Bright Blue, the independent think tank for liberal conservatism, and WSP, the leading engineering professional services firm, have today published a major essay collection, Delivering Net Zero, which outlines radical new ideas for how the UK can deliver on its net zero commitment by 2050, with contributions from nearly 40 leading chief executives, politicians, academics and thought leaders from across the private, public and third sectors.
The essay collection from Bright Blue and WSP argues that delivering net zero is both an environmental necessity and an economic opportunity. It rejects the argument that the transition to net zero requires vast amounts of government spending and intervention, highlighting instead the progress that has been made on decarbonisation to date, and could further be made in the future, through well-regulated markets with sensible incentives from government.
The essay collection offers analysis and ideas across nine key areas: transport; land; utilities; buildings; industry; waste; finance; government; and, innovation. The publication provides inspiration to politicians, policymakers, and practitioners in advance of the Conference of the Parties (COP) 26 in Summer 2021 to implement innovative programmes and policies to ensure the UK’s market-based economy can meet its net-zero commitments.
Bright Blue and WSP believe that COVID-19 has strengthened the case for action on the challenge of this century – climate change. Governments, businesses and communities need and will be expected to do more to mitigate and build resilience to disruptive crises, such as global warming and extreme weather events.
The collection includes contributions from Nigel Wilson (Chief Executive, Legal & General Group), John Holland-Kaye (Chief Executive, Heathrow Airport Ltd), Peter Jelkeby (Chief Executive, IKEA UK & Ireland), Tony Juniper CBE (Chair, Natural England), Christine McGourty (Chief Executive, Water UK), Richard Walker (Managing Director, Iceland Foods), Nicholas Boys Smith (Co-Chair, Building Better, Building Beautiful Commission), Graham Stuart MP (Minister for International Trade), George Freeman MP (Former Minister for Transport), Ben Houchen (Mayor, Tees Valley), Professor Michael Grubb (Professor of Energy and Climate Change, University College London), Barny Evans (Sustainable Places Director, WSP), and many more.
Patrick Hall, Researcher at Bright Blue and report co-editor, commented: ‘The UK has reduced its emissions by just over 40% since 1990 at the same time as its economy growing by 75%. A market economy can and should deliver deep decarbonisation. But achieving net zero emissions by 2050 is by no means an easy feat. Large parts of the UK’s economy remain rooted in fossil fuels, and hard-to-abate sectors present the greatest challenge to decarbonisation. The coronavirus crisis should act as a catalyst for governments and businesses to urgently do more to address the challenge of this century – climate change. The transition towards net zero is often seen as requiring vast amounts of government-led investment and intervention. Yet, this neglects the progress that has been made on decarbonisation to date and could further be made in the future through well-regulated markets with sensible incentives from government. This Conservative Government needs to examine and promote how market-based reforms could yield substantial economic and environmental benefits in the journey to net zero.’
Mark Naysmith, Chief Executive at WSP UK, commented: ‘Ensuring that big societal ambitions get delivered is what drives our planners, engineers, environmental consultants and technical experts. To us, there is no agenda greater than mitigating climate change and environmental degradation. Delivering net zero will be a team effort. As WSP is involved in all aspects of the built and natural environment, we felt it was important to convene some of the best minds from business, academia and government to explore how this agenda should be delivered, offering constructive ideas to move forward. The net zero agenda is an opportunity to build back better, level up the country, boost our national resilience and attract new talent into the built and natural environment , as well as being a societal duty. WSP is committed to being carbon neutral by 2025 and advises both national and local government as well as private organisations on sustainable practices, and I felt this collaborative essay collection would be a timely contribution to the national conversation on delivery.’
Key policy ideas offered in the essay collection include:
- The introduction of a ‘carbon pound’. Purchases and activities are not labelled with indications of their carbon impacts, meaning making the right choices for the environment can be extremely difficult and consumers are often left ‘in the dark’ about the carbon intensity of products they are purchasing. A carbon pound should be introduced, reflecting the environmental impact of goods and services. This ‘virtual’ carbon pound would not actually cost the consumer anything, but would be a representation in terms of money which would allow consumers to make more informed decisions about their consumption and encourage more environmentally friendly choices.
