We led that revolution by exploiting technology and finance. We harnessed the energy which Newcomen's steam engine gave us, and we invented the limited liability company.

The power of steam and capital together enabled us to rule a quarter of the world and to become the wealthiest nation on earth.

What we did not know then was that the technology that gave us those riches was also changing our environment. It is only now that we understand that our climate is in disarray and that the emissions that we British put into the atmosphere in those two centuries are a serious part of the cause.

Today, we may be responsible for only three per cent of the world's greenhouse gasses, but then these tiny islands were the planet's most significant single polluter. What we did made us rich, but now we are paying the cost in global warming.

The trouble is that it didn't stop with Britain. The rest of the world caught on. The Great Exhibition stimulated the development of trade and manufacturing. The United States, with only four per cent of the world's population, is responsible for one quarter of the world's pollution.

If it is Britain's past pollution that is doing the damage now, it's the whole developed world that has been making it worse for the future, and the developing world – particularly India and China – that is now adding to the climate chaos that our children will inherit.

So, just as we have had to clean up the physical mess that Victorian enterprise and profit left behind, so now we have to clean up their atmospheric mess before it does irreversible damage.

That's the challenge that David Cameron gave us when he set up the Policy Group on the Quality of Life. How do we build the policies that could enhance the quality of our lives without destroying the planet?

We've worked for 18 months with more than 500 people from all over the country and of every political hue. We have produced a report that offers the Shadow Cabinet a blueprint for a green revolution. It comes to the exciting conclusion that Britain could repeat the triumph of the Industrial Revolution today, in a way which will bring profit to our nation and lead the global battle against climate change. The formula is much the same. We have to harness technology and finance to produce that new economic success.

New technology will reduce our costs. In a world of increasing energy prices, we can use energy saving and energy efficiency to deliver more power for less. That means lower emissions and lower overheads.

The policy group presents a programme that makes new generating capacity vastly more efficient; that encourages local generation, combined heat and power, and the development of new sources of energy.

We propose to sweep away the prescriptive building regulations and bring in output standards that will encourage innovation and make all our new and refurbished buildings and homes use much less energy and water.

Low Carbon Zones will be the pathfinder areas to transform our built environment so that we can cut substantially the 50 per cent of our emissions that derive from the built environment.

Smart metering; more efficient appliances and vehicles; teleconferencing, home working, and investment in fast trains – a matrix of measures that together will bring about the world's first low-carbon economy.

As the rest of Europe and, increasingly, the United States follow the same path, our first mover advantage will open up
the globe for our services and technology. Every country will need them if they are to compete in a world strapped for energy and resources.

Yet, just like the Industrial Revolution, it's not only the technology but the capital that changes things. Today, our institutions and our regulations inhibit those necessary changes. We have a lop-sided country where the investment is forced into the South-East and too little goes North. This Government thinks that everything has to happen south of Milton Keynes.

Compared to the rest of Europe, we have snail rail, and we fly internally because the alternatives are so grim. Public procurement is tacky and short-term instead of setting the pace in raising environmental standards.

Our regulators inhibit innovation by law and force investment in old technology and end-of-pipe solutions. Our planning system holds back development, yet allows the desecration of our countryside. We finance sub-prime mortgages but can't get the money for technology start-ups or rural diversification.

Putting all this right demands a green revolution, and that is what we plan. It will transform Britain into a low-carbon economy and, in doing that, will bring a new quality of life to our people.