But industry insiders tell BusinessGreen.com that tensions remain between DECC and BERR
Whitehall officials have today denied reports that business secretary Lord Mandelson and energy and climate change secretary Ed Miliband are engaged in a turf war over UK energy policy.
However, industry insiders insist tensions remain between the two ministers' departments, following the launch of a new "energy and climate change unit".
The unit has reportedly been set up within Lord Mandelson's Department for Business, Enterprise and Regulatory Reform (BERR) to lobby the Department for Energy and Climate Change (DECC) on behalf of businesses.
According to reports in The Observer over the weekend, the new unit has been seen by some energy industry insiders as an attempt by BERR to water down green policies that it believes could damage UK businesses' competitiveness.
An anonymous source from one of the UK's Big Six energy companies told the paper that the launch of DECC should have "made life simpler". However, considerable overlap between the remits of DECC and BERR, which used to handle energy policy, meant that tensions remained.
"Because of who the business minister [Mandelson] is, BERR is still involved at lots of different levels in the decision-making," they said. "It's hard to say that if you're an outsider this is anything more than a mess."
Speaking to BusinessGreen.com, a BERR spokeswoman insisted there was no "turf war" between the two departments, adding that there was nothing unusual about the setting up of a new energy and climate change unit.
"Our work inevitably crosses into areas also covered by other departments - we have a team that looks at the auto industry, for example - but DECC is the lead department on energy and climate change," she said. "The BERR energy and climate change unit works closely with DECC on the challenges and opportunities presented by low-carbon manufacturing."
Her comments were echoed by a spokesman for DECC, who also insisted that the department had lead responsibility for energy and climate change policy and therefore would work closely with other Whitehall departments.
"There's one Energy and Climate Change Department and DECC is it," he said. "But for the UK to meet its carbon targets we need every department to play a part, and so it's only right that there are teams across Whitehall working on these issues."
However, there are still rumours surrounding the level of DECC's influence and BERR's ongoing efforts to shape energy policy.
Earlier this year, reports emerged that Miliband and Mandelson had disagreed over the number of civil servants that should be transferred from BERR to DECC. The Observer also reported that morale within DECC had plummeted after the department's permanent secretary, Moira Wallace, issued a memo to staff saying DECC was meant to be a "campaigning department".
Some civil servants read this as a tacit admission that DECC could not drive through policies without support from other parts of Whitehall.
One energy industry insider told BusinessGreen.com that many of DECC's proposals had to be "filtered through" BERR, and as a result many of its more ambitious green proposals were being "stymied".
"It is entirely appropriate that BERR and DECC work closely together," they said. "But it has long been known that there is a cabal within BERR that is very pro-traditional business and is dominated by coal and nuclear - it would be no surprise if they were still wielding a lot of influence."
However, the DECC spokesman countered that the department had been "punching above its weight in policy terms" since its launch last autumn, arguing that only last week it had "secured an injection of support for the offshore wind industry and set out a world-leading clean coal policy for the UK".
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