UK net-zero review: ‘economic opportunities missed’ in transition planning
Chris Skidmore’s report highlights weaknesses in the investment environment, including skills shortages and inconsistent policies.
A review of the UK’s net-zero transition planning by former energy minister Chris Skidmore has called for the nation’s government to do more to deliver climate action and seize the economic opportunities presented by the transition.
Mission Zero makes a total of 129 recommendations focusing on areas such as the greater role that business can play, making better use of infrastructure and delivering more energy-efficient homes.
On the financial regulation side, the 340-page report calls on the UK government to endorse and implement the International Sustainability Standards Board (ISSB) as soon as possible. Skidmore argues that the UK should “lead by example”, launching a formal adoption mechanism as soon as the ISSB standards are published and moving swiftly to assess and endorse the standards for use in the UK.
“The rest of the world, along with international investment communities, has woken up to the fact that the energy transition is a new economic reality”, said Skidmore.
It is positive that the review recognises the necessity for good disclosures across the economy, including the need to implement the ISSB standards as well as the UK's Green Taxonomy as soon as possible.
Investment weakness
Mission Zero claims that economic opportunities have been missed because of “weaknesses” in the UK investment environment, such as skills shortages and inconsistent policy commitment.
The need for the UK to “act decisively” in investment in the net-zero transition was compared to actions already taken around the world, such as the US committing to a $369bn investment in clean technology through the Inflation Reduction Act, and the “France 2030” investment plan.
The review cited data showing that the UK economy could potentially see approximately 2% additional growth in GDP from net-zero investment, through new jobs, increased economic activity, reduced fossil fuel imports and cost savings.
James Alexander, chief executive of the UK Sustainable Investment and Finance Association, said: “It is positive that the review recognises the necessity for good disclosures across the economy, including the need to implement the International Sustainability Standards Board’s standards as well as the UK's Green Taxonomy as soon as possible. We will continue to make this case to government, which will be critical to facilitate investors’ efforts to address sustainability risks and opportunities.”
The review also called for a cross-sectoral infrastructure strategy by 2025 that would “rapidly build and adapt” the infrastructure for electricity, hydrogen, other liquid and gaseous fuels and CO2 networks that support a green economy.
Philip Dunne, a UK Member of Parliament and chair of the Environmental Audit Committee, said: “This review demonstrates, unequivocally, the countless opportunities net zero brings. The emphasis on clarity and leadership cannot be overstated.
“In some areas the UK government has made major advances in tackling climate change, and its stated ambition is undoubted. But inconsistent policies and a lack of coherence across government in implementation, with little effective cross-departmental governance, does not give confidence to those sectors that will drive real change and develop green skills.”
The rest of the world, along with international investment communities, has woken up to the fact that the energy transition is a new economic reality.
Net-zero city
The review also called for the creation of at least one “Trailblazer Net Zero” city, local authority and community in the UK that can work toward achieving net-zero emissions by 2030.
Nicholas Stern, chair of the Grantham Research Institute on Climate Change at the London School of Economics, said: “I hope the prime minister and his government will respond to the review with the urgency and scale required to prevent this enormous economic opportunity from slipping through our fingers. This transition, and the investment and innovation it embodies, are at the core of the UK’s growth story for the coming decade.”
While still a serving MP and a member of the governing Conservative Party, Skidmore has pledged to stand down at the next general election.
The UK government has until the end of March to publish its revised net-zero strategy after the original strategy was deemed unlawful in the courts following a challenge by Friends of the Earth, the Good Law Project and ClientEarth.
