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Government must seize business opportunity presented by net zero target

2nd May 2019

Welcoming the publication of the Committee on Climate Change’s advice today [1], the Aldersgate Group urges the government to press ahead with setting a net zero target. This must be underpinned by a comprehensive policy package to deliver net zero emissions and support business investment and competitiveness. Today’s report from the CCC follows the recent publication of two reports from the Aldersgate Group, setting out how innovation and business investment in ultra-low carbon technologies can be accelerated to achieve net zero emissions by 2050. [2]

Nick Molho, Executive Director, Aldersgate Group, said: “The CCC’s advice provides powerful analytical backing for the growing calls to update our 2050 target to deliver the Paris Agreement’s 1.5°C goal. Setting a net zero target without delay is essential to provide investment clarity for the new business models and high capital cost infrastructure required to drive down emissions. To put the UK on a credible path to net zero, the government should accelerate its efforts to meet existing carbon budgets in areas such as buildings and transport and should ensure that a net zero target is accompanied by industry-led decarbonisation roadmaps, as has been done in Sweden.”

Nick Molho added: “A net zero target could provide a significant industrial opportunity for UK businesses to lead in the development and export of ultra-low carbon goods and services. However, a policy framework to accelerate innovation and support British businesses investing in low carbon technologies and solutions is essential. This requires urgently trialling key technologies such as carbon capture and storage and hydrogen at scale, introducing market standards to drive demand for low carbon goods and provide a level playing field for businesses, and using the UK’s diplomatic network to encourage low carbon trade and the adoption of net zero targets globally.”  

Peter Simpson, CEO, Anglian Water, said: ”We fully support the CCC’s recommendation to tighten the UK’s climate change target to net zero by 2050. At Anglian, we have seen first hand how ambitious carbon targets can disrupt established practice, drive innovation, and significantly reduce costs and environmental impacts. This experience has convinced us that more ambitious targets are not only essential but are also good for business. That is why the water industry has agreed to go even further and achieve net zero carbon emissions for the sector by 2030.”

Steve Waygood, Chief Responsible Investment Officer, Aviva Investors, said: “The CCC’s report makes a significant contribution, showing that a net zero economy is necessary, feasible and desirable. We urge the Government to accept the CCC’s recommendations and set out a comprehensive plan to raise the investment needed to deliver the net zero target. The forthcoming Green Finance Strategy presents a key opportunity for this and we urge the government to bring forward an ambitious package that includes fiscal and regulatory levers to ensure finance flows are consistent with a net zero economy and ensures the UK leads the world in green finance.”

Andy Wales, Chief Digital Impact and Sustainability Officer, BT Group, said: “Policymakers setting more ambitious targets will encourage the entire supply chain to make their own bold commitments and generate greater positive momentum towards a net zero future. BT is working to drive change with our own target to be net zero by 2045 but there is no doubt industry needs collaboration and policy support to realise it.”

Duncan Price, Director of Sustainability, BuroHappold, said: “BuroHappold welcomes the Committee on Climate Change recommendation that the UK government should legislate for net zero greenhouse gas emission by 2050. We know from our research for C40 Cities that clean transport, buildings and industry can deliver significant air quality, health and economic benefits. We need government to support a series of ‘no regrets’ actions including adopting ambitious energy efficiency targets for new and existing buildings and, working together with the UK construction and property industry, adopt the UK Green Building Council’s framework for net zero carbon buildings.”

Tom Delay, CEO, the Carbon Trust: “The Committee on Climate Change report on reaching net zero emissions by 2050 fundamentally makes the best in the world even better, by strengthening the ambition of the UK’s Climate Change Act. It sends an important message - it is possible, it is worthwhile and we don’t have to compromise. Crucially net zero captures the public mood in the UK which is increasingly demanding urgent action on climate change and this should help to carry the Committee’s recommendations over the line by securing the necessary political backing. The vast majority of businesses already recognise the opportunities that a net zero economy will bring and we expect them to embrace this ambitious goal."  

Iain Patton, CEO, EAUC, said: “Universities and colleges are supportive of the recommendation to increase the UK’s GHG emissions cutting target to 100% by 2050. To reach net zero by 2050, it is critical the Government invests in the enabling infrastructure and skilled people required to ensure a low carbon society. Higher and Further Education is in a prime position to undertake much of the Research and Development required to achieve net zero emissions and has a big role to play in educating and upskilling young people and those already in the workforce on this agenda. Universities and colleges are working hard towards incredibly ambitious carbon reduction targets, with 80 UK institutions committed to divesting from fossil fuels already. We will continue to work with institutions to ensure they fulfil their potential on this topic.”

Nick Blyth, Policy Lead on Climate Change and Corporate Sustainability, IEMA, said: “In supporting a binding Net Zero target, IEMA believes there is a leadership and skills imperative. Innovation as a priority extends from the technical right through to leadership and collaborative skills. It is vital to equip companies and organisations with sustainability skills, in order to enable their rapid and successful transition.”

Benet Northcote, Director, Corporate Responsibility, the John Lewis Partnership, said: "It's clear that rapid action is needed to avoid global climate breakdown and the UK should lead the way with an ambitious and binding zero emissions target as recommended by the CCC, along with clear decarbonisation roadmaps. It would help businesses like ours who have already committed to net zero operations ramp up decarbonisation efforts even further and unlock investment and innovation needed to cut emissions across the board." 

Andy Walker, Technical Marketing Director, Johnson Matthey, said: “There is no doubt that setting a Net Zero target raises the bar. UK plc can meet this challenge, which will also ensure the UK maintains a global leadership position in the technologies required to stabilise our climate. However, this is not just a question of waiting for new technologies to be discovered but, importantly, providing the policy framework that allows us to deploy the technologies we currently have – and at scale.”

John Bromley, Head of Clean Energy Strategy, Legal & General, said: "We welcome the recommendations of the CCC and encourage the government to adopt them. People and the economy benefit from prosperous low carbon jobs and a healthy environment while businesses and investors need policy certainty to plan and innovate. Adopting the net zero target would be an important step to meet both goals."

Mike Barry, Director of Sustainable Business, Plan A, Marks & Spencer, said: “The imperative for transformational action to build a low carbon society and economy is clear. The Committee on Climate Change’s call for a bold Net Zero 2050 target is welcome as is its detailed analysis of the UK’s potential pathway to get there. Now is the time for Government and business to respond decisively by scaling the many known solutions we have today and innovating the remaining hard to solve challenges. In doing so, we can respond to rapidly shifting societal expectations, provide global leadership and position the UK to win in a new, green global economy.”

Julian Brown, Vice President and UK Country Manager, MHI Vestas Offshore Wind, said: “Today’s recommendation by the CCC sets an ambitious, and much needed, vision for a low carbon UK economy. Quite simply, to achieve net zero by 2050, the UK will need to unleash the full power of the renewable energy sector. With MHI Vestas driving wind turbine innovation and industrial investment to help deliver at least 30 GW of offshore wind by 2030, the offshore wind industry is well-positioned to play a leading role in the drive to meet these targets.”

Matthew Wright, Managing Director, Ørsted UK, said: “The CCC report highlights that the action needed to decarbonise the UK is both achievable and affordable. As a company that has divested its fossil fuel business to invest only in renewable energy, we are convinced that we can transition to a world that runs entirely on green energy and that this transition creates a great economic opportunity for the UK.

75GW of offshore wind by 2050 is definitely achievable. The cost of offshore wind has already reduced to the point where it is comparable with conventional generation, and it’s continuing to fall. The UK has a rapidly expanding supply chain supporting the offshore wind sector, which is creating thousands of new jobs, and we are confident of attracting the tens of billions of pounds of investment required to make this a reality.”

Matthew Knight, Head of Business Development, Siemens plc, said: “Siemens UK welcomes the CCC report on net zero. Businesses need to respond to the urgency and scale of the climate challenge and Siemens is committed to make our own operations net zero by 2030. Government and politicians have an import role to play. Climate change transcends politics and we call for immediate cross-party commitment to deliver net zero emissions by 2050 in line with the CCC report.

Net zero is a big challenge and businesses need to make big investments to deliver it. Government can help by setting clear policy direction, creating the right market conditions through financial mechanisms such as carbon pricing, training and skills and setting standards through regulation to raise the bar. We are committed to work with government to make this ambitious target a reality for society and future generations.”

Steve Robertson, Chief Executive, Thames Water, said: “Climate change is perhaps the biggest challenge facing humanity and will directly impact on the provision of water and sanitation both here in the UK and the rest of the world. We recognise the need to urgently reduce greenhouse gases entering the atmosphere so to help build a better future for our customers and the environment, we’ve committed to work towards delivering net zero emissions by 2030. We continue to develop our plan on how we’ll achieve this but are proud to be stepping up our ambition and encourage others to do the same if we’re to collectively reduce the impact of climate change.”

