse gas emissions (or a removal of greenhouse gas from the atmosphere) that would not otherwise have occurred".

I appreciate that Malcolm Chisholm has sought to address issues that we identified at stage 2 when the Transport, Infrastructure and Climate Change Committee discussed an amendment from Des McNulty. However, amendment 107 would prevent the Scottish ministers from using one of the most fundamental carbon units that is available under the Kyoto mechanisms—the assigned amount unit.

Parties with commitments under the Kyoto protocol have accepted targets for limiting or reducing emissions. Those targets are expressed as levels of allowed emissions or assigned amounts. Allowed emissions are divided into assigned amount units. Emissions trading allows countries that have emission units to spare—emissions that were permitted but not made—to sell that excess capacity to countries that are over their targets. AAUs therefore represent an emissions allowance and not

"a reduction in greenhouse gas emissions (or a removal of greenhouse gas from the atmosphere) that would not otherwise have occurred",

as required by paragraph (a) in amendment 107.

Paragraph (b) in amendment 107 would create a specific sustainability duty in relation to the origin of carbon units. However, such a duty is made unnecessary by the duty in section 61A, which was created by a combination of Labour, Liberal Democrat and Government amendments at stage 2. Section 61A says that, in exercising the functions that the bill confers on them, the Scottish ministers have a duty to

"take into account the need to do so in a way that contributes to the achievement of sustainable development."

That will apply to the crediting of carbon units to the net Scottish emissions account.

I recognise absolutely that Malcolm Chisholm does not come lightly or early to the issue. His reference to the Gold Standard Foundation is important. That is a measure of what we should be looking at. I hope that he is reassured about sustainability and that he acknowledges the drafting problems that I described in amendment 107 that would affect ministers' ability to use assigned amount units to credit the net Scottish emissions account. I hope that he is satisfied with my assurances and that he will seek leave to withdraw the amendment on that basis. If he says in closing that there were gaps in what I have said, I might be able to shed further light.

Amendment 113 would delete section 18A(4), which allows specified units to be excluded from counting towards any limit that the Scottish ministers are required to set on the quantity of carbon units that may be credited to the net Scottish emissions account in given periods. Having the ability to exclude some types of carbon units from counting towards the section 18A limits is extremely important. In practice, it is intended to prevent carbon units that are used by installations that participate in emission trading schemes such as the EU emission trading scheme from counting towards section 18A limits. Carbon trading is one way in which the international community expects to reduce emissions. The joint effort that has been put into the EU ETS and the joint commitment to it throughout Europe will lead to early reductions in the most polluting sectors throughout Europe. That is important.

The traded sector in Scotland accounts for more than 40 per cent of our emissions. Even though the Scottish ministers do not participate directly in the EU scheme, they cannot ignore it. We are simply the accountants to the scheme. Of course, our approach is entirely consistent with that of the UK Government in the carbon accounting regulations that it has made under the UK Climate Change Act 2008. In the advice to the UK Government that it published in December, the Committee on Climate Change recommended that any restriction should not extend to units such as those from the EU. If section 18A(4) were deleted, EU units would take up most of the carbon units that we would be allowed to credit to the account and in some years would even breach that amount. That would create very serious difficulties and, of course, run counter to the advice of the expert Committee on Climate Change. Given Parliament's future scrutiny of the regulations and the problems that are inherent in amendment 113, I ask Malcolm Chisholm not to move it.

The question is, that amendment 107 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 60, Against 61, Abstentions 0.

The question is, that amendment 108 be agreed to. Are we agreed?

There will be a division.

The result of the division is: For 3, Against 118, Abstentions 0.

Group 8 is on Scottish share of emissions from international aviation and international shipping. Amendment 109, in the name of Patrick Harvie, is grouped with amendments 110, 111, 146 and 112.

Mr McNulty's amendments 110 and 111 are not necessary, but I would have no objection to his pressing them. There is certainly merit in what he says. A range of difficulties is associated with shipping compared with aviation. Indeed, there is a range of difficulties with shipping on a broad range of emissions, not simply greenhouse gas emissions. Shipping must still reduce the sulphur in its fuel, which has certain effects, and it must still do work on particulates, which are still being emitted from burning shipping fuel. Mr McNulty is therefore perfectly correct to give us the opportunity to consider the issue.

We must ensure that aviation plays a significant part. I was interested to hear Patrick Harvie say that we sometimes overfocus on aviation. That is true, but it is important that every sector shows that it is making progress. I do not think that aviation has so far taken the demonstrable steps forward that we might wish for. I assure members that the Government is absolutely committed to moving rapidly on aviation and that when we understand how to resolve some of the difficulties associated with shipping, we will move on them as well.

There is a drafting issue with respect to Des McNulty's amendment 111, which my amendment 146 seeks to correct. It would insert a reference to the other date of 1 June 2011, which it is important to do.

