According to the Net Zero Strategy, by 2035, the UK will be powered entirely by 'clean electricity' (subject to security of supply). This will require the mobilisation of £150-270 billion of public and private investment. According to a Carbon Brief report published last week, the UK’s power system has already seen the biggest drop in emissions for any sector, falling 72% between 1990 and 2019.
The Net Zero Strategy proposes that 40GW of offshore wind will be active by 2030 and that a £120 million Future Nuclear Enabling Fund will be launched that will retain options for future nuclear technologies, including 'small modular reactors'.
The strategy towards industry is aimed at reducing emissions from heavy industry while simultaneously encouraging innovation and new technologies to assist with the net zero transition. The strategy builds on the industrial decarbonisation strategy, released earlier this year and estimates that indicative emissions could drop by 63-76% by 2035. Key to the latter of these sub-strategies, is the use of hydrogen as a fuel, set out in the Government's ambitious August 2021 "UK Hydrogen Strategy" policy.
Changes to domestic energy consumption
The UK Government published a separate heat and buildings strategy on the same day as the Net Zero Strategy, which outlines the importance of improved energy efficiency in homes and an ambition that by 2035, no new gas boilers will be sold. A new £450 million three-year boiler upgrade scheme will see households offered grants of up to £5,000 for low-carbon heating systems.
The strategy foresees that this will require a mobilisation of approximately £200 billion of public and private investment as well as further funding for the Social Housing Decarbonisation Scheme and Home Upgrade Grants, investing £1.75 billion and £1.425 billion for Public Sector Decarbonisation, with the aim of reducing emissions from public sector buildings by 75% by 2037.
Transport remains a key focus for the Net Zero Strategy, making up the largest share of UK emissions – 27% - of which more than half comes from cars. Central to the strategy therefore is the commitment to end the sale of new petrol and diesel cars by 2030 and to ensure all cars are zero emissions capable by 2035. Taken alongside the announcements of a £2 billion investment in helping increasing walking and cycling, and a further £3 billion investment in improving bus networks, the strategy envisages emissions from domestic transport falling 65-76% by 2035 from 2019 levels.
Much of the funding for transport projects is underway and the new commitments announced in the strategy aim to bolster and improve on previously established pledges. However, to achieve the levels of emissions reductions in the sector it is estimated that an additional £220bn of public and private investment will be needed.
Carbon capture and sequestration
Funding will also be used to deliver four carbon capture usage and storage clusters by 2030. This carbon storage strategy is intended to complement the UK Emissions Trading Scheme.
Measures are being taken to sequester carbon through natural means in addition to reducing emissions. The Net Zero Strategy outlines plans to treble woodland creation rates in England, contributing to the UK’s overall target of increasing planting rates to 30,000 hectares per year by the end of this Parliament. Linked to this is a boost to the existing £640 million Nature for Climate Fund with a further £124 million of new money, ensuring total spend of more than £750 million by 2025 on peat restoration, woodland creation and management.
Despite the policies and commitments outlined above, it is acknowledged that emissions will still be produced and so there is a need for future innovation, specifically in connection with greenhouse gas removal from the atmosphere ("GGR"). This will be achieved by delivering £100 million of investment in GGR technology innovation, which in turn could enable further deployment of GGR technology on a wider scale in the future.