Bevis Watts, CEO, Triodos Bank UK, said: “Now is the time for much faster action and a clear and credible plan and policy. The government must also look beyond specific climate policy and influence climate change through an ambitious Green Finance Strategy. In the Netherlands, they have a climate agreement in place mandating the financial sector to measure and reduce the carbon footprint of finance and investment. With the right political will, the banking sector is uniquely placed to lead the transition to the sustainable economy. We need disclosure rules in the UK such as those recommended by the Taskforce for Climate-related Financial Disclosures (TCFD) and efforts to account for carbon on bank balance sheets such as the Platform for Carbon Accounting Financials (PCAF).”

Frazer Mackay, UK Managing Director of Water, Energy & Industry, WSP, said: “Net Zero makes perfect long-term business sense on the basis that the cost of inaction will outweigh the cost of action. A Net Zero goal is exactly the type of aspiration that will galvanise industry to step up its efforts to decarbonise as an immediate priority. It will embolden WSP’s engineers and planners to leverage their ingenuity to devise innovative solutions to break the vicious circle between carbon emissions and economic growth.” 

- ENDS - 

[1] The UK has an existing target of at least an 80% emission reduction between now and 2050 against 1990 levels under the Climate Change Act. Following the publication of a report in October 2018 from the Intergovernmental Panel on Climate Change calling on the world economy to achieve net zero emissions by mid-century to limit global warming to 1.5C, the CCC was asked by Minister of State Rt Hon Claire Perry MP, along with the Scottish and Welsh governments and support from senior Northern Ireland officials, to review the UK’s long-term climate targets in light of the IPCC’s report. The CCC published its advice today, recommending that the UK increase the current goal under the Climate Change Act to achieve net zero emissions of greenhouse gases by 2050. The advice is available here: www.theccc.org.uk.

[2] The Aldersgate Group published two reports on 4th April 2019 on the business implications of achieving net zero emissions by 2050. The first report, Accelerating innovation towards net zero, from Vivid Economics and the UK Energy Research Centre (UKERC) commissioned by the Aldersgate Group, sets out key recommendations to accelerate innovation based on a review of case studies of rapid innovations. The second report, Zeroing in: capturing the opportunities from a UK net zero emission target, from the Aldersgate Group, establishes key policy measures that should accompany a UK net zero emissions target to maximise industrial opportunities for UK businesses and avoid unintended consequences. Both reports are available here.

FORCCC

Businesses positive about a UK net zero emissions target but it must come with bold innovation support

4th April 2019

Based on extensive business engagement and new research from Vivid Economics and the UK Energy Research Centre, the Aldersgate Group launches two new reports today [1]. They argue that a net zero emissions target could provide a significant industrial opportunity for UK businesses as long as it is accompanied by a much bolder innovation policy and ambitious market creation measures that are informed by a clear understanding of lifecycle emissions. These policies should seek to accelerate the innovation at scale of critical technologies such as carbon capture and storage and hydrogen, and rapidly grow the demand for ultra-low carbon infrastructure, products and services.

Both reports, which come ahead of the publication of the Committee on Climate Change’s advice to government, will be presented at an Aldersgate Group event hosted by RICS from 9.30am - 11:00am on Thursday 4th April [2]. See business reactions below.

1. The first report, Accelerating innovation towards net zero, from Vivid Economics and the UK Energy Research Centre (UKERC) commissioned by the Aldersgate Group, sets out key recommendations to accelerate innovation. These recommendations come from a review of past case studies of rapid innovations relevant to decarbonisation from the banking, manufacturing and energy sectors [3]. 

2. The second report, Zeroing in: capturing the opportunities from a UK net zero emission target, from the Aldersgate Group, establishes key policy measures that should accompany a UK net zero emissions target to maximise industrial opportunities for UK businesses and avoid unintended consequences. It features innovative case studies from the energy, steel, aviation, manufacturing, ICT and cement sectors showing how businesses are already taking action towards net zero emissions.

Key messages to government include:

1. Urgently accelerate efforts to meet current carbon budgets to provide a credible foundation from which to achieve net zero emissions. The UK is currently not on track to meet the fourth and fifth carbon budgets [4]. To rectify this and put the UK on a credible and cost-effective pathway to achieve net zero emissions, government must urgently pursue low-regret policy options. These include significantly improving energy efficiency in buildings through the introduction of binding regulatory standards and fiscal incentives and accelerating the roll-out of zero emission vehicles through tightening emission standards in the 2020s and guaranteed plug-in vehicle grants.

2. Provide long-term visibility to businesses by setting a net zero target as soon as possible after the CCC publishes its advice [5]. Long-term clarity is essential to inform cost-effective business investment decisions in the new business models and high capital cost infrastructure required to achieve net zero emissions. Government should work with industry to set sector-based decarbonisation roadmaps underpinning this target, following the example of the Swedish fossil free industry roadmaps.

3. The Government’s innovation policy should overcome the fear of failure and be focused on demonstrating the viability of critical technologies and systems at scale, including through public-private funding arrangements. This should include supporting at scale demonstration of Carbon Capture and Storage (CCS), the use of hydrogen in heating, Direct Air Capture technology and continued innovation in offshore wind. Government – and its stakeholders – should recognise that successful and unsuccessful trials provide equally valuable lessons to inform good policymaking. 

4. Market creation policies based on an understanding of lifecycle emissions are essential to accelerate innovation and deploy new low carbon infrastructure, goods and services at scale. Market standards informed by lifecycle emissions can help grow the market for critical infrastructure and products such as ultra-low carbon building materials, guarantee a level playing field for business and avoid offshoring emissions. Stable revenue policies such as through incentives for fossil fuel using industries to store their carbon emissions can provide a market for CCS.

5. Mandate new or existing institutions to accelerate innovation and co-ordinate the early stage deployment of complex technologies such as low carbon heat and CCS. Past innovations show that third party institutions can accelerate knowledge sharing between businesses and sectors and co-ordinate the efficient deployment of complex infrastructure. For example, government-backed organisations in the UK and Denmark ensured that successful wind energy designs proliferated more quickly, whilst the Gas Council in the UK played an essential role in the late 1960s in developing bulk gas supplies, rolling out a gas network and supporting the rapid customer take-up of gas boilers and central heating in homes.

6. Support the UK’s workforce so it can benefit from the economic opportunities that a net zero target could provide. This requires developing a cross-departmental education and training strategy to ensure the workforce is equipped with the skills required by the net zero transition, working with industry to understand future needs. Government should also work with businesses and Local Enterprise Partnerships to encourage low carbon supply chain investment decisions to be made in parts of the country facing high unemployment risks and where similar skill sets can be found.

7. Use the UK’s diplomatic reach and new trade policy to promote the adoption of net zero targets globally. Through its extensive diplomatic network of climate attachés, the UK can play an influential role in encouraging the adoption of net zero targets globally in the run-up to the COP26 climate summit in December 2020. The UK’s future trade policy after Brexit should support the delivery of its net zero target and promote growing trade in low carbon goods and services.

Nick Molho, Executive Director, Aldersgate Group, said: “UK businesses are ready to take up the challenge of delivering a net zero emissions target but bold innovation and market creation policies will be essential to give them the support they need. Businesses want to see the government’s innovation policy move beyond the ‘fear of failure’ and trial critical technologies such as CCS and hydrogen at scale in order to inform key policy decisions in areas such as heat and industrial decarbonisation. Support for innovation must be combined with measures informed by lifecycle emissions, such as markets standards, to grow the demand for ultra-low carbon infrastructure, products and services and set a market level playing field in the process.”  

Alex Kazaglis, Principal, Vivid Economics, said: "Achieving a net zero emissions goal requires a vast economic transition in just a few decades. History tells us that such transitions are possible, but a broad program of government action is vital. Government can accelerate the adoption of innovative technologies through demonstrating key technologies at-scale, making use of important skills and knowledge spillovers between sectors, strengthening market signals and harnessing the disruptive power of digital technologies." 

Professor Jim Watson, Director, UK Energy Research Centre, said: “Accelerating innovation will be essential if a net zero target is to be met by the middle of this century. Our report shows this is likely to require governments to implement comprehensive, mission-oriented policy programmes that include support for R&D, demonstrations and market creation. Institutional innovations could also be needed - including, for example, a new public delivery body to develop pipeline and storage infrastructure for carbon capture and storage (CCS).”

Steve Waygood, Chief Responsible Investment Officer, Aviva Investors, said: “Aviva Investors is currently directly investing over £500 million a year in innovative infrastructure projects that deliver significant emissions reductions. A net zero emissions target would give us the confidence we need to scale up these investments and help to deliver a zero carbon economy in the UK. To make further progress, we need government to pursue market creation policies based on an understanding of lifecycle emissions and innovation policies that overcome the fear of failure and focus on demonstrating the viability of critical technologies and systems at scale.”

Andy Wales, Chief Digital Impact and Sustainability Officer, BT Group, said: “We need policymakers to continue to set more ambitious targets, encouraging businesses to make their own bold commitments and generating greater positive momentum to a net zero future. We have set an ambitious net zero by 2045 target, but we need collaboration and policy support to realise it.” 

