Comment

Is the Government’s 10 point plan really a green revolution?

Boris Johnson today outlined his 10 point plan for a green industrial revolution for 250,000 jobs.

Covering clean energy, transport, nature and innovation, the plan seeks to provide a blueprint to deliver the UK’s net zero 2050 target and demonstrate our ambition for next years’ COP26 climate summit in Glasgow.

We take a look at some of the key points.

Quadrupling offshore wind capacity to 40GW by 2030, supporting up to 60,000 jobs

Net zero requires the UK to maximise its offshore wind potential, and new floating turbine technology will allow deployment in more challenging marine environments with greater wind resource and deliver further cost savings (see our previous comment). Manufacturing and servicing this infrastructure will create a large number of well paid jobs, helping to “level up” the economies of our northern coastal towns and cities. This target cannot be met without substantial upgrades to the UK’s electricity grid however, and green groups have raised concerns over potential harm to marine and coastal habitats unless planning and delivery is better co-ordinated. It is particularly disappointing to see no new support for onshore wind (the cheapest energy technology) or references to other technologies such as solar or tidal energy, and we await the publication of the Energy White Paper later this year with much anticipation in this regard.

Working with industry to generate 5GW of low carbon hydrogen production capacity by 2030 for industry, transport, power and homes, and to develop the first town heated entirely by hydrogen by the end of the decade

The £500m funding announced for new hydrogen infrastructure is critical to support the decarbonisation of hard to treat parts of our economy such as transport and heating. ‘Low carbon’ hydrogen suggests a focus on ‘blue’ hydrogen generated from fossil fuels rather than ‘green’ hydrogen generated from renewables. The Committee on Climate Change notes that low carbon hydrogen has an important role to play in scaling up a hydrogen industry, but even when combined with carbon capture and storage (CCS), emissions savings may not be sufficient to meet our long-term emissions targets if deployed at significant scale. As Renewable UK highlighted earlier in the year, hydrogen production from renewables (offshore wind in particular) could make a very substantial contribution to the transition to net zero as well as delivering significant economic benefit. It is therefore disappointing to see an absence of explicit support, albeit individual proposals for such are likely to be welcomed and supported in appropriate locations.

£535m to advance nuclear as a clean energy source, including large scale nuclear and developing small and advanced reactors, which could support 10,000 jobs

Hinkley Point is the UK’s only new nuclear power station under construction, and is likely to be the most expensive source of power when it finally comes on line following a series of delays and cost rises. Plans for a new reactor on Anglesey were abandoned in September by Hitachi, and proposals for a new plant at Sizewell are under review. If the Government wishes to expand nuclear power, it must prove that it can be economical which may be a tall order given the huge falls in the cost of renewables such as wind and solar over recent years. Small modular reactors (SMRs) are not yet on the market and, whilst we need to keep our technology options open to deliver net zero, reliance on the future development and cost effectiveness of this technology looks a potentially risky bet in view of falling renewables costs and rapid innovation in batteries and other storage technologies. Could the money identified for nuclear development and management be better spent on supporting large scale retrofitting of buildings?

C.£500m to boost electric vehicle (EV) battery production in the West Midlands, North East and North Wales and £1.3bn to transform national infrastructure to better support EVs

Developing an EV battery production capability will be critical for our automotive sector post Brexit. The move to bring forward to 2030 the phase-out of fossil fuel vehicles has been widely anticipated and is a very positive move. One or more Gigafactories in the UK are vital and it is far more efficient and cost effective to place at least one of these factories in the midlands on the doorstep of our car industry. EV charging infrastructure will need to expand significantly to support this commitment. Enhancing such infrastructure could generate tens of thousands of “shovel-ready” jobs.

Public transport, cycling and walking: Making cycling and walking more attractive ways to travel and investing in zero-emission public transport of the future

Another sensible policy to reduce carbon emissions from transport whilst improving health and wellbeing. The COVID-19 lockdown has shown the climate and air quality benefits from reducing car use in our towns and cities, however the resistance to several Low Traffic Neighborhoods (LTNs), that have been introduced by local authorities to try to retain these benefits as we come out of the pandemic, shows the likely challenges ahead and need for strong policy to deliver these aims.

Supporting the decarbonisation of aviation and shipping

Aviation and shipping have historically not formed part of the UK’s carbon targets as a result of being omitted from international climate agreements. As carbon emissions from other parts of our economy reduce, however, they represent an increasing share of our emissions. The development of innovative low and zero carbon fuels to decarbonise these sectors is therefore critical.

Making our homes, schools and hospitals more energy efficient, whilst creating 50,000 jobs by 2030, and installing 600,000 heat pumps every year by 2028

The existing Green Homes Grant and Public Sector Decarbonisation schemes will be extended for a further year via £1bn funding. Research suggests insufficient installers are currently registering for the Green Homes Grant scheme to support the level of interest from home owners, and extending the scheme for only a year may not significantly change this. Heat pumps are critical to achieve our net zero target and whilst proposed regulations such as the Future Homes Standard 2025 require low carbon heating, some form of compulsion may be necessary to provide a clear signal to the market – perhaps similar to the banning of combustion engines in vehicles from 2030.

Becoming a world-leader in carbon capture and storage with a target to remove 10MT of carbon dioxide by 2030

Carbon Capture and Storage has suffered from intermittent Government support over the years and if there is one lesson to be learnt from the success of the off-shore wind industry it is the success that can result from long-term market support. An extra £200m of new funding will combine with existing funding to support the development of two carbon capture clusters by the mid-2020s, followed by another two by the end of the decade, taking total planned investment in CCS clusters to £1bn. CCS utilising disused oil and gas fields is likely to be needed to meet the net zero 2050 target, for example to lock up carbon emissions from the manufacture of blue hydrogen. Although the technology is proven at pilot scale around the world, successive governments have failed to kickstart the industry in the UK. Some form of carbon tax for high emitters may be necessary in future to scale up CCS from these initial clusters.

Protecting and restoring our natural environment, planting 30,000 hectares of trees every year, whilst creating and retaining thousands of jobs

This welcome commitment responds to the Committee on Climate Change’s recommendation for nature-based solutions including significant afforestation. Government has so far failed to meet its own targets on new woodlands however, and details of the environment land management contracts to replace current EU CAP subsidies and provide rewards for restoring natural features such as bogs and wetlands are awaited. Government must seize the significant opportunity from these reforms to develop a UK carbon offsetting market through the Woodland Carbon Code and emerging Peatland Code to reduce current reliance on international carbon offset frameworks. Many local authorities (including Greater London) established carbon offset schemes with substantial liquidity. Might these funds be used to encourage ambitious national tree planting schemes? This would certainly be a cost-effective way to sequester carbon from the atmosphere.

Whilst the ten point plan totals some £12bn of investment, only £4bn appears to be new spending. This compares with €30bn and €50bn proposed by France and Germany respectively for green investment as part of their COVID-19 recovery plans; or the £40bn investment estimated by PwC to be needed each year over the next decade to put UK infrastructure on a trajectory to meet our 2050 net zero target.

In summary, whilst these measures are to be welcomed and will support our national aspirations for a green recovery and to “build back better”, they should be regarded as a down payment and, unless further enhanced, are unlikely to fully meet the scale of the climate challenge or green jobs potential; representing a missed opportunity. Whether the Government seizes the opportunity to stimulate further investment in a broader range of technologies in the Energy White Paper remains to be seen.

For more information on how sustainability can benefit your development please contact James Blake in the Sustainability team or Mark Worcester in the Planning team.

18 November 2020