A review of net zero

Former energy minister Chris Skidmore recently published his independent Net Zero review, “Mission Zero”. GB looks into some of its main points and recommendations

The “Mission Zero” review makes a total of 129 recommendations, which cover areas such as the greater role that business can be supported to play, making better use of infrastructure and delivering more energy efficient homes. The recommendations are intended to maximise economic investment, opportunities and jobs, and at the same time, work towards achieving the legally binding targets to reach net zero by 2050.

The review was commissioned in September 2022, to look into how the UK can better meet its net zero commitments, and how the UK might deliver its own net zero targets in a manner that was more affordable and more efficient, and in a pro-business and pro-enterprise way.

Achievements so far
Chair of the Review, and Conservative MP for Kingswood, Chris Skidmore MP, said: “We should be proud of the lead the UK has taken in tackling climate change, having exceeded expectations so far in our race to net zero emissions by 2050. As essential as that is environmentally, it also puts us at an economic advantage globally.

“We lead in areas including clean technologies, science, manufacturing and green finance – areas that, if managed right, can lead to new jobs and strong economic growth.

“In developing this report, we have engaged with communities, economists and climate experts from across the country through more than 50 roundtables and 1800 submissions – all of which have led to the Mission Zero findings.

“My recommendations are designed to make the most of this historic opportunity, covering the length and breadth of our economy, so that people in every part of the country can reap the benefits of this both in their communities, and in their pockets.”

In his introduction to the review, Skidmore, who was the energy minister responsible for signing the UK’s net zero commitment into law, highlights the progress that has already been made, with carbon dioxide emissions reduced by nearly 50 per cent over the past years, compared to 1990 levels. The review says that the UK should be proud of the steps it has taken to achieve net zero, with progress since 2019 exceeding expectations.

Skidmore also made note of the global energy crisis, which has brought into focus the importance of energy security though domestically generated renewable and clean sources of power, as well as the need to reduce energy demand.
    
Over the course of the review, more than 1800 written submissions were received in the call for evidence, more than 50 roundtables were held and every devolved nation in the UK and region in England was visited.

The recommendations in the review are aimed at each sector and industry, local regions and authorities and individual households.

Delivering net zero
Talking about the review, Skidmore said: “Above all, this Review has sought to ask how the UK can deliver on its net zero commitments by demonstrating how to deliver and implement most effectively and efficiently a plan for our future energy transition. Climate commitments and net zero targets remain just words on a page without a clear, consistent, and stable transition plan. I hope that this Independent Review can provide additional clarity and certainty on how the UK can not only meet its net zero commitments but can once again demonstrate international leadership in setting out a comprehensive roadmap towards a net zero future. While forty-two months may have passed since the UK signed net zero into law, there remain just three hundred and twenty-four months until 2050. Planning effectively for that net zero future must be our priority.

“The Review’s recommendations require not merely action, but careful decisions to be taken. Central to delivering net zero will be making the right decisions at the right time to ensure that we achieve net zero in the most efficient manner possible. Crucial to taking decisions, however, is recognising that to delay making them creates new consequences, the costs of which can be greater than previously anticipated. Equally, rushed and poorly executed decision making can produce adverse consequences with similar costs.

“This Review has sought to establish how best to create a delivery ecosystem to achieve the best possible decisions for the future. This requires not merely government to play its role, but importantly to empower the agency of regions, local communities, and individuals to play a greater role in their own net zero journey. How we create a ‘big bang’ moment for net zero, enabling and unleashing the potential of the whole of the UK to seize the opportunities that net zero presents has been a key focus of this Review.”
    
Following the release of the report, business and energy secretary Grant Shapps said: “With a wealth of talent and expertise, and a track record to be proud of, the UK is well placed to ensure that tackling climate change also brings new jobs and investment for businesses and communities.
“I am grateful to Chris Skidmore – the man who signed our climate commitments into law – for his detailed report today, which offers a range of ideas and innovations for us to consider as we work to grasp the opportunities from green growth.”