Martin Casey, Director, Public Affairs & Communications UK & Public Affairs EU, CEMEX, said: “CEMEX supports efforts to understand better how the UK can achieve net zero, and therefore welcomes these new reports. CEMEX’s use of fuels derived from unrecyclable wastes in cement manufacture helps us contribute to the circular economy whilst also reducing our carbon emissions. We are eager to understand further how the journey to net zero could be achieved, including utilising carbon capture use and storage technologies without negatively impacting competitiveness. It is essential that the government gets on with the job of trialling critical technologies at scale to support business in this process and considers how lifecycle emissions can better inform future policy measures.”

Sam French, Business Development Manager, Johnson Matthey, said: “The latest IPCC assessments are showing that global emissions need to move to net zero by 2050, which presents a great opportunity for UK industry to implement existing low carbon technologies and develop new ones to be one of the leaders in this transition to a net zero carbon world. 

At Johnson Matthey we are driving innovation in low carbon hydrogen generation, batteries and fuel cells, as well as constantly looking for new areas of sustainable chemistry to help meet these future needs. To put UK businesses at the forefront of global efforts to move to net zero, further policy support is needed to drive large scale, low carbon projects using known technologies and help businesses to “learn by doing” and to incentivise future-focused innovation by providing a clear market demand for these technologies.”

Benet Northcote, Partner & Director of Corporate Responsibility, the John Lewis Partnership, said: "Urgent action is needed to keep global warming below 1.5C to avoid the most dangerous impacts of climate breakdown. Now, more than ever, businesses and government must respond with ambitious and credible zero emissions targets. At the John Lewis Partnership we are committed to making significant emissions cuts in the vital period of the next ten years through investment in new refrigeration technology, biomethane-powered trucks and renewable electricity, and we have set out a clear path to becoming a net zero operation by 2050 at the latest."

Alexander Law, Public Affairs Manager, Michelin Tyre, said: "At Michelin, we fully support the aim of reaching net zero carbon dioxide emissions in keeping with the 2015 Paris Agreement. This will require clarity from government on the pathway going forward as these global issues require long-term planning and structural changes and not just quick fixes. In particular we support effective and robust carbon pricing mechanisms which should help change investment decision-making processes without penalising consumers unduly." 

Dr Jonathan Scurlock, Chief Adviser, Renewable Energy and Climate Change, National Farmers' Union, said: “Climate change is one of the greatest challenges of our time, and British farmers are ready to take action. The NFU’s ambition is to strive for net zero greenhouse gas emissions across the whole of agricultural production by 2040. A combination of policies and practises are needed to achieve this aim, and the NFU is looking to build upon our work on industry-led initiatives such as the Greenhouse Gas Action Plan to help deliver this. We look forward to a smart and well-targeted partnership with Government and other agricultural stakeholders.”

Chris Fry, Infrastructure & Regeneration Director, Ramboll, said: “The Zeroing in report highlights the need to accelerate cost effective short term action, whilst establishing a clear, long term framework for more significant changes and technological breakthroughs. Accelerating decarbonisation may be best served by policies and industry initiatives designed to galvanise the uptake of existing solutions. For example, leveraging investment in major regeneration and infrastructure renewal programmes to embed energy efficiency, resource efficient digitalised design and harnessing waste heat sources for district heating.”

Sean Tompkins, CEO, Royal Institution of Chartered Surveyors, said: “These reports show that people shouldn’t fear the transition to a low-carbon economy. Buildings account for 60% of global electricity use and produce more than one-third of all greenhouse emissions, so our profession should see it as a huge opportunity to innovate and modernise. That’s why we’re supporting them with resources, skills and standards to ensure this happens.”

Sarah Handley, Carbon Neutral Programme Manager, Siemens plc, said: “Siemens is committed to be carbon neutral by 2030, working with our customers to deliver intelligent and sustainable solutions. We call on government to provide leadership so we can all play our part in addressing the risks of climate change.” 

Stuart Hayward-Higham, Technical Development Director, SUEZ recycling and recovery UK, said: “SUEZ is taking part in a number of industrial collaborations across our operations as we align our business and sustainability goals both laterally across the value chain and vertically with other value chains, with those of our customers and industrial partners. However, to make further progress, we need government to openly prioritise the green growth sectors it wants to support so we can explore the industrial opportunities for using residual wastes as potential feedstocks for this future green growth agenda (from aviation fuels, to sugars, polymers and heat offtake). We will invest in new transformational infrastructure needed if the policy direction is clear.”

Bevis Watts, Managing Director, Triodos Bank UK, said: “We believe that a fundamental transition is needed away from a carbon based economy to a renewable one. To stimulate this transition, we are lending and supporting investment in this sector, focusing on financing solar, wind and hydro energy as well as energy efficiency and new technologies. In order to accelerate investment in projects that will help to cut emissions in the UK, we need government to provide long-term clarity and visibility on a net zero target to give us greater confidence in investing in the innovative low carbon technologies that will be crucial to achieving a net zero emissions goal in the UK.” 

Julia Barrett, Director, Willmott Dixon Re-Thinking, said: “Sustainability makes good business sense and at Willmott Dixon, setting challenging carbon reduction targets makes us more efficient and effective. We have exceeded our current goal to reduce our carbon intensity by 50% by the end of 2020 compared to 2010 levels. However, extending beyond the 59% reduction we have achieved towards the imperative of net zero emissions will get progressively harder without accelerated government support for this agenda. We would welcome regulatory standards to improve energy efficiency in buildings, and standards, informed by lifecycle analysis, to grow the market for low carbon building materials.”

Dr Maria Brogren, Director of Sustainability and Innovation, WSP Sweden, said: "The Swedish government aims for Sweden to become the world’s first climate neutral welfare society. The target is net zero emissions by 2045. To help meet this goal, WSP Sweden has pledged to ensure its operations are climate neutral by 2040 and to possess the competence to help our clients to cut their CO2 emissions in half by 2030.

Support from government is essential to meet the national target, and policy initiatives such as facilitating the development of climate neutrality roadmaps for different business sectors and allotting funding for flagship projects, such as climate neutral steel production, is crucial. These actions provide a clear direction for the Swedish business sector, which facilitates the investments needed to reach net zero.”

—ENDS—

[1] These two new reports will be available on the Aldersgate Group’s website at the following link from 00.01 Thursday 4 April 2019 http://www.aldersgategroup.org.uk/our-reports

[2] This event will be held from 9.00am - 11.00am on Thursday 4th April at RICS, 12 Great George Street, Parliament Square, London SW1P 3AD. Chaired by Nick Molho, Executive Director at the Aldersgate Group, the event will feature a review of each report from Nick Molho and Alex Kazaglis, Principal at Vivid Economics. The event will then proceed to a panel debate with Dr Maria Brogren, Director of Sustainability and Innovation at WSP Sweden, Sam French, Syngas New Market Manager at Johnson Matthey, Sarah Handley, Carbon Neutral Programme Manager at Siemens plc, Chris McDonald, Advisor at the GREENSTEEL Council, Graham Meeks, Head of Policy at the Green Investment Group and Dr Jonathan Scurlock, Chief Adviser, Renewable Energy and Climate Change at the National Farmers' Union. 

[3] Case studies reviewed in this report include (i) the deployment of the ATM network and cash cards across the UK; (ii) the roll out of a gas network and central heating in the UK; (iii) the development of wind turbines in Denmark and the UK; (iv) moving from late-stage adoption of steel technology in South Korea to being the world-leading exporter; and (v) the failure to develop commercial-scale CCS to date across the world. A table summarising the report’s recommendations can be found on page 4 of the report.

[4] CCC (June 2018) Progress Report to Parliament 

[5] The UK has an existing target of at least an 80% emission reduction between now and 2050 against 1990 levels under the Climate Change Act. The CCC has been asked by Minister of State Claire Perry MP, along with the Scottish and Welsh governments and support from senior Northern Ireland officials, to review the UK’s long-term climate targets, and their advice is expected on 2 May 2019.


We're recruiting! Policy Manager

15th March 2019

The Aldersgate Group is recruiting a Policy Manager to join its Secretariat. The Policy Manager will shape and lead the development of the Group's overall policy work. 

The closing date for the receipt of applications is 5.00pm BST on Monday 15th April 2019. Applicants should send their CV (max two sides) and covering letter (max one side) to Sarah Williams.

See the full job specification for more details.


Spring Statement 2019: sustainability must sit at the heart of the UK's economic model

13th March 2019

Reacting to the Spring Statement presented to Parliament today by the Chancellor Philip Hammond, Nick Molho, Executive Director of the Aldersgate Group said: “The Chancellor’s clear commitment to reaping the opportunities of our shift to a carbon neutral economy and improving our natural environment is very welcome. For too long, Chancellor's speeches have been at odds with government commitments in these areas and businesses will welcome the signal that this is a genuine cross-government mission.
 
