Government unveils 2030 net zero strategy ahead of Cop26
The UK has committed to an ambitious plan to phase out fossil fuels over the next 30 years and the Government’s net zero strategy is expected to provide the blueprint for how we will travel, heat our homes and run our economy in the future.
The Government will be hoping that the plan, announced on Tuesday, will boost its climate credentials as it prepares to host the Cop26 international climate summit in two weeks, but it risks undermining its role if it fails to deliver on its promises.
Gas boilers
Gas boilers heat 85 per cent of the UK’s homes, and account for around 14 per cent of its greenhouse gas emissions. They also pose perhaps the biggest road bump in the Government’s decarbonisation plan.
It wants to ensure no new gas boilers are installed from 2035, but will on Tuesday stop short of a hard ban on sales, instead laying out an “ambition”, amid concern that alternatives are too expensive and unfamiliar.
In reality it will have to introduce a hard ban if it hopes to meet its green targets. But in the meantime, it is relying on industry promises that low-carbon technology like heat pumps will drop in price to roughly the same as a gas boiler by 2030.
Before then, it is hoped a £5,000 grant scheme to buy heat pumps will incentivise people to make the switch. But the £450 million three-year scheme will only cover 30,000 homes annually, fewer than the number of households that installed a heat pump in 2020.
Meanwhile, gas prices are likely to rise as the Government adds a green tax to fund biomethane, and mulls carbon pricing. It is also committed to cutting the cost of electricity bills to encourage people to take up heat pumps, by removing the 20 per cent that comes from environmental and social levies. These could also be added on to the cost of gas.
Renewable electricity
Nuclear is expected to feature significantly in the Government’s plans to decarbonise electricity generation.
It will on Tuesday promise to agree funding for a new nuclear power plant as the country’s existing reactors are retired in the next 15 years.
Funding for the plant is likely to be added to household energy bills in the near future, although it is likely to be more than a decade until it is running.
The Government’s recently announced plan to source all of the UK’s electricity from renewables by 2035 will therefore rely heavily on untested technologies including carbon capture and storage (CCS), significant battery capacity and hydrogen.
Next week it is expected to announce which CCS projects will be first in line for development funding.
It will also have to ramp up offshore wind, with the Prime Minister saying he wants to see it go from 10GW of electricity a year to 60GW.
Onshore wind and solar are also likely to be a bigger feature on the British landscape. The climate change committee has called for onshore wind to be doubled by 2035, from 14 GW to 30GW, enough to power 19.5 million homes, which is likely to take up an additional 3,300 km2 of land, an area more than twice the size of London.
Land for solar farms will have to increase five times, requiring an additional 1,500 km2, compared with the current 290km2, the committee has said.
Hydrogen
The Government has an ambition to produce 5GW of hydrogen for use in heavy industry, manufacture and transport by 2030.
Concerns have been raised that it does not distinguish between “blue” hydrogen, which is made using fossil gas and carbon capture technology, and “green” hydrogen, which is made from electricity. Only green hydrogen, made using renewable electricity, is considered properly low carbon.
The Government is also carrying out trials to determine whether hydrogen could be used in home heating and has said it will decide by 2026.
It will announce that hydrogen-ready boilers will only be installed in 2035 in areas where they are “confident” of supply, amid warnings that green hydrogen will be too expensive for home heating.
But homeowners could still face higher energy bills to pay for the gas under a subsidy scheme to help fund its development for use across the economy.
Cars
The sale of petrol and diesel cars will be banned from 2030, with the most polluting hybrids to follow in 2035.
The Government has committed £1.3 billion to supplying charging infrastructure around the country and is expected to introduce a requirement for carmakers to ensure a growing proportion of their sales are electric cars.
EV sales have risen rapidly in recent years with half of cars on the road predicted to be electric as soon as 2030 and the Government plans to trim its £2,500 grant to reflect rapidly dropping upfront costs.
But there remain big unanswered questions about how we will get there, not least how the Treasury will plug the nearly £40 billion gap in fuel duty and vehicle excise duty that will open up as everyone switches to EVs.
Despite an ongoing debate within Government, the possibility of a move to road pricing has not been raised in the net zero strategy.
Green groups also say more needs to be done to nudge people towards switching from car journeys to walking and cycling and fund public transport.
The Government’s strategy for aviation includes its Jet Zero Council, which is exploring decarbonising the industry. It will also consider an expansion of pollution taxes on flying, under the UK’s Emissions Trading Scheme, which could lead to higher airline fares.
Nature
The role of trees, peat and marine environments as vital carbon sinks has risen up the global agenda and is likely to feature prominently at the upcoming Cop26 climate summit.
The Government has committed to planting 30,000 hectares of new trees per year by 2024 in England, and to restoring 35,000 hectares of peatland by 2025.
Peatlands store three times as much carbon in the UK as its forests and damaged peatland is producing as much carbon as all HGVs on British roads, according to a recent report.
A ban on peat-based compost will come into force in 2024. It will also ban burning on deep peat in protected areas, a practice regularly used in grouse shooting, though critics say there are too many loopholes in the new law.
The strategy is also expected to provide more detail of the transition within farming, which accounts for 10 per cent of emissions, to a system that pays farmers for public goods.
But it is expected to swerve questions around carbon pricing for the sector, which could see the costs of meat and dairy rise, and help to reduce demand.
Costs
Alongside the net zero strategy, the Treasury will also release its own review of the costs of the decarbonisation transition.
The long-delayed document has been the target of a political battle between Number 10 and the Treasury, and has been rewritten from an earlier version that focused heavily on the cost burden on households.
The new version will say that the costs of decarbonising will be less than the overall cost of inaction on climate change, which will include risk to assets from drought, flooding and storms.
But it will also warn that there are economic risks involved in the transition, including a potential loss of competitive advantage if green UK industries are forced to compete with cheaper, more polluting countries.
