CCC Sixth Carbon Budget advice: The green economy reacts

The Climate Change Committee has just delivered its most detailed and ambitious work yet to the government, in what the advisory body’s CEO Chris Stark this week called “one of the most important things we’ve ever published”.

The Sixth Carbon Budget report published today encompasses around 1,000 pages which offer the most detailed roadmap ever developed on how to transform a modern economy so that it delivers net zero emissions within the space of just 30 years. Crucially, it contains advice to the government on how to meet its statutory climate targets for the mid-2030s, and makes it clear that rapid action on policy to drive tens of billions of pounds investment each year throughout the 2020s is required to realise the full benefits of the net zero transition, and to avoid the worst financial and climate costs. 

All in all, it is a remarkable and fascinating document that provides businesses with the clearest UK investment blueprint yet for the next three decades, and makes clear that while huge challenges remain in the immediate, medium, and long-term if the UK is to decarbonise in line with the goals of the Paris Agreement, the pathway is nevertheless an achieveable and immensely attractive one. 

The government, on top of an already bulging in-tray for 2021, is legally-required to respond to the CCC’s recommendations by June next year, and many businesses leaders, politicians, experts and campaigners have called on the ministers to endorse the report as soon as possible, and to urgently get started on building a net zero emission economy. Here, BusinessGreen rounds up all the reaction to the CCC’s report from across the green economy. 

 

Rain Newton-Smith, CBI chief economist, said: 

“Today’s detailed analysis from the CCC demonstrates how important the coming years are for making progress to this important goal. As technology costs continue to fall, the pathways to net-zero are becoming clearer. Now is the time for business and government to work together to deliver a transition that will secure both our economic recovery and sustainable growth well into the future.  

“Last year the CBI highlighted the 2020s as a ‘decade of delivery’ for achieving net-zero emissions. We have a short window of opportunity between now and COP26 to set the clear strategy we need to meet net-zero commitments. With that in place, business, government and society stand ready to deliver.”

Clara Goldsmith, campaigns director for The Climate Coalition, said:

“The government must accept this advice and unleash a decade of ambitious action to get on track to net-zero and give a turbo boost to our economic recovery. There is no downside to the government embracing this plan. It can transform our society and create hundreds of thousands of green jobs. This is the leadership the UK must show ahead of the decisive UN climate summit we are hosting next year.”

Nick Mabey, chief executive of climate and energy think tank E3G, said:

“This ground-breaking report has revealed that a five-fold increase in finance is needed to get the UK on track to net-zero, rising from £10bn to £50bn a year. This investment can accelerate our economic recovery whilst cleaning up our air and driving down our energy bills. The Treasury must urgently set out a detailed finance plan to make it happen. This should prioritise investment to decarbonise our homes and transport which are jobs rich and can lead to the fastest cuts in emissions. This is a unique moment of opportunity we must not squander.”

Sarah Allan, head of engagement at charity Involve – which ran the first UK-wide citizens’ assembly on climate change – said: 

“It is terrific to see that the CCC’s technical recommendations to government in the Sixth Carbon Budget have been so strongly informed by Parliament’s recent Climate Assembly UK, with the CCC putting both hard-nosed data analysis and public preferences at the heart of its recommendations for net zero policy delivery. As UK net zero policy begins to ‘knock on people’s doors’ bringing changes to the way we all live, travel and heat our homes, the CCC report rightly urges government to listen to, educate and involve people in the decision-making process or risk undermining vital public support needed to hit its own climate targets.”

Dr Doug Parr, policy director at Greenpeace UK, said: 

“The CCC may have set out its paths to net zero but we’ll need much more legwork from the government over this parliament to reach it. Doing so will be critical for successful international climate leadership from the UK in 2021. While some progress has been made recently there remains a yawning gap between our targets over the next decade and action needed to meet them straight away.  

“Not only is immediate action to make our homes warmer and our power renewable necessary for the climate, but it creates huge numbers of jobs, and the costs across the economy are progressively falling.”

Dr Jonathan Marshall, head of analysis at the Energy and Climate Intelligence Unit (ECIU), said:

“These stretching targets will see climate policies increasingly overlap with everyday life, bringing changes in the cars we drive, how we heat our homes, and how the products we buy are made. The overwhelming backing among the British public for climate action, at both governmental and individual levels, means that these measures are likely to be popular and well-supported, as long as well-thought policies are used to bring about change.