We look forward to seeing further details of the proposal to increase the proportion of green gas in the grid and the development of the Future Homes Standard. Cutting the carbon intensity of the gas grid and building new homes with low carbon heating and high energy efficiency standards are key low regret policies which will allow the government to learn by doing and avoid costly retrofits further down the line. In the same vein, the confirmation that government will mandate net gain for biodiversity will be welcomed by business and ensure new developments deliver much-needed improvements for the natural environment.”
 
Nick Molho added: “The announcement of a three-year spending review to be concluded at this year’s Budget will be a further opportunity for the Chancellor to put his money where his mouth is. The next twenty months are going to be crucial – both in the UK and globally – to increase ambition on climate action and tackle biodiversity decline. A spending review that supports the ongoing implementation of the Clean Growth Strategy and 25 Year Environment Plan will ensure the UK reinforces its leading role on these issues on the world stage.”

PGH

System-wide approach key to cut transport emissions

11th March 2019

Today the Aldersgate Group publishes a new report, Shifting emissions into reverse gear [1], setting out key policies needed to deliver deep cuts in surface transport emissions. It argues that improving the overall efficiency of the transport system will be just as important as investing in new technologies and infrastructure and therefore calls on the government to take an integrated system approach to decarbonising transport, rather than treating each mode of transport separately.

This report will be launched at an event hosted by RELX Group from 1:00pm – 3:00pm on Monday, 11th March [2].

UK carbon emissions have fallen by over 42% since 1990 [3], thanks mainly to actions in the power sector. However, there has been relatively little overall change in the level of greenhouse gas (GHG) emissions from the transport sector over the same period, which is now the largest emitting sector of the UK economy accounting for 28% of GHG emissions [4]. This is happening in a context where 33% of UK drivers are more dependent on their car now than a year ago [5].

Making substantial cuts in surface transport emissions, which accounts for the majority of domestic transport emissions [6], is therefore essential to delivering the UK’s climate targets cost-effectively. Decarbonising transport could also provide significant social and economic benefits for the UK, for example by tackling poor air quality, now the most significant risk to public health in the UK [7] and growing the manufacturing base for low and zero emission vehicles, a global market estimated to reach £1-2tn per year by 2030, and £3.6-7.6tn per year by 2050 [8].

Given the significant challenges faced by the UK’s automotive industry in light of recent announcements by Honda, Nissan, Ford and Jaguar Land Rover [9], the UK cannot afford to be left behind in the global race to design and manufacture low and zero emission vehicles.

To deliver deep cuts in surface transport emissions and maximise the environmental, social and economic opportunities from the transition to a zero carbon transport system, government policy should:

1. Establish an integrated road and rail strategy to ensure that the most environmentally and economically beneficial infrastructure projects are taken forward. This should include shifting more road freight onto the UK rail network and developing a national bus strategy.

2. Devolve long-term funding and key powers to local authorities to cut emissions from short journeys. With 72% of journeys in urban areas being under five miles [10], local authorities have a key role to play to cut emissions. Similar to the stable budgets given to Network Rail and Highways England, the government should devolve long-term revenue and capital funding to local authorities so they can develop their own integrated transport strategies and empower them to require new housing developments to be better connected to sustainable forms of transport. As part of this, the decline in funding to supported bus services and the development of cycling and walking networks must be urgently reversed to cut car dependence for local journeys.

3. Improve local air quality by moving the most polluting journeys outside of urban areas, through supporting the development of Urban Consolidation Centres (UCCs) to reduce inner-city freight traffic and implementing an ambitious national network of Clean Air Zones (CAZs) with common standards.

4. Grow the UK’s global manufacturing base for Low and Zero Emission Vehicles, by setting rapidly tightening CO2 emission standards for vehicles after the UK leaves the EU, guaranteeing upfront purchase grants for electric vehicles until they reach cost parity to help drive the market until the mid-2020s, and delivering widely accessible electric vehicle charging infrastructure, with a particular focus on areas where the business case is more complex such as in rural locations.

5. Provide targeted innovation support to complex parts of the transport sector where zero emission technologies are not yet deployable at scale, such as long distance journeys and Heavy Commercial Vehicles (HCVs). This should include trialling different technologies on UK roads and rail lines, such as hydrogen and renewable biomethane, and pursuing an ambitious rail electrification strategy to close the gap with the UK’s continental neighbours [11].

6. Use measures announced under the Resources and Waste Strategy to drive greater resource efficiency across the UK transport system. Measures such as extended producer responsibility schemes and product standards have an important role to play to incentivise the use of more resource efficient components such as long-lasting performance tyres, the re-use and reconditioning of electric vehicle batteries for second-life appliances and a much greater use of secondary materials in vehicle manufacturing.

Nick Molho, Executive Director, Aldersgate Group, said: “With emissions flatlining for several years now, government needs to fundamentally rethink its transport policy and work across departments to deliver the modern and ultra-low emission transport system the UK needs. This means taking an integrated view of the whole transport system to ensure that new transport infrastructure projects deliver the best environmental and economic outcomes, empowering local authorities to develop low-carbon transport systems, incentivising greater resource efficiency across the automotive industry and targeting innovation support to technologies that can help cut emissions in difficult areas such as heavy commercial vehicles, long-distance journeys and rail.” 

Nick Molho added: “Given the significant challenges faced by the UK’s automotive industry following the announcements by Jaguar Land Rover, Ford, Nissan and Honda, the UK cannot afford to be left behind in the global race to design and manufacture zero emission vehicles. To ensure the UK is at the forefront of the shift to cleaner mobility, the government must commit to long-term financial and regulatory measures that will grow that market, such as through predictable purchase grants and tightening vehicle emission standards.”

Justin Laney, General Manager of Fleet, John Lewis Partnership, said: “Radical change is needed to decarbonise long distance heavy trucks. These vehicles are the most challenging to tackle, but also the ones that deliver the biggest benefit. Our view at the John Lewis Partnership is that biomethane is the best solution for the next 20 to 25 years, and after that electrification, whereby trucks are supplied by power from an electrified overhead line. Government has been very supportive of low carbon trials, and it is important that continues, combined with creating the right tax and fuel duty regime that provides a sound, long term business case.”

Andy Walker, Technical Marketing Director, Johnson Matthey, said: “The coming decade will see more change in the automotive sector than we have seen in the previous 100 years, and it is clear that if the UK is to meet its climate targets and deliver deep cuts in emissions, greater innovation across the transport sector will be essential. At Johnson Matthey, we are driving innovation in battery and fuel cell capability to meet the needs of an electric vehicle future. To put UK businesses at the forefront of the global race to decarbonise transport, further policy support is needed to ensure the UK remains one of the best places in the world to design and manufacture low and zero emission technologies.”

Alexander Law, Public Affairs Manager, Michelin Group, said: “It is only by decisive action that we will be able to decarbonise the transport sector, and meet the aims of the Paris Agreement. Decarbonisation requires the collaboration of all the relevant stakeholders, the four Cs: countries and cities which have the power to bring in smart regulations, companies which can find the technical solutions and civil society which pushes for change for the better. At Michelin, our purpose is to provide a better way forward for goods and services by ensuring that mobility is sustainable and resource efficient. But we cannot do this alone, the solutions will only be found collectively.”

Chris Fry, Director, Infrastructure & Regeneration, Ramboll, said: “Like squeezing a balloon, reducing emissions in one part of the transport system has tended to increase them elsewhere. Ramboll welcomes the integrated approach outlined in this new report, which will enable a step change in transport decarbonisation, unleash opportunities in the clean growth economy and help to create liveable places. It is by combining new technologies with a people-centric approach – for example in the design of Nordhaven (Copenhagen) as a carbon neutral, “five minute city” – that we can develop effective and feasible solutions to decarbonising. This makes it an incredibly exciting time to be in the sector.”

Christina Downend, Climate Change Manager, Tesco, said: "Efficient and widely accessible charging infrastructure will be key to accelerate the uptake of electric vehicles, and businesses can take a lead. At Tesco, we want to be the UK’s leading electric vehicle energy provider and make it easier for customers to switch to clean vehicles. That’s why we have committed to roll out over 2,400 charging bays across our 600 stores within the next three years. But government must also accelerate it's own ambition on this agenda, such as by guaranteeing upfront purchase grants on electric vehicles and establishing the UK as one of the best places to develop new electric vehicle technologies."

Giles Perkins, Head of Future Mobility, WSP, said: “There’s a huge opportunity to rapidly cut transport emissions since forecasts show electric cars will be cheaper to own and run than petrol and diesel in the mid 2020s, if not sooner. It’s essential that the UK has the charging infrastructure ready to go for this future, learning from leaders, like Norway, where 4 in 10 of the cars sold this January were fully electric or hydrogen-powered. The move to electric fleets requires action from local authorities, developers as well as national Government, and provides tremendous opportunity for innovation and business leadership.”

Jonathan Hampson, General Manager, Zipcar, said: “Car sharing is at an all time high and Zipcar UK, the UK’s leading car sharing network, has a rapidly growing membership of over 250,000 members and is playing a key role in changing public attitudes to private vehicle ownership. Zipcar UK is cutting emissions by reducing the UK’s dependence on private cars and bringing electric vehicles into the mainstream, with over 300 electric cars in our fleet so far.

