Understanding the Government’s Net Zero strategy

In this blog, Joseph Smith of our partner PLMR pulls together all the key announcements made by the Government with regard to its climate strategy earlier this week.

The Government has published its Net Zero Strategy today, one of several related publications on energy and sustainability including the long-awaited Heat and Buildings Strategy. The 368-page Net Zero Strategy outlines the actions the UK will take to balance the amount of emissions it produces and removes from the atmosphere. The Conservatives have promised to meet this goal by 2050, but it will only be achieved if there are drastic reductions in carbon emissions. The UK economy will need to undergo a fundamental transformation across all sectors, and ministers have referred to this rapid decarbonisation as the Green Industrial Revolution.

The Net Zero Strategy ties in closely with the Conservatives’ levelling up agenda. Investment is promised in areas that have traditionally seen less, with economic hubs planned in Teesside, the Humber, Merseyside, and North Wales. This place-based approach promises close cooperation with the local government system to enable best delivery of the Strategy, and the Government estimates it will create up to 440,000 green jobs by 2030. It insists these will be high-skilled and high-wage.

The Net Zero Strategy is the first to be published by a major economy, and Boris Johnson believes that by moving first the UK can acquire a competitive advantage. There is a strong belief that the Strategy will deliver an economic boost, with UK companies able to export expertise and technologies around the globe. Furthermore, the Government has been keen to be seen to be taking a leadership position ahead of the crucial COP26 summit being hosted in Glasgow from 31st October.

Consumer choice and private investment have been important threads in Conservative politics since Margaret Thatcher and remain deeply embedded within the Net Zero Strategy. The Government believes that by spending £26 billion up front, it can leverage a further £90 billion of private investment by 2030. It is clear the intention is to reduce the costs associated with low carbon technologies to encourage market investment and, later, make consumer adoption cheap and easy.

The cost of the transition has been a bone of contention in recent weeks, with The Treasury at odds with The Prime Minister and Secretary of State for Business, Energy and Industrial Strategy, Kwasi Kwarteng. A review published by the Treasury today says “the costs of global inaction significantly outweigh the costs of action” to tackle climate change.

The document, released alongside the government’s net zero strategy, says it is not possible to forecast how individual household finances will be affected over the course of a 30-year transition Evidence of the Treasury’s commitment will be assessed in the forthcoming Spending Review.

Reaction to the publication has so far been mixed. Climate Change Committee Chief Executive Chris Stark describes it as “a substantial step forward that lays out clearly the government’s ambitions to cut emissions across the economy over the coming 15 years and beyond.”, but TUC General Secretary Frances O’Grady called it a huge let down, saying “the spending commitments will do little to address the yawning investment gap needed to get British industry ready for net-zero”.

See below for a more detailed overview:

The Government's Net Zero Strategy

If you would like us to send this overview to you, please contact Matt

We will be hosting a drop-in session on Friday 19th November with James Dove, Founder of ClimateEQ to talk about the Government proposals as well as discuss the first reaction to the COP26 Summit.

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