Government review says net zero is growth opportunity of the century

Former Energy Minister Chris Skidmore’s newly published Net Zero Review calls for the UK to do more to reap economic benefits of green growth.

Commissioned by former Secretary of State for Business and Energy Jacob Rees-Mogg during Liz Truss’s Government last September, the report makes 129 recommendations, each designed to maximise economic investment, opportunities and jobs – while working towards achieving legally binding targets to reach net zero carbon emissions by 2050.

In developing the report, the Net Zero Review engaged with communities, economists and climate experts from across the country through more than 50 roundtables and 1800 submissions.

Chair of the Grantham Research Institute on Climate Change at the London School of Economics and Political Science, Professor Lord Stern of Brentford, said, “Chris Skidmore and his team deserve great credit for carrying out a rigorous, robust, and inclusive review of the evidence on the economics of the UK’s net-zero transition.

“In particular, the review has argued convincingly that the transition to a net-zero economy is the growth opportunity of the 21st century, and the UK is well-placed to benefit from the increasing demand for net-zero goods and services, if it makes the right public and private investments. It also correctly highlights the critical importance of government creating an environment that is conducive to this investment by providing clarity, certainty, consistency and continuity of policy.

“I hope the Prime Minister and his government will respond to the review with the urgency and scale required to prevent this enormous economic opportunity from slipping through our fingers. This transition, and the investment and innovation it embodies, are at the core of the UK’s growth story for the coming decade.”

Nick Molho, Executive Director of the Aldersgate Group, a mutistakeholder alliance of leaders from business, politics and civil society that drives action for a sustainable economy added, “The Skidmore Review is absolutely right to emphasise that the net zero transition is a major pro-business and pro-investment opportunity.

“The government should use the recommendations to produce an updated and strengthened Net Zero Strategy early this year. It should also crack on with some of the most pressing policy recommendations highlighted in the report, such as on grid infrastructure, full power sector decarbonisation, energy efficiency in homes, resource efficiency, and business models to support the roll out of CCS, hydrogen and other low carbon solutions urgently needed by heavy industry.

Deputy Director of Policy at Logistics UK, Michelle Gardner, comments, “Logistics, like many other sectors of the UK economy, is facing increasing cost pressures and Logistics UK has long-called for greater certainty from government to allow businesses to plan and invest in the necessary technologies and infrastructure. We are pleased that the review has recommended government provide this long-term certainty to allow businesses confidence in the knowledge that UK policy or funding will not rapidly change without very good reason. We hope this report will help shape future government policy.”

The main recommendations to the government in the Review are:

1) Using infrastructure to unlock net zero — accelerating the implementation of the British Energy Security Strategy to update the mandate of Ofgem, creating the Future System Operator and accelerating the connection of cheaper renewables such as solar and onshore wind developing a cross-sectoral infrastructure strategy by 2025 supporting the building and adaptation of infrastructure for electricity, hydrogen, other liquid and gaseous fuels and CO2 networks that support the green economy reforming our approach to planning, so that where locally supported, more solar and onshore wind can be developed more easily, helping communities reap the benefits of cheaper low-carbon electricity

2) Creating sustainable governance structures for net zero — developing an over-arching government financing strategy by the end of 2023 establishing an Office for Net Zero Delivery, responsible for placing net zero delivery at the heart of government thinking

3) Backing businesses to go green — reviewing incentives for investment in decarbonisation, including via the tax system and capital allowances, and protecting British industries from environmental undercutting by progressing plans on carbon leakage measures and providing more detail on the UK’s new Emissions Trading Scheme (ETS) building skills needed for the transition by driving forward the Green Jobs Taskforce recommendations and launching a ‘Help to Grow Green’ campaign, offering information and support to SMEs to plan and invest in the transition

4) Catalysing local action — reforming the planning system at local and national level to place net zero at its heart back at least one Trailblazer Net Zero City, local authority and community, with the aim for these places to reach net zero by 2030

5) Increasing transparency and engaging people — expanding the government’s public reporting on net zero ramping up public information through a new engagement plan, a new carbon calculator on the carbon cost of choices, and a standardised approach to ecolabelling on products developing a Net Zero Charter mark, acknowledging ‘best in class’ among firms for their work in reaching net zero

6) Delivering cleaner, cheaper, greener homes — legislating for the Future Homes Standard, meaning no new homes will be built with a gas boiler from 2025, and for all homes sold to be EPC C by 2033 adopting a 10-year mission to make heat pumps a widespread technology in the UK and legislate for the end of new and replacement gas boilers by 2033 at the latest reforming EPC ratings to create a clearer, more accessible Net Zero Performance Certificate (NZPC) for households

7) Capitalising on international leadership — conducting a strategic review on the UK’s international climate leadership and introduce environmental and climate protections in future free trade agreements, removing trade barriers to environmental goods and services

8) Setting ourselves up for 2050 and beyond — ramping up investment in research and development (R&D), with a new net zero R&D and technologies roadmap up to 2050, supporting up to three 10-year demonstrator projects backing business