However, to accelerate current momentum towards car sharing and meet our vision to be fully electric by 2025, we need the government to roll out efficient and widely accessible charging infrastructure and certainty that the government’s upfront purchase grants for electric vehicles will remain in place. Beyond this we need government to encourage local authorities to integrate car sharing within their local transport systems.”

—ENDS—

[1] The Aldersgate Group publishes a new report today called Shifting emissions into reverse gear: priorities for decarbonising transport available at the following link from 00.01 Monday 11 March 2019 http://www.aldersgategroup.org.uk/latest#system-wide-approach-key-to-cut-transport-emissions

[2] This event will be held from 1.00pm – 3.00pm on Monday 11th March at RELX Group, 1-3 Strand, London, WC2N 5JR. Chaired by Joan Walley, Chair of the Aldersgate Group, the event will feature a panel with Justin Laney, General Manager - Fleet, John Lewis Partnership; Andy Walker, Technical Marketing Director, Johnson Matthey; Alexander Law, Public Affairs Manager, Michelin Tyre; Chris Fry, Director, Infrastructure & Regeneration, Ramboll; Justin Moss, Strategic Development Manager, Siemens; Christina Downend, Climate Change Manager, Tesco. Please email sophie.arndt@aldersgategroup.org.uk to attend.

[3] BEIS (February 2018) 2017 UK Greenhouse Gas Emissions, Final Figures

[4] Committee on Climate Change (June 2018) Reducing UK emissions: 2018 Progress report to Parliament

[5] RAC (September 2018) Report on Motoring 2018: The frustrated motorist

[6] Cars, vans and heavy good vehicles account for 87% of domestic transport emissions. Committee on Climate Change (June 2018) Reducing UK emissions: 2018 Progress Report to Parliament

[7] Public Health England (14 November 2018) ‘Health matters: air pollution’ https://www.gov.uk/government/publications/health-matters-air-pollution/health-matters-air-pollution 

[8] HM Government (July 2018) The Road to Zero: Next steps towards cleaner road transport and delivering our Industrial Strategy

[9] SMMT (31 January 2019) ‘UK Automotive on red alert as ‘no deal’ threat sees manufacturing and investment plummet’ https://www.smmt.co.uk/2019/01/uk-automotive-on-red-alert-as-no-deal-threat-sees-manufacturing-and-investment-plummet/

[10] DfT (July 2018) Future of Mobility: a call for evidence

[11] 42% of the UK’s railway is electrified compared to 76% in the Netherlands, 71% in Italy and 61% in Spain. Institution of Mechanical Engineers (February 2018) Decarbonising Rail: Trains, energy and air quality


Offshore wind sector deal shows low carbon transition is a huge industrial opportunity for the UK

7th March 2019

Reacting to the new Offshore Wind Sector Deal published today, Nick Molho, Executive Director at the Aldersgate Group, said: “We welcome the release today of the Offshore Wind Sector Deal, especially its commitment to boost the supply chain and ensure job opportunities are spread across the country, and its 2030 ambition to achieve a 40% female workforce. Other pledges, such as introducing an Offshore Energy Passport to facilitate work across offshore sectors and driving a greater focus on jobs and skills for young people, will cement offshore wind at the centre of the UK’s energy system, bringing jobs, investment and export opportunities to regions across the UK.
 
The government’s objective to reduce project costs in the 2020s will materialise if there is a sufficiently high and stable volume of projects in the coming decade. This requires building on the government’s commitment to hold auctions every two years and further clarifying the process, volume and exact timings of auctions as soon as possible so that the industry is clear about the opportunity ahead.”

IS

Beyond the 2019 elections: maintaining momentum on resource efficiency

28th January 2019

The Aldersgate Group has today released a new report Beyond the 2019 elections: maintaining momentum on resource efficiency. This is an updated version of the Group's previous report Beyond the Circular Economy Package: maintaining momentum on resource efficiency to take account of the upcoming European elections.

Building on an Aldersgate Group report published in January 2017, and updated since its first release in December 2017, this report sets out policy recommendations that EU institutions should pursue after the 2019 European elections to build on the Circular Economy Package and support increased business action on resource efficiency. These recommendations are based on business case studies, including some developed as part of the EU LIFE+ funded REBus project, which began in 2013 and on which the Aldersgate Group was a partner. 

See here for the original report's press release from December 2017. 


Long-term targets essential to success of Environment Bill

19th December 2018

Reacting to the publication today of the Draft Environment Bill, Nick Molho, Executive Director of the Aldersgate Group said: “We welcome the government’s ambition to establish a world-leading green governance framework. Progress has been made in several areas of the government’s proposals such as improving the Office for Environmental Protection’s powers on enforcement, although there is still work to be done to ensure as strong an enforcement system once the UK has left the European Union.

The pre-legislative scrutiny process should aim to reinforce the progress made on governance arrangements, by in particular clarifying how the Office for Environmental Protection can be set up in a way that best ensures its proper independence, elevating the government’s statutory duty to act in accordance with environmental principles rather than just have “regard to” the policy statement and broadening the scope of the policy statement to include the government’s fiscal and spending decisions.”

Nick Molho added: “It is welcome to see confirmation from government that they are exploring the inclusion of new environmental targets in the Environment Bill. Businesses have repeatedly welcomed the environmental improvement ambition shown in the government’s 25 Year Environment Plan but without the clarity provided by underpinning legislation, sufficient business investment to deliver natural environment improvement goals will not be forthcoming [1]. As we have seen following the impacts of legislation on waste, vehicle emissions and climate change, clear objectives in the Environment Bill, backed by the introduction of statutory measurable targets and delivery policies, will unlock business investment in new technologies, production processes, facilities and products [2]. An ambitious Environment Bill backed by clear targets will deliver environmental and economic benefits for the UK and cement its reputation as a world-leader in environmental action.”

—ENDS—

[1] Multi-sector business support for the introduction of environmental goals in the Environment Bill can be seen in a letter to the editor of the Sunday Telegraph published on 4 November.

[2] BuroHappold Engineering (December 2017) Help or Hindrance? Environmental regulations and competitiveness was commissioned by the Aldersgate Group and is based on business interviews studying the impacts of three key environmental regulations in the buildings (London Plan), waste (Landfill Tax) and car (EU Regulations on passenger cars) industries. It concludes that the compliance cost attached to each regulation has been more than offset by the economic benefits they have triggered. These include greater business investment in innovation and skills, better quality and performing products and infrastructure, greater business competitiveness and net job creation.

Envirobillllll

Resources strategy: a good start but more action needed in 2019

18th December 2018

Reacting to the publication today of the government’s Resources and Waste Strategy for England, Nick Molho, Executive Director of the Aldersgate Group said: “With 80% of a product’s environmental impact determined at the design stage, this Strategy is a welcome step forward in that it moves the focus of England’s resources and waste policy beyond just recycling and towards the early stages of a product’s lifecycle. We welcome in particular the intention to consult on new rules for extended producer responsibility schemes, the plan to broaden their scope to include a wider range of products as well as the intention to introduce product standards setting minimum resource efficiency criteria, which together could have a significant impact in improving the quality of products put on the market. 

The intention to take greater consideration of social and environmental impact in public procurement decisions and the potential introduction of clear eco-labels, product assurance schemes and warrantees could, subject to the final details, also play an important role in driving the demand for resource efficient products and secondary materials. We would urge the government however to also consider the role of fiscal incentives such as VAT rebates in driving consumer uptake and to exceed its goal of doubling resource productivity early as research suggests far greater improvements are possible.”

Nick Molho added: “Despite the positive sense of direction provided by this Strategy, a lot of the measures announced today are either subject to consultation or at an early exploratory stage. It will be essential for the consultations and actions referenced in the strategy to make rapid progress in 2019. Greater resource efficiency is critical to cutting waste, cutting emissions and improving the competitiveness of our economy and it is essential that the Brexit process doesn’t result in further delay to policy progress in this area [1].”

—ENDS—

[1] The Aldersgate Group was a partner on the REBus project, an EU LIFE+ funded project that demonstrated how businesses can implement resource efficient business models and thus generate, financial, material and greenhouse gas savings. The REBus project ran 30 pilot schemes across a range of market sectors in the UK and the Netherlands, including electrical and electronic products, textiles, construction and ICT. If the savings secured by these pilots were applied across the EU, resource efficient business models could secure an increase of up to £280bn GVA for the EU economy by 2030, a reduction in material demand of 184 million tonnes and a reduction in greenhouse gas emissions of 154 million tonnes CO2eq. See Aldersgate Group (June 2018) No Time to Waste: An Effective Resources and Waste Strategy and (January 2017) Amplifying Action on resource efficiency: UK edition.