We are happy to agree to Patrick Harvie's amendments in the group. Amendment 109 seeks to include various criteria that the Scottish ministers must comply with when they make orders to specify the emissions from international aviation and international shipping that are to be attributable to Scotland for the purposes of the targets in the bill. The amendment simply puts on a statutory footing actions that the Scottish ministers intended to take anyway. On that basis, I am comfortable with amendment 109 and am willing to support it.

Amendment 112, which is linked to amendment 109, requires the Scottish ministers to request advice from the relevant body on the appropriate multiplier for each greenhouse gas prior to bringing forward an order to include Scotland's share of international aviation emissions within Scottish emissions. That relates to the matter of radiative forcing, which is of particular interest to Patrick Harvie and is of interest to me, too. We have committed to seeking advice on the multiplier, so the principle behind the amendment causes me no problems. I am therefore content to support it.

We are content that the current provisions give us sufficient time to make an initial judgment. Of course there will be changes as information emerges over the years, particularly about maritime transport—I think that there is a move from using a number of quite heavily contaminating fuels; I am thinking of M30, M40 and the less-contaminating M120—but we are in a position at which we can take initial steps. Indeed, it is important that we take early initial steps. That is a thread running through the bill.

All the amendments in the group are for minor drafting purposes. They are designed to tidy up a number of provisions that were amended at stage 2, and principally address matters of consistency of language and structure. Given their technical nature, I do not propose to say any more about them, unless any member wishes to intervene; I would be happy to provide further details if any member does so.

I move amendment 28.

Amendment 32, which is the main amendment in the group, introduces a national planning framework format to some of the reporting that the bill requires. That is in line with the commitment that I made to Alison McInnes in the stage 1 debate.

At stage 2, Des McNulty raised concerns on going through an NPF-style scrutiny period each year for reporting under the bill. I agree that that would probably be unhelpful and cumbersome. That is why amendment 32 applies specifically to the report that ministers must make on proposals and policies to achieve annual targets. Unlike other reports that the Parliament requires, it is not simply a presentation of data, so a 60-day period for parliamentary scrutiny shall be of benefit.

Members will note that amendment 36 is consequential on amendment 32 and seeks to delete the reference in section 34 to proposals and policies for achieving annual targets. That is because section 34 is concerned with the scrutiny of reports after they have been laid in Parliament. Proposed new subsections (1E) and (1F) that amendment 32 would insert into section 30 contain provisions relating to the scrutiny of the final report on proposals and policies for meeting annual targets once that report is laid in Parliament. Because that provision is made in amendment 32, the post-laying scrutiny provision in section 34 is unnecessary in respect of the report on proposals and policies.

Amendment 33 adds a new requirement for the report on proposals and policies to report the respective contributions that energy efficiency, energy generation, land use and transport should make towards achieving the targets. That fulfils another commitment that I made to Alison McInnes at stage 2.

Amendment 37 seeks to clarify some ambiguity in the wording of section 34(4) surrounding reports, which are made by committees, and resolutions, which are made by the Parliament.

I move amendment 32.

I thank Liam McArthur for his assistance in this regard. We never had a policy difference; we merely foresaw a difficulty with the drafting. I am glad that, in amendments 147 in his name and amendment 54 in mine, we have something in front of us that will take us forward and resolve the issue.

Under amendment 147, the Scottish ministers will have to report on the impact that the exercise of their electricity generation functions has on net Scottish emissions. Liam McArthur's amendment will give members a strong assurance of an enduring legislative requirement for ministers to justify their actions on electricity generation. Given our clear commitment to the decarbonisation of electricity generation by 2030, as set out in the climate change delivery plan, the Government will be more than happy to make such reports.

However, as Liam McArthur accepted, we have to delete section 49A from the bill. It is a serious matter when there is a risk that a bill will breach legislative competence. As Liam McArthur said, the Privy Council could come into play and significantly delay the bill. That would be embarrassing, risk undermining our reputation as leaders on climate change and take us into uncharted legal territory. That is not a risk worth taking, and Liam McArthur has been clear about that.

As I outlined to committee members at stage 2, the Government has not ruled out introducing an emissions performance standard for new electricity generating stations. As my colleague Jim Mather informed the Parliament last week in his answer to parliamentary question S3W-24912, we will consider, in line with the UK approach, the development of an emissions performance standard in line with the development of carbon capture and storage technology.

The key issue at present, as I said at stage 2, is timing. To decarbonise by 2030, CCS will need to be retrofitted in the 2020s and demonstrated in the 2010s, so the next decade will be crucial in making CCS a technical and commercial reality. That will require substantial investment from the public sector. That is why the UK Government is currently consulting on a CCS levy—which will require new UK legislation—which will be spent by this Parliament. We will seek the Parliament's consent on the issue in the autumn, so the Scottish Parliament has a clear reassurance that it can revisit the subject later this year. Decarbonising electricity generation by 2030 must remain our overarching objective.

I have given some clear commitments to Parliament today. Under amendment 147, in the name of Liam McArthur, ministers will be subject to a new reporting duty. That should give clear assurance that emissions reduction from electricity generation will take place in keeping with the bill.