“Calling time on gas boilers will represent a major step on the UK’s path to a carbon neutral nation, and is a way for families up and down the country to take action on their carbon footprints. Switching to clean heat will not only cut emissions, it will reduce air pollution and – if supported with the right policies – dramatically cut energy bills. With strong suggestions that hydrogen will not be widely used to heat our homes, the CCC have given the government the ammunition needed to make a big call on clean heat, which if done well could lead to a booming heat pump industry based on British soil.

“The Sixth Carbon Budget also brings with it a clear need to act in the short term. Setting targets is all well and good, but the next few years is key to whether we hit them or not. The government is currently sitting on a slew of strategies, frameworks and plans that are tasked with decarbonising the economy; the recent increase in ambition only highlights the need for these to contain policies that match the rhetoric.”

Dr Alison Doig, international lead at ECIU, said:

“In its report today the CCC demonstrates that, as president of COP26, the UK can show it is serious about delivering the goals of the Paris Agreement, by taking its advice. 

“The report demonstrates that taking bold action to decarbonise our economy makes sense for jobs and prosperity across the country, but also keeps the UK at the forefront of an international zero carbon revolution. Leading the world in renewable technologies, at the forefront of innovations, and building international confidence that net zero is possible.”

Ana Musat, head of policy at the Aldersgate Group, said:

“The CCC has set a huge, but feasible, investment challenge for the UK economy for the next 15 years and one where the private sector will have to do most of the heavy lifting. This budget represents an opportunity for the UK to get the economy going again as it emerges from the Covid-19 crisis and to invest in innovation, grow supply chains and create jobs in areas such offshore wind, EV manufacturing, low carbon industrial goods, building renovation and green finance. As more countries take on net zero emissions targets, the export opportunities for the UK could also be significant: by 2030, the global market for low carbon goods will be worth more than £1tr a year, representing an increase of seven to 12 times on today, with the market for low carbon services growing in tandem.”We welcome the recent steps taken by government to meet this ambition, including the publication of the Ten Point Plan and its commitments on offshore wind and the phase out of petrol and diesel vehicle sales. To support the private sector in delivering the ambition of the sixth carbon budget on time and at low cost, the government now needs to put forward a comprehensive net zero delivery plan, which sets out clear policy signals for all key emitting sectors of the economy.”Such a plan should include introducing binding energy efficiency performance standards and fiscal incentives that ensure that all new buildings are ultra-low carbon and that existing homes meet a level of energy efficiency of at least EPC band C by 2035 at the latest. Other key priorities should include strengthening the grid to support the full decarbonisation of the power sector by the end of the decade, setting up a UK Emissions Trading Scheme aligned with the net zero target with a starting price of at least £40 per tCO2 and introducing measures such as product standards and green public procurement to grow the demand for ultra-low carbon industrial goods.” 

Julie Hirigoyen, chief executive at the UK Green Building Council (UKGBC), said:

“The advice on the Sixth Carbon Budget is a gamechanger and the message is clear: if we don’t act decisively this decade, we will not meet our climate targets. The step up in ambition being advocated by the CCC should be embraced by government, and will demonstrate leadership on the world stage ahead of COP26.

“Delivering the Sixth Carbon Budget and net zero by 2050 will clearly require a significant acceleration of action across the economy, from both government and industry alike, with the decarbonisation of the built environment front and centre. A major nationwide investment programme as recommended by the CCC, led by government but leveraging private investment, should focus on improving the energy efficiency of our homes and non-domestic buildings and decarbonising heat. The built environment industry is crying out for the clarity and long-term certainty that must be provided by the upcoming Buildings and Heat Strategy.

“We wholeheartedly endorse the CCC’s call for a robust definition of the Future Homes Standard in advance of 2023 and accelerated plans for a new in-use performance standard for commercial properties with all commercial efficiency renovations to be completed by 2030. The new recommendation that no home should be sold after 2028 without a rating of EPC C is a radical but welcome proposal, and would send a clear message to both consumers and lenders.

“We continue to urge government to strengthen policy that drives the property and construction sector to reduce embodied carbon in construction, maintenance and demolition, which is treated separately to buildings in the CCC report. There are huge opportunities for resource efficient, innovative methods of construction and materials choices that reduce both our domestic and imported emissions – and can boost local jobs and supply chains. We need to be delivering at least 40 per cent less embodied carbon in construction projects by 2030 and that won’t happen by voluntary action alone.”