RWS

European Commission shows welcome ambition to achieve net zero emissions

28th November 2018

Reacting to the publication today of the European Commission’s proposal for a strategy for long-term EU greenhouse gas emissions reductions, Nick Molho, Executive Director at the Aldersgate Group said: “We welcome the publication of the European Commission’s proposal for a long-term climate strategy and the clear vision put forward by Commissioners Maroš Šefčovič, Miguel Arias Cañete and Violeta Bulc of building a climate neutral, competitive and socially cohesive European economy by 2050. This intervention comes at a key time ahead of the Katowice summit and can play an important role in ramping up ambition amongst other key emitters. To deliver the Paris Agreement and act on the key messages from last month's IPCC report, the Commission, European Parliament and national governments must focus their attention on the highest ambition pathways in the proposal, aim to over-achieve Europe’s 2030 climate targets and introduce appropriate policy in the immediate term to put Europe on a cost-effective and economically beneficial pathway towards net zero emissions.”

Nick Molho added: “It is by setting ambitious science-based goals and supporting these with credible innovation, deployment and transition support policies that the EU and its member states can play their part in delivering the ambition of the Paris Agreement, influence international partners and ensure European businesses are well placed to compete in the global low carbon economy.”

commssion

Reactive to Secretary of State Greg Clark's speech on the Cost of Energy Review

15th November 2018

Reacting to Secretary of State Greg Clark's speech on the Cost of Energy Review, Nick Molho, Executive Director at the Aldersgate Group said: "The Secretary of State announced some important principles today that give a better sense of the government's long-term energy policy direction. However, if the UK is to have an affordable and low carbon power system, the government's upcoming policy paper needs to tackle how cheap and mature forms of renewable energy can have a route to market, how interconnection links with the EU will continue to grow after Brexit, what the carbon price trajectory will look like in the 2020s and how large consumers of electricity can be rewarded for providing flexibility services to the grid [1]."

—ENDS—

[1] UCL (2018) UK industrial electricity prices: competitiveness in a low carbon world http://www.aldersgategroup.org.uk/latest#removing-barriers-to-mature-renewables-key-to-lowering-industrial-electricity-prices

GG face

Top companies back green targets

6th November 2018

On 4th November, the Sunday Telegraph published our letter, signed by 20 business organisations, arguing that there is a strong business case for including long-term environment goals in the upcoming Environment Bill. See full text below:

Britain’s first environmental Bill in over 20 years is a unique opportunity to improve the competitiveness of the British economy and demonstrate continued environmental leadership after Brexit.

As organisations operating across multiple sectors of Britain’s economy, we believe that ambitious, well-designed and properly enforced environmental regulations make good business sense. They provide a level playing field, incentivise investment in innovation and skills, support job creation and help businesses develop commercial strengths in fast- growing areas of the world economy. We have seen this dynamic at play in, for example, the introduction of environmental regulations in the construction, waste and car manufacturing industries.

We therefore call on the Government to strengthen its 25 Year Environment Plan by introducing environmental goals in the upcoming Environment Bill. The Bill should at least set measurable targets to cover improvements to air and water quality, soil health, peatland restoration, net biodiversity gain and resource efficiency.

If supported by detailed policies and an effective environmental watchdog, this legislation would send clear signals for businesses to invest in environmental improvements and resource efficiency, and ensure that we pass on a healthy environment and competitive economy to the next generation.

Nick MolhoExecutive director, Aldersgate Group, Javier Quiñones, Country Retail Manager, Ikea UK and Ireland, Mike Barry, Director of Sustainable Business, Marks & Spencer, Stefano Agostini, CEO, Nestlé UK & Ireland, Juergen Maier, CEO, Siemens plc, Jonathan Hampson, General Manager, Zipcar UK, Peter Simpson, Chief Executive Officer, Anglian Water, Duncan Price, Partner, Sustainability, BuroHappold Engineering, Martin Casey, Director, Public Affairs Europe, CEMEX, Dale Vince, Founder, Ecotricity, Ece Ozdemiroglu, Director, eftecRichard Speak, Founder Director, Environmental Finance, Nigel Stansfield, President, Interface EMEA, Nick Lakin, Group Director of Corporate Affairs, Kingfisher plcCaroline MayHead of Safety and Environment, Norton Rose Fulbright LLP, Dr Richard AndrewsManaging Principal, Europe & Africa, Ramboll Environment and Health UK LtdDavid Palmer-JonesCEO, SUEZ Recycling & Recovery UKBevis WattsManaging Director, Triodos Bank UKRick WillmottGroup Chief Executive, Willmott DixonDavid SymonsUK Sustainability Director, WSP.

London city

Budget 2018 doesn’t live up to government’s clean growth ambitions

29th October 2018

Reacting to the Budget presented to Parliament today by the Chancellor Philip Hammond, Nick Molho, Executive Director of the Aldersgate Group said: “Despite some positive announcements on industrial energy efficiency and plastics, today’s budget – and the way in which it was presented – did little to match the commitment to clean growth the government showed during Green GB Week. The creation of an industrial energy transformation fund is welcome and targets public funding at an essential part of the economy that needs support to cut its emissions, but it would be made even more effective if combined with measures to support a renewed roll-out of onshore renewable energy to lower power prices for industry [1].”
 
Nick Molho added: “As the red book recognises today, ‘the economy of the future will be low carbon and green’ and the UK is well positioned to compete in this global transition. It is essential that the government backs its commitment to clean growth in the next Spending Review and upcoming legislation. Priorities should include introducing new regulations and fiscal incentives to accelerate energy efficiency investments in domestic and commercial buildings, accelerating the phase out of polluting vehicles and roll out of electric vehicles, providing clear visibility to investors on carbon pricing and introducing an ambitious Environment Bill with legally binding goals that drives improvements in the natural environment.”

—ENDS—

[1] UCL (2018) UK industrial electricity prices: competitiveness in a low carbon world http://www.aldersgategroup.org.uk/latest#removing-barriers-to-mature-renewables-key-to-lowering-industrial-electricity-prices

Red box

Aldersgate Group reactive to Green GB Week green finance announcements

17th October 2018

Alex White, Policy Manager at the Aldersgate Group, welcomed government’s announcements on green finance today, saying: “It's positive to see that the government is driving forwards the green finance agenda. In particular, we're encouraged that government is supporting work on the development of green finance standards and that it is considering how the growth of green finance can have real impacts on infrastructure funding. Today’s announcement on quantifying the UK’s pipeline of green infrastructure will help to demonstrate the size of the investment opportunity to the private sector, as well as the gap in planned UK infrastructure we still need to build to remain within 1.5 degrees of global warming.”

Alex White added, “Once we’ve established just how green the infrastructure pipeline is, government must provide more clarity in the coming months on the regulations and incentives that will be introduced to encourage even more green projects to fill that infrastructure gap and meet our carbon budgets, such as investment in the energy efficiency of buildings, low carbon heat, electric vehicles and the natural environment. The new Clean Growth venture capital fund announced today will be a useful tool to support investment in these less mature and complex areas. We're also pleased to see the planned engagement at regional level, to really deliver the gains from green finance across the country.”  

scr_313782_503140

UK shows welcome leadership on net zero emissions

15th October 2018

Reacting to the UK government’s announcement today that it is commissioning independent advice from the Committee on Climate Change on the setting of a net zero target, Nick Molho, Executive Director of the Aldersgate Group said: “Just a week after the publication of the IPCC report highlighting the importance of limiting temperate rises to 1.5°C, the Prime Minister and her government deserve credit for making a formal referral to the CCC to investigate how a net zero emissions target could be set in the UK. The development of such a target, which is receiving growing public and cross-party support [1], could provide significant supply chain growth and export opportunities for the UK if it is accompanied by a clear plan of action.” [2]

Nick Molho added: “In parallel with the CCC developing its advice, it is essential that the government continues progress on its Clean Growth Strategy to deliver on current climate targets. Greater policy detail is urgently needed to drive energy efficiency improvements in commercial and domestic buildings, increase the take-up of zero emission vehicles and support the growth of onshore renewable energy which is key to deliver affordable industrial power prices [3]. Targeted innovation support will also increasingly be needed to support businesses in sectors where emission cuts are more complex to achieve such as agriculture, heavy industry and long-distance transport.” 

—ENDS—

[1] Bright Blue (2018) Hotting up: Strengthening the Climate Change Act ten years on

63% of UK adults when the UK to be a global leader in tackling climate change and 64% of UK adults agree the UK should aim to cut its carbon emission to zero in the next few decades. https://brightblue.org.uk/wp-content/uploads/2018/05/Hotting-up.pdf

See also Cross-party MP joint letter on net zero emissions target ahead of 2050: https://www.theclimatecoalition.org/joint-letter

[2] The UK cut its emissions by 43% since 1990, leading the G7, and grew its economy by over 70% in the same period. With strengths in areas such as offshore wind and electric vehicle manufacturing, energy efficient building design, green financial and legal services, and ICT solutions, UK businesses have a strong basis from which to accelerate emission cuts and be at the forefront of the development of the new clean technologies and services which the world economy will increasingly demand. See Committee on Climate Change (2018) Reducing UK emissions – 2018 Progress Report to Parliament https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf

[3] UCL (2018) UK industrial electricity prices: competitiveness in a low carbon world  http://www.aldersgategroup.org.uk/latest#removing-barriers-to-mature-renewables-key-to-lowering-industrial-electricity-prices

Big ben

Aiming for net zero emissions is a major opportunity for UK plc

8th October 2018

Reacting to the publication today of the International Panel on Climate Change’s special report on 1.5 degrees, Nick Molho, Executive Director of the Aldersgate Group said: “This report from the world’s leading climate scientists is clear that there are compelling environmental, economic and social benefits to limiting the increase in global temperatures to 1.5 degrees as envisaged in the Paris Agreement. Whilst achieving such a target will require challenging emission cuts across the economy, important progress has already been made and an increase in ambition would unlock a significant innovation and investment opportunity.

