June 2023

Progress report:
Reducing emissions in WalesProgress Report: Reducing emissions in Wales
Climate Change Committee
June 2023

Presented to Welsh Ministers pursuant to Section 45(2) of the Environment (Wales) Act 2016. This report
was published on 6 June 2023 and is available online at: www.theccc.org.uk/publications
Progress Report: Reducing emissions in Wales2© Climate Change Committee copyright 2023
The text of this document (this excludes, where present, the Royal Arms and all departmental or agency
logos) may be reproduced free of charge in any format or medium provided that it is reproduced accurately
and not in a misleading context. The material must be acknowledged as Climate Change Committee
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photographs are reproduced.

3

Contents
Acknowledgements

6

The Committee

7

Executive summary10

1. Assessment of the First Carbon Budget

13

2. Progress towards future emissions reduction

17

Chapter 1: Progress in reducing emissions24

1. Assessment of the First Carbon Budget

26

2. Welsh Government’s plans to meet future targets

34

Chapter 2: Progress in sectors with significant Welsh Government powers

38

1. Agriculture and land use, land-use change and forestry

41

2. Waste46

3. Surface transport

50

4. Buildings

57

Chapter 3: Progress in largely-reserved policy areas

67

1. Electricity supply

70

2. Industry

73

3. Fuel supply

77

4. Aviation

80

5. Shipping83

6. F-gases

86

7. Engineered removals

89

Chapter 4: Cross-cutting issues

94

1. People and business96

2. Governance100

3. Adaptation

104

Annex 1: Policy scorecards

108

Annex 2: Recommendations

110

1. Recommendations – Priority

111

2. Recommendations - Cross-cutting

113

3. Recommendations – Agriculture and land use

115

4. Recommendations – Waste

117

5. Recommendations – Surface transport

118

6. Recommendations – Buildings

119

7. Recommendations – Electricity supply

121

8. Recommendations – Industry

121

Progress Report: Reducing emissions in Wales

4

9. Recommendations – Fuel supply

122

10. Recommendations – Aviation

122

11. Recommendations – Shipping

123

12. Recommendations – F-gases

123

13. Recommendations – Engineered removals

124

5Contents

Acknowledgements
The Committee would like to thank:
The team that prepared this report and its analysis: This was led by Chris Stark,David Joffe, Emily Nurse, James Tarlton and Simona Battipaglia, and included
Sasha Abraham, Rose Armitage, Ruby Barrett, Owen Bellamy, Bhargabi Bharadwaj,
Sandra Bogelein, Marili Boufounou, Victoria de la Cruz, Ramesh Deonarine, Joshua
Deru, Eoin Devane, Tom Dooks, Caitlin Douglas, Kieron Driscoll, Brendan Freeman,
Lisa Friberg, Kirsty Girvan, Ruth Gregg, Rachel Hay, Robbie Herring, Gemma
Holmes, Sarah Holmes, Daisy Jameson, Luke Jones, Stephen Jones, Miriam
Kennedy, Cara Labuschagne, James Lees, Bianca de Farias Letti, Michael Lord,
Luke Maxfield, Richard Millar, Bea Natzler, Chloe Nemo, Chris Parker, Simon Rayner,
Niki Rust, Vivian Scott, Penny Seera, Olivia Shears, Marcus Shepheard, Suzannah
Sherman, Felicity Taylor, Seán Taylor, Indra Thillainathan, Emma Vause, Sophie
Vipond, Louis Worthington, Ken Wright and Susie Wright.
A number of organisations and stakeholders for their support, including the Welsh
Government.

Progress Report: Reducing emissions in Wales

6

The Committee

The Rt. Hon John Gummer, Lord Deben,
ChairmanProfessor Keith Bell

Lord Deben was the UK’s longest-serving Secretary ofState for the Environment (1993 to 1997). He has held
several other high-level ministerial posts, including
Secretary of State for Agriculture, Fisheries and Food (1989
to 1993). Lord Deben also runs Sancroft, a corporate
responsibility consultancy working with blue-chipcompanies around the world on environmental, socialand ethical issues.

Keith Bell is a co-Director of the UK Energy ResearchCentre (UKERC), a Chartered Engineer and a Fellow of
the Royal Society of Edinburgh. He has been at the
University of Strathclyde since 2005, was appointed to
the Scottish Power Chair in Smart Grids in 2013 and has
been involved in energy system research incollaboration with many academic and industrial
partners.

Professor Michael Davies

Professor Piers Forster

Michael Davies is Professor of Building Physics andEnvironment at the UCL Institute for Environmental Design
and Engineering (IEDE). At UCL his research interests relate
to the complex relationship between the built
environment and human wellbeing. He is also Director of
the Complex Built Environment Systems Group at UCL anda member of the Scientific Advisory Committee of‘Healthy Polis’.

Piers Forster is Director of the Priestley International
Centre for Climate and Professor of Physical Climate
Change at the University of Leeds. He has played asignificant role authoring Intergovernmental Panel on
Climate Change (IPCC) reports, and is a coordinating
lead author role for the IPCC’s sixth assessment report.

7

The Committee

Paul Johnson CBEProfessor Corinne Le Quéré FRS

Paul Johnson is Director of the Institute for Fiscal Studies
and a visiting professor at University College London (UCL).
He is widely published on the economics of public policy,
and he co-wrote the ‘Mirrlees review’ of tax systemdesign. He was previously Chief Economist at the
Department for Education (2000 to 2004).

Corinne Le Quéré is a Royal Society Research Professor
at the University of East Anglia (UEA), specialising in theinteractions between climate change and the carbon
cycle. She was lead author of several assessment reports
for the UN’s Intergovernmental Panel on Climate
Change (IPCC) and she currently Chairs the French
Haut Conseil pour le Climat.

Nigel Topping CMG
Nigel Topping was appointed by the UK Prime Minister as
UN Climate Change High Level Champion for COP26. In
this role Nigel mobilised global private sector and local
government to take bold action on climate change,
launching the Race To Zero and Race To Resiliencecampaigns and, with Mark Carney, the Glasgow Financial
Alliance for Net Zero.

Progress Report: Reducing emissions in Wales

8

Executive summary

1. Assessment of the First Carbon Budget

13

2. Progress towards future emissions reduction

17

Progress Report: Reducing emissions in Wales

10

With an ambitious target to reach Net Zero greenhouse gas emissions by 2050,
action on decarbonisation in Wales must now accelerate. Wales’s journey to Net
Zero is mapped out by a series of legislated five-yearly carbon budgets anddecadal interim targets. While the First Carbon Budget (2016-2020) has beenachieved, Wales is not yet on track to meet its targets for the second half of thisdecade and beyond.
Some positive steps have been taken in Wales, with a welcome focus fromministers on skills, jobs and public engagement for the Net Zero transition. However,there are too many areas where the Welsh Government has policy responsibility,
but progress is slow. In this report we discuss how Wales achieved its First Carbon
Budget, assess progress towards the future targets and outline priority next steps.
We have shifted our focus to include monitoring real-world indicators ofdecarbonisation progress.
Our key messages are:•

The First Carbon Budget (2016-2020) was achieved. Welsh greenhouse gas
emissions decreased to an average of 28% below 1990 levels during the First
Carbon Budget period. Wales has therefore achieved its First Carbon
Budget, which required a 23% reduction. Wales’s interim 2020 target for a
27% reduction was also achieved with 2020 emissions being 34 MtCO2e,39% below 1990 levels, with emissions falling sharply as a result of the
COVID-19 pandemic.
– Over the course of the First Carbon Budget period (2016 to 2020)
significant reductions were seen in the power (a 68% reduction) andindustry (a 10% reduction) sectors, both of which have policy powers
mostly reserved to the UK Government. Transport saw a sharp
reduction in 2020 as a result of the response to the COVID-19
pandemic. There was little progress in emissions reduction in othersectors of the economy, which overall fell by only 3%.
– Prior to this, the largest absolute fall in emissions since 1990, was in theindustry sector. There was also a significant reduction in emissions fromwaste, whereas emissions from power increased over this time.

11•

Decarbonisation indicators. Tangible progress has been insufficient in many
areas that are dependent on Welsh Government policy powers. Most
notably, tree-planting rates and peatland restoration rates are far too low,and development of the charging infrastructure needed to support thetransition to electric vehicles is not happening quickly enough. Moreprogress has been seen in the waste sector and recycling rates remain
higher than in the rest of the UK, but improvements have stalled in recent
years.

•

Policy progress. Wales has taken some positive steps, for example therecent decision to cancel all major road projects on environmental grounds
and the welcome focus ministers have placed on skills, jobs and public
engagement for the Net Zero transition via several public engagement
campaigns and a Skills Action Plan. But the Welsh Government is not using
its policy powers to full effect. In those sectors where policy is mostly
controlled in Wales, the effort is insufficient to achieve the emissions
reduction required. In particular, agriculture and land use are missing an
overarching decarbonisation strategy and the Welsh Government’s planfor the Second Carbon Budget (2021-2025) projects a slight increase inemissions from agriculture.

Executive summary

Low ambition in this sector puts the later targets at risk and increases
Wales’s reliance on emissions reduction in sectors with reserved policy
powers, such as industry.
•

Third Carbon Budget (2026-2030). The middle of the Third Carbon Budget isonly five years away, and by then Wales should have reduced emissions by
39% compared to pre-pandemic (2019) levels. Policy action in all sectors
across the economy is now needed, including:– Addressing the funding gap in 2024 for agri-environment financial
support and overcoming non-financial barriers related to woodland
creation, through capacity building and skills development.
– Delivering a widespread, reliable, and high-quality electric vehicle
charging network and developing a full delivery plan for achieving
Wales’s target of a 10% reduction in car-km per person compared to2019 levels by 2030.
– Improving recycling policies to increase the currently stalled rates in
Wales to ensure future recycling targets are met.
– Developing a detailed plan for delivering energy efficiency measuresand low-carbon heat – drawing on Local Area Energy Plans –including clear deployment targets and investment costs, andenabling delivery of long-term plans to decarbonise public buildings,
social housing and fuel-poor homes.

The rest of this executive summary is set out in two sections:
1. Assessment of the First Carbon Budget
2. Progress towards future emissions reductions

Progress Report: Reducing emissions in Wales

121. Assessment of the First Carbon Budget
Welsh emissions fell to an
average of 28% below 1990
levels during the First Carbon
Budget period (2016-2020) andWales has therefore met its First
Carbon Budget.

The power and industry sectors
led Wales’s decarbonisation
over the First Carbon Budget
period.

Welsh greenhouse gas emissions have been falling slowly since 1990 and fell to an
average of 28% below 1990 levels during the First Carbon Budget period (20162020). Wales has therefore met its First Carbon Budget, which requires a 23%
reduction (Figure 1). Emissions in 2020 were 34 MtCO2e, which is 39% lower than1990 levels and so Wales has also achieved its 2020 interim target of a 27%
reduction.
•2020 emissions. There was a large drop in emissions in 2020 as a result of the
response to the pandemic, but even prior to this, emissions were alreadyfalling faster than required to meet the First Carbon Budget.

•

Emissions reductions 2016 to 2020. Over the First Carbon Budget period,
both power and industry emissions fell significantly, with a transient
contribution from transport in 2020 due to the pandemic (Figures 2 and 3).
The reduction in power was driven by the Aberthaw coal power station
ceasing operations in 2019.
– Emissions reduced in both the power and industry sectors at a much
faster rate than projected in the CCC’s pathways for the First Carbon
Budget period, which were based on existing trends at the time of ouradvice in 2017 (Figure 4).
– Emissions reduction in the agriculture and land use, land use change
and forestry (LULUCF) sectors, which depend on Welsh Government
policy, and the F-gas sector, which is mostly reserved to the UK
Government, was slower than expected (Figure 4).
– Progress in the waste sector stalled during this period, but this pathway
was following a significant reduction in the years prior to the First
Carbon Budget (Figures 2, 3 and 4).

The most significant
contribution to the fall in Welsh
emissions between 1990 and2016 was in the industry sector.

•

Emissions from 1990 to 2016. The most significant contribution to theabsolute fall in Welsh emissions between 1990 and 2016 (the start of the First
Carbon Budget) was in the industry sector (Figures 2 and 3).
– Industrial emissions decreased 34%, driven by changes in the energyintensity of production, the industrial fuel mix and a structural shift in
output towards a less carbon-intensive mix of products, including a fallin Welsh production of crude steel. There was also a significant (63%)
reduction in emissions from waste, driven by the landfill tax andincreased recycling rates.
– Emissions from power generation increased by 44%, driven by anincrease in exports to England and an increase in fossil fuel generation,
partly to compensate for the closure of Wylfa nuclear power station.
Wales has a disproportionate share of gas power stations, comparedto the rest of the UK. Both power and industry are policy areas largely
reserved to the UK Government whereas action in waste is dependent
on Welsh Government policies.

13

Executive summary

Wales has achieved its First
Carbon Budget and now mustsignificantly outperform its
Second Carbon Budget to be
on track to meet future targets.

Figure 1 Historical emissions and future targets in
Wales
100%
50

80%
40

70%
60%

30

50%
40%

20

30%
20%

Emissions (MtCO ₂e)

Emissions (% of 1990 levels)

90%

10

10%
0%

0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
First Carbon Budget
Third Carbon Budget
Updated Balanced Pathway
2030 target
W elsh Gov ernment pathway

Second Carbon Budget
Historical emissions
Av erage CB emissions
2040 target

Source: National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales& Northern Ireland: 1990-2020; CCC (2020) The Sixth Carbon Budget; CCC analysis; Welsh Government.
Notes: The updated Balanced Pathway includes the following changes: rescaling residential buildings emissions tomatch 2019 emissions and correcting for greenhouse gas inventory methodology updates up to the 1990-2020
inventory. The global warming potentials are those without carbon feedback from the IPCC’s Fifth Assessment
Report.

Figure 2 Historical emissions by sector in Wales
60
50
GHG emissions (MtCO 2e)

Emissions in Wales fell slowly
between 1990 and 2016, but
sped up between 2016 and
2020.

40
30
20
10
0
-10

1990

1995

2000

Agriculture Buildings

Transport

2005
W aste2010
F-gas

Industry

2015

2020

Power

LULUCF

Source: National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales& Northern Ireland: 1990-2020.
Note: The global warming potentials are those without carbon feedback from the IPCC’s Fifth Assessment Report.

Progress Report: Reducing emissions in Wales

14

Welsh emissions reductions
were driven by industry
between 1990 and 2016 andby power over the First Carbon
Budget period (2016-2020).

Figure 3 Change in Welsh emissions 1990 to 2016
and 2016 to 2020

Change in emissions 1990-2016 (MtCO 2e)

a)
6

43%

4
2
0
-2%

-2
-63%

-4

-10%

-30%

-6
-8

-35%

-10

b)

Change in emissions 2016 -2020 (MtCO2e)

2
0%

0
-2

-15%

-4%

-3%

-10%

-4
-6
-8
-10
-12

-68%

Source: National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales& Northern Ireland: 1990-2020.
Notes: The global warming potentials are those without carbon feedback from the IPCC’s Fifth Assessment Report.
*For the second graph, transport emissions are compared from 2016 to 2019 to take out the impact of the
COVID-19 pandemic.

15

Executive summaryFigure 4 Comparison between CCC pathways and historicalemissions (2010-2030)

Source: Welsh Government, CCC analysis.
Notes: Global warming potentials from the IPCC’s Fifth Assessment Report without carbon feedback, except for the CB1 pathway and the dashed lines,
for historical emissions (to allow for comparison) which use the IPCC’s Fourth Assessment Report. The updated Balanced Pathway includes the followingchanges: rescaling residential buildings emissions to match 2019 emissions and correcting for greenhouse gas inventory methodology updates up to the
1990-2020 inventory. The discontinuity in power emissions in 2020 reflects uncertainty in the CCC pathway due to data lags and differences in modellingassumptions compared to actual outturns (e.g. for load factor of fossil fuel plant). The y-axis range is different for each row in the chart.

Progress Report: Reducing emissions in Wales

16

2. Progress towards future emissions reduction
The Welsh Government has
made insufficient progress onemissions reduction with thepolicy powers available.

The Welsh Government has made insufficient progress on emissions reduction withthe policy powers available. Action should now be focused on those sectors whereWelsh Ministers have the greatest capacity to effect change. This is the best
possible basis for deeper co-ordination and influence with the UK Government on
those sectors where reserved policy plays a greater role in reducing Welsh
emissions.
•

The Welsh Government havenot published a transparent
quantification of how theirtargets and milestones add up
to achieve their plan’s sectoral
emissions pathways for theSecond Carbon Budget.

