As 2023 dawns, where is Britain on Net Zero?

By Imogen O'Rorke

There was one glaring omission from the PM’s opening speech of 2023: the UK’s net zero plans. The 2050 target got just a passing mention in a string of promises that prioritised the health of the economy and the NHS, inflation and debt reduction and “stopping the boats” over the existential challenge of our times. In Rishi Sunak’s “optimistic” vision for Britain, our “net zero challenges” would be “solved by innovation” – in other words, let’s leave it to the markets.

This week also saw the publication of the Environmental Audit Committee’s (EAC) report on accelerating energy transition. The committee of MPs unsurprisingly found large gaps between the government’s net zero ambitions and reality. The UK is still dependent on fossil fuels for 78% of its energy needs. It concluded the acceleration away from fossil fuels is not happening fast enough to be in alignment with the 68% reduction in emissions that’s needed in this decade under the Paris Agreement; and it recommended nothing short of a “a national ‘war effort’ on energy saving and efficiency” is needed to upgrade Britain’s draughty homes and building stock.

Meanwhile, the business community and environmental groups await the publication of the independent Net Zero Review, promised early 2023. Since 2019, when the UK became the world’s first major economy to legally bind itself to a target to reduce its GHG emissions to net zero by 2050, a series of Conservative governments have fallen woefully behind on their targets – a situation not helped by three regime changes.

In June, Friends of the Earth and ClientEarth won a legal challenge against the government, proving its Net Zero Strategy does not contain the level of funding or detail needed to be aligned with true net zero in just under three decades’ time, nor even with the UK’s interim carbon budgets.

So, what can we expect from the independent review authored by Chris Skidmore MP that’s intended to explore the key issues, obstacles and trade-offs that are thrown up along the rocky road to lofty realms of net zero; and how the country can deliver “maximum economic growth and investment” alongside climate ambitions? It should at least address a number of policy gaps that have emerged since the last report in 2021.

Energy security will be a strong focus, not just because of the ongoing war in Ukraine, but following the controversy surrounding April’s Energy Security Strategy which greenlit a major oil and gas licencing round in the name of greater “energy independence”. We can expect the arguments for increasing oil and gas and even coal production in the short term for Britain to meet its commitments to be weighed against the case for increasing renewables. And as the EAC recommended this week, it’s likely to consider the expansion of onshore wind energy and even tidal in the longer term.

We can expect it to go large on energy efficiency and retrofitting – now a big policy focus. As Bim Afolami MP, a net zero champion and chief advisor for the Energy and Climate Intelligence Unit, hinted at an EG property conference in December, Skidmore’s Review will recommend a range of reforms and incentives to tackle the upgrading of period buildings and rapidly reduce energy usage. “He is not pulling back on what needs to happen – and these policies will be pushed forward post-review,” said Afolami. “There will be set laws that will drive down the costs of decarbonisation.”

The report is likely to address the green skills gap and explore how the government’s target of the two million new jobs at the heart of its “Green Industrial Revolution” will be achieved. The official Net Zero Strategy has been criticised by the EAC, amongst others, for only detailing the creation of 440,000 green jobs. This is likely to be a major policy focus for 2023 as Sunak pledges to drive economic growth through innovation in sectors such as cleantech.

Another policy area that’s been short on progress is agricultural reform, which is often pitted against food security. In a backwards move, the Truss government proposed ending Environmental Land Management schemes (ELMs) that would see farmers paid for conserving and restoring soils, nature, water and more. The ELMs are designed to discourage farming approaches that prioritise short-term yields over long-term sustainability. Sunak’s government has so far provided no clarity on the issue, which prompted the WWF and 49 other organisations last month to send a letter to Defra calling for “the vision, clarity, and detail on the rollout of ELMs to plan into an uncertain future”. The solar industry is also on tenterhooks over the proposed ban on the expansion of photovoltaics on agricultural land, even in dual-use settings where there’s sufficient evidence that crop yields are not affected.

Other time-critical issues including the recalibration of environmental standards as Britain exits the majority of EU laws at the end of 2023 and changes to the taxation system to incentivise more rapid decarbonisation (as suggested by the Climate Change Committee in 2022) are also likely to come up.

Ultimately, Skidmore’s Review will be full of recommendations for how government can best support industry, public services, consumers and everything in between to decarbonise. Whether they subsequently make it into hard policy over the next 12 months remains to be seen.