Getting to grips with . . .
Net zero plans for finance and homes are announced as the Treasury tots up the price tag
Boris Johnson’s claim that “it is easy to be green” will be put to the test this week as the government publishes its plans for the UK’s transition to becoming more environmentally friendly.
Ahead of Cop26, No. 10 is setting out its strategy for the UK to reach net zero by 2050. Its neighbours at the Treasury are also sharing the calculated costs, and how they will be distributed, in an accompanying review.
The overarching Net Zero Strategy was expected to be given the green light on Friday during a cabinet “away day”, but the release was delayed following the murder of Conservative MP David Amess.
The government has a legal duty to achieve net zero greenhouse gas emissions by 2050, and it’s “taking a high-stakes gamble” by focusing its plans to do so on the publication of its Net Zero Strategy this close to the Cop26 summit, said Westminster’s independent advisory body on climate earlier this year.
“The challenges involved are monumental,” said The Guardian, but one solution is likely to be the UK’s “slow-moving and long-awaited nuclear power programme”, predicted the Financial Times. The strategy will “put nuclear power at the heart” of the government’s plan to reach net zero, with a “regulated asset base” funding model “key to delivering a future fleet of large atomic power stations”, said the newspaper.
Indeed, the strategy, published this afternoon, vowed to invest £120m in the development of nuclear projects, which it claimed could support the path to decarbonising the UK’s electricity system as early as 2035.
The plans also include investing in electric vehicles and green tech, kick-starting the commercialisation of sustainable aviation fuel, and accelerating industrial carbon capture and hydrogen. The government has promised to unlock up to £90bn of private investment by 2030, and support 440,000 well-paid jobs in green industries in 2030.
Another “piece in the Boris Johnson climate-calming jigsaw” is the Heat and Buildings Strategy, said the BBC’s environment analyst Roger Harrabin. This encompasses decarbonisation plans for homeowners, the public sector and social housing at a total cost of £3.9bn to the Treasury over the next three years.
It includes a “world first”, said The Guardian, with the promise to ban new fossil fuel heating systems by 2035. It’s a “trend-setting initiative that other nations will surely follow”, said Harrabin.
The strategy aims to incentivise homeowners to switch to lower-carbon heating systems, with the promise that the transition will be “simple, fair and cheap”. A mix of low-carbon solutions will be needed, the government has highlighted, with trials currently under way to test the feasibility of hydrogen for home heating.
From April 2022, grants of £5,000 will be made available to “take the edge off” the cost of installing greener heating systems, such as heat pumps, as part of a three-year Boiler Upgrade Scheme, said The Times. A selling point of switching is that these systems will be no more expensive than a fossil fuel-powered boiler by 2030, as a result of agreements between government and industry.
The Treasury published Greening Finance: The Roadmap to Sustainable Investing on Monday. The document sets out the government’s plans to clamp down on greenwashing, with changes to legislation and regulations to better inform investors and consumers about how green their investments really are.
The three-phase plan aims to provide better information about green claims that can be acted on in the market, eventually leading to a shift across the economy to keep investments in line with net zero goals. For the first time, some businesses will be required to share information about an investment’s environmental impact under new sustainability disclosure requirements.
The roadmap also provides further details on the Green Finance Taxonomy, the rules by which economic activities can be given the go-ahead for government investment.
The cost of decarbonising the UK will amount to less than the expense of inaction on climate change. That’s what the latest version of the Treasury’s “long delayed” assessment of the costs of reaching net zero is set to say, said The Telegraph.
The Net Zero Review will set out who is paying what costs to achieve net zero. It “has been the target of a political battle between Number 10 and the Treasury”, and a previous version was criticised for putting the financial burden of achieving net zero on to households. An interim report published in December last year said that the costs of the transition were as yet “uncertain”.
The latest review will also warn of the economic risks involved in decarbonisition. Leaked Treasury documents seen by The Observer say that “more green investment is likely to attract diminishing returns, reducing the positive impact of ever more investment on GDP”.
Johnson is ready to “galvanise ambitious action from every country at Cop26”, said independent think tank E3G’s campaign director Ed Matthew. “If the government has not presented the robust economic case in favour of action, that’s going to significantly undermine those attempts.”