The Second Carbon Budget (2021-2025). The level of the Second Carbon
Budget was set before Wales had a Net Zero target, to an average
reduction in emissions of 37% compared to 1990 levels. This is too loose to
be on track for Wales’s later targets.
– In October 2021 the Welsh Government published its plan for emissions
reduction over this period. The plan projects to outperform the target
with a reduction of 44% * (Figure 1).
– A series of targets and milestones for deployment rates in each area ofthe economy are given in the plan, but the Welsh Government havenot published a transparent quantification of how these add up toachieve the plan’s sectoral emissions pathways.
– The plan projects no change in emissions from agriculture over theSecond Carbon Budget period. Reducing agricultural emissions isimportant for Wales to achieve its longer-term targets and failing to
reduce them will place greater reliance on sectors with reserved
policy powers, such as industry.
– In our updated Balanced Pathway, 57% of the required emissions
reduction between 2020 and 2025 comes from power and industry
sectors, whose progress is substantially determined by policies set by
the UK Government. The majority of the remaining abatement before
2025 is in the transport and agriculture sectors. Beyond 2025, Welsh
emissions targets become increasingly reliant on sectors including
agriculture, LULUCF, transport and buildings where significant policy
powers lie with Welsh Ministers. These sectors require early policy action
now to ensure they are on track.

The middle of the Third Carbon
Budget is only five years away,
and by then Wales needs tohave reduced emissions by 39%
compared to pre-pandemic
levels.

•*17

Third Carbon Budget (2026-2030). The middle of the Third Carbon Budget isonly five years away, and by then Wales needs to have reduced emissions
by 39% compared to pre-pandemic (2019) levels (Figure 1). Action in all
sectors across the economy is needed now.

The 44% reduction is based on the 1990-2019 greenhouse gas inventory and uses global warming potential values
from the IPCC’s Fourth Assessment Report.

Executive summary

(a) Progress against key indicators
Table 1 summarises the progress against key indicators where devolved policy has
significant influence. The picture is mixed:
Both new woodland creationand peatland restoration
remain significantly off-track,with waste indicators generally
on-track.

•

Agriculture and LULUCF. Both new woodland creation and peatland
restoration remain significantly off-track, with tree-planting rates being
consistently low. The peatland restoration rates are judged against the
CCC’s target, which is more ambitious than the Welsh Government’s. Whiledecreases in livestock numbers are currently on-track, this has not been
driven by policy and the Welsh Government has not made it clear how itwill capitalise on this momentum. Emissions from machinery are not falling
fast enough.

•Waste. Indicators for waste are generally on-track, with Welsh recycling
rates being higher than the rest of the UK, although progress has stalled inrecent years. Energy from waste has been increasing in recent years.

•

Transport. Progress on transport is off-track for areas in which the Welsh
Government has policy control. Expansion of charging infrastructure
provision needs to accelerate and, whilst positive steps have been made inWales to reduce traffic, it is too early to say if this is sufficient as the sector
rebounds from the pandemic. Van-kilometres have increased faster andare already slightly off-track.

Table 1
Summary of progress against key indicators where Welsh Government policy has significant influence
Agriculture and land

Waste

Transport

New woodland

Total waste

Charge points

Peatland restoration

Recycling rate

Rapid charge points

Livestock numbers

Landfilled waste

Car kmMeat consumption

Biodegradable waste

Van kmMachinery emissions

Energy from waste

HGV kmKey:

On track

Too early to say

Slightly off track

Data not reported

Significantly off track

No benchmark or target

Notes: An indicator is on track if it is going in the right direction at an appropriate rate. This is determined either by comparing to a quantified
pathway/benchmark or making a judgement.

Progress Report: Reducing emissions in Wales18

(b) Policy progress and next steps
Wales has made insufficient policy progress since our last progress report in 2020.
Many of our recommendations made to the Welsh Government, either in thatreport or in our 2022 progress report to the UK Government, have seen either
insufficient or no progress, this is particularly striking in the buildings sector (Figure 5).
Many of our recommendations
made to the Welsh
Government, have seen either
insufficient or no progress. This isparticularly striking in thebuildings sector.

Figure 5 Assessment of previous recommendations
to WalesCross-cutting
Waste
Surface transport
Agriculture & land use
Buildings
I ndustry
0

1

2

3

4

5

6

7

8

9

Number of recommendations
Good progress

Moderate progressSome but insufficient progress

No progress

Too early to tell
Source: CCC analysis.
Note: Recommendations are from our 2022 UK Progress Report, our 2020 Wales Progress Report and our 2020
Advice Report: The path to a Net Zero Wales.

(i) Sectors in which significant policy powers are held by the
Welsh Government
Table 2 summarises our assessment of policy progress in sectors with significant
policy powers devolved to the Welsh Government. The criteria for this assessment
are outlined in the Annex. The picture is mixed but, overall, there are significant risks
to Wales meeting its Third Carbon Budget.
There are significant risks toWales meeting its Third Carbon
Budget, particularly in the
agriculture, LULUCF andbuildings sectors.

19•

Agriculture and LULUCF. There has been little progress in agriculture and
LULUCF in recent years and an overarching strategy is missing.
– The Agriculture (Wales) Bill was introduced in 2022, outlining the future
framework of agricultural policy and support. However, there will be afunding gap in agri-environment financial support between thecurrent scheme ending in 2023 and the replacement scheme not
beginning until 2025. This needs to be addressed.

Executive summary– Success depends on delivering a just transition where livestock farmers
can benefit from new opportunities to diversify land use which canprovide an additional income stream.
– Although the level of grant funding committed to afforestation until
2024 is generous, challenges remain on encouraging landowners andmanagers to take up the offer. The Welsh Government should work to
overcome the non-financial barriers related to woodland creation
through capacity building and skills development. This includes
implementing actions recommended by the Trees and Timber
Taskforce. On its recommendation, the Welsh Government issued aguide for farmers and land managers on woodland carbon credits.
– Cross-departmental work comprising health and agriculture has
started to develop a long-term strategy to promote a shift to a‘healthier and suitable’ diet. Work will aim to identify opportunities for
new policies and/or interventions, which could lead to improved
dietary patterns within Wales.
Wales has a relatively highrecycling rate compared toother UK nations, although
recent progress on waste
emissions has plateaued.

•

Waste. Wales has a relatively high recycling rate compared to other UK
nations, achieved through initiatives such as the ‘Collaborative Change
Programme’ and ‘Be Mighty’ public campaign. Although recent progresson waste emissions has plateaued.
– Like the rest of the UK, Wales is bringing in Extended Producer
Responsibility and a Deposit Return Scheme, which should help
improve recycling rates – but further policies are likely to be needed tomeet recycling targets.
– Business Wales’s initiative to provide businesses dedicated resource
efficiency advice linked to public-backed loans is a good example forthe rest of the UK – but more work is needed to improve waste
prevention and resource efficiency.

•

Surface Transport. There are promising early signs in the uptake of electricvehicles and policies to incentivise a shift away from private car use.
– The Welsh Government should work with the UK Department forTransport to ensure that the zero-emission vehicle mandate is effective
in driving the scale-up in EV sales that is required. Delivering awidespread, reliable and high-quality charging network will be key toenabling this.

Wales is aiming to reduce carkm travelled per person by 10%
by 2030 relative to 2019 levels
and has made several key
decisions in line with this.

– Wales is aiming to reduce car-kilometres travelled per person by 10%
by 2030 relative to 2019 levels and has made several key decisions inline with this, including cancelling all major road projects, introducing
environmental requirements for future road-building, and reducing
speed limits. Wales has committed almost four times as much funding
per capita to active travel as the UK Government. The Welsh
Government should build on this progress to develop a full delivery
plan for achieving its demand-reduction target.
•

Buildings. The Welsh Government is supporting delivery of Local Area
Energy Plans across all local authorities in Wales, but currently lacks acomprehensive national plan for decarbonising buildings.

Progress Report: Reducing emissions in Wales20

– The Welsh Government has plans to decarbonise public buildings andsocially rented homes. However, it is yet to make long-term plans forthe funding required. Its proposals to require existing social housing toreach an EPC ‘A’ rating are unlikely to be a cost-optimal approach todecarbonising homes.
A detailed plan for delivering
energy efficiency measuresand low-carbon heat inbuildings should be developed.

– A detailed plan for delivering energy efficiency measures and lowcarbon heat should be developed – drawing on Local Area Energy
Plans – including clear deployment targets and investment costs.

Table 2
Assessment of Welsh policy progress in sectors with significant policy powers devolved to Wales
SectorEmissions reductionneeded from 2020 to2028 (MtCO2e)

Assessment of Welsh policy
progress

Risk due to UK Government
actionSurface transport

2.0 MtCO2e *Some risks (Y)MediumAgriculture and LULUCF

1.5 MtCO2e

Significant risks (O)

Low

Waste

0.4 MtCO2e

Some risks (Y)MediumBuildings

0.8 MtCO2e

Significant risks (O)High

Notes: *Change in emissions is from 2019 for surface transport due to the low emissions in 2020 during the pandemic. The criteria for policy assessment are
given in the Annex. The required emissions reductions are taken from our updated Balanced Pathway.

(ii) Sectors with significant reserved policy powers
The Welsh Government has
influence over the
decarbonisation of all sectors,
for example through use of its
planning powers or skills andenterprise support.

21

The Welsh Government has influence over the decarbonisation of all sectors, forexample through use of its planning powers or skills and enterprise support.
However, progress in these sectors is influenced by UK Government policies to agreater degree:•

Industry (excluding fuel supply). Decarbonisation of Welsh industry is at risk
from insufficient action at the UK level, especially in the steel sector. The
Welsh Government plans to continue working with the UK Government toadvocate for more support for industrial decarbonisation in Wales. It is alsousing its limited powers to enable industrial decarbonisation, for example bysetting up Net Zero Industry Wales to support all Welsh industrial clusters.

•

Fuel supply. The Welsh Government has made positive progress inannouncing the intent to prevent further extraction of fossil fuels, including
preventing the expansion of the coal industry, and restricting new oil andgas extraction projects in Wales. Next steps are to assess the potential forlarge-scale hydrogen production and infrastructure in Wales, coordinate
with the UK Government on how Wales can best contribute to UK-widehydrogen plans and develop a Bioenergy Action Plan to clarify its position
on bioenergy in Wales.

Executive summary•Electricity supply. By 2030, Wales aims to generate renewable electricity
equal to 70% of its electricity consumption. Welsh renewables capacity has
increased over time but at a slower rate since 2016. Wales must now workwith the UK Government to deliver strong policy consistent withdecarbonising electricity supply by 2035 (e.g. on standards for new-build
power plants), and to continue to take Welsh-specific programmes forward
where these are devolved (e.g. on planning and consenting for new lowcarbon developments).

•

Aviation. Decarbonising aviation is dependent on the uptake of Sustainable
Aviation Fuel and UK-wide aviation demand management, which aredependent on UK Government action. However, the Welsh Government is
not using the levers it does have. It does not have a strategy for managing
airport expansion and aviation demand, and does not have a plan for
ensuring Cardiff Airport is prepared for sector decarbonisation.

Progress Report: Reducing emissions in Wales

22

Chapter 1

Progress in reducing emissions
1. Assessment of the First Carbon Budget

26

2. Welsh Government’s plans to meet future targets

34

Progress Report: Reducing emissions in Wales

24

Introduction and key messages
Greenhouse gas emissions in Wales are regulated by the Environment (Wales) Act
2016 (hereafter ‘the Act’). This legislation originally included a target to reduce
emissions by at least 80% on 1990 levels * by 2050. Our 2017 advice on the First(2016-2020) and Second (2021-2025) Carbon Budget targets, which was acceptedby the Welsh Government, was based on this 80% target. Following the advice of
the CCC in 2019 and 2020, Wales subsequently increased the ambition of its 2050
target to be Net Zero emissions. 1, 2 This means that emissions will need to be
reduced at a faster rate than envisaged when the First and Second Carbon
Budget targets were set. † Wales’s Third Carbon Budget (2026-2030) was set,following our 2020 advice, at a level compatible with the Net Zero target. In thischapter we look back on Welsh emissions over the First Carbon Budget, assessing
how it was met, as required in the Act. We then discuss Wales’s plans for meeting
future carbon budgets and targets. Our key messages for this chapter are:•Emissions in Wales were 34 MtCO2e in 2020. Wales met both its 2020 interim
target and its First Carbon Budget, with emissions falling to an average of
28% compared to 1990 levels over the period 2016-2020.

•

The reduction in emissions during the First Carbon Budget period (20162020) was primarily driven by the power and industry sectors, and areduction in 2020 transport emissions as a result of the COVID-19 pandemic.
In the sectors with policy powers mostly devolved to Wales, emissions
reductions were generally slower than the pathways in our 2017 advice,
which were based on a continuation of trends at the time.

•

The largest absolute fall in emissions since 1990 and prior to the First Carbon
Budget period was in the industry sector. There were also significant
reductions in the waste sector, while an increase in emissions was seen in
the power sector. Both industry and power have policy largely reserved to
the UK Government whereas policy in waste is mostly devolved to Wales.

•

The Welsh Government has published its plan for meeting the Second
Carbon Budget.
– The plan sets out sectoral pathways from 2021 to 2025 that combine toproject an average reduction in emissions of 44% compared to 1990
levels, outperforming the Second Carbon Budget target of a 37%
reduction.
– The plan projects emissions in agriculture to slightly increase by 2025
compared to 2020 levels, whereas the CCC’s updated Balanced
Pathway projects a reduction of 11% over this period. Reducing
agricultural emissions is vital for Wales’s longer term decarbonisation
goals and decreasing reliance on sectors with reserved policy powers.

•

25

The middle of the Third Carbon Budget is only five years away. By this point,
Wales needs to have reduced emissions by 39% compared to prepandemic levels in 2019 in order to achieve the target of an average
reduction of 58% compared to 1990 levels. Emissions reduction will now
need to significantly speed up in all sectors across the economy.

*

The comparison year for CO2, methane and nitrous oxide is 1990. The comparison year for fluorinated gases is 1995.

†

The Second Carbon Budget was adjusted to account for the earlier than expected closure of the Aberthaw coal
power station, but even with this adjustment the target is insufficient to be on track for Net Zero.

Chapter 1: Progress in reducing emissions

1. Assessment of the First Carbon Budget(a) Total emissions
Emission in Wales reduced by an average of 28% compared to 1990 levels over theFirst Carbon Budget period (2016-2020) and the target of a 23% reduction has
therefore been met.
Under the Act, emissions targets are set as percentage reductions on 1990 levels
rather than in absolute terms. This is in order to minimise the impacts of changes in
the methodology to estimate emissions on whether the targets are met. 3 The First
Carbon Budget requires an average reduction in greenhouse gas emissions of 23%
on 1990 levels over the period 2016 to 2020, consistent with the CCC’s 2017 advice
for a path to an 80% reduction in emissions by 2050. 4 In that 2017 advice, we also
recommended that if the Aberthaw coal power station ceased operation in 2019(as turned out to be the case) rather than 2020 or later, the First Carbon Budget
target should be a 24% reduction rather than a 23% reduction.
The advice on the level of the First Carbon Budget was provided well into thebudget period, but without data being available on emissions during the budget
period (2015 was the latest year for which emissions data were available at thetime). The advice was therefore based on analysis of available data relating toemitting activities in Wales in 2016 and 2017 and projections of current trends for2018 to 2020. It was assumed that the scope was small for new policies developed
following the 2017 advice to affect emissions by 2020.
Emissions in Wales have been falling slowly since 1990 (Figure 1.1) and have so far
been in line with the targets set in 2017:

Although there was a large
drop in emissions in 2020 as aresult of the response to the
COVID-19 pandemic, emissions
were already falling faster thanrequired prior to this.

•Reported average emissions over the First Carbon Budget period were 40
MtCO2e, corresponding to a 28% reduction on 1990 levels (Figure 1.1). The
First Carbon Budget has therefore been met. Emissions in 2020 were 34
MtCO2e, a fall of 12% since 2019 and of 39% since 1990. The interim 2020
target for a 27% reduction has therefore also been achieved.

•

The average annual fall in emissions between 2016 and 2019 was 7%, asignificant increase from before the First Carbon Budget period, withemissions falling an average of 0.6% each year between 1990 and 2016.

•

There was a large drop in emissions in 2020 as a result of the response to thepandemic. But even prior to this, in the period 2016 to 2019, emissions werefalling faster than needed to meet the First Carbon Budget – the reductionin emissions in 2017 already surpassed the average reduction required by
the Budget (Figure 1.1). Progress up to 2019 meant that the First Carbon
Budget would have been met as long as emissions were 26% above 2019
levels, rather than the 12% fall seen that was largely associated with the
pandemic. The targets would therefore have been met even if thepandemic had not occurred.

