If the UK moves towards a zero-carbon society it will mean major changes to how we live our lives and run our businesses.
From the cars we drive and the food we eat, to the way we heat our buildings or manage our supply chains, cutting emissions to zero and ending our contribution to climate change will be transformational.
The UK Government has so far led the way by being the first country to create a legally binding agreement to reduce emissions to zero by 2050. And in recent months it has come out with big policy proposals as to how we are going to get there. These include support for cleaner heating, many more electric vehicles, and a significant increase in offshore wind energy.
Our work in Renewable Nation showed that reaching net zero is possible with very high levels of renewable power – 98% to be exact.
Building on the findings of our modelling, we developed a range of recommendations to guide policy decisions. These are aimed at helping government, business, and people play a role in creating a truly sustainable society.
Invest in Innovation
The UK invests an average of 1.7% of GDP on R&D which is below other developed nations. On average, OECD countries spend around 2.4% on funding new ideas and innovation. The UK’s approach needs to change with higher, targeted investments more akin to tech-orientated nations such as Israel or South Korea which spend closer to 5% of their GDP on innovation. Our recommendation is that a minimum of 1.5% of GDP go solely into supporting the net zero transition. This would help scale-up industries where Britain has a natural advantage: wave, tidal and geothermal energy. We also need to look at how to innovate in new areas, such as smart EV charging, new forms of energy storage technology, and end-of-life uses for renewables.
Protect People and Businesses
Net zero offers the potential for long lasting, positive impacts to the way people run their businesses. Policy decisions need to be made with consumer support and protections built in from the outset. All communities and households need to participate in the energy transition, especially those from deprived areas and low incomes.
Greenwashing has grown substantially in the energy supply sector over the past five years. As energy retailers create new green products for consumers, we need to ensure that companies are kept to high standards, and that consumers are protected against false claims. The Committee on Climate Change highlighted this in their guide to corporate procurement of electricity, in which they advised using suppliers who use Power Purchase Agreements to buy renewable electricity for their customers.
That’s why the government should move quickly to establish a ‘net zero watchdog’ to combat greenwashing across all sectors.
Britain’s building stock is notoriously leaky. Many buildings waste huge amounts of energy which often goes straight out of the window. Improving the quality of these buildings is essential for reducing carbon emissions – the greenest electron is, after all, one which we don’t use at all. It will also save people and businesses money along with making life more comfortable.
Energy efficiency is a no-brainer, but subsequent governments have failed to create a scheme which gets to the heart of the problem. The last attempt was the Green Homes Grant which lasted less than a year. One of our key recommendations is to a create fiscal and policy package to provide grants and low-cost capital for business owners to make their buildings more efficient, while enacting new legislation to ensure minimum efficiency standards for all buildings.
Commit to the Future
The decisions we make now will have a lasting impact on the makeup of the energy system and the opportunities of future generations living with the impacts of climate change. Ending Britain’s contribution to global heating is a long-term project and 2050 is, in part, just a political deadline. The Welsh Government passed the ‘Well-being of Future Generations Act’ in 2015, which requires public bodies in Wales to consider the long-term impact of their decisions. A version of that bill is currently going through the UK Parliament. The Government should not only give its full support for this act, but it should be amended to place net zero and the Sustainable Development Goals at the heart of future policymaking.
Support Net Zero Financing
Our decision making should not be confined, or constrained, by the 2050 target date. Nor should it set us on a pathway which might lock out future innovations that could help achieve net zero earlier. Our report found that not only could parts of the economy decarbonise before this date, but it would be wise to have a plan for how emissions will be subdued long into the future.
One way we can achieve this is to create a mandatory net zero clause for all private and public investment. This would ensure financial decisions are aligned with cutting emissions and prevent stranded assets. Financial flows will ultimately determine whether net zero is achieved quickly, slowly, or not at all. Governments and business make decisions, and bets, all the time on which parts of the economy to support, and which ones to avoid. Creating the right conditions for net zero financing to flourish, is therefore, an essential recommendation.