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CCC welcomes ambition of Net Zero Strategy but key issues must be resolved

The government's Net Zero Strategy is broadly in line with the CCC's sixth carbon budget. Image: Getty.

The government's Net Zero Strategy is broadly in line with the CCC's sixth carbon budget. Image: Getty.

The Climate Change Committee (CCC) has welcomed the ambition of the government’s Net Zero Strategy, but called for further steps to implement policy quickly.

Published on 19 October, the strategy provides an affordable and achievable vision for the path to a Net Zero UK, the committee noted in its independent assessment.

“This is a credible package that reflects the scale and breadth of the challenge. It is a material step forward,” the executive summary notes. “For the Strategy to be a success the delivery of these ambitions must follow quickly, requiring key issues to be resolved in the coming months. The Committee will be closely monitoring this progress.”

The Net Zero Strategy broadly aligns with the CCC’s own Sixth Carbon Budget, with both targeting a fully decarbonised electricity system by 2035, 40GW of offshore wind by 2040 and all homes to hit an EPC band C rating by 2035.

In other segments, there are just small differences. For example, the government is targeting that 20-30Mt of CO2 should be captured and stored using CCS across the UK annually by 2030, with this to include the technology being utilised at one power site, to the CCC’s 22 MtCO2/year captured and stored in 2030 including multiple power sites.

There are a number of areas where there must be greater pace and detail for policies, however, said the CCC, such as decarbonisation of buildings, which includes urgent action for driving low-carbon heat uptake and the development of energy efficiency plans.

The Heat and Buildings strategy committed to developing a major market for heat pumps in the UK, improving consumer offers, securing significant cost reductions and bringing in an obligation on boiler makers to start phasing out oil boilers, as well as a small grant fund for heat pumps.

Alongside this, there is a commitment to look at rebalancing policy costs on electricity and gas, to favour electrification. This has been called for by a number of industry bodies of late, including a group of utilities that branded the levies "outdated" in February.

However, the CCC warned that there are still significant delivery risks, most notably the energy efficiency of the 60% of the nation’s homes that are owner-occupied but not fuel poor.

Here the Net Zero diverges from the CCC’s Sixth Carbon Budget, with the committee noting that the government is expecting greater emissions reductions from buildings despite the expected deployment of low-carbon measures by 2035 being similar. The government has committed to rolling out a minimum of 600,000 heat pumps a year by 2028, while the CCC has suggested 900,000.

Greater reductions are possible, but these are dependent on future energy demand, the impact of policy interventions and the effectiveness of the low-carbon options.

“Funding overall, and specifically for heat networks, the public sector and heat pumps, appears to be relatively low," said the CCC report. "The lack of an integrated offer on home retrofit for the majority of households remains a real source of concern, and contrasts with international best practice as exemplified by the decade-long KfW scheme in Germany, which is largely self-funding and widely celebrated as a major policy success.”

The CCC welcomed the government’s commitment to phasing out fossil fuel vehicles and targeting a low-carbon grid, although it has listed a clear plan for the buildout of a flexible electricity system as a key priority for the next five years.

Whilst there is much to be praised according to the CCC, the government is yet to quantify the effect of each policy and proposal on emissions. Therefore it is not clear how the mix of policies will impact overall emissions reductions.

A Net Zero Test is yet to be announced, meaning the UK runs the risk of locking in high-carbon developments. Similarly, how the government intends to build public engagement is not established. Therefore, whilst the strategy gives positive signals, more action is required.

The government's work on ensuring a fair transition to net zero is “far from complete”, with further clarity on policies, but also how they will be funded, required.

Additionally, the Treasury must build on the analysis set out in its Net Zero Review to support the transition and manage the gap in tax revenue created by falling fuel duties.

Effective policy cannot be designed and implemented overnight, the CCC notes, pointing the challenges that led to the shuttering of the Green Homes Grant. But the report added that “there is little time to develop, test and refine policies and meet the Net Zero path; work must proceed apace.”

It finishes by flagging key actions for the government to take, including Implementing the Transport Decarbonisation Plan and the Heat and Buildings Strategy, reviewing energy levies, continuing the deployment of renewables, and implementing hydrogen and CCUS business models.

To read more about the CCC’s reaction to the Net Zero Strategy, see its full report here.

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