Progress Report: Reducing emissions in Wales

26

Figure 1.1 Welsh greenhouse gas emissions (19902020) and the First Carbon Budget target-10%

GHG emissions (MtCO 2 e)

60

0%
10%

50

20%
40

30%
40%

30

50%
60%

20

70%
80%

10

90%

0
1990

1995

2000

2005

First Carbon Budget target

2010

2015

100%
2020

GHG emissions reduction from 1990 levels

Emissions have fallen slowly
overall since 1990 and Wales
has achieved its First Carbon
Budget.

Historical emissions

Historical CB1 av erage
Source: National Atmospheric Emissions Inventory (2022) Report: Greenhouse Gas Inventories for England, Scotland,
Wales & Northern Ireland: 1990-2020; Welsh Government.
Notes: GHG stands for greenhouse gas. The global warming potential values used are those without carbon
feedback from the IPCC’s Fifth Assessment Report.

(b) Sectoral emissions(i) Emissions changes 1990-2016
The most significant
contribution to the fall in Welsh
emissions between 1990 and2016 was in the industry sector.

The most significant contribution to the absolute fall in Welsh emissions between
1990 and 2016 (the start of the First Carbon Budget) was in the industry sector(Figures 1.2 and 1.3). Industrial emissions decreased 34%, driven by changes inenergy intensity, industrial fuel mix and a structural shift towards a less carbonintensive mix of products, including a fall in Welsh production of crude steel.
There was also a significant reduction in emissions from waste (63%), driven by thelandfill tax and an increase in recycling rates resulting in less waste being sent tolandfill. Power emissions increased by 44% in Wales during this period, driven by anincrease in exports to England and an increase in fossil fuel generation, partly tocompensate for the closure of Wylfa nuclear power station. Wales has adisproportionate share of gas-fired capacity (around 15% of UK gas-fired capacity)
relative to its share of electricity consumption (around 5% of UK electricity
consumption). 5, 6
Both industry and power are sectors with policy largely reserved to the UK
Government whereas policy in waste is mostly devolved to Wales. Emissions
reduction in the UK as a whole was significantly faster between 1990 and 2016,
driven predominantly by a large reduction in UK power emissions. Faster reductions
were also seen in the UK’s emissions from industry and waste (Figure 1.3).

27

Chapter 1: Progress in reducing emissions

(ii) Emissions changes 2016-2020
The power and industry sectors
led Wales’s decarbonisation
over the First Carbon Budget
period.

Over the First Carbon Budget period, both power and industry emissions fellsignificantly, with a transient contribution from transport in 2020 due to thepandemic (Figures 1.2 and 1.4). In the UK as a whole, emissions reductions in power
were less over this period than for Wales. Waste emissions rose slightly in the UK overthis period but decreased by 15% in Wales (Figure 1.4).
Figure 1.5 compares reported emissions with our sectoral pathways over the First(2016-2020), Second (2021-2025) and Third (2026-2030) Carbon Budget periods. The
pathways for the First Carbon Budget period were based largely on existing trends
at the time and were consistent with Wales’s then target to reduce emissions by
80% on 1990 levels by 2050. The pathways over the Second and Third Carbon
Budget periods are based on our updated Balanced Pathway (Box 1.1), originallydeveloped as part of our 2020 Sixth Carbon Budget advice to the UK Government.
The updated pathways are consistent with Wales’s current target to reach Net
Zero by 2050. They therefore go further than is required to reach the Second
Carbon Budget target but are consistent with the Third Carbon Budget.
Over the First Carbon Budget period:•

The power sector performed better than our pathway, largely as the resultof reserved policies, with emissions from both gas-fired and coal-fired
generation lower than we had assumed:– The cessation of electricity generation by the Aberthaw coal power
station in 2019 meant that the station’s substantial contributions toWales’s emissions were eliminated.
– Emissions from Welsh gas-fired power stations were lower thanprojected as load factors were lower than assumed in our 2017
pathway.

•

The industry sector performed better than in our pathway, mainly becauseof a decrease in Welsh production of iron and steel. However, industry
remains the dominant source of emissions in Wales.

•

Progress in the agriculture and land use, land use change and forestry(LULUCF) sectors, which have significant devolved policy powers, has been
insufficient. In the F-gas sector, which is mostly reserved to the UK
Government, the reduction in emissions has been slower than expected.

•

Progress in the waste sector, which has significant devolved policy powers,
stalled during this period, although this pathway was following a significant
reduction in the years prior to the First Carbon Budget.

Progress Report: Reducing emissions in Wales

28

Emissions in Wales fell slowly
between 1990 and 2016 but
sped up between 2016 and2020.

Figure 1.2 Historical emissions by sector in Wales60

GHG emissions (MtCO 2e)

50
40
30
20
10
0
-10

1990

1995

2000

Agriculture Buildings

Transport

2005
W aste2010
F-gas

Industry

2015

2020

Power

LULUCF

Source: CCC analysis.
Notes: The global warming potential values used are those without carbon feedback from the IPCC’s Fifth
Assessment Report.

29

Chapter 1: Progress in reducing emissions

Figure 1.3 Change in Welsh and UK emissions 1990
to 2016a) WalesChange in emissions 1990-2016 (MtCO 2e)

6

43%

4
2
0
-2%

-2
-63%

-4

-10%

-30%

-6
-8

-35%

-10

b) UK
Change in emissions 1990-2016 (MtCO 2e)

Welsh emissions reductions
were driven by industry
between 1990 and 2016, with arise in emissions from power. In
the UK as a whole, reductions
were driven by power andindustry.

40
11%

20
0
-20

-18%

-40

-14%

-66%

-60
-80
-100
-120
-140

-52%

-62%

Source: CCC analysis.
Notes: The global warming potential values used are those without carbon feedback from the IPCC’s Fifth
Assessment Report.

Progress Report: Reducing emissions in Wales

30

Welsh emissions reductions overthe First Carbon Budget (20162020) were driven by power.

Figure 1.4 Change in Welsh and UK emissions
2016 to 2020a) WalesChange in emissions 2016-2020 (MtCO 2e)

2
0%

0
-2

-15%
-10%

-4%

-3%

-1%

-3%

-4
-6
-8
-10
-68%

-12

Change in emissions 2016-2020 (MtCO2 e)(b) UK
5
2%

0

-3%

-5
-10

-10%

-15
-20
-25
-30
-35

-44%

-40

Source: CCC analysis.
Notes: The global warming potential values used are those without carbon feedback from the IPCC’s Fifth
Assessment Report. *Transport emissions are compared from 2016 to 2019 to take out the impact of the COVID-19
pandemic.

31

Chapter 1: Progress in reducing emissions

Figure 1.5 Comparison between CCC pathways and historicalemissions (2010-2030)

Source: Welsh Government; CCC analysis.
Notes: GHG stands for greenhouse gas. The global warming potentials used are those from the IPCC’s Fifth Assessment Report without carbon feedback,except for the CB1 pathway and the dashed lines for agriculture, waste and F-gas, which use those from the IPCC’s Fourth Assessment Report. This isbecause the CB1 pathways were based on these global warming potentials and cannot be converted into those from the IPCC's Fifth Assessment
Report, while the dashed lines are given for the sectors most affected by the change in global warming potentials. We have adjusted our pathways toaccount for updates to the greenhouse gas inventory methodology. We have adjusted our power CB1 pathway to account for the cessation ofelectricity generation by the Aberthaw coal power station in 2019. The y-axis range is different for each row in the chart.

Progress Report: Reducing emissions in Wales

32

Box 1.1
Updates to the Balanced Pathway for Wales
Here we summarise the updates and changes in presentation we have made for thisreport to our Balanced Pathway for Wales, originally developed as part of our 2020 Sixth
Carbon Budget to the UK Government:•

To be consistent with the sector definitions used by the Welsh Government:– Moved Energy from Waste emissions from the waste sector to the electricity supply
sector.
– Combined the manufacturing and construction and fuel supply sectors into asingle industry sector, and combined surface transport, aviation and shipping intoa single transport sector.

•

Converted from the IPCC’s Fifth Assessment Report Global Warming Potential values
with carbon feedback to those without carbon feedback to be consistent withinternational agreements made since 2020.

•

Corrected for the inventory methodology updates since we first published ourBalanced Pathway by rescaling emissions by the difference in 2018 emissions
between the latest inventory and the inventory we used for our original analysis. For
LULUCF, we made this correction with a constant offset in all years of the pathway,
and for all other sectors we scaled the whole pathway by the proportional
difference.

•

Rescaled buildings emissions so that 2020 emissions match historical 2019 emissions in
the 1990-2020 greenhouse gas inventory. This is to account for the impact oftemperature variations on emissions, as the UK-wide buildings emissions in 2019 weresimilar to the temperature-adjusted emissions, so this is a good year to use tobenchmark our pathway.

Source: CCC analysis.

33

Chapter 1: Progress in reducing emissions

2. Welsh Government’s plans to meet future targets
Wales must now accelerateaction to ensure it is on-track tomeet its future carbon budgets
and the Net Zero target.

Wales must now accelerate action to ensure it is on-track to meet its future carbon
budgets and the Net Zero target. The Second (2021-2025) and Third (2026-2030)
Carbon Budgets are set at average reductions in emissions of 37% and 58%
compared to 1990 levels respectively (Figure 1.6).
•

Second Carbon Budget (2021-2025). The 37% reduction target was set on
the path to Wales’s previous target of an 80% reduction by 2050 rather thanNet Zero. In 2020, the Committee recommended the Welsh Government tooutperform the Second Carbon Budget to be on track to reach Net Zero by2050.
– In October 2021, the Welsh Government published its plan for meeting
the Second Carbon Budget. 7 The plan presents sectoral pathways,
which have been determined with its Wales 2050 calculator. * A seriesof targets and milestones for deployment rates in each area of theeconomy are given in the plan, but the Welsh Government have notpublished a transparent quantification of how these add up toachieve the plan’s sectoral emissions pathways (priority
recommendation R2022-199).

The Welsh Government havenot published a transparent
quantification of how theirtargets and milestones add up
to achieve their plan’s sectoral
emissions pathways for theSecond Carbon Budget.

– Wales plans to outperform the Second Carbon Budget and reduce
emissions by an average of 44% against 1990 levels. This is lower than
the 46% percentage reduction in our updated Balanced Pathway(Box 1.1), originally developed as part of our 2020 Sixth Carbon Budget
report (Figure 1.6). † The difference comes from a steeper initial fall inemissions in the updated Balanced Pathway, predominantly caused
by a decrease in power emissions in 2021, due to the assumed closureof the Connah’s Quay gas plant in that year. Since the gas plant has
not yet closed, power emissions are likely to be higher in 2021 and 2022
than projected in the updated Balanced Pathway.

The Welsh Government’s
pathway projects a slight rise inagricultural emissions over theSecond Carbon Budget period(2020 to 2025) but action in this
sector is needed now.

– Where it has been possible to compare, ‡ the split in emissions
reductions between sectors is generally similar between the CCC and
the Welsh Government’s pathways. An exception is the agriculture
sector emissions, which are projected by the Welsh Government toslightly increase over the Second Carbon Budget period (between
2020 and 2025), resulting in an average reduction of 9% compared to1990 levels, to be compared to a 16% reduction in our updated
Balanced Pathway. Emissions reductions in agriculture are importantfor Wales to achieve its longer-term targets and failing to reduce themin line with the updated Balanced Pathway will place greater relianceon sectors with reserved policy powers.

*

As worded in the Second All Wales Low Carbon Delivery Plan (2021-2025): ‘The Wales 2050 calculator is a scenariobased emissions projection model with a 2050 time horizon, covering all emissions sectors. … The model allows theuser to explore different pathways to decarbonisation and generates quantified emission outputs, based on the user
choices made.’†

The Welsh Government reduction is in the IPCC’s Fourth Assessment Report Global Warming Potential values,
whereas the CCC’s reduction is in the Fifth Assessment Report values without carbon feedback. This difference
makes a small contribution to the difference between these values, but most of the difference is due to a differencein the pathway.

‡

Following the Welsh Government’s recent redefinition of their sectors, several of them are difficult to compare
directly with their old definitions or the CCC’s definitions.

Progress Report: Reducing emissions in Wales

34

– In our updated Balanced Pathway, 57% of the required emissions
reduction between 2020 and 2025 comes from the power and industry
sectors, where progress is substantially determined by policies set by
the UK Government. The majority of the remaining abatement before
2025 is in the transport and agriculture sectors. Beyond 2025, Wales’semissions targets become increasingly reliant on sectors like
agriculture, LULUCF, transport and buildings where significant policy
powers lie with Welsh Ministers. These sectors require early policy action
now to ensure they are on track.
Wales must significantly
outperform its Second Carbon
Budget to be on track to meet
future targets.

Figure 1.6 Historical emissions and future targets in
Wales
100%
50

80%
40

70%
60%

30

50%
40%

20

30%
20%

Emissions (MtCO ₂e)

Emissions (% of 1990 levels)

90%

10

10%
0%

0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
First Carbon Budget
Third Carbon Budget
Updated Balanced Pathway
2030 target
W elsh Gov ernment pathway

Second Carbon Budget
Historical emissions
Av erage CB emissions
2040 target

Source: National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales& Northern Ireland: 1990-2020; Climate Change Committee (2020) The Sixth Carbon Budget; CCC analysis; Welsh
Government.
Notes: We have made the following updates to our Balanced Pathway: converting from the IPCC’s Fifth
Assessment Report Global Warming Potential values with feedback to those without, correcting for greenhouse gas
inventory methodology updates up to the 1990-2020 inventory and rescaling buildings emissions so 2020 emissions
match historical 2019 emissions in the 1990-2020 greenhouse gas inventory.

(a) The Net Zero Challenge Group
The Welsh Government and Plaid Cymru commissioned an independent group to
explore potential pathways to achieve Net Zero by 2035, which is well ahead of
the current target date of 2050. The Net Zero Challenge Group started its work in
January 2023 to examine how to increase Welsh Net Zero ambitions, whileconsidering societal and economic impacts, mitigation of adverse effects and faircost and benefit sharing.
Our updated Balanced Pathway (which is highly ambitious) reaches 81% emission
reduction by 2035 on 1990 levels, leaving residual emissions of 11 MtCO2e, of which
3 MtCO2e are from industry, which is a reserved sector. While the Committee
welcomes the ambitious goals of the Net Zero Challenge group, the challenges toachieving their goal to reach Net Zero by 2035 are huge.

35

Chapter 1: Progress in reducing emissions

Endnotes
1 Climate Change Committee (2019) Net Zero – The UK’s contribution to stopping global warming,

https://www.theccc.org.uk/publication/net-zero-the-uks-contribution-to-stopping-globalwarming/.

2 Climate Change Committee (2020) The path to Net Zero and progress on reducing emissions in

Wales, https://www.theccc.org.uk/publication/the-path-to-net-zero-and-progress-reducingemissions-in-wales/.

3 Climate Change Committee (2017) Advice on the design of Welsh carbon targets,

https://www.theccc.org.uk/publication/advice-on-the-design-of-welsh-carbon-targets-2/.

4 Climate Change Committee (2017) Building a low-carbon economy in Wales – Setting Welsh

carbon targets, https://www.theccc.org.uk/publication/building-low-carbon-economy-walessetting-welsh-carbon-targets/.

5 BEIS (2022) Power stations in the United Kingdom,

https://www.gov.uk/government/statistics/electricity-chapter-5-digest-of-united-kingdomenergy-statistics-dukes.

6 BEIS (2022) Subnational total final energy consumption, United Kingdom, 2005 – 2020,

https://www.gov.uk/government/statistics/total-final-energy-consumption-at-regional-andlocal-authority-level-2005-to-2020.

7 Welsh Government (2021) Net Zero Wales Carbon Budget 2 (2021-25),

https://www.gov.wales/sites/default/files/publications/2021-10/net-zero-wales-carbon-budget2-2021-25.pdf.

