What will a net zero by 2050 target mean for business?
The UK can, and should reduce its greenhouse gas emissions to zero by 2050, says a new report from the Committee on Climate Change (CCC).
The report is largely optimistic about the possibility of achieving net zero but does not underestimate the level of ambition that this will require. It says that a ‘profound and wide-ranging shift in the UK’s emission reduction pathway is needed’.
If the government acts on recommendations, it will require significant action across all sectors. Here’s our summary of the key points set to affect business and industry:
More ambitious regulations
The report says that existing policies must be urgently strengthened to deliver tangible emissions reductions – current policy is not enough even for existing targets. It is likely that we will see more ambitious standards set for business across carbon reporting, resource and energy efficiency.
It did however recognise that businesses will be looking for a policy framework that is long-term, stable and consistent.
Buildings and heating systems
‘An overhaul of the approach to low-carbon heating and energy efficiency is needed,’ says the report. It wants the Government’s planned 2020 Heat Roadmap to establish a new approach that will lead to full decarbonisation of buildings by 2050.
The CCC wants to see the future trajectory of standards for buildings strengthened to meet current targets. Furthermore, it highlights the need for more effective enforcement – we may therefore see a tightening of current building energy efficiency standards, and more emphasis placed on enforcing these rules.
Fleet, travel and transport:
The report says cars and vans should produce zero emissions by 2035. This would mean bringing forward the government’s fossil fuel car ban from 2040 to 2035. By 2050, the vast majority of HGVs should be either electric or hydrogen powered, and trials of zero emission HGVs and trucks and associated refuelling infrastructure are now needed.
In the shipping sector, energy efficiency and operational changes could be implemented in the short to medium term, but technical solutions to deliver ships that are almost zero carbon are not yet commercially available, says the report.
Aviation was highlighted as one of the most challenging sectors to decarbonise and the report stressed the need to support low and zero carbon innovations in this sector. It said the industry may be required to cover the costs of decarbonisation if they are unable to reach zero emissions themselves. We may see the cost of flights rise as a result.
The report also wants to see a reduction in the demand for air travel. It recommended policies to discourage air travel, make it more expensive, and/or to make alternatives more attractive.
Energy supply – Demand response and grid flexibility:
The report says that the power sector has the potential to reach net zero by 2045 – that means a 100 per cent renewable and low carbon electricity system in the next two to three decades, compared to around 50 per cent today.
Policy and regulatory support for grid flexibility within a high renewables system, such as through demand response, storage, and interconnection is recommended.
Industry
The report suggests that industry could be less difficult to decarbonise than previously thought. It foresees the near-full decarbonisation of stationary combustion in manufacturing with hydrogen, Carbon Capture and Storage, Bio Energy with Carbon Capture and Storage (BECCS) and electrification all playing a role.
Major infrastructure developments in hydrogen and CCS are needed to achieve this – and this requires major policy and regulatory changes to drive the necessary innovation and investment. ‘Such developments can only partly be influenced by industry itself,’ says the report.
Resource efficiency
The report suggests a landfill ban on food waste after 2025, and that UK recycling rates would need to reach 70 per cent by 2025 to put the UK on a net zero trajectory.
The CCC’s recommendations will require a significant shift if placed into regulation, but the report is keen that policy changes work for UK firms. It says, ‘For a net-zero GHG target, standards will need strict enforcement and incentive schemes must be designed with businesses and investors in mind.’
The CCC’s full report is available here.