- HM Treasury should introduce a ‘carbon scorecard’ for all new policies. Currently, HM Treasury uses a scorecard to measure how each new policy is aligned with public sector net borrowing. A new scorecard setting out how each new policy aligns with net carbon emissions would put decarbonisation at the heart of Treasury decision-making, ensuring that policymakers are focused on delivering net zero in all decisions. Even when rapid decisions are needed, such as during a pandemic, the effect on the carbon emissions would always be considered.
- UK net zero emissions should consider consumption emissions. Consumption emissions take into account the emissions from domestic final consumption and those caused by the production of its related imports. The UK must ensure that its domestic consumption does not encourage carbon-intensive practices overseas, simply shifting the carbon emissions outside of UK borders without reducing their release into the planet as a whole. Aligning the net-zero target with consumption emissions would allow the UK to take a lead globally and help to reduce the world’s overall carbon footprint as well as its domestic carbon footprint.
- An international and privately-backed Green Investment Bank should be established. In 2012, the UK Government commissioned the world’s first ‘green investment bank’ which became the leading financier in the UK clean energy space and built up £12 billion of clean energy assets over five years. There are now some 20 similar government-sponsored entities all over the world, inspired by the UK model. A global institution should be established, free of the constraints of the limited capital of national governments and limited geographical scope.
- The Future Homes Standard should be implemented now rather than waiting until 2025. Delivering net zero requires changes to the way all of us operate our homes including how we receive and use water, gas, and electricity. The Government’s proposed Future Homes Standard will ban gas connections in new homes from 2025 while significantly tightening building regulations. This can be brought forward and implemented for new developments now instead of waiting for five years. Developers can immediately begin building the sustainable, low-carbon homes of the future.
- Decarbonisation standards should be introduced for local authorities to decarbonise small and medium sized enterprises (SMEs). The 2020s must be a ‘decarbonisation decade’ for councils. The bulk of local authority supply chains are made up of SMEs. Setting up decarbonisation standards for local authorities would encourage the decarbonisation of these SMEs and demonstrate climate leadership at a local level, as well as serving as a guarantee of a greater local quality of life.
- New legislation should mandate companies over a certain size to audit their supply-chains and overseas operations to ensure they are not contributing to deforestation. The Government should create new due diligence requirements for big businesses with international supply chains to monitor practices and ensure environmental standards are met. The introduction of new legislation mandating larger companies to audit their supplies and overseas operations would better demonstrate and ensure that destructive practices such as deforestation are not taking place in connection with UK companies.
- Air passenger duty (APD) should be reformed so that flights operated using sustainable aviation fuels (SAFs) are charged a lower rate of APD. Increasing the use of SAFs is critical for decarbonising one of the most hard-to-abate sectors: aviation. The use of SAFs should be scaled up to meet our net zero target. This can be encouraged by greater investment from government into upscaling the production of SAFs. A differentiating APD should be adopted so that a higher use of SAFs means the APD owed is lower.
- The Government should ban the burning and extraction of peatland for use in horticulture. Peat covers 12% of the UK’s land area, and contains more carbon than the forests of the UK, France, and Germany combined. Peatland is the UK’s largest existing terrestrial store of carbon. It can sequester additional carbon, but only when in good condition and at a slower rate than trees. If it is not in its natural wet condition, and is subject to practices such as burning and extraction for use in horticulture, peatland emits carbon dioxide rather than sequestering it. Protecting peatland, therefore, is essential for delivering net zero.
- A de minimis levy should be placed on any good sold, which would go towards a new ‘Nature Restoration Fund’. This would mean that the business community would be made to invest in our environment as well as its corporate growth. Such a fund would allow conservationists – who are best placed to know where such funding should be allocated – to help reverse declining biodiversity and combat climate change. This would be predominantly achieved through nature-based solutions, including forests, grasslands and wetlands, which store carbon, regulate weather patterns and reduce emissions.