Progress Report: Reducing emissions in Wales

36

Chapter 2

Progress in sectors with significant
Welsh Government powers
1. Agriculture and land use, land-use change and forestry

41

2. Waste46

3. Surface transport

50

4. Buildings

57

Progress Report: Reducing emissions in Wales

38

Introduction and key messages
Progress towards future decarbonisation in Wales has been too slow. Focus must
be increased now on achieving emissions reductions in sectors with significant
policy powers devolved to the Welsh Government.
In this chapter we track indicators of decarbonisation progress in these sectors anddetermine whether they are on track compared to the Welsh Government
milestones. If Welsh Government milestones are not available, or if ambition is too
low, we track against CCC milestones from our updated Balanced Pathway for
Wales. We also summarise and assess policy progress and outline key next steps.
Our key messages for this chapter are:•

Agriculture and land use. There has been little progress in emissions
reductions in recent years in agriculture and land use, land-use change
and forestry (LULUCF) and Wales is still missing an overarching strategy forthese sectors.
– Rates of tree planting and peatland restoration are far too low. The
Welsh Government should implement the recommendations of theTrees and Timber Deep Dive Panel on actions to overcome the nonfinancial barriers related to woodland creation.
– The Agriculture (Wales) Bill, introduced in 2022, outlines the future
framework of agricultural policy and support. There will be a funding
gap in agri-environment financial support between the current
scheme ending in 2023 and the replacement scheme beginning in
2025.
– Success depends on delivering a just transition. As part of this, livestock
farmers should be able to benefit from new opportunities to diversify
land use, which can provide an additional income stream.
– Cross-departmental work has started to develop a long-term strategy
to promote a shift to a ‘healthier and suitable diet’. 1 Work will aim to
identify opportunities for new policies and/or interventions, which
could lead to improved dietary patterns within Wales.

•

Waste. Wales has a relatively high recycling rate compared to the rest of
the UK, achieved through initiatives such as the ‘Collaborative Change
Programme’ and ‘Be Mighty’ public campaign.
– Like the rest of the UK, Wales is bringing in Extended Producer
Responsibility for packaging and a Deposit Return Scheme, whichshould help improve recycling rates – but further policies are likely tobe needed to meet recycling targets.
– Business Wales’s initiative to provide businesses with dedicatedresource efficiency advice, linked to public-backed loans, is a good
example for the rest of the UK – but more work is needed to improve
waste prevention and resource efficiency.

•

39

Surface Transport. There are promising early signs in uptake of electricvehicles and in policy to reduce vehicle-kilometres.

Chapter 2: Progress in sectors with significant Welsh Government powers

– Electric car sales are on track. However, charging infrastructure is off
track and the number of public chargepoints per capita is lower thanin England and Scotland. The development of a widespread andreliable charging network will need to accelerate now to support thetransition.
– Wales has made positive progress on reduction of road transportdemand and active travel and is aiming to reduce car-kilometrestravelled per person by 10% by 2030 relative to 2019 levels. Several key
decisions have been made in line with this, including cancelling all
major road projects, introducing environmental requirements for futureroad-building, and reducing speed limits. The Welsh Government has
also committed almost four times as much funding per capita toactive travel as the UK Government. The Welsh Government should
build on this progress to develop a full delivery plan for achieving its
demand-reduction target.
•

Buildings. The Welsh Government is supporting delivery of Local Area
Energy Plans across all local authorities in Wales, but currently lacks acomprehensive national plan for decarbonising buildings.
– The Welsh Government has plans to decarbonise public buildings andsocially rented homes. However, it is yet to make long-term plans forthe funding required. Its proposals to require existing social housing toreach an EPC ‘A’ rating are unlikely to be a cost-optimal approach todecarbonising homes.
– A detailed plan for delivering energy efficiency measures and lowcarbon heat should be developed, drawing on Local Area Energy
Plans and including clear deployment targets and investment costs.

In the rest of this Chapter, we discuss progress in the following sectors:
1. Agriculture and land use, land-use change and forestry
2. Waste
3. Surface transport
4. Buildings

Progress Report: Reducing emissions in Wales40

1. Agriculture and land use, land-use change and forestry
Policy towards agriculture and land use, land-use change and forestry policy area
is primarily the responsibility of the Welsh Government.

(a) Indicators of progress
The agriculture and LULUCF
sectors have shown little
progress in reducing emissions
in recent years.

Progress on key indicators for agriculture and land use, land-use change andforestry (LULUCF) in Wales are shown in Figure 2.1.
Emissions from the sector were 5 MtCO2e in 2020, with 5.5 MtCO2e and -0.6
MtCO2e coming from agriculture and LULUCF respectively. Combined emissions forthe two sectors have fallen by 18% since 1990. However, there has been little
progress in reducing emissions in recent years and the ability of the LULUCF sector
to act as a carbon sink has shown a declining trend over the last decade.
Underlying indicators show that emissions may fall off track compared to the
CCC’s pathway at current rates of progress (Figure 2.1a).

Delivery of land-use change
measures such as woodland
creation and peatland
restoration is off trackcompared to what is required.

New woodland. The rate of new woodland creation in Wales has been consistently
very low and is currently less than a third of the Welsh Government’s target of 2,000
hectares per year, which in turn is significantly less ambitious than the CCC’s
pathway (Figure 2.1b).
Peatland restoration. Under the National Peatland Action Programme, annual
restoration of peatland soils has consistently hit around 800 hectares since 2020/21(Figure 2.1c). This is consistent with the Welsh Government’s target, but significantly
off track compared to the CCC’s pathway.
Livestock numbers and diet change.
•

Cattle and sheep numbers fell slightly in 2022 following a larger rise of 5%
the previous year. Numbers are on track compared to the CCC’s pathway(Figure 2.1d).

•

Purchases of beef, lamb and pork in Wales fell in 2021 after an increase in
the previous three years (Figure 2.1e). It is too early to say what the longerterm trend is from the available data (only available from 2018).

Stationary and mobile machinery. GHG emissions due to the use of fossil fuels inagricultural machinery fell by 1% in 2020 compared to the previous year. The rateof decrease will need to accelerate to meet the CCC’s pathway.

41

Chapter 2: Progress in sectors with significant Welsh Government powers

Figure 2.1 Key agriculture and land use, land-use change andforestry indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) Forest Research (2022) Forestry Statistics 2022;c) estimate provided by the National Peatland Action Programme, figures for 2022/23 are provisional estimates;d) Defra (2022) Agriculture in the United Kingdom, sheep and cattle only;e) Meat Promotion Wales (2012-2022) Little Book of Meat Facts;f) DESNZ (2023) Final UK greenhouse gas emissions national statistics: 1990 to 2021 and CCC analysis.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 2.1 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

Progress Report: Reducing emissions in Wales

42

Table 2.1
Policy scorecard for agriculture and land use
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Low-carbon
farming andproductivity

Significant risks (O)Mostlydevolved•

The Agriculture (Wales) Bill, introduced to the Senedd in Autumn 2022, sets out the Welsh
Government’s vision for future agricultural support following the UK leaving the EU Common
Agricultural Policy. The future support framework is based on sustainable land management
objectives.

•

The Sustainable Farming Scheme (SFS) will provide funding for measures that deliver sustainable
and environmental benefits. 2 Farmers must carry out specific ‘universal actions’ if they are to beeligible to receive payments. Universal actions include basic nutrient accounting and soil testing,protection of soils, animal health improvement, restoration of semi-natural peatland and abaseline obligation to have 10% tree cover on-farm.

•

The Agriculture (Wales) Bill gives farm tenants the right to challenge should landlords refuse themaccess to the new SFS, with the aim to remove barriers to tenant farmers participating in thescheme. This change does not apply to farm business tenancies that make up around half of thetenanted sector in Wales.

•

The Welsh Government is offering competitive capital grants during 2023 for horticulture, withboth existing businesses and those wishing to enter this industry eligible for support. The aim is tosupport diversification, improve efficiency and deliver sustainable local food production.

•

Farming Connect, a knowledge-sharing platform, has received a two-year funding commitmentof £23 million to support knowledge transfer to drive sustainability and improved environmental
performance. 3 Themes include on-farm carbon approaches and GHG abatement.

Progress:

To be addressed:•

The current agri-environment scheme, Glastir, is due to finish at the end of 2023 and the SFS is notdue to begin until 2025. The Welsh Government should address this gap to facilitate farmers tomake the transition and maintain incentives for land management actions (priority
recommendation R2023-034).

•

Payment levels under the new SFS are not yet set and the regulatory baseline is still indevelopment. This detail should be released as soon as possible to provide clarity for land
management planning and prevent delay in delivering land-use change (recommendation
R2023-033).

•

Schemes and capital grants available currently include emissions abatement as a delivery
priority amongst many others. Clear targeting and prioritisation of actions is needed if measures
under the SFS will deliver the emissions abatement that is required (priority recommendation
R2022-043).

•

The Welsh Government needs to address constraints of land managers under farm businesstenancies to support their engagement with the new farming subsidy package. This continues tobe a significant barrier to the tenanted sector being able to make the long-term investment
decisions which are required for some low-carbon farming approaches and land-use change.

Risk due to UK Government action: Low.
Demand andconsumption
Mostlydevolved

43

Significant risks (O)Progress:•

Wales has commenced work to develop a long-term strategy to promote a dietary shift to a‘healthier and suitable diet’.1 Work is cross-departmental, across the health and agriculture
sectors, and will aim to identify opportunities for new policies and/or interventions, which could
lead to improved dietary patterns within Wales.
Chapter 2: Progress in sectors with significant Welsh Government powers

•Introduction of a Food Bill into the Welsh Parliament last year by a Senedd member with thestated aim to establish a more sustainable food system in Wales, including healthier diets. The Billis still at an early stage and a consultation on its principles closed at the end of January.

To be addressed:•

The Welsh Government is not currently considering targeted reductions on meat and/or dairy
choices.

Risk due to UK Government action: Low.
Peatlands

Significant risks (O)Mostlydevolved

Progress:•

Peatland restoration ambition in Wales has significantly increased. There is a politicalcommitment to increase the current target of 600–800 hectares of annual peatland restoration
to 1,800 hectares a year by 2030/31. This exceeds the trajectory set in the CCC’s Sixth Carbon
Budget advice.

•

The Welsh Government is working with the UK to implement a ban on the retail sale ofhorticultural peat products. The ban will come into effect from 2024.

•

The National Peatland Action Plan is continuing to develop how restoration is reported, aligningwith the UK GHG Inventory. Collaboration with initiatives in other UK administrations indicates thatsteps towards consistent reporting at a UK level are making good progress.

To be addressed:•

A significant increase in funding and capacity across actions that support peatland restoration
will be needed if Wales is to meet its ambition for peat restoration. This will include addressing
staffing in delivery bodies, skills and contractor availability and landowner engagement tosupport a steady supply of land. Funding commitments are yet to be formalised(recommendation R2023-035).

•

The Welsh Government should increase their peatland restoration ambition to align with orexceed the trajectory set in the CCC Sixth Carbon Budget advice.

Risk due to UK Government action: Low.
Afforestation

Significant risks (O)Mostlydevolved

Progress:•

The Welsh Government’s annual afforestation interim target remains at 2,000 hectares, although
this would need to increase to an annual average of 4,000 hectares if it is to deliver its wider
ambition to create 43,000 hectares of new woodland in the 2020s.

•

In a bid to understand why actual planting rates remain well below this target, a Trees andTimber Deep Dive Panel outlined recommendations on actions to overcome barriers related towoodland creation and models to secure private sector investment in woodland creation. 4
On its recommendation, the Welsh Government issued a guide for farmers and land managers
on woodland carbon credits.

•

Grant funding of £32 million to increase woodland creation has been committed for the period
between 2022/23 and 2024/25 across three main schemes:– The existing Woodland Creation Planning Scheme has boosted grants from £800 to between£1,000 and £5,000 to develop plans for new woodland creation. As part of this, Natural
Resources Wales are engaging with landowners and farmers at the pre-application stage toencourage uptake.
– The new Woodland Creation Grant (WCG) will provide capital grants for planting and ongoing
maintenance for the first 12 years after planting. Sign-posting the dates of funding windows –every three months – should address issues around uncertainty of when to apply, and payment
rates are to be reviewed to determine whether they are attractive.
– Smaller areas of tree planting of under two hectares will also be eligible for funding under the
Small Grants scheme. Land must be either agriculturally improved or of low environmental

Progress Report: Reducing emissions in Wales

44

value to be eligible. As with the WCG, farmers and land managers will still be able to claim
from the Basic Payment Scheme.
•

Opened in April, the Coetiroedd Bach Grant is worth £2.6 million and will provide grants until
March 2025 for the creation of 100 ‘tiny forests’ of native trees, mainly in urban areas.

To be addressed:•

Despite the target and financial support available (previously available under Glastir), planting
rates remain low, with 580 hectares planted in 2021/22. Tree-planting rates need to increase if
Wales is to meet its own target of 2,000 hectares per year, and the higher 4,500 hectares a yearby 2030 under the CCC’s pathway (priority recommendation R2023-054).

•

While the funding pot committed to 2024 is generous, challenges remain in encouraging
landowners and managers to take up the offer. The Welsh Government should continue toconsider and implement the recommendations of the Deep Dive Panel, where it has not alreadydone so. This includes publishing user-friendly guidance for farmers on tree planting, and ensuring
any future advisory service has a prominent role for woodland advice to support sustainable,
productive farm businesses.

•

Welsh Government budgets have not been set beyond 2024/25. There is a risk that applications
for the current round of funding may not be forthcoming, as interested parties wait to see what isbeing offered under the SFS. To avoid a potential hiatus in tree planting, the rates payable under
the SFS should be made public and payment under the Woodland Creation Grant matchedaccordingly. Proposals to attract private sector investment into woodland creation need to be
firmed up as soon as is practicable (recommendation R2023-122).

Risk due to UK Government action: Low.
Agroforestry
and hedgerows
Mostlydevolved

Some risks (Y)Progress:•

Under the Glastir scheme, a small, competitive grant funding round opened a one-monthapplication window in early 2023 – with £3 million in funding allocated for hedgerow creation.

•

Grants for agroforestry have been included under Woodland Creation since August 2022. These
include funding for associated capital items and five years’ maintenance. Funding windows are
expected to open every three months and scheduled to close in September 2023.

•

From 2025 onwards, hedgerows and agroforestry are proposed to be funded in the SFS. This will
require farmers to keep their hedges higher and wider, with additional funding tiers to support
expansion of farm woodland, new hedgerows and improved connectivity between sites.

To be addressed:•

There is currently no clear funding mechanism for hedgerows in Wales during 2024 due to the
Glastir scheme finishing at the end of 2023 – creating a year-long gap before the SFS begins.
The Welsh Government should take steps to support delivery for hedgerows between the two
schemes (recommendation R2023-036).

Risk due to UK Government action: Low.
Energy crops

Insufficient plans (R)Mostlydevolved

Progress:•

There has been no progress on energy crops.

To be addressed:•

There is currently no clear funding mechanism for hedgerows in Wales during 2024 due to the
Glastir scheme finishing at the end of 2023 – creating a year-long gap before the SFS begins. The
Welsh Government should take steps to support delivery for hedgerows between the two
schemes (recommendation R2023-036).

Risk due to UK Government action: Low.

45

Chapter 2: Progress in sectors with significant Welsh Government powers

2. Waste(a) Indicators of progress
Progress on key waste indicators for Wales is shown in Figure 2.2.
Emissions in 2020 were 68%
below 1990 levels meaning
Wales has not met its target ofan 80% reduction by 2020.

Emissions. Progress on reducing emissions from waste largely stalled over the First
Carbon Budget period, prior to the pandemic (Figure 2.2a). Emissions in 2020 thenfell by 11% compared with 2019, potentially due to the reduction in economic
activity - and in particular the reduction in construction (which accounted foraround 50% of waste generated in 2018) – due to the pandemic. 5, 6, 7 Emissions in2020 were 68% below 1990 levels, well below the Welsh Government’s target of an
80% reduction by 2020. Wales is therefore off track to meet its 2030 target of a 92%
reduction. 8
Waste arisings. Total municipal waste increased by 1% in 2021, back to prepandemic levels, following a decrease in 2020. Waste arisings fell by 3% between
2012 and 2021 (Figure 2.2b).

Waste going to incineration has
increase by a factor of six since
2012.

•

The proportion of municipal waste being reused, recycled or composted
has been increasing since 2012, although the rate of increase has slowed inrecent years. It reached 65% in 2020, exceeding Wales’s target of 64%(Figure 2.2c). On a like-for-like basis, Wales’s rate is consistently higher thanthat in England. To meet Wales’s target of 70% by 2025, the improvement inrecycling rates over the next four years will need to be more than twicethat achieved over the last four years.

•

0.08 Mt of municipal waste was landfilled in Wales in 2021, a reduction of
88% since 2012 (Figure 2.2d). The recent rate of reduction will have tocontinue for Wales to be on track to meet its target of zero waste going tolandfill by 2025. 9

Energy from waste. Waste going to incineration * has increased by a factor of six
since 2012, reaching 0.43 Mt in 2021 (Figure 2.2f). This trend must reverse if the
Welsh Government is to achieve its aim to phase out the use of Energy from Waste(EfW) altogether by 2050.