The UK cut its emissions by 43% since 1990, leading the G7, and grew its economy by over 70% in the same period. [1] With strengths in areas such as offshore wind and electric vehicle manufacturing, energy efficient building design and green financial and legal services, UK businesses have a strong basis from which to accelerate emission cuts and be at the forefront of the development of the new clean technologies and services which the world economy will increasingly demand.”

Nick Molho added: “Major economies now need to increase their existing emissions reduction pledges under the Paris Agreement and adopt net zero emissions targets in line with the conclusions of the IPCC report. The Prime Minister made the right call when she announced at the UN General Assembly that the UK will be joining the Carbon Neutrality Coalition, especially as this follows growing public backing [2] and cross-party support for a net zero target. [3]

The government must now begin work towards legislating for such a target in the UK, by rapidly acting on its commitment to seek the Committee on Climate Change’s advice on how the UK can ensure its climate targets are aligned with the 1.5 degrees goal. Backed by detailed policies, such a target would accelerate investment in ultra-low emission goods, services and infrastructure and support the innovation needed to tackle emission cuts in more challenging sectors such as land management, agriculture, long-distance transport and heavy industry.”

Steve Waygood, Chief Responsible Investment Officer, Aviva Investors, said: "Aviva Investors understands the business imperative of tackling climate change. The Economist Intelligence Unit estimated that, left unabated, climate change will cost the global economy $43tn in today’s prices. This is not a risk we can afford to take.

Keeping global temperature increases to 1.5 degrees will help safeguard our investment portfolios and protect our customers savings. The long term negative financial consequences of climate change are far, far greater than the short term financial risks of transitioning to the Paris Agreement. Today’s report reiterates the need for policymakers to accelerate action to reduce carbon emissions and meet the agreed aims of the Paris Agreement.”

Gabrielle Ginér, Head of Environmental Sustainability, BT, said: “Recognising the need to limit global warming to 1.5 degrees, BT set a science-based target in line with a 1.5 degree trajectory in September 2017. Our target is to reduce the carbon emissions intensity of our operations by 87% by 2030 against a 2016/17 baseline. We welcome this report by the IPCC and hope that other organisations and policymakers will follow suit in setting 1.5 degree targets.”

Pia Heidenmark Cook, Chief Sustainability Officer, IKEA Group, said: “This latest IPCC report on climate change reinforces the urgent need for action from every part of society. The science and facts are clear and that is why IKEA has set an ambition to be climate positive by 2030, reducing more greenhouse gas emissions than what the IKEA value chain emits.

Setting stretching science based targets is essential for achieving this. We will contribute by decarbonising our energy use including electricity and heating, using zero-emissions deliveries, moving to a circular business model and enabling millions of customers and co-workers to take climate action in their everyday lives.

We firmly believe that together with other businesses joining the climate action movement, we can help to create a positive future and avoid the worst impacts of climate change.” 

Benet Northcote, Director, Corporate Responsibility, John Lewis Partnership, said: “The Paris Accord was a great moment of hope as countries came together to tackle the challenge of climate change. Today's IPCC report confirms that it is possible to achieve what we need to, but only if everyone responds with speed and ambition. It is not too late, but there can be no delay.  

Fortunately, we know what is needed and I am pleased that the John Lewis Partnership is responding in our operations and through our supply chains. We have already cut our operational emission intensity by nearly 70% since 2010 and over the coming months we will be unveiling the next stage in our plans to reduce our environmental impact and emissions even further. Waitrose & Partners continues to lead in its commitment to truly sustainable agriculture, while John Lewis & Partners is pioneering circular economy solutions that will lessen humanity's impact on the environment."

Meryam Omi, Head of Sustainability and Responsible Investment Strategy, Legal & General Investment Management, said: “Climate science is unequivocal in showing the benefits of action to finance a low-carbon future. But we have to act now. From large investors to individuals who choose their own pension fund, our option must be the one that makes sense financially and for the planet.”

Mike Barry, Director of Sustainable Business, Plan A, Marks & Spencer, said: “The IPCC continues to provide the sound science we need to make profound decisions about how we run the economy globally. It’s a powerful reminder that business as usual is unsustainable and even climate action 1.0, as inspired by COP21, is insufficient. We need to take bolder, faster action and shift our mind-set to one of embracing the inevitability and opportunity of the low carbon economy.”

Nicolas Beaumont, Senior Vice President Sustainable Development and Mobility, Michelin Group, said: “Michelin is firmly committed to the full implementation of the Paris Agreement and the subsequent necessity to limit the increase of temperatures to 1.5 degrees. Fighting climate change is essential and not an option and it is only by working together that we will be able to face this challenge. That’s why Michelin has set up its annual global summit Movin’On which aims to go from ambition to action while bringing together all stakeholders from the transport sector to invent the mobility of the future.

We welcome any initiative by the UK government to decarbonise the transport sector, by encouraging electric and hydrogen powertrains, and by ensuring the effective pricing of carbon. This will help us ensure we continue to bring to market the most effective products and services, through our continuous R&D efforts and by reducing the CO2 impact of our offerings. Now more than ever, our aim is to ensure that transport is safe, green, efficient and accessible.”

Sarah Handley, Carbon Neutral Programme Manager, Siemens plc, said: "By providing innovative technologies, Siemens is a leading partner for decarbonisation for our customers and society. We welcome the IPCC’s report on the benefits of limiting global warming to 1.5 degrees which supports the urgency of delivering the Paris Agreement goals. Siemens has set targets to achieve net zero-carbon status by 2030. We urge the government to review the UK Climate targets to help shape the low carbon economy."

Danielle Lane, UK Country Manager, Vattenfall, said: “Vattenfall strongly welcomes the IPCC’s new special report on the Paris Agreement. We are seriously concerned that the combined effect of the pledges for reduced GHG emissions in national plans to date may cause the temperature to continue to rise above 3 °C. It is vital that governments take heed of the IPCC report and let it guide them when updating their respective pledges under the Paris Agreement to ensure that these conform with global objectives.”

David Symons, UK Director of Sustainability, WSP, said: “Ambitious carbon free strategies drive business innovation and growth. That’s why the UK must continue to be a leader and why we’re challenging all our colleagues to design Future Ready buildings and transport networks – ready for the future as well as today. And business has to lead too. At WSP we’ve set a target to be carbon neutral by 2025 – because we want to do the right thing and because our colleagues want us to lead.”

—ENDS—

[1] Committee on Climate Change (2018) Reducing UK emissions – 2018 Progress Report to Parliament https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf

[2] Bright Blue (2018) Hotting up: Strengthening the Climate Change Act ten years on

63% of UK adults when the UK to be a global leader in tackling climate change and 64% of UK adults agree the UK should aim to cut its carbon emission to zero in the next few decades. https://brightblue.org.uk/wp-content/uploads/2018/05/Hotting-up.pdf

[3] Cross-party MP joint letter on net zero emissions target ahead of 2050: https://www.theclimatecoalition.org/joint-letter

UK expertise to help developing countries tackle climate change and move to cleaner energy: https://www.gov.uk/government/news/uk-expertise-to-help-developing-countries-tackle-climate-change-and-move-to-cleaner-energy?utm_source=116d819e-3284-4ce7-ba27-0f20242c25f3&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

Labour announces zero net greenhouse gas emissions by 2050: http://www.itv.com/news/2018-09-24/labour-to-commit-to-zero-net-greenhouse-gas-emissions-by-2050/

IPCC

UK must accelerate transition to zero emission vehicles

11th September 2018

Coinciding with the global Zero Emission Vehicles Summit held in Birmingham today, the Aldersgate Group launches a new briefing, Driving ambition: accelerating the transition to zero emission vehicles, [1] setting out key business recommendations for rapidly cutting road transport emissions in the UK. The Group argues that to significantly cut emissions in line with climate targets and put the UK at the forefront of the zero emission vehicle industry, government must provide much greater clarity on regulations, fiscal incentives and innovation support to drive manufacturing and demand.

Transport is now the largest-emitting sector of the UK economy, accounting for 28% of UK greenhouse gas emissions in 2017, with road transport the most significant form of emissions within the sector. Hitting the UK’s current climate targets requires the transport sector to cut emissions by 46% by 2030. [2] While the need to decarbonise is urgent, the opportunities of doing so for the UK are also great. The global market for low emission vehicles could be worth £1-2tn per year by 2030, and £3.6-7.6tn per year by 2050 [3] and significantly cutting emissions from road transport would deliver air quality and health benefits. The UK is well placed to capture a significant part of this low emission vehicle global market, with just one Nissan plant in Sunderland producing a fifth of all electric vehicles sold in Europe in 2016. [4]

To seize this economic and environmental opportunity, the Aldersgate Group urges the government to:

  1. Drive consumer uptake of the cleanest vehicles by extending the plug-in car and van grants until such a time that electric vehicles reach cost parity with conventional cars, which is not expected to happen until the mid-2020s. [5] The government should also consider boosting demand further through fiscal incentives, including significant VAT cuts on the sale of zero emission vehicles.  
  2. Provide much greater clarity on how vehicle emissions are to reduce in the 2020s after the UK leaves the EU. This should include providing clarity on whether the UK will remain part of the current EU rules on car, van and HGV emission targets or whether the UK will develop its own framework to drive down emissions. The government will also need to consider regulatory measures to tackle the limited supply of zero emission vehicles on the market, such as by introducing mandatory zero emission vehicles sales targets as a backstop.
  3. Deliver an affordable, efficient and reliable charging infrastructure by accelerating roll out of charging infrastructure to support 100% electric new car and van sales by 2030 and introducing standards on smart charging. Public funding to support charging infrastructure should be targeted where the market will not deliver such as in rural areas and should include offering guarantees against the unknown cost of connecting the chargers to the electricity grid to lower investment risk.
  4. Plan now for the future by looking at how the overall efficiency of the transport system can be improved. This should include planning long-term improvements to the accessibility, affordability and reliability of public transport (including working with cities and local authorities), encouraging a shift from road freight to rail, preparing for connected and autonomous vehicles, as well as facilitating disruptor businesses such as car sharing services. This will also require developing a sustainable future road tax system.

Nick Molho, Executive Director of the Aldersgate Group said: “Significantly cutting emissions from road transport is both an urgent environmental imperative and a unique economic opportunity for the UK. We will only get there however if the government provides much greater clarity on how vehicle emissions need to reduce in the 2020s, provides stable grant and tax incentives to drive consumer demand and stands ready to take the necessary measures to ensure that manufacturers play their part in meeting the public and business demand for clean vehicles.”  
 
“If we are to fully decarbonise transport by 2050, technological changes are only part of the picture. The government also needs to plan ahead and consider the shifts in travel patterns and infrastructure needs that are required to improve the overall efficiency of the transport system, from passenger travel to freight transport.”

—ENDS—
 
The Aldersgate Group will be exploring some of wider issues involved in decarbonising the transport sector in a comprehensive report early next year. This will include planning long-term improvements to the accessibility, affordability and reliability of public transport (including working with cities and local authorities), encouraging a shift from road freight to rail, preparing for connected and autonomous vehicles, as well as facilitating disruptor businesses such as car sharing services.

[1] The briefing can be found here.
 
[2] Committee on Climate Change Progress report to Parliament 2018: https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf
 
[3] Road to Zero (2018): https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/724391/road-to-zero.pdf
 
[4] Green Alliance: How the UK can lead the electric vehicle revolution (2018)
https://www.green-alliance.org.uk/How_the_UK_can_lead_the_electric_vehicle_revolution.php
 
[5] Bloomberg New Economic Forecast: Electric Vehicle Outlook 2018
https://about.bnef.com/electric-vehicle-outlook/        


Legislation is essential if businesses are to invest in the 25 Year Environment Plan

24th July 2018

Responding to the House of Commons Environmental Audit Committee (EAC)’s report today on The Government’s 25 Year Plan for the Environment, Nick Molho, Executive Director of the Aldersgate Group, said: “Contrary to a common misconception, an ambitious, well-designed and properly enforced environmental regulatory framework will deliver significant economic benefits by supporting investment in more innovative and efficient business practices, increasing private sector investment to improve the state of the natural environment and providing a level playing field for businesses across the economy. [1]

The upcoming Environment Bill is a unique opportunity to move beyond the status quo as envisaged in the 25 Year Environment Plan and set long-term goals to improve the state of the natural environment on which businesses and the economy are heavily dependent. As the EAC argues, these targets should include measurable improvements to air and water quality, soil health, biodiversity and the UK economy’s resource efficiency, be underpinned by clear milestones, and be established within a suitable advisory and reporting architecture.”

Nick Molho added: “The EAC rightly highlights that the government’s initial proposals for the governance body must be strengthened to ensure environmental protections are maintained after Brexit, particularly in terms of enforcement where the new body must have the power to take legal action against the government as a last resort. It is also right to emphasise the importance of the body directly overseeing all public bodies, as well as ensuring its independence by being accountable to and funded by Parliament in a similar way to the National Audit Office. This will ensure that the body is a truly world-leading institution as the government desires.”

[1] BuroHappold Engineering (December 2017) Help or Hindrance? Environmental regulations and competitiveness was commissioned by the Aldersgate Group and is based on business interviews studying the impacts of three key environmental regulations in the buildings (London Plan), waste (Landfill Tax) and car (EU Regulations on passenger cars) industries. It concludes that the compliance cost attached to each regulation has been more than offset by the economic benefits they have triggered. These include greater business investment in innovation and skills, better quality and performing products and infrastructure, greater business competitiveness and net job creation.

Natcap

UK must up the pace on its clean vehicles ambition

9th July 2018

Reacting to the publication today of the government’s Road to Zero Strategy, Nick Molho, Executive Director of the Aldersgate Group said:

“With transport now the largest emitting sector of greenhouse gases across the UK economy [1], the publication of the government’s Road to Zero Strategy should mark an important milestone in the UK’s efforts to tackle climate change and boost clean growth. However, despite welcome measures to support the roll out of electric vehicle charging infrastructure and innovation, this strategy fails to support the rapid pace of change that is needed to deliver climate targets and put the UK at the forefront of the global clean vehicles market [2]. Transport emissions need to reduce by at least 46% by 2030 for the UK to meet its fifth carbon budget [3], which requires a phase out of conventional petrol and diesel cars far ahead of 2040.”   

Nick Molho added: “Given the UK’s strengths in manufacturing ultra-low emissions vehicles and world leading battery research, it is essential that the government provides strong regulatory and policy support to accelerate the transition to zero emission vehicles and ensure that UK businesses are amongst the best placed to capitalise on this emerging market. This requires building on the charging infrastructure measures announced today by bringing forward the phase out date for the sale of conventional petrol and diesel vehicles, providing support for the purchase of ultra-low emission vans beyond October 2018 and cars beyond 2020, and delivering on its commitment to simplify the regime for drivers to access local charging points.”

[1] Transport accounted for 28% of UK greenhouse gas (GHG) emissions in 2017. Committee on Climate Change Progress report to Parliament 2018: https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf

[2] The global clean vehicles market is estimated to be worth up to £7.6tn by 2050 by government. The UK automotive sector employs over 160,000 people and generates £40bn in exports, accounting for 7.3% of the UK’s total exports of goods and services. UK Automotive Council 2017: https://www.automotivecouncil.co.uk/wp-content/uploads/sites/13/2017/03/UK-Automotive-Sector-Core-Briefing-March-2017.pdf

[3] Transport emissions must reduce by 46% between 2017 and 2030 for the UK to remain on a cost-effective pathway to meet its climate targets. Committee on Climate Change Progress report to Parliament 2018: https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf

used-nissan-leaf

Time for UK clean growth plans to turn into concrete policies

28th June 2018

Reacting to the publication today of the Committee on Climate Change’s 2018 Progress Report, Nick Molho, Executive Director of the Aldersgate Group said: “Despite the positive progress delivered in the power sector and ambition coming out of government, the UK is not on course to deliver its carbon budgets on time or cost effectively. Private sector investment and supply chain growth in areas such as onshore wind and energy efficiency is being hampered by a lack of clear regulations (such as binding EPC targets), fiscal incentives (such as stamp duty rebates) and market mechanisms (such as subsidy free CfDs for onshore wind). 

The vision set out in the government’s Clean Growth Strategy was a positive one but it must urgently be complemented by clear regulations and incentives that will support decarbonisation in sectors that have shown negligible progress by creating project pipelines to drive energy efficiency improvements and low carbon heat provision in buildings, and the growth of an ultra low emissions vehicles market. Without project pipelines that attract long-term business investment in innovation, supply chains and skills, the UK will miss out on its climate targets and its industrial clean growth ambitions.”   

Nick Molho added: “In the power sector, providing a route to market for onshore wind through a new competitive auction round and providing more clarity on the timing and size of future offshore wind auction rounds would do much to cut power prices for UK heavy industry and support continued cost reductions in renewable technologies.” [1]

[1] See Professor Michael Grubb and Paul Drummond (February 2018) UK industrial electricity prices: competitiveness in a low carbon world. This report set out six policy recommendations to support competitive industrial electricity pricesas the UK continues its transition to a low carbon power system including for the government to improve investment conditions for low-cost renewable energy technologies such as onshore wind.

Committee on Climate Change

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