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Climate & Energy

The UK’s Row Back on Climate Targets Is a Wake-Up Call to Get Real About Net Zero


Commentary6th October 2023

The United Kingdom has reached a turning point on climate-change politics over the past few weeks.

The consensus that has existed about how and when – and even if – net zero should be delivered has been called into question. Climate legislation passed in 2019 with a 17-minute-long debate in the House of Commons is now the subject of endless discussion in newspaper columns, on the airwaves and on stage at the Conservative Party Conference.

In many ways, debate around net-zero policy is justified. We are trying to achieve the biggest industrial transition the planet has seen in as little time as possible, and that is throwing up lots of issues that need to be overcome – grid connections, planning constraints, power intermittency, labour shortages, supply-chain bottlenecks, the list goes on.

The government’s recent decision to delay its climate pledges is symptomatic of this challenge – without a clear plan for how to deliver net zero, progress is slow. Bans without plans won’t deliver the net-zero transition the country needs.

As in all political matters, the challenge for leaders is to implement practical plans for delivery and to manage the costs and trade-offs associated with net zero in a way that is acceptable to the public. They need to bring people along on the journey. But the shifting political sands on net zero make it even more challenging for politicians who stand by established targets to advance their argument.

Net-zero politics must now prioritise the aspects of the transition that matter most: practical plans and real leadership on managing the costs and trade-offs of the transition.

Prioritising What Really Matters

The sheer scale of the net-zero transition means that what matters most can often get lost in the weeds. Discussions about imagined policies to tax meat and introduce seven different types of rubbish bin are distracting from what really matters: a total of 88 per cent of the energy consumed in the economy comes from fossil fuels like oil and gas. To meet future carbon budgets, the UK will need to rapidly reduce fossil-fuel reliance in the economy and move to renewable alternatives. This means politicians need to have a laser focus on what matters the most – delivering a decade of electrification.

The UK has, as the prime minister rightly points out, met all its carbon budgets to date. However, the country faces a much more significant challenge to truly deliver the next stage of the transition. Delivering a decade of electrification involves shifting energy demand away from fossil fuels to electric sources. Currently only about 20 per cent of the energy used in the UK comes from electricity. This needs to increase significantly over the next decade. By 2035, the country needs to see an increase from just over 700,000 electric vehicles on the road to more than 20 million. Annual heat-pump installations need to increase from about 60,000 to 1.4 million and the energy used in manufacturing needs to increase from 30 per cent electricity to 50 per cent.

Alongside this, the UK needs to build enough renewable-generation capacity to power the system and enough grid infrastructure to transport the electricity from where it is generated to where it is used. This will involve delivering four times more electricity-generation capacity and doubling the capacity of the transmission grid by 2035.

Delivering a decade of electrification is the big challenge. And unlike a lot of the UK’s previous decarbonisation efforts, engagement with the public will be central to this part of the transition. Over the next ten years leaders will be asking industry to rapidly decarbonise manufacturing processes and calling on people to change how they heat their homes, how they fuel their cars and how many wind turbines and pylons they can see from their windows.

But at the moment the country is off track to deliver this. TBI analysis shows that on the current trajectory, the government’s goal of installing 600,000 heat pumps per year by 2028 won’t be achieved until 2039 and the UK will not deliver enough renewable power to decarbonise the electricity grid until 2062. The country will not even have an electricity grid that is fit for purpose until 2084.

Getting Serious About Delivery

To deliver a decade of electrification, politicians cannot just set targets and introduce bans; the state must intervene to create the underlying markets and structures required to deliver a self-sustaining transition. Blunt tools such as banning gas boilers or stopping oil and gas exploration should be used only when the conditions are in place to deliver an affordable and secure transition.

The role of government is to systematically address and consider the individual barriers and enablers to delivery. This includes how to get a strong electric-vehicle charging network, how to incentivise people to buy heat pumps, how to make the UK an attractive place to build renewable projects, and how to overcome local opposition and speed up energy-grid construction so capacity is in place ahead of need.

Investing in technology is central to creating a positive, demand-led transition. Technological and market innovation can create more attractive “green” products and services than the existing fossil-fuel ones, driving natural demand and creating self-sustaining markets. Innovations in electric vehicles have made them an appealing option for consumers, meaning they now make up 20 per cent of new car sales in the UK and more than 90 per cent in Norway. The cost of solar has dropped 90 per cent over the past decade. Focusing on supporting technology and innovation through policy certainty and clear incentives must be central to any net-zero strategy.

In our recent paper Powering the Future of Britain, we set out practically what a plan to achieve this should look like: First, building the underlying infrastructure that is needed, at scale and at pace. Second, creating favourable conditions for investment to crowd in private-sector funding. Third, acting to give consumers and businesses the confidence they need to transition from fossil fuels to electricity. And finally, establishing a regulatory system that unleashes innovation in energy and electrification.

Only through this kind of bold action can the UK deliver on its net-zero targets in a sustainable way and reap the economic benefits of the clean-technology revolution.

Show Real Leadership on Net Zero

Delivering net zero will not only require the right regulatory framework and government investment, it will also require a different national conversation. It is the role of leaders to ensure that policies are backed by reasonable delivery plans and that the public understands why they are being implemented. Given the scale of the changes the public is being asked to accept, it is paramount that people feel like they can trust their leaders.

It will be essential for leaders to find a clear answer to the question of costs. Recent weeks have shown that this is an issue that will not go away. Rather than shy away from it, they should own the fiscal argument around net zero. This means framing the net-zero transition in terms of long-term economic benefits for households and society. For instance, showing how insulation measures and heat pumps will reduce consumer bills in the long term, or clearly outlining how much better insulated and warmer homes will save the NHS by improving public health. Leaders should emphasise the point that short-termist backtracking will only increase the cost of living in the long term and hurt the UK economy.

Crucially, this must be combined with policies that are sensitive to current cost-of-living pressures. For instance, it is not a strong political strategy to ask people in off-gas-grid homes to get rid of their oil boilers if there is not a readily available alternative at a manageable cost.

Unless leaders clearly lay out how the costs of net zero will be managed, people will assume that the answer to the question of “who pays” is themselves.

Forging a New Path to Net Zero

It is crucial that political leaders find a way to respond to and own the emerging conversation about net zero. This moment should be a wake-up call to shift the debate and show real leadership on net zero. Leaders must actively engage with the fact that achieving net zero involves more than targets and ambition – it is a huge task that will require a transformation of the UK economy and society.

Instead of rowing back on targets and weakening ambition, leaders need to back up ambition with practical delivery plans. Only by showing leadership can they bring the consumers along and deliver the decade of electrification the UK needs to achieve net-zero goals.

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