*

This is largely Energy from Waste, but also includes 1% of waste that is incinerated without energy recovery.

Progress Report: Reducing emissions in Wales

46

Figure 2.2 Key waste indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) Statistics Wales Local Authority Municipal Waste Data (2021-22), Annual management of waste by management method;c) Statistics Wales Local Authority Municipal Waste Data (2021-22), Annual management of waste by management method;d) Statistics Wales Local Authority Municipal Waste Data (2021-22), Annual management of waste by management method;e) Natural Resources Wales (2019-20), Register of the Landfill Allowances Scheme (LAS) in Wales, 2004 onwards;f) Statistics Wales Local Authority Municipal Waste Data (2021-22), Annual management of waste by management method.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 2.2 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

47

Chapter 2: Progress in sectors with significant Welsh Government powers

Table 2.2
Policy scorecard for waste
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Solid waste

Some risks (Y)Mostlydevolved

Progress:•

Wales published its Beyond Recycling9 strategy in March 2021. This sets targets to send zero waste
to landfill and achieve a 70% recycling rate by 2025, reduce food waste by a third by 2030 andbecome a ‘zero waste nation’ by 2050. The strategy also set an ambition to establish 80 re-use
and repair hubs in town centres – with around 30 established to date.

•

Wales’s relatively high recycling rate compared to other UK nations has been delivered throughnovel approaches such as its ‘Collaborative Change Programme’, which tasks the Waste andResources Action Programme (WRAP) to support local authorities (LAs) to consider options toseparate recycling collections and provides capital funds to LAs to implement service changes.

•

Improvements to recycling rates and waste prevention have slowed in recent years. To deliver its
future waste and recycling targets, the Welsh Government has been developing forthcoming
Extended Producer Responsibility (EPR) and Deposit Return Scheme (DRS) reforms alongside the
UK and other devolved governments.

•

Non-residential premises will be required to separate recycling and the Welsh Government has
proposed a ban on sending small electrical items and textiles to incineration or landfill, andwood to landfill – subject to consultation.

•

Wales intends to prevent biodegradable waste from going to landfill by 2025 and introduced a
moratorium on new Energy from Waste (EfW) plants over 10 MW capacity in 2021.

•

The Welsh Government’s Business Wales service is providing advice to businesses on potential
resource efficiency measures alongside opportunities to access finance for these measuresthrough the Development Bank for Wales. 10

To be addressed:•

The Government should continue to engage closely with LAs and businesses around theincoming EPR and DRS reforms, to address concerns about the schemes.

•

Recycling rates have shown limited improvement in recent years so stronger policies are neededto drive recycling rates up to meet the 2025 and future targets (priority recommendation R2022327, recommendation R2022-328).

•

More action on capturing methane emissions from landfill is needed in addition to working with
Natural Resources Wales to better measure these emissions (priority recommendation R2023004).

•

EfW policy should be considered as part of the waste sector to effectively address the drivers ofthese emissions. This requires separate reporting of EfW emissions.

•

A detailed plan setting out how policies will deliver emissions reduction in the waste sector
through to 2050 is needed (priority recommendation R2023-005).

Risks due to UK Government action: Medium.
•

The joint delivery of the EPR and DRS depends on collaboration between the UK and devolved
governments, and could be held up by one party, particularly the UK Government.

•

The UK Government is developing a business model for supporting first-of-a-kind Carbon capture,utilisation and storage (CCUS) technology at industrial clusters, including the HyNet cluster inNorth Wales. EfW sites will be eligible for support under the scheme and a draft set of terms has
been published. Rollout of the technology in Wales will depend on the Industrial carbon captureand storage (CCS) business model proving viability in the late 2020s.

Progress Report: Reducing emissions in Wales48

Wastewater

Insufficient plans (R)Partially
devolved

To be addressed:•

49

Very little detail has been provided by the Welsh Government on how it intends to enable andencourage water companies and industrial users to reduce emissions from wastewater. This is apolicy gap.

Chapter 2: Progress in sectors with significant Welsh Government powers

3. Surface transport
The surface transport, aviation and shipping sectors are treated separately in thischapter and in Chapter 3 to provide a clearer distinction of the different policies
taking place and the decarbonisation rates. In Chapter 1, they were combined
into an overall transport sector to align with the sector definitions used by the Welsh
Government in its Low Carbon Delivery Plan, which outlines how Wales intended tomeet its First Carbon Budget.
Policy powers to decarbonise
surface transport are shared,
with Welsh Government having
particular responsibility forplanning and delivering local
transport systems.

Policy powers to decarbonise surface transport are shared between the Welsh and
UK Governments. Planning and delivery of local transport systems, including active
travel, public transport, and electric vehicle charging, are largely the responsibilityof a partnership between the Welsh Government and local authorities. The key
areas that are either reserved or dependent on UK-wide policy development
include regulation of new vehicles sales and some parts of the rail system.

(a) Indicators of progress
Progress against key indicators for surface transport decarbonisation in Wales isshown in Figure 2.3.
Surface transport emissions fellin 2020, due to travel restrictions
during the pandemic.

Emissions were 4.5 MtCO2e in 2020, a 22% decrease compared to 2019 levels due
to travel restrictions during the pandemic. There was a flat trend in emissions prior
to this, with improvements in conventional vehicle efficiencies being balanced by
growing road traffic and an increasing trend in the size of vehicles. It is too early to
say whether surface transport emission reductions in Wales are on track comparedto the CCC’s pathway, as it depends on how the sector rebounds from thepandemic (Figure 2.3a).

Electric car sales in Wales areon track but remain slightly
lower than the UK average.

Uptake of zero-emission vehicles is continuing to accelerate in Wales.

Public chargepoint provision isslightly off track anddeployment needs to scale up
urgently to support the EV
transition.

•

Data from New Automotive * indicates that 13.8% of new car sales in Wales
were battery-electric in 2022, which is on track compared to the CCC’s
pathway (Figure 2.3b). This is slightly below the 16.6% seen in the UK in 2022.

•

Sales of battery-electric vans are significantly off track compared to the
CCC’s pathway (Figure 2.3c). In 2021, only 1.8% of van sales were batteryelectric vehicles, which is a factor of four lower than the CCC pathway of
8%.

Electric vehicle charging infrastructure. The number of public chargepoints
increased to 1,465 in 2022, which is slightly off track compared to the CCC’s
pathway (Figure 2.3d). There were only 283 rapid public chargepoints in 2022,
which is significantly off track compared to the CCC’s pathway (Figure 2.3e).
Installations will need to accelerate fast to support the transition to electric vehicles(EVs) over the next decade and beyond.

*

We have used data from New Automotive on the level of electric car sales in Wales because it has been suggested
that the published Department for Transport (DfT) vehicle licensing statistics (which we had used previously) may beunderreporting the uptake of EVs in the devolved administrations – due to numerous leasing companies registering
vehicles at their head office locations in England rather than where the vehicle is being used. New Automotive does
not currently publish equivalent regional breakdowns for van sales, so we are still using the DfT data for vans.

Progress Report: Reducing emissions in Wales

50

Car demand fell steeply during
the pandemic. However, itbegan to rebound during 2021
and pre-pandemic trends wereincreasing.

Van traffic has increased morethan any other mode since
2000. Policy is needed toaddress this to reduce emissions
and improve urban air quality
and congestion.

51•

Wales is currently behind both England and Scotland in terms of publicchargepoints per head of population, although some progress was madein closing this gap during 2022. It should be noted that there may be aslightly lower need for on-street charging in Wales, given that recent
research found that the proportion of Welsh households with the potential
to install a home charger is around ten percentage points higher than the
UK average. 11•

An immediate and significant acceleration in deployment is needed if the
Welsh Government is to meet its target of having one public chargepoint
for every 7-11 EVs by 2025. Current provision is around one for every 15 EVs.
The longer-term target for this to fall to one for every 25 EVs is more
ambitious than the UK Government’s minimum target of a total of 300,000
public chargepoints by 2030, which translates to around one for every 30
EVs.

Road transport demand. Vehicle-kilometres increased in 2021 as travel restrictions
were lifted following the pandemic. Prior to the pandemic they were steadily rising.
•

Car-kilometres in 2021 were still 17% below pre-pandemic levels but are
expected to have increased further in 2022, and it is too early to say
whether this is on track compared to the CCC’s pathway (Figure 2.3f).

•

Both van and Heavy Goods Vehicle (HGV) kilometres had alreadyrecovered to pre-pandemic levels by 2021, with van-kilometres beingslightly off track compared to the CCC’s pathway (Figures 2.3g and 2.3h).
More needs to be done to address this rise in van traffic.

Chapter 2: Progress in sectors with significant Welsh Government powers

Figure 2.3 Key surface transport indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) New Automotive (2023) Electric car count;c) DfT (2022) Vehicle licensing statistics;d-e) DfT (2023) Electric vehicle charging device statistics;f-h) DfT (2022) Road traffic statistics.
Notes: We have data from New Automotive on the level of electric car sales in Wales because it has been suggested that the published DfT vehicle
licensing statistics (which we had used previously) may be underreporting the uptake of EVs in the devolved administrations due to numerous leasing
companies registering vehicles at their head office locations in England rather than where the vehicle is being used. New Automotive does not currently
publish equivalent regional breakdowns for van sales, so we are still using the DfT data for vans.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 2.3 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

Progress Report: Reducing emissions in Wales

52

Table 2.3
Policy scorecard for surface transport
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Cars and vans– zero-emission
vehiclesMostly reserved
Progress:•

The Zero-Emission Vehicle (ZEV) mandate, due to be introduced from 2024, will be the key policy
mechanism to drive further uptake of electric cars and vans in the UK. It is positive that the Welsh
Government has been involved in the development of the final consultation on this important
policy. 12•

The Welsh Government has published an EV charging strategy and supporting action plan,
which aim to deliver a high-quality, reliable and widely available charging network acrossWales. 13, 14 These documents are a good example of how to identify what needs to be done,
when and by whom.

•

Engagement with the private sector has been identified as a key area that needs to accelerate.
The Welsh Government is working closely with local authorities to support on this, including by
mapping out their vision of what charging infrastructure is expected to be needed where to
guide discussions between local authorities and the private sector and by offering assistancewith key enablers, such as planning.

•

Funding for local chargepoint installations in Wales is available through the UK Government’s OnStreet Residential Chargepoint Scheme (ORCS) – but not the Local Electric Vehicle Infrastructure(LEVI) fund. In addition to this, the Welsh Government’s 2021 Infrastructure Finance Plan
committed £42 million for addressing challenges and opportunities within EV adoption, including
rural charging, on-street residential charging and zero-emission taxis. 15

To be addressed:•

There is currently uncertainty over the reliability of published statistics covering EV registrations in
Wales. The Welsh Government should work with the UK Department for Transport (DfT) to ensurethat these statistics present an accurate picture of uptake (recommendation R2023-017).

•

It will be important for Welsh Government to ensure proactive identification of opportunities forfurther policies and incentives that could drive adoption forward beyond the ZEV mandate anddeliver benefits for Welsh people (priority recommendation R2023-018).

•

The charging strategy aims to provide one public chargepoint for every 7-11 EVs on the road.
Present provision is slightly below this ambition (estimated to be around one for every 8-15 EVs),
so infrastructure deployment will need to grow faster than EV adoption to meet this goal(recommendation R2023-019).

Risks due to UK Government action: Medium.

53•

Regulation of the new-vehicle market from 2024 onwards will be driven by the new ZEV
mandate, which as currently proposed is a UK-wide scheme. Wales is therefore dependent on
the efficacy of these regulations and the establishment of a robust UK-wide market for EVs. The
recent acceleration in sales, coupled with the credibility of these policy proposals, gives
confidence that this will occur. The four-nations approach taken for the latest ZEV mandate
consultation suggests an improvement in engagement between the UK and devolved
governments.

•

However, the Welsh Government’s ambition for EV uptake aligns with our Balanced Pathway,
which is more ambitious than the targets proposed in the ZEV mandate. This poses a risk todelivery if further policy and market development do not drive adoption to scale up more
quickly than the minimum requirements imposed by the mandate.

Chapter 2: Progress in sectors with significant Welsh Government powers

Heavy-duty
vehicles – zeroemission
vehiclesMostly reserved
Progress:•

Wales has signed up to a global memorandum of understanding on zero-emission medium- andheavy-duty vehicles, which commits to working together to enable 100% zero-emission new truck
and bus sales by 2040. 16•

The Welsh Government is supporting Welsh businesses to apply for funding as part of the UK
Government’s Zero-Emission Road Freight Trials. The projects selected for this funding have notyet been announced.

To be addressed:•

The Welsh Government should be involved in the UK Government’s next steps on heavy-duty
vehicles – including consulting on sales regulations and considering what enabling infrastructureand support might be required.

Risks due to UK Government action: Medium.
•

Conventional
vehicleefficiency

Decarbonisation of the fleet will depend on UK-wide markets, which are expected to expand
through ongoing UK zero-emission HGV demonstration projects and as a result of UK
Government phase-out dates.

Mostly reserved
Risks due to UK Government action: High.
•

Regulation of the new vehicle market is proposed to be carried out at a UK-wide level andcurrent proposals do not aim to reduce emissions intensities from this portion of the market, but
merely to ensure they do not get worse.12 This is unlikely to deliver the emissions savings required
from the conventional vehicles that continue to be sold out to 2030.

•

The Welsh Government should push for greater ambition, ensuring that manufacturers are
incentivised to reduce the size of vehicles sold.

Rail – efficiency
andtechnology

Some risks (Y)Joint
responsibility•

Construction work is underway to electrify 170 km of track across the Core Valleys Lines. This isfunded through a combination of remaining EU grants, UK Government funding and Welsh
Government investment.

•

Transport for Wales is investing £800 million in new rolling stock for the South Wales Metro and
Borderlands rail services, which will be both faster and lower-carbon. This includes fivediesel/battery hybrid trains.

Progress:

To be addressed:•

A comprehensive plan for decarbonising Britain’s railways is needed, including establishment ofa rolling programme of track electrification. The Welsh Government should be involved in thedevelopment of this.

Risks due to UK Government action: Medium.
•

Passenger
travel –reducing car
demandMostlydevolved

There remain uncertainties around the interdependencies between Wales and the UK throughNetwork Rail and the new Great British Railways. Welsh Government officials are represented on
Network Rail’s Traction Decarbonisation Strategic Implementation Board.

Some risks (Y)Progress:•

Wales is more ambitious than the UK Government on reducing car demand, with the 2021 Net
Zero Wales plan setting an aim of reducing car miles travelled per person by 10% by 2030 relative
to 2019 levels.1

Progress Report: Reducing emissions in Wales54

•To help deliver demand-side emissions reductions, Wales has taken two significant and laudable
decisions concerning its road network in recent years:– Changing the default speed limit on most residential and built-up roads from 30mph to 20mph(due to be introduced in September 2023). This aims to improve road safety and make walking
and cycling in local communities more attractive.
– Cancelling all major road-building projects (announced in February 2023). The Welsh
Government accepted the recommendations from an independent panel to cancel
construction of 44 out of 59 road projects reviewed on environmental grounds and to
introduce stringent tests that will only permit new road projects if they will meaningfully
contribute to modal shift, reducing emissions and adapting to the impacts of climatechange. 17•

The Welsh Government has also published a Remote Working Strategy, setting out a vision for
how to meet its goal of 30% of the workforce to work remotely on a regular basis and aframework of indicators to monitor progress. 18 These include a variety of travel demand metrics.

To be addressed:•

A full delivery plan is now needed for how to realise the ambition of reducing per-person car
demand by 10% by 2030. This should include consideration of how measures that restrict car
usage will interact with those that enable more sustainable modes (priority recommendation
R2023-020).

Risks due to UK Government action: Medium.
•

Passenger
travel – modal
shift to active
travelMostlydevolved

Demand policy is largely devolved. However, measures with taxation implications, such as
national road-pricing schemes, would need to be co-developed with the UK Treasury which is
not currently focusing on these issues. There also remains a risk that the lower ambition andreluctance to consider demand-side measures in the wider UK could hinder public acceptanceof Wales’s demand-reduction plans.

Credible plans (G)Progress:•

The Welsh Government’s 2021 Infrastructure Finance Plan committed £220 million over 2022/23 –2024/25 through the Active Travel Fund.13, 19 It is positive that this includes a mixture of corefunding for every local authority and grants for specific projects. On a per-capita basis, this isalmost four times as much funding as that committed by the UK Government to Active Travel
England. *•Welsh local authorities are required to produce maps of both existing and future active travel
routes, to help inform investment decisions. All local authorities except one have now produced
the required maps and received approval from the Welsh Government.

