Across the political divides there is a clear recognition that economic growth and clean growth are not mutually exclusive – but equally a sense that it is for business, not Government, to find the answers to meeting the legally binding target of a net zero economy in 2050 in the UK.
The energy, manufacturing and technology sectors have proven themselves to be innovative and responsive to the challenges of decarbonisation – but they do need to have a clear set of parameters in which to operate. Some regulatory direction and incentivisation is always needed; government may have to be honest about where it has decided to pick winners rather than stringing projects along as we sadly saw with the slow marine and tidal policy.
Potential solutions and innovations for meeting net zero are emerging in abundance. However, many of these economy-wide changes require wholescale shifts in our infrastructure – e.g. large-scale electrification or deployment of hydrogen to decarbonise heating and transport would require a coordinated approach and changes to regulatory frameworks.
A challenge for everyone
The public will also be critical to the success of the net zero project. There are lessons to learn from the failure of complex household-focused programmes such as the Green Deal on how to incentivise changes in behaviour. The digital television rollout vs historic smart meter take-up demonstrated that consumers need to see a clear personal benefit to changing their habits. Introduction of innovations such as smart appliances to drive energy efficiency domestically may need to be incentivised with near-term nudges to get to tipping point for mass take-up. Government’s recently announced green number plate plans suggest that there is appetite for this within Whitehall.
Despite this need for widespread engagement to drive change, recent YouGov analysis shows that a large swathe of businesses have yet to begin to make plans to meet the challenge of net zero. The backdrop of Brexit may not make this is wholly surprising, but it does demonstrate that practical support is needed to help businesses tackle the issues.
Back to basics
At a purely practical level, there are low hanging fruit which companies of all scales should consider:
From a corporate strategy perspective, this is also the time to understand your competitors and customers, to ensure that you are well placed to deliver products and advice to the political stakeholders who are developing the framework for net zero:
Alison Woodhouse is Hanover’s Net Zero Analysis Lead.