The review itself is split into two parts, with part 1 explaining the opportunities and benefits to individuals and the economy and part 2 setting out how to achieve this. Part 2 has six pillars and makes recommendations to speed up action in individual sectors of the economy.

Opportunity
The review says that “net zero is the economic opportunity of the 21st Century”. The government estimates that the transition to net zero can support 480,000 jobs in 2030 and McKinsey estimates a global market opportunity of £1 trillion for British businesses by 2030. Some estimates anticipate that the UK could see around 2 per cent additional growth GDP, as a result of new jobs, increased economic activity, reduced fossil fuel imports and cost savings. The same can be said of benefits to the individual: “Not only can the transition deliver a thriving, modern, green economy but it can materially improve people’s lives.”

On the other hand, the cost and risk of not doing anything are severe.

Barriers to net zero
The review highlights problems that businesses and local areas have faced on their journey to net zero. This may be policy clarity, capital waiting for investible propositions, infrastructure bottlenecks, or delays in the planning system. The review makes recommendations intended to unblock policy barriers, including how to decarbonise oil and gas extraction and providing clarity for industry through a long-term vision for the UK Emissions Trading Scheme (ETS).

Priority missions
The review has identified ten priority missions “to harness public and private action out to 2035”: Grid and infrastructure; Solar; Onshore Wind; Nuclear; Energy Intensives and Industry; Circular Economy and Waste; Net Zero Local Big Bang; Energy Efficiency For Households; Net Zero Nature; and R&D and Innovation.
    
Grid and Infrastructure focusses on a strategic framework and delivery plan for the critical networks of the future to turbocharge onshore and offshore development.
    
There should be a full-scale deployment of solar, including a “rooftop revolution” in order to increase energy independence, by harnessing one of the cheapest forms of energy.
    
Onshore Wind is about paving the way for onshore deployment and working with communities to deliver local benefits.
    
The fourth priority mission is a programmatic approach for a next generation fleet of nuclear.
    
A clear plan should be set for industry decarbonisation built around investment in CCUS and hydrogen networks and technologies.
    
Circular Economy and Waste is about stimulating the efficient and circular use of resources across the economy and boosting action on recycling and the reuse of critical materials.
    
The planning system should be unblocked and the relationship between central and local government should be reformed to give local authorities and communities the power they need to act on net zero.
    
Energy Efficiency for Households focusses on working towards gas-free homes by 2035, as well as working towards giving consumers better understanding of their household through a new Net Zero Performance Certificate.
    
Nature and habitat restoration should be embedded throughout transition plans, which will maximise co-benefits for climate and nature wherever possible.
    
Finally, R&D and Innovation is about catalysing decisions and action with an R&D and technology roadmap to 2050.

Decision making and planning
Evidence from the review found three basic principles of effective net-zero decision making, including making decisions quickly, investing in research and development and producing agile and flexible policy frameworks.
    
In order to achieve net zero, there needs to be a step change in the government’s approach to delivering net zero. Many respondents to the review were frustrated by a lack of long-term thinking, siloed behaviour from government departments and uncertainty over the length of funding commitments. Evidence has suggested that all of this is delaying the deployment of green technologies, hampering investment and preventing the creation of British jobs. In order to overcome this, the review recommends that an over-arching government financing strategy be created by the end of 2023 in order to give long-term clarity to business and investors. The review also recommends a long-term programmatic approach to net-zero projects and considering longer-term funding certainty for major net zero priorities. It also recommends an Office for Net Zero Delivery which will be responsible for placing net zero at the heart of government thinking and ensuring best practice for key delivery projects and taking ownership of net zero priorities.

Private sector
The review points out that the private sector is integral to net zero transition, as investment and innovation from the private sector will bring low-carbon technology to the mass market. However, the private sector has said that more action is needed. The review recommends reviewing how the Treasury incentivises investment in decarbonisation, protecting industries from environmental undercutting and helping SMEs upskill.

Local action
The review also emphasises that there should be more locally led action on net zero, stating: “Our local areas and communities want to act on net zero, but too often government gets in the way. The Government must provide central leadership on net zero, but it must also empower people and places to deliver.” On this point, the review recommends reforming the planning system at local and national level to ensure it properly supports net zero, simplifying the local net zero funding landscape and providing full backing to a set of ‘trailblazer’ places.
    
The review points out the importance of transparency and engaging the public: “Net zero will affect everyone in the UK and nearly half the policies in the government’s Net Zero Strategy rely on individual action. There is widespread support for net zero, but often this is undermined by a lack of information, cost, and opportunities we cannot access.”

Home improvements
The review puts a focus on delivering cleaner, cheaper and greener homes, and improving the insulation and heating sources of our homes, so they are warmer and cleaner. The review calls on the government to bring forward all consultations and work to mandate the Future Homes Standard by 2025 and for all homes sold to be EPC C by 2033. The review also calls on the government to urgently adopt a 10-year mission to make heat pumps widespread and regulate for the end of new and replacement gas boilers by 2033.

Global leadership
The review highlights the leading role the UK has had in global climate action, as COP26 president and G7 president. On this topic, the review recommends that the government should conduct a strategic review on the UK’s international climate leadership and establish a baseline for environmental and climate protections in future free trade agreements.

Reception
On the publication of the review, Dr Nina Skorupska CBE FEI, chief executive of the Association for Renewable Energy and Clean Technology (REA) said: “The Net Zero Review, above all else, makes it clear that the energy transition is as much an economic opportunity as an environmental imperative and that action must be accelerated.

“The REA warmly welcomes the recognition of the need for much more renewable deployment, highlighting the demand for a complete range of renewable and clean technologies to all play their part, as well as the transition to a circular economy.

“This Review must finally settle any political and economic debate as to why Net Zero is essential. This has to mark a watershed moment, ending political hesitation and offering the catalyst to a cleaner, more prosperous future.”
    
As a member of the panel at the Mission Zero launch event, Polly Billington, chief executive of UK100 said: “It’s a very good day for local Net Zero action because Chris, in his report, actually says unlocking the ambition of places and communities will deliver the most successful version of Net Zero. And for us, we’ve been the network of local government leaders who are already ambitious on climate action and have been trying to do this. This is basically, Chris, repeating back what we’ve been saying, and we hope the government listens because that will make a real difference.

“And there are specific recommendations that you’ve got in the report that will make a big difference, the acknowledgement of the need for a national framework. I mean, our members are doing this on their own backs and of their own volition, with an enormous number of national barriers, national framework barriers, and policy barriers in their way. Imagine what it would be like if there was a national framework which presumed in favour of local Net Zero action. How much more would be done! So we think that’s great.

“The reduction in competitive bidding is also fantastic. The amount of money that is spent simply applying for money, not getting any money, therefore wasting money, is between £27 and £63 million spent by local authorities applying for bids. We don’t need it to be competitive. We need it to be available for everybody.

“And then on further, say, the reform of the EPCs, I know it sounds really boring, but EPCs actually create perverse incentives. It doesn’t encourage you to install a heat pump. That’s daft. We need to change that, and we’re pleased to see that. And I’m really pleased about that. There are a lot of grid nerds in the room, as you’d expect, but we’re really pleased to see the recommendations about the Future Systems Operator enabling smart local energy systems.

“And in terms of the planning framework, we need to get local area energy planning absolutely embedded in what our planning system does. If we get those things done, I know none of those will happen immediately by 2025, but those are the long-term things, and I’m really pleased to hear you talk about the importance of political consensus.

“Our members are from all political parties across England, Scotland and Wales. There is a political consensus on this. We need to build on that and not have a race to the bottom when people are attacking Net Zero. Instead, have an escalation to the top because people want to be more ambitious.”