To be addressed:•

Current active travel funding runs to 2024/25. Local authorities will require certainty on funding
beyond this point in order to progress plans for more ambitious schemes. Therefore, the Welsh
Government should provide clarity on future funding arrangements, ideally providing certainty
for a number of years, (recommendation R2023-021).

Risks due to UK Government action: Low.
•

Passenger
travel – modal
shift to public
transport
Joint
responsibility

Most active travel policy is devolved, although powers to approve the use of new types ofvehicles (e.g. e-scooters) are reserved.

Some risks (Y)Progress:•£107 million of sustainable transport funding has been allocated to the Local Transport Fund withresponsibility for prioritising its use devolved to regional transport planning bodies. 20 This is in*

55

This comparison refers to the funding committed to Active Travel England at Spending Review 2021, before this was
subsequently cut in March 2023. Following this cut, the per-capita comparison increases to eight times as much.

Chapter 2: Progress in sectors with significant Welsh Government powers

addition to £770 million of funding for the public transport system, for which delivering emissions
reductions and modal shift has been made a priority.
•

Transport for Wales is leading development of the South Wales Metro, an integrated network ofrail, bus and active travel that will make sustainable travel more appealing and less complex.

To be addressed:•

Wales should build on the success of the £2 bus fare cap in England to introduce measures tomake public transport fares more affordable, joined-up and straightforward (recommendation
R2023-022).

Risks due to UK Government action: Medium.
•

Freight –demandreduction andmodal shift
Joint
responsibility

While bus policy is mostly devolved, planning and funding of rail infrastructure remain mostly
reserved. Future interactions through the new Great British Railways are uncertain.

Significant risks (O)Progress:•

Sustrans is running two e-cargo bike trial schemes in Swansea and Aberystwyth, which offer
businesses free loans of e-cargo bikes to test how well they could work for them.

To be addressed:•

The Welsh Government is currently developing a National Freight and Logistics Plan. This should
cover opportunities to reduce road freight travel demand, including consolidation and modal
shift, and should be published by 2024 (recommendation R2023-023).

Risks due to UK Government action: Medium.
•

Cross-border freight and UK-wide haulage companies will be influenced by policies imposed byboth the Welsh and UK Governments.

Progress Report: Reducing emissions in Wales56

4. Buildings
The Welsh Government makes policy for social housing, public buildings, educationand skills, and building regulations. It does not have control over energy efficiency
standards for existing buildings (such as EPC requirements and regulation of private
landlords), products policies, or regulating the financial sector. However, the Welsh
Government is able to provide loans and grants for improvements to buildings(such as investing in energy efficiency measures and low-carbon heating).

(a) Indicators of progress
Emissions have changed little over much of the last decade and were 4.4 MtCO2e
in 2020 (Figure 2.4a). Emissions come predominantly from residential buildings (3.6
MtCO2e) with smaller contributions from commercial (0.5 MtCO2e) and public (0.3
MtCO2e) buildings (Figure 2.5).
•

Emissions increased by 2% in 2020 compared to 2019 levels, driven byincreased emissions from residential buildings, probably caused by anincrease in working from home during the pandemic. Emissions are
therefore slightly off track compared to the CCC’s pathway.

Energy demand.
•Gas demand in residential buildings has remained broadly similar over thelast decade. In 2020, temperature-adjusted gas demand in residentialbuildings in Wales was 14.9 TWh, almost the same as in 2011 (Figure 2.4b).

•

Electricity demand in residential buildings fell by around 9% over the
decade from 2009 to 2019. However, in 2020 consumption rose 5%, to 5.1
TWh, driven by increased occupation of homes in the COVID-19 pandemic.

Data gaps. There is currently no data to track energy efficiency treatments or heatpump installations. Data collection should be improved in these areas.

57

Chapter 2: Progress in sectors with significant Welsh Government powers

Figure 2.4 Key building indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) BEIS (2022) Subnational total final energy consumption statistics: 2005 to 2020;c) BEIS (2022) Subnational total final energy consumption statistics: 2005 to 2020.

Progress Report: Reducing emissions in Wales

58

Figure 2.5 Buildings emissions by building type7

GHG emissions (MtCO 2e)

6
5
4
3
2
1
0
1990

1995

Residential buildings

2000

2005

2010

Commercial buildings

2015

2020

Public buildings

Source: Welsh Government.
Notes: GHG stands for greenhouse gas. The global warming potential values used are those without carbon
feedback from the IPCC’s Fifth Assessment Report.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 2.4 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.
Table 2.4
Policy scorecard for buildings
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Buildings(Overall)Significant risks (O)Joint
responsibility

59

Progress:
The Welsh Government is:•

Supporting the delivery of Local Area Energy Plans across all local authorities in Wales. These are
due to be completed by April 2024.1•

Delivering schemes to decarbonise socially rented homes by retrofitting energy efficiency
measures and low-carbon heat.

•

Planning to decarbonise public buildings.

Chapter 2: Progress in sectors with significant Welsh Government powers

To be addressed:•

The Welsh Government needs a credible, detailed plan for decarbonising all buildings, drawing
on the details in Local Area Energy Plans (priority recommendation R2023-039). This should
include deployment targets and investment costs for delivering energy efficiency measures andlow-carbon heat. This would support planning of investment and monitoring progress, and clarify
requirements for action by the Welsh and UK governments.

Risks due to UK Government action: High.
•

Owneroccupied andprivate-rented
homes (nonfuel-poor)

Most of the powers required to deliver decarbonisation of buildings are reserved to the UK
Government, limiting the levers available to the Welsh Government to deliver on its targets. Thereare currently significant risks in UK Government policies across the joint responsibility sub-sectors,
including energy efficiency and low-carbon heat in non-fuel-poor homes.

Mostly reserved
Progress:•

The Welsh Government has commenced its Optimised Retrofit Programme. 21 This targets sociallyrented homes but enables the trial and refinement of digital tools to support a wider
decarbonisation programme.

To be addressed: The Welsh Government:•

Needs a credible strategy for decarbonising existing owner-occupied and private-rented
homes, and a clear understanding of the scale of this challenge (priority recommendation
R2023-039). It is largely reliant on UK Government policies but would benefit from a plan settingout the scale of the challenge and preferred solutions, to identify areas it can influence andrequirements for investment, and clarify its expectations of the UK Government.

•

Could develop more ambitious plans for enabling delivery of low-carbon heating and energy
efficiency in those areas where it has powers, such as skills and investment.

Risks due to UK Government action: High.
•Powers required for policies to decarbonise existing owner-occupied and private-rented homes
are largely reserved. Many policies which will be critical to decarbonising buildings are still being
developed by the UK Government, including: the market-based mechanism for low-carbon
heat; updated minimum energy efficiency standards for private rented homes; phase-out dates
for fossil fuel boilers; financial incentives to support widespread building retrofits; andimprovements to EPCs and EPC assessments.

Social housing

Significant risks (O)Mostlydevolved

Progress: The Welsh Government has:•Commenced its Optimised Retrofit Programme, involving works to around 1,700 socially rented
homes, and enabling the trial and refinement of digital tools to support the wider
decarbonisation of homes.21•

Consulted on updating the Welsh Housing Quality Standard, including a requirement for
retrofitting all social housing to achieve an EPC ‘A’ rating. 22

To be addressed:•

Retrofitting houses to achieve an EPC ‘A’ rating is costly and unlikely to be a cost-optimal
approach to decarbonising homes (considering the overall investment and operational costs
and savings). The Welsh Government should carefully consider whether requiring EPC ‘A’ ratings
is a sensible approach to decarbonising the social housing stock – as opposed to delivering amore moderate improvement in energy efficiency and decarbonising through use of heatpumps – before finalising the Welsh Housing Quality Standard (priority recommendation R2023040).

•

The Welsh Government needs to fully assess the level of investment required to decarbonisesocial housing and make long-term plans for delivering the funding required (priority
recommendation R2023-040).

Risks due to UK Government action: Low.
Progress Report: Reducing emissions in Wales

60

Fuel-poor
homes
Mostlydevolved

Progress:•

The Welsh Government’s fuel poverty strategy identifies reducing carbon emissions from homes
as a goal. 23•

The Welsh Government’s Warm Homes Programme supports retrofitting of energy efficiency andlow-carbon heating in lower income households in owner-occupier and private-rented sectors.
The Welsh Government has consulted on the next phase of the programme and is considering
widening eligibility for support. 24

To be addressed:•

The Welsh Government needs to fully assess the level of investment required in fuel-poor homes
and make long-term plans for delivering the funding required (recommendations R2022-111 andR2023-112).

Risks due to UK Government action: Low.
New homes

Some risks (Y)Mostlydevolved

Progress:•

The Welsh Government has implemented an update to Part L of the Building Regulations,requiring a reduction in carbon emissions from new homes. The standards will not completely
prevent developers from installing fossil-fuel boilers, and it is unclear whether they will sufficiently
incentivise uptake of low-carbon heating.

To be addressed:•

Plans are being developed for a revision of Part L in 2025 – the Welsh Government should takethis opportunity to ensure that all new homes incorporate zero-emissions heating and ultra-highlevels of fabric efficiency (recommendation R2023-043).

•

Energy standards could be improved by using absolute targets for energy use rather thancomparison against notional buildings.

•

Improvements to building standards enforcement are needed, including expanding the use of
performance testing, to ensure that the actual performance of new buildings aligns withexpectations and to hold contractors to account for quality and performance.

Risks due to UK Government action: Low.
Heat networks

Significant risks (O)Joint
responsibility

Progress:•

The Welsh Government is supporting the delivery of Local Area Energy Plans across all local
authorities in Wales. These should identify areas where heat networks are to be prioritised.1•

The Welsh Government Energy Service provides support for delivering low-carbon heat in the
public sector, including using heat networks. 25

To be addressed:•

The Welsh Government opted out of participating in the Green Heat Network fund. Thispotentially leaves a lack of support for investment in larger heat network schemes. The Welsh
Government should ensure that plans are put in place to support delivery of heat networks
where a need for these is identified in Local Area Energy Plans.

Risks due to UK Government action: Medium.
Commercial
buildings
Joint
responsibility

61

Some risks (Y)Progress:•

The Welsh Government has implemented an update to Part L of the Building Regulations,requiring a reduction in carbon emissions from new buildings. The standards will not completely
prevent developers from installing fossil-fuel boilers and it is unclear whether they will sufficiently
incentivise uptake of low-carbon heating.

Chapter 2: Progress in sectors with significant Welsh Government powers

•

From April 2023, UK Government regulations will require all privately rented non-domestic
buildings to achieve a minimum EPC ‘E’ rating.

To be addressed:•

Plans are being developed for a revision of Part L in 2025 – the Welsh Government should takethis opportunity to ensure that new buildings incorporate zero-emissions heating and ultra-highlevels of fabric efficiency (recommendation R2023-043).

•

Energy standards could be improved by using absolute targets for energy use rather thancomparison against notional buildings.

•

Improvements to building standards enforcement are needed, including expanding the use of
performance testing, to ensure that the actual performance of new buildings aligns withexpectations and to hold contractors to account for quality and performance.

Risks due to UK Government action: High.
•Powers required for policies to decarbonise commercial buildings are largely reserved. Many
policies which will be critical to decarbonising non-residential buildings are still being developedby the UK Government.

Public buildings

Significant risks (O)Mostlydevolved

Progress:•

The Welsh Government’s Net Zero Strategic Plan includes a plan to decarbonise theGovernment’s administrative estate by 2030. 26•

The Welsh Government Energy Service provides technical advice and grants to public sector
organisations and community enterprises for reducing emissions, including through energy
efficiency and low-carbon heating measures.25 Plans are in place to continue the service to
2027.

•

The Wales Funding Programme provides interest-free loans to public sector organisations to
support energy efficiency projects.

To be addressed:•

The Welsh Government has set out a route map for decarbonising all public sector buildings by2030. 27 However, this does not identify the detailed actions required, or funding requirements
and sources (priority recommendation R2023-041).

•

The current Energy Service grant scheme is due to end in June. The Welsh Government needs tomake plans to ensure adequate funding continues to be available to support public sector
decarbonisation.

Risks due to UK Government action: Medium.
•

Emissions from some public buildings, such as prisons and departmental offices, are under thecontrol of the UK Government. Decarbonisation of these buildings relies on plans by the UK
Government, but their emissions contribute to the emissions apportioned to Wales.

Enabling policy

Significant risks (O)Joint
responsibility

Progress:•

The Welsh Government is supporting the delivery of Local Area Energy Plans across all local
authorities in Wales. These are due to be completed by April 2024.1

To be addressed: The Welsh Government:•

Has published a Net Zero Wales Skills Action Plan, but has not yet quantified the skills andworkforce requirements, or developed policies for skills delivery (recommendation R2023-045). 28•

Needs to develop long-term solutions for financing low-carbon heat and energy efficiency, using
its devolved powers where possible, and working with the UK Government on solutions which areoutside its powers (priority recommendation R2023-039).

•

Should improve public engagement on Net Zero and raise awareness of the changes required
to decarbonise buildings (recommendation R2023-044).
Progress Report: Reducing emissions in Wales62

•

Should review planning policies, including details of permitted development rights, which may
currently restrict installations of low-carbon heating and energy efficiency measures(recommendation R2023-042).

Risks due to UK Government action: Medium.

63•

Public funds available for investment in decarbonising buildings are constrained by spending
decisions made by the UK Government.

•

Regulation of the finance sector is under the control of the UK Government. Incentivising private
investment in decarbonisation through regulation of the finance sector is reliant on UK
Government policy decisions.

Chapter 2: Progress in sectors with significant Welsh Government powers

Endnotes
1 Welsh Government (2021) Net Zero Wales Carbon Budget 2 (2021 – 25),https://www.gov.wales/sites/default/files/publications/2021-10/net-zero-wales-carbon-budget2-2021-25.pdf.

2 Welsh Government (2023) Sustainable Farming Scheme, https://www.gov.wales/sustainable-

farming-scheme-guide.

3 Welsh Government (2023) Farming Connect,

https://businesswales.gov.wales/farmingconnect/business.

4 Welsh Government (2021-23) Trees and Timber deep dive, https://www.gov.wales/trees-and-timber-deep-dive.

5 ONS (2021) Gross Domestic Product: Year on Year Growth: CVM SA %,https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyp/pn2.

6 ONS (2021) Construction statistics Great Britain: 2020,

https://www.ons.gov.uk/businessindustryandtrade/constructionindustry/articles/constructionstati
stics/2020.

7 Welsh Government (2022) Carbon Budget 1 (CB1): Final Statement of Progress: supporting

dataset – performance indicators, https://www.gov.wales/carbon-budget-1-cb1-finalstatement-progress-supporting-dataset-performance-indicators.

8 Welsh Government (2019) Waste management: Sector Emission Pathway,

https://www.gov.wales/sites/default/files/publications/2019-06/waste-sector-emission-pathwayfactsheet-plan.pdf.

9 Welsh Government (2021) Beyond Recycling,https://www.gov.wales/sites/default/files/publications/2021-03/beyond-recycling-strategydocument.pdf.

10 Welsh Government (2023) Helping businesses cut energy costs: Welsh Government andDevelopment Bank launch new Green Business Loan Scheme, https://www.gov.wales/helpingbusinesses-cut-energy-costs-welsh-government-and-development-bank-launch-new-greenbusiness.

11 RAC Foundation analysis of Field Dynamics data (2021) Standing still,https://www.racfoundation.org/wp-content/uploads/standing-still-Nagler-June-2021.pdf.

12 Department for Transport (2023) A zero emission vehicle (ZEV) mandate and CO2 emissions

regulation for new cars and vans in the UK, https://www.gov.uk/government/consultations/azero-emission-vehicle-zev-mandate-and-co2-emissions-regulation-for-new-cars-and-vans-in-theuk.

13 Welsh Government (2021) Electric vehicle charging strategy for Wales,

https://www.gov.wales/electric-vehicle-charging-strategy-wales.

14 Welsh Government (2021) Electric vehicle charging strategy for Wales: action plan,

https://www.gov.wales/electric-vehicle-charging-strategy-wales-action-plan.

15 Welsh Government (2021) Infrastructure finance plan 2021,

https://www.gov.wales/infrastructure-finance-plan-2021.

16 CALSTART and the Clean Energy Ministerial (2022) Global commercial vehicle drive to zero,

https://globaldrivetozero.org/.

Progress Report: Reducing emissions in Wales64

17 Roads Review Panel (2023) The future of road investment in Wales,

https://www.gov.wales/roads-review.

18 Welsh Government (2022) Smarter working: a remote working strategy for Wales,

https://www.gov.wales/smarter-working-remote-working-strategy-wales-html.