Mike Foster, CEO of the Energy and Utilities Alliance (EUA), said:

“We all know that decarbonising heat is tricky, but necessary if we are to meet our climate change obligations, and low carbon gases such as hydrogen have a critical role to play in the process. Today’s announcement in part supports this. Our fear is that while the world is waking up to a hydrogen future, the CCC is still wedded to some out-dated thinking about electricity being able to solve all our problems.

“However, there is an increasing degree of scepticism that the UK will be able to meet the technological deployment number outlined in the recommended scenario, with some of the increases required being almost impossible to achieve in the indicated timelines.

“EUA also does not believe that sufficient voice has been given to consumers and the impact that these changes will have on them. We should be upfront and declare what costs we expect them to have to pay to achieve decarbonisation. We believe that the CCC have a duty to say how much consumers are expected to pay under their plans to have decarbonised heating, given that it is a necessity, not a luxury.”

General secretary of the Trades Union Congress (TUC), Frances O’Grady, said:

“To reach net zero, we need a shared sense of national purpose. Everyone must understand how they will benefit from a climate-safe economy, clean air, healthy land, restored wildlife and new green industries. For working people, a just transition means knowing that job security and quality is guaranteed, with training for the great new jobs in green industries. This must begin quickly, to prevent mass unemployment following the pandemic. By fast-tracking public investment in green infrastructure, the government can create over a million jobs in the next two years.

“The only true just transition plan is one that’s made with workers, rather than done to workers. If workers have a genuine say, there will be stronger community backing, so progress will be both fairer and faster. And we’ll all become proud when our generation delivers a major upgrade to Britain that improves everyone’s quality of life.”

RenewableUK’s head of policy and regulation, Rebecca Williams, said: 

“The CCC is right to urge government to move faster to reach net zero by taking a series of key steps which will benefit consumers by delivering cheap energy, as well as slashing carbon emissions. As their latest report states, low-cost offshore wind will play a major role as the backbone of our future power system with up to 140GW installed by 2050 – a fourteen-fold increase in our current capacity – and we also need a ramping up of onshore wind and innovative technologies like floating wind, tidal stream and renewable hydrogen to get there.

“The report highlights the fact that this will deliver tens of thousands of new jobs throughout the UK, especially including regions which need levelling up most, as part of the Just Transition from fossil fuels to renewables. As the report points out, certainty over consenting issues and auctions for contracts to generate power will help to increase investment in the UK renewable energy supply chain.

“Billions of pounds in investment by the private sector will help to achieve this. The CCC highlights the fact that this can only be achieved by Government enabling the construction of new grid infrastructure for offshore wind, and ensuring that the planning system is improved by resourcing environmental bodies appropriately, as well as working closely with other sea users and addressing aviation radar issues.

“Another vital measure highlighted by the CCC is enabling older onshore wind farms to re-power with even more efficient turbines when they reach the end of their 25-year lifespan. The report suggests almost doubling onshore wind capacity overall to 25-30GW by 2050 in order to generate low-cost power for consumers. Taking these steps will demonstrate that the UK government is leading efforts to tackle dangerous climate change in the run up to COP26 in Glasgow next year, where we can demonstrate global leadership on the biggest long-term threat all of us are facing.”

Drax CEO, Will Gardiner, said:

“The government’s new 68 per cent NDC commitment last week, alongside this report, reinforce how net zero will only be achievable through negative emissions and sustainable BECCS in the UK. This world-leading technology can showcase the UK’s global leadership in the run up to COP26 in Glasgow next year.”

Stewart Clements, director of the Heating and Hotwater Industry Council (HHIC), said:

“We welcome the CCC’s ambition to have 5.5 million Heat Pumps installed by 2030 and also the recognition of hydrogen and the real potential it offers to decarbonise heat, affordably. HHIC represents the whole heating sector and we will be working with our members to understand the implications of this report and how we can assist BEIS with the transition. As an industry we are committed to helping and supporting the UK reach our carbon reduction targets.”

“However, we must proceed with caution. Having ambition is positive but we have to be prepared for what happens if we can’t meet that ambition. The accelerated timelines will be very difficult to achieve in practice. BEIS need to urgently engage with the heating industry to fully understand what we can start to deliver, and what we will need to put into place.

“For example more work is going to be needed on reskilling the workforce and developing supply chains. Red tape will need to be reduced to allow greater participation in government support schemes like the RHI and Green Homes Grant. If a collaborative approach is adopted the heating industry is confident it can reduce emissions to meet our net zero goals.”

Tom Greatrex, chief executive of the Nuclear Industry Association (NIA), said:

“The CCC’s recommendation that we should build enough new nuclear to replace the current fleet by 2035 is a good start, but we will have to build twice that amount to be on track for net zero. Right now, we regularly rely on gas and coal for most of our power, and we need to replace all of it in the next 15 years. Nuclear is our only proven source of firm, emissions-free power that can do that. It also has one of the lowest lifecycle carbon footprints of any generating source, 14 times lower than gas with CCS, and has saved more in emissions than any other generating source in our history. Replacing the current fleet should be the starting point, not the limit, of our ambition.”

Crispin Truman, chief executive of CPRE, the countryside charity, said:

“Stopping the climate emergency runaway train is possible if we use all the solutions at our fingertips right now. Today’s report from the CCC is absolutely clear – nature-based solutions such as planting trees and restoring peatlands can lower the costs and multiply the returns from cutting carbon emissions. Not only do they hold the key to swifter climate action now, they offer other important benefits including preventing floods, cleaning up our air and water, improving treasured landscapes and inviting wildlife back to our countryside.  

“Thinking has clearly shifted on peatlands: we welcome the strengthened ambition from the CCC and join them in calling for all upland peat to be restored and most lowland peat to be rewetted and sustainably managed by 2050. The upcoming England Tree and Peat Strategies will be key tests of the government’s willingness to act with real ambition.

“The writing is on the wall for the government. It’s time for ministers to show bold leadership and deliver deeper, faster cuts to our carbon emissions before 2030 with the countryside and nature-based solutions at the fore. It’s time to get back on track to tackle the climate emergency head on.”

Luke Warren, chief executive of the Carbon Capture and Storage Association (CCSA), said:

“Today’s advice from the Climate Change Committee is clear – to deliver net zero across the UK economy, we need to be moving further and faster with emissions reductions from Carbon Capture, Usage and Storage. The Committee recommends an increase to the amount of CCUS that the UK must deploy in the next decade.

“The CCUS industry should now be aiming to store over 20 Mt CO2 every year by 2030. This requires the UK to develop CCUS clusters in all of our industrial regions. Industry is ready to deliver this ambition and is actively progressing work on the CCUS clusters, helping the UK to demonstrate to the world its commitment to tackling climate change whilst ensuring a green post-Covid recovery.”

Aviation Environment Federation (AEF) deputy director, Cait Hewitt, said:

“The CCC’s advice is clear: the government needs to call time on airport expansion. Zero carbon aviation is currently an aspiration, not a reality, and while it’s right to pursue new technologies for cutting emissions, we can’t rely on these coming through fast enough to decarbonise the sector without also reducing aviation demand. “Our analysis shows that current and planned UK airport expansions could increase aviation CO2 emissions by nearly 9MtCO2 a year in 2050 compared to a situation with no expansion. The aviation sector has taken a huge hit from the Covid pandemic, but jobs per passenger had already been falling for many years. The government now needs to sharpen its focus on how to build the zero carbon industries – and jobs – of the future.”

Mike Thornton, chief executive of Energy Saving Trust, said:

“We congratulate the Committee on the clarity, detail, and optimism of the report, and urge government to adopt the recommendation for a target of a 78 per cent reduction in carbon emissions by 2035.

“This report provides a world-leading route map to address the climate emergency. By setting out a comprehensive and clear process to replace all fossil-fuel infrastructure within 30 years, it provides the scale of ambition we need policymakers to commit to in full.  Everyone will have a role to play and we all stand to benefit. The vision outlined will mean a clean electricity grid within 15 years, reduced electricity costs, as well as all new cars and more than half of new heating systems being fossil-fuel free by the end of this decade.  As part of this, it will be crucial to encourage people to change their habits and provide them with support and advice on more sustainable ways of living including travel and home energy efficiency.

“The report highlights home energy efficiency as a fundamental first step to a carbon free future. It includes the ground-breaking finding that the costs of upgrading our housing stock – to improve insulation and low carbon heating – will be more than outweighed by the lower energy bills by 2050. This is thus a compelling opportunity to take action in a way that is fair and benefits everyone.”

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