Ted Christie-Miller is a researcher at Onward. Richard is currently the Research Director at Aurora Energy Research. He was formerly the Director of Development and Head of the Energy and Environment Unit at Policy Exchange, prior to which he was the Chief Economist at the Crown Estate.
If Extinction Rebellion have anything to do with it, the final fortnight of this general election will be dominated by a single issue: climate change. From Sunday, activists will embark on twelve days of Christmas disruption to highlight the climate emergency before polling day – but they will be silent about what is required and how much it will cost.
This is because their central demand, to reach net zero emissions by 2025, sounds much better as protest than it does in practice. Research by the think tank Onward published this week reveals it would cost an absolute minimum of £200 billion a year to decarbonise the UK economy by 2025 – one and a half times the cost of the NHS – and £100 billion a year to get there by 2030.
Even if people were willing to pay higher taxes and prices, a 2025 target would be practically impossible to achieve. We would have to hire 270,000 extra plumbers, for example, to replace 22.8 million boilers in five years, and the global manufacturing capacity of electric vehicles would need to increase three-fold just to replace all the petrol and diesel cars on British roads (let alone those in other countries).
This is the uncomfortable truth facing the party leaders as they prepare for the Leaders’ Climate Debate on Channel 4 this evening. Parliament has rightly legislated to decarbonise the UK by 2050, but no political party has yet set out a practical plan to get there. Without it, the climate catastrophes that have punctuated this election- the flooding in venice, bushfires in Australia and floods in Yorkshire closer to home – will continue.
Thankfully, there are steps that we can take right now that will deliver net zero by 2050 without sacrificing the UK’s competitiveness, our fiscal balance or the budgets of low-income households in the process.
First, ministers should use market and behavioural incentives to drive lasting change. By abolishing VAT on domestic electricity and increasing it to 20 per cent on highly-emitting gas, whilst also removing the cost of renewable subsidies from consumer bills altogether, ministers could create market based incentives for people to switch to low carbon heating options such as electric heat pumps.
The £2 billion a year that taxpayers currently spend on Winter Fuel Payments is targeted at the age group now least likely to be in fuel poverty, the over-65s. Why not turn it into a capital grant of up to £4,400 per household, to upgrade the insulation and boilers of fuel poor households?
Second, we should be much more ambitious in our plans for the natural environment, to offset carbon emissions whilst boosting health and wellbeing. The Conservative manifesto pledged 30 million trees a year over a five year term, which although welcome, falls short of setting long term target. The Conservative pledged 30 million trees a year over a five year term, which although welcome, falls well short of what could be achieved. We should plant 1.4 billion trees by 2050, 20 times the current rate, by redirecting agricultural subsidies and encouraging low-cost forms of planting like wild-seeding.
Third, for too long the UK has lagged behind its competitors in Research and Development investment. It is such a vital tool for spurring innovation in the energy tech sector and we must therefore align our R&D spending to at least with the OECD average. This will allow technologies that are crucial to the UK’s zero-carbon mission such as hydrogen and carbon capture (usage) and storage to accelerate at the fast pace that we need.
Fourth, the UK has often struggled with competing government priorities, meaning the chips do not always fall in favour of decarbonisation. Often other departments win the battle, as we saw with the scrapping of zero carbon homes policy in 2015 after effective lobbying by the Ministry for Housing, Communities and Local Government. We need a Net Zero Secretariat, set up like the National Security Secretariat, which would support the newly announced Climate Change cabinet committee in research, coordination and implementation. This would align departmental objectives around the core goal of decarbonisation, factoring it in to all decision making.
Fifth, because the UK is responsible for just two per cent of global emissions we need to drive serious international action – as Britain has done in the past. Next year’s COP26 summit, hosted in the UK, should agree a global commitment on the phase-out of coal, as well as an agreement to introduce Border Carbon Adjustments to ensure decarbonisation does not damage competition in international markets.
That said, the UK is not blameless. Between 2013-2018, 96 per cent – £2.5 billion – of UK Export Finance’s energy budget was spent on fossil fuel projects. There is no point keeping the house tidy if you are making the world a mess, so we should once and for all end taxpayers money being used for fossil fuel projects abroad.
The UK has always blazed an international trail on decarbonisation, cutting emissions faster than any other developed country (by 44 per cent between 1990 and 2018) and brokering international agreements at the Gleneagles Summit and the Kyoto Treaty. It can do so again, but we must stick to a sensible target and devise a practical plan, so we set the best possible example on the world stage of how to go about decarbonisation our economy.