19 Welsh Government (2022) Active Travel Fund: guidance for applicants 2023 to 2024,

https://www.gov.wales/active-travel-fund-guidance-applicants-2023-2024-html.

20 Welsh Government (2022) Local transport fund, resilient roads fund and ultra low emission

vehicle transformation fund: guidance 2023 to 2024, https://www.gov.wales/local-transportfund-resilient-roads-fund-and-ultra-low-emission-vehicle-transformation-fund-1.

21 Sero Technologies (2023) Optimised Retrofit, https://www.optimised-retrofit.wales/.
22 Welsh Government (2022) Welsh Housing Quality Standard 2023: Draft for consultation.

https://www.gov.wales/sites/default/files/consultations/2022-05/draft-whqs_3.pdf.

23 Welsh Government (2021) Tackling fuel poverty 2021 to 2035. https://www.gov.wales/tackling-fuel-poverty-2021-2035-html.

24 Welsh Government (2021) Improving home energy efficiency to support a just transition andgreener Wales: Proposals for the next iteration of the Warm Homes Programme,
https://www.gov.wales/sites/default/files/consultations/2021-12/warm-homes-consultationdocument.pdf.

25 The Carbon Trust (2023), Welsh Government Energy Service, https://www.carbontrust.com/our-work-and-impact/impact-stories/welsh-government-energy-service.

26 Welsh Government (2022) Welsh Government’s Net Zero Strategic Plan,

https://www.gov.wales/sites/default/files/publications/2022-12/welsh-government-net-zerostrategic-plan.pdf.

27 Welsh Government (2021) Net zero carbon status by 2030 - a route map for decarbonisation

across the Welsh public sector, https://www.gov.wales/sites/default/files/publications/202107/a-route-map-for-decarbonisation-across-the-welsh-public-sector.pdf.

28 Welsh Government (2023) Stronger, Fairer, Greener Wales: Net Zero Skills Action Plan,

https://www.gov.wales/sites/default/files/publications/2023-02/net-zero-skills-action-plan.pdf.

65

Chapter 2: Progress in sectors with significant Welsh Government powers

Chapter 3

Progress in largely-reserved policyareas
1. Electricity supply

70

2. Industry

73

3. Fuel supply

77

4. Aviation

80

5. Shipping83

6. F-gases

86

7. Engineered removals

89

67

Chapter 3: Progress in largely-reserved policy areas

Introduction and key messages
The Welsh Government has influence over the progress of decarbonisation in every
sector. However, emissions reduction in Wales relies on significant progress insectors with policies largely reserved to the UK Government. Most notably industry,
which is Wales’s highest-emitting sector.
In this chapter we track indicators of decarbonisation progress in these sectors anddetermine whether they are on track compared to the Welsh Government’s
milestones. If Welsh Government milestones are not available, or if ambition is too
low, we track against CCC milestones from our updated Balanced Pathway for
Wales. We also summarise and assess policy progress and outline key next steps.
Our key messages for this chapter are:•Industry. Decarbonisation of Welsh industry is at risk from insufficient action
at UK Government level, especially in the steel sector. The Welsh
Government plans to continue working with the UK Government toadvocate for more support for industrial decarbonisation in Wales. It is alsousing its limited powers to enable industrial decarbonisation, for example bysetting up Net Zero Industry Wales to support all Welsh industrial clusters.

•

Electricity supply. By 2030, Wales aims to generate renewable electricity
equal to 70% of its electricity consumption. Welsh renewables capacity has
increased over time but at a slower rate since 2016. Wales must now workwith the UK Government in reserved areas to deliver strong policy consistent
with decarbonising electricity supply by 2035 (e.g. on standards for newbuild power plants). In addition, Wales must now take Welsh-specificprogrammes and devolved policy forward to support decarbonisation (e.g.
on planning and consenting for new low-carbon developments andnetworks, participating in a Minister-led infrastructure delivery group).

•

Fuel supply. The Welsh Government has announced the intent to prevent
further extraction of fossil fuels, including preventing the expansion of thecoal industry, and restricting new oil and gas extraction projects in Wales.
Alongside delivering this, next steps should include assessing the potential
for large-scale hydrogen production and supporting infrastructure in Wales,
coordinating with the UK Government on how Wales can best contribute to
UK-wide hydrogen plans and developing a Bioenergy Action Plan to clarify
its position on bioenergy in Wales.

•

Aviation. Aviation decarbonisation requires UK Government action to
reduce the carbon- intensity of UK aviation and manage demand. There
should be no net airport expansion across the UK, including Wales, until thesector is outperforming its emission reduction pathway and an airport
capacity management framework is in place. Further recommendations on
UK aviation demand and airport capacity will be in the Committee’s 2023
Progress Report to the UK Parliament. The Welsh Government should also set
out an aviation decarbonisation pathway to 2050, how it will beaccommodated in Welsh Carbon Budgets and how Wales will prepare forthe roll-out of new technologies.

•

Engineered removals. The Welsh Government should carry out a feasibility
study that assesses the potential for engineered removals in Wales, taking
into account proximity to biomass feedstocks, access to CCS networks andpotential impacts on energy systems. The Welsh Government should also

Progress Report: Reducing emissions in Wales

68

publish a Timber Industrial Strategy that sets out clear plans and policies forincreasing the volumes of timber used in Welsh construction.
In the rest of this Chapter, we discuss progress in the following sectors:
1. Electricity supply
2. Industry
3. Fuel supply
4. Aviation
5. Shipping
6. F-gases
7. Engineered removals

69

Chapter 3: Progress in largely-reserved policy areas

1. Electricity supply
The electricity supply policy area is mostly reserved to the UK Government.

(a) Indicators of progress
Emissions have fallen by 64%
since 2015 but are still slightly
higher than the CCC pathway.

Emissions for the electricity supply sector were 5 MtCO2e in 2020, 0.5 MtCO2e
higher than the CCC’s pathway (Figure 3.1a). It is too early to tell whether this is off
track, as any difference for 2020 mainly reflects uncertainty in the CCC pathway
due to data lags. Given the closure of coal capacity in Wales, future progresscompared to the CCC pathway will also depend upon when the remaining
unabated gas plant close, as well as the load factors of those that remain open.
•

From 2010 to 2015, there were significant fluctuations in emissions due to thesuccessive replacement of nuclear generation with coal, and then coal
generation with gas.

•

Since 2015, emissions have fallen by 64%. Over the First Carbon Budget
period the power sector performed better than our pathway, largely as theresult of reserved policies, with emissions from both gas-fired and coal-fired
generation lower than we had assumed:– The cessation of electricity generation by the Aberthaw coal power
station in 2019, meant that its substantial contribution to Wales’semissions was eliminated.
– Emissions from Welsh gas-fired power stations were also lower thanprojected, as load factors were lower than projected in our 2017
pathway.

Policy to deliver low-carbon
capacity is largely reserved.
Deployment of renewables in
Wales has slowed in recent
years.

Low-carbon capacity deployment. In 2020, generation of renewable electricity inWales equated to 56% of Welsh electricity consumption. 1 By 2030, the Welsh
Government aims to increase this to 70%. Welsh renewables capacity, including
wind and solar power, has increased over time, reaching 3 GW by 2020 (Figure3.1b). However, since 2016 renewables deployment has slowed.
•

The CCC and the Welsh Government do not have a target for the total
renewable energy operational capacity in Wales (Figure 3.1b), and policy
to deliver this is largely reserved.

•

Offshore wind capacity increased by 26% in 2015 (Figure 3.1c). After that, it
stagnated, with no increase in operational capacity between 2016 and
2020.

•

Operational capacity of onshore wind increased by 12% in 2019 and largely
plateaued thereafter (Figure 3.1d).

•Solar operational capacity increased by 38% in 2016 (Figure 3.1e).
Installation of solar capacity increased at a slower rate since 2016, with 0.27
GW of capacity installed in 2016 compared to 0.03 GW in 2020.

Progress Report: Reducing emissions in Wales

70

Figure 3.1 Key electricity supply indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b - e) BEIS (2022) Renewable electricity – installed capacity by region 2003 – 2021.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.1 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

71

Chapter 3: Progress in largely-reserved policy areas

Table 3.1
Policy scorecard for electricity supply
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Electricity
supplyMostly reserved
Progress:•

Renewable energy targets. In 2023, the Welsh Government published a Review of Wales’s
renewable energy targets. 2 The current aim, set in 2017, is to generate renewable electricity
equivalent to 70% of Wales’s electricity consumption by 2030. To align with the requirements of
Net Zero, the consultation proposes that the Welsh Government set a target to meet theequivalent of 100% of annual Welsh electricity consumption from renewable electricity by 2035.
In addition, two new freeports are to be established in Wales, enabling development in green
industries, including renewable energy (see Chapter 4). 3•

Standards for new power plants. In 2021, the UK and Welsh Governments jointly published a callfor evidence (CfE) on updating decarbonisation readiness standards for new-build power
plants. 4 Following the CfE, the UK Government published a consultation covering projects in
England: the changes proposed cover new build and substantially refurbished combustion
power plants, and require developers to demonstrate decarbonisation readiness through either
carbon capture and storage (CCS) or hydrogen conversion. The Welsh Government will publish
a separate response to the CfE. 5•

Electricity networks. The Future Energy Grids for Wales project is underway and expected to be
published in 2023. This aims to develop a long-term assessment of the likely future energy andnetwork requirements for Wales, and the steps needed to deliver these.

•

National planning. In 2021, the Welsh Government published Future Wales: The National Plan
2040. 6 This identified a series of ‘Pre-Assessed Areas for Wind Energy’ which now have apresumption in favour of large-scale energy developments. In addition, in July 2022 the Welsh
Government announced a new Bill on Infrastructure Consenting. This is intended to replace
existing statutory regimes for the consenting of Welsh infrastructure projects, reducing thenumber of authorisations required to consent projects.

•

Local planning. A programme to develop Local Area Energy Plans is underway and the intention
is to scale these up to create a national energy plan by 2024.

To be addressed:•

Wales must now work with the UK Government in reserved areas to deliver strong policy
consistent with decarbonising electricity supply by 2035 (e.g. on standards for new-build power
plants) and take Welsh-specific programmes and devolved policy forward to support
decarbonisation.

•

The Welsh Government should work closely as part of a Minister-led infrastructure delivery group,
and in conjunction with the new Electricity Networks Commissioner, to ensure enabling initiatives
for energy infrastructure are taken forward at pace and necessary policy changes are
implemented in Wales, to deliver a decarbonised and resilient power system by 2035 (priority
recommendation R2023-131).

Risks due to UK Government action: High.
•

Almost all powers are reserved to the UK Government, including on energy policy and regulationof energy markets and networks, and planning for nationally significant infrastructure projects.

•

The UK Government has made good progress developing policy and decarbonising electricity
supply, and the overall strategic objective aligns at both UK and Welsh levels (i.e. to decarboniseelectricity supply by 2035).

•

However, the UK Government still lacks a delivery strategy for their 2035 objective, and Welsh
targets are therefore dependent on UK policy and supporting infrastructure (e.g. networks andgrid connections) delivering sufficiently at scale and to time.

Progress Report: Reducing emissions in Wales72

2. Industry
The industry sector in Chapter 1 merges the industry and fuel supply sectors to alignwith the sector definitions used by the Welsh Government’s Low Carbon Delivery
Plan. They are presented separately in this chapter to provide a clearer distinction
between their different statuses on policy and decarbonisation rates.
Policy to decarbonise industry is mostly the responsibility of UK Government.

(a) Indicators of progress
Emissions fell by 5% to 9.9 MtCO2e in 2020 (Figure 3.2a). This reflects a drop in
output during the pandemic rather than decarbonisation policy progress. While
this means that, in 2020, Wales was on track compared to the CCC’s
recommended pathway, UK-wide industry emissions rebounded back to close to2019 levels in 2021, with Wales likely to have seen a similar trend.
Energy consumption per unit of
GVA of Welsh industry has
fallen by 49% since 2005.

Energy-intensity of output. The energy consumption per unit of GVA of Welsh
industry has been steadily falling over time, and in 2020 it was at 2.7 TWh/GVA,
which is about 49% lower than in 2005, but 5% higher than in 2019 (Figure 3.2b).
Fuel switching. It is too early to say whether Wales is on track compared to thepathway for industrial bioenergy uptake and electricity usage (Figures 3.2e and3.2c). There is not yet any industrial use of low-carbon hydrogen, with uptake in the
CCC’s pathway starting in 2024 (Figure 3.2d).

*

73

•

Electricity use in industry plateaued between 2015 and 2019, before it fell in
2020, reflecting the lower output of the sector that year (Figure 3.2c). The
CCC’s pathway does not include any substantial increases in electrification
until the mid-2020s.

•

Bioenergy use * in industry as a percentage of total energy use was 11% in2020 (Figures 3.2e). This is 49% higher than it was in 2015. It is not clear what
has driven this growth or whether bioenergy use is being adequately
prioritised. The CCC’s pathway recommends that use of bioenergy inindustry stays at a similar level to 2020 and decreases after 2026 aselectrification and hydrogen use in the sector ramp up.

Also includes waste.

Chapter 3: Progress in largely-reserved policy areas

Figure 3.2 Key industry indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) BEIS (2022) Subnational total final energy consumption statistics: 2005 to 2020 and Stats Wales, Gross Value Added in Wales by industry;(c-e) BEIS (2022) Total final energy consumption at regional and local authority level: 2005 to 2020.
Notes: The Welsh Government’s Carbon Budget 1 final statement tracks ‘total industry energy consumption’ while we monitor ‘energy consumption perunit of GVA in industry’. Wales’s energy use data includes both commercial and industrial sector emissions, whereas our pathways include only industrial
energy use.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.2 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

Progress Report: Reducing emissions in Wales

74

Table 3.2
Policy scorecard for industry
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Industry

Mostly reserved
Progress:•

The South Wales Industrial Cluster (SWIC), a private-sector initiative supported by the Welsh
Government, has continued to develop:– In 2021 SWIC launched its Phase 2 Deployment Project which involves engineering studies ofdecarbonisation options. 7– In 2022 SWIC was awarded £21.5 million by the UK Government to progress Phase 2. 8 A further£17.6 million has been contributed by SWIC partner companies. 9– In March 2023 SWIC launched A Plan for Clean Growth – a roadmap for decarbonisingindustry in South Wales. 10 The plan sets out an ambition for decarbonisation of the cluster by
2040 and presents 30 policy drivers to help achieve this.

•The Welsh Government established Net Zero Industry Wales to support all developing industrial
clusters in Wales, including SWIC. 11 The new body aims to facilitate continued collaboration
between industry, government and others. It will also develop Net Zero pathways for industry inWales and support industrial decarbonisation policy development.

•

The Welsh Government published Beyond Recycling, a circular economy strategy which aims toreach zero waste by 2050 through greater re-use, repair, remanufacture and recycling (seeWaste chapter). 12 Achieving this would improve industrial resource efficiency.

•

The Welsh Government commissioned a report and sensitivity analysis on the feasibility of, andoptions for, a CCUS network for Wales. 13 The Welsh Government will use this information to informdiscussions with UK Government on the new CCS business models.

•

The Welsh Government asked the Development Bank of Wales to develop a scheme supporting
businesses on their Net Zero transition. This led to the launch of the bank’s Green Business Loan
Scheme which enables Welsh businesses to invest in decarbonisation and energy efficiency. 14•

The updated Manufacturing Action Plan released in May 2023 includes industrial
decarbonisation as a strategic objective. 15 It sets out the Welsh Government’s approach to
improving industrial energy efficiency and productivity and embedding circular economy
principles.

•

The Innovation Strategy for Wales identifies Net Zero and decarbonisation as one of six priorities
for RD&I investment decisions. 16 A delivery plan is planned to be published in summer 2023.

•

The Welsh Government is working with SWIC and HyNet industrial clusters on deployment
approaches for hydrogen.

To be addressed:•

The Welsh Government should continue to work with the UK Government and advocate formore support for industrial decarbonisation in Wales (priority recommendation R2023-027).

•

The National Energy Plan for Wales and Local Area Energy Plans (due in 2024) are an opportunity
to identify the local and national requirements for, and opportunities from, industrial
decarbonisation (recommendation R2023-026).

•

There is a need to identify the skills needed to decarbonise Welsh industry and develop andimplement plans to train the workforce in those skills (recommendation R2023-052).