- Provisions which remove tariff and non-tariff barriers in low carbon sectors should be included in free trade agreements (FTAs). Post-Brexit, the UK has adopted an ambitious policy of negotiating a plethora of new FTAs, to make up 80% of our trade within three years. These FTAs offer many opportunities to further our low-carbon objectives and grow UK exports while we are at it. Provisions should promote trade in low-carbon sectors, goods and services, support R&D collaboration and maintain both parties’ rights to regulate in pursuit of decarbonisation. The Department for International Trade should seek to remove trade barriers, strengthen the global trading system and maximise low-carbon UK exports for the benefit of both the planet and British prosperity.
The policies advocated by particular individuals are not necessarily supported by other contributors to the essay collection.
John Holland-Kaye, Chief Executive of Heathrow Airport Ltd, commented: ‘Climate change is the greatest challenge facing our generation. The race to decarbonise our economy is one that we will always wish we had started sooner and run faster. Aviation is a force for good in the world and the advent of affordable air travel has changed our lives beyond recognition. Our challenge is to protect the benefits of aviation in a world without carbon.’
Nicholas Boys Smith, Co-Chair of the Building Better, Building Beautiful Commission, commented: ‘One of the most energy intensive, carbon non-neutral things we humans do is build a building. The embodied energy in the bricks of a typical Victorian terraced house could drive a car more than ten times around the world. Reusing such a house rather than destroying it could significantly reduce its lifetime energy consumption.’
Peter Jelkeby, Chief Executive of IKEA UK & Ireland, commented: ‘In a world of growing inequality, climate emergency and resource scarcity, it’s evident that a better life can only mean one that respects the limits of the planet. Climate change is no longer a distant threat, but a visible reality. It’s one of the biggest challenges that humanity faces and it’s affecting the lives of millions of people around the world.’
Barny Evans, Sustainable Places Director, WSP, commented: ‘Delivering net zero may well be the agenda through which local government regains its purpose as an agent of change. They’re suddenly in the driving seat of one of the most progressive, radical and complex transformational agendas of our time. With two thirds of local authorities declaring climate emergencies, they have started to shift the dial away from target setting and signalling to action, and partnerships with business and the community to deliver will now be key. They are telling us that the real challenge will be around funding and maintaining community support, and we’re keen to help unlock that.’
Graham Stuart MP, Minister for International Trade, commented: ‘The world faces a formidable challenge in tackling climate change. The UK is uniquely positioned to lead the green industrial revolution and build prosperity as a result. We must continue with domestic policies that drive increased R&D, innovation, emissions reductions and first mover advantage in the UK, but also ensure that our dedicated trade department, DIT, seeks to remove trade barriers, strengthens the global trading system and maximises low-carbon UK exports for the benefit of both the planet and British prosperity.’
George Freeman MP, Former Minister for Transport, commented: ‘As we face the immediate threat of large-scale death, disease, economic damage and societal disruption, the issue of climate change might seem an irrelevance. Indeed, the combination of empty streets, clean air, satellite images of vanishing smog and the urgent need to restore global economic growth is already leading some to dismiss the green agenda as a luxurious indulgence we can ill afford. They are profoundly wrong. We would be wiser to treat the COVID-19 crisis as a warning of what happens when we take resilience for granted.’
Nigel Wilson, Chief Executive of Legal & General Group, commented: ‘Climate change, like the COVID-19 pandemic, is a challenge that will require a superlative effort combining: the best thinking provided by science, public policy, and economics – including behavioural economics; the most effective delivery and implementation, by the public and the private sectors; and, the application of huge financial resources, where again there are both public and private sector elements.’
Richard Walker, Managing Director of Iceland Foods, commented: ‘The recent COVID-19 pandemic has shown us the devastating impact on people and communities of our carbon-emitting economy stalling. We still clearly need to reduce emissions, but now more than ever we need to do so in a way where some of the potentially negative consequences on people’s lives are mitigated and minimised.’
Professor Michael Grubb, Professor of Energy and Climate Change at the University College London, commented: ‘Renewable energy has surpassed all expectations. From their childhood of the 2000s, renewables have emerged in the 2010s as the boisterous, energetic and optimistic teenagers of the energy revolution, with offshore wind as the biggest and strongest for Britain, yet still visibly immature. A renewable future beckons, but leaves no room for complacency.’