Risks due to UK Government action: High.
•75

Industrial policy is mostly reserved to the UK Government. Welsh industry has a major role to playin the UK’s pathway to Net Zero as it represents 16% of UK industrial emissions. However, thedecarbonisation of Welsh industry is at risk from insufficient action at the UK level. We will address

Chapter 3: Progress in largely-reserved policy areasUK policy progress in industrial decarbonisation in greater detail in our upcoming UK Progress
Report.
•

The lack of UK-level action is particularly evident for industrial electrification and resource
efficiency – two vital areas of industrial decarbonisation. There is also a lack of clarity of whatsome UK policies mean for Wales. For example, as SWIC is not a Track 1 cluster, it is not clear how
Welsh industry will be supported to adopt CCS and hydrogen.

•

The UK Government has detailed policy mechanisms for both CCS and hydrogen. However,these are currently focussed on industrial clusters with access to local storage of carbon dioxide.
It is unclear how most industrial sites in Wales will be supported to adopt these technologies.

•

To achieve industrial decarbonisation in Wales the UK Government must introduce policies toprotect local industry from high-carbon imports.

Progress Report: Reducing emissions in Wales76

3. Fuel supply
The industry sector in Chapter 1 merges the industry and fuel supply sectors to alignwith the sector definitions used by the Welsh Government’s Low Carbon Delivery
Plan. They are presented separately in this chapter to provide a clearer distinction
between their different statuses on policy and decarbonisation rates.
The fuel supply policy area is mostly reserved to the UK Government.

(a) Indicators of progress
Fuel supply emissions fell by 12%
in 2020, as refinery activity
reduced during the pandemic.
Given the potential for
rebound, it is too early to say if
the sector is on track.

Emissions fell by 12% in 2020 to 3 MtCO2e, as refinery activity reduced due to thepandemic.
•

Emissions have been steadily decreasing since 2014 but increased in 2019
before reducing in 2020 as refinery activity reduced due to the pandemic.
Emissions may have rebounded since 2020. It is too early to say if the sector
is on track compared to the CCC’s pathway (Figure 3.3a).

•This fall in 2020 emissions was driven by a fall in refineries emissions (Figure3.3b) and partially balanced by an increase in oil and gas production
emissions from 2018 to 2020 (Figure 3.3c), which have fluctuated around 0.5
MtCO2e for the past decade.

Figure 3.3 Key fuel supply indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b-c) CCC (2020) The Sixth Carbon Budget; CCC analysis.

77

Chapter 3: Progress in largely-reserved policy areas

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.3 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.
Table 3.3
Policy scorecard for fuel supply
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Fossil fuelsupplyMostly reserved
Progress:•

In 2021, the Welsh Government published a ‘Coal Policy Statement’, setting out policy on coal
extraction and use in energy generation. 17 The Welsh Government has set out policy to notconsent new mines, extend the lifetime of existing mines or permit an expansion to existing
mines, except in exceptional circumstances (e.g. to safely decommission). It has stated that theuse of coal for power generation will not be permitted.

•

The Welsh Government has announced that it will not issue new licenses for onshore oil and gas
extraction in Wales (offshore exploration is reserved). 18•

Any land-based elements required for offshore oil and gas developments are required to becompatible with the Welsh Government’s decarbonisation approach through the Welsh
National Marine Plan, published in 2019. 19

Risks due to UK Government action: High.

Hydrogen
supply•The Welsh Government’s powers on fossil fuel supply are broadly limited to planning andconsenting. Powers relating to the approval of licences for coal-mining operations weredevolved through the Wales Act 2017, with the Coal Authority remaining responsible forlicencing coal mines. 20 Powers relating to licencing onshore oil and gas extraction were also
devolved through the Wales Act 2017. The UK Government is responsible for the fiscal regime
and regulation of the oil and gas industry.

•

We have set out in recent letters to Government our view of the overwhelming evidence against
new consents for coal exploration or production, and our support for tighter limits on UK oil andgas production, with stringent tests and a presumption against exploration. 21, 22

Mostly reserved
Progress:•

The Welsh Government has set out a pathway for developing the hydrogen energy sector in
Wales. 23 In the pathway, the Government has committed to establish at least one renewablehydrogen production site of at least 10 MW by 2023-24, scope large-scale hydrogen production
sites and support local projects (e.g. Holyhead Hydrogen Hub). In addition, it was recently
announced that two freeports in Wales are to be established, aiming to develop low carbon
technologies, including hydrogen.

•In 2021, a Hydrogen Business Research & Innovation for Decarbonisation competition was
launched to provide funding for research and innovation in hydrogen. 24

To be addressed:•

The potential for larger-scale hydrogen production and supporting infrastructure in Wales
beyond 2023-24 should be assessed. Assessments and plans should consider potential sites(including freeports) and associated capacity; approaches to minimise the length of theProgress Report: Reducing emissions in Wales78

licensing and consenting process; and co-ordination with UK Government to determine how
Wales can best contribute to UK wide plans (recommendation R2023-024).
Risks due to UK Government action: High.

Bioenergy
supply•While Wales can support the consenting of hydrogen production sites and supporting
infrastructure, the fiscal regime is within the control of the UK Government. Furthermore, key
decisions (e.g. hydrogen for heat) that will shape the demand and scale of hydrogenproduction and storage required are reserved.

•

We have called on the UK Government to finalise funding mechanisms to support thedevelopment of low-carbon hydrogen production and accelerate the development of businessmodels for hydrogen transportation and storage, both seen as crucial to the delivery of ahydrogen industry.

Mostly reserved
Progress:•

The Welsh Government has committed to develop its position on the long-term role of biomass ina sustainable energy system and clarify its role in reaching Net Zero before the end of its Second
Carbon Budget period (2021-25).18

To be addressed:•

A Bioenergy Action Plan should be developed, clarifying the Welsh Government’s position on
bioenergy, setting out its best use, key delivery mechanisms, available funding, licensing
requirements and future timelines (recommendation R2023-025).

Risks due to UK Government action: High.
•79

The majority of powers are reserved to the UK Government. The UK Government has previously
committed to publishing a Biomass Strategy in 2022, which should inform the Welsh
Government’s Action Plan. However, this is not yet published.

Chapter 3: Progress in largely-reserved policy areas

4. Aviation
The surface transport, aviation and shipping sectors are treated separately in thischapter, to provide a clearer distinction of the different policies taking place andthe decarbonisation rates. In Chapter 1 they were combined into an overall
transport sector to align with the sector definitions used by the Welsh Government
in its Low Carbon Delivery Plan, which outlines how Wales intended to meet its First
Carbon Budget.
The aviation policy area is mostly reserved to the UK Government.

(a) Indicators of progress
Emissions. In 2019 aviation emissions were 0.17 MtCO2e and fell by 66% in 2020 to
0.06 MtCO2e (Figure 3.4a) due to the pandemic. Wales’s international aviation
emissions were 0.04 MtCO2e in 2020, while non-international emissions were 0.02
MtCO2e. It is too early to say if emissions are on track compared to the CCC’s
provisional pathway, as it depends how the sector rebounds from the pandemic.
Demand management. Cardiff Airport is the only civilian airport in Wales. The Welsh
Government intends to support airline growth at Cardiff Airport.
Data is not currently collectedon the number of Welsh
passengers travelling to English
airports to fly, meaning CCC
indicators do not reflect total
Welsh aviation demand.

Welsh passengers tend to take flights from English airports, such as Bristol,
Manchester and Birmingham. Data on where airport passengers travel from is not
regularly reported on, therefore CCC indicators will not capture all Welsh aviation
demand. A Civil Aviation Authority passenger survey report from 2019 collected
data on passenger origin, which shows that 4.5 million passengers travelled from
Wales to English airports. 25 For reference, in 2019 Cardiff Airport processed 1.6
million terminal passengers, and Welsh passenger-km per capita was 444
compared to 5392 passenger-km per capita for the UK as a whole. *Aviation demand has not yet
rebounded to pre-pandemic
levels.

For the air transport movements, terminal passengers and passenger-km per
capita indicators, data are only available for Cardiff Airport.

*•

Compared to 2019 levels, the number of air transport movements in Wales
fell by 80% in 2020 during the pandemic, decreasing further in 2021. They
increased in 2022 but remain 59% below pre-pandemic levels (Figure 3.4b).

•

The number of terminal passengers saw similar trends, and it was still 48%
below pre-pandemic levels in 2022 (Figure 3.4c).

Note the passenger survey report does not exclude passengers travelling from Wales who do not permanently live
there.

Progress Report: Reducing emissions in Wales

80

Figure 3.4 Key aviation indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b-d) DfT (2023) Seat-km & passenger-km flown to/from UK airports on passenger services, 2021 (unpublished); ONS (2023) Population estimates; CCC
analysis; Civil Aviation Authority, Annual airport data Table 05, Air Transport Movements; Civil Aviation Authority, Annual airport data, Table 09 Terminal
and Transit Passengers.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.4 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

81

Chapter 3: Progress in largely-reserved policy areas

Table 3.4
Policy scorecard for aviation
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Demandmanagement

Insufficient plans (R)Mostly reserved

Progress:•

Wales is making progress in modal shift and creating low-carbon alternative transport means.
See Chapter 2 for more detail.

To be addressed:•

In 2013 the Welsh Government purchased Cardiff Airport. The Welsh Government has a role insupporting the airport commercially, as well as creating “an environment to encourage growthof airlines.” 26 The Wales Transport Strategy commits to maintaining aviation capacity in Wales,
whilst recognising the challenges this creates for meeting decarbonisation targets. 27 There is noaviation pathway for Wales that describes how the aviation sector will be decarbonised in linewith Wales’s Carbon Budgets and the Net Zero target (recommendation R2023-008).

•

No data are currently available that consistently tracks Welsh passengers travelling to English
airports (recommendation R2023-015).

Risks due to UK Government action: High.
•Sustainable
Aviation Fuel(SAF)

Air Passenger Duty is not devolved to the Welsh Government, unlike Northern Ireland andScotland. The UK Government’s Jet Zero Strategy commits to increasing terminal passengers by
70% compared to 2018 levels by 2050. 28 The UK Government’s pathway for aviation relies on
nascent technology being scaled and deployed relatively quickly for commercial use. There isno policy framework in place that would mitigate demand growth if these technologies were
not deployed as planned.

Mostly reserved
Progress:•

The UK Government has published its response to the first SAF mandate consultation and issued asecond consultation. The 2023 UK Progress Report will provide a full assessment of the mandate.

To be addressed:•

Plans must be in place to ensure Cardiff Airport has the support required to enable SAF uptake tohelp meet the UK Government’s 10% SAF target by 2030 (recommendation R2023-009).

Risks due to UK Government action: High.
•Developing and deploying SAF is reserved to the UK Government. The SAF mandate consultation
is delayed and needs to be operational by 1 January 2025.

Progress Report: Reducing emissions in Wales82

5. Shipping
The surface transport, aviation and shipping sectors are treated separately in thischapter, to provide a clearer distinction of the different policies taking place andthe decarbonisation rates. In Chapter 1 they were combined into an overall
transport sector to align with the sector definitions used by the Welsh Government
in its Low Carbon Delivery Plan, which outlines how Wales intended to meet its First
Carbon Budget.
The shipping policy area is mostly reserved to the UK Government.

(a) Indicators of progress
The shipping sector is mostly
reserved to the UK
Government. Emissions fell by
17% between 2019 and 2020
due to the pandemic.

Emissions. Shipping emissions in Wales were 0.6 MtCO2e in 2020, a fall of 17%
compared to 2019 levels, due to the pandemic (Figure 3.5a). Similar to the UK
picture, Welsh shipping emissions were steadily decreasing prior to this, with 2019
emissions being 41% below 1990 levels. Emissions are likely to have increased sincethen, as suggested by the demand indicators.
Shipping demand. The recent decrease in shipping emissions has been driven by areduction in demand.
•

83

Between 2010 and 2019, imports at major Welsh ports decreased, from 41.6
Mt to 36.7 Mt of imports (Figure 3.5b). In 2020 imports dropped to 33.2 Mt
and in 2021 they increased to 36.0 Mt. Similarly, historical export data shows
an overall downward trend between 2010 and 2019, from 18.0 Mt to 15.5 Mt(Figure 3.5c). Exports further decreased to 13.2 Mt in 2020 and increased to14.7 Mt in 2021.

Chapter 3: Progress in largely-reserved policy areas

Figure 3.5 Key shipping indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b) StatsWales (2022) Foreign and domestic freight traffic at major ports in Wales, by cargo category;c) StatsWales (2022) Quarterly imports and exports at major ports in Wales.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.5 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.
Table 3.5
Policy scorecard for shipping
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Cross-cutting

Insufficient plans (R)Mostly reserved

Progress:•

The National Transport Delivery Plan 2022 commits to publishing a new National Ports andMaritime Plan for Wales and recognises the importance of delivering training and skills to local
people. 29

To be addressed:•

Planning and consent are devolved to the Welsh Government. The Welsh National Marine Plan
commits to the future growth and increases in port facilities and vessel size. There is nodecarbonisation pathway for the Welsh shipping sector (recommendation R2023-014).

Risks due to UK Government action: High.
Progress Report: Reducing emissions in Wales84•

Low-carbon
fuels
Joint
responsibility

Shipping is reserved to the UK Government. Wider maritime decarbonisation is dependent on
uptake of zero-emission vessels by national and multinational shipping operators and provision of
the required refuelling infrastructure at destination ports across the rest of the UK and overseas(recommendation R2023-011).

Insufficient plans (R)Progress:•

The National Transport Delivery Plan 2022 recognises the role of ports in decarbonising shippingby providing green fuel and shore supplies to ships.29

To be addressed:•

85

Welsh ports must be prepared to transition to low-carbon fuels and electrified shipping(recommendation R2023-013).

Chapter 3: Progress in largely-reserved policy areas

6. F-gases
The F-gas policy area is mostly reserved to the UK Government with theintroduction of the F-gas regulation in 2021.

(a) Indicators of progress
Emissions in 2020 were 0.48 MtCO2e. Progress in reducing F-gas emissions wasbroadly stagnant during the first years of the First Carbon Budget, with fallingemissions from 2018 (Figure 3.6a).
Inhalers and other aerosols represent 13% of the F-gases emissions in Wales.

*•

32% of all inhalers in 2022 were low-carbon * (Figure 3.6b). This proportion
has remained steady since 2019 and it will need to increase to reach the
80% Government target by 2035. Wales is significantly off track in meeting
this target.

•

In 2022, 6% of salbutamol inhalers and 48% of non-salbutamol inhalers were
low-carbon (Figures 3.6c & 3.6d). The proportion of such non-salbutamol
inhalers is below the 74% recommended by the CCC for 2022, and it issignificantly off track against the CCC’s pathway. Similarly, the percentage
of low-carbon salbutamol inhalers is significantly off track compared to the
CCC’s recommended pathway of 56% in 2022.

A low-carbon inhaler is defined as either (1) a non-metered dose inhaler (MDI) inhaler, or (2) an MDI inhaler using
propellants with a GWP below 200 times that of CO2.

Progress Report: Reducing emissions in Wales

86

Figure 3.6 Key F-gases indicators

Source:a) National Atmospheric Emissions Inventory (2022) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2020;b-d) NHS Wales (unpublished).
Notes: A low-carbon inhaler is defined as either (1) a non-metered dose inhaler (MDI) inhaler, or (2) an MDI inhaler using propellants with a GWP below
200 times that of CO2.

(b) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.6 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.

87

Chapter 3: Progress in largely-reserved policy areas

Table 3.6
Policy scorecard for f-gases
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

F-gases

Some risks (Y)Mostly reserved

Progress:•

There has been positive progress through the NHS Wales Decarbonisation Strategic Delivery Plan
2021-2030 (published in March 2021).

•

The All Wales Medicines Strategy Group (AWMSG) have since endorsed optimising inhaler use
and recommended that stakeholders transition from high global warming potential (GWP)
inhalers to alternative lower GWP inhaler types where deemed suitable.

To be addressed:•

Review the use of F-gases in Wales’s health service and take action to educate clinicians andpatients on the global warming impacts of inhalers (recommendation R2023-003).

•

Participate in the planned GB-wide F-gas cap scheme, either administered by the Environment
Agency or through a Welsh regulator (recommendation R2023-002).

Risks due to UK Government action: High.
•

Most of the F-gases regulation is reserved.

Progress Report: Reducing emissions in Wales88

7. Engineered removals
For engineered removals technologies using CCS, some areas, including planningand permitting of installations, are devolved and some areas, including permittingof offshore infrastructure, are mostly reserved. In practice, funding support for early
deployment of engineered removals is likely to be delivered through UK
Government business models and CCUS cluster development programmes. The
levers for deploying wood in construction are mostly devolved.
The Welsh Government is yet to
set out its ambition onengineered removals.

There are currently no engineered removals projects operating in Wales. The Welsh
Government has not yet defined the role it expects engineered removals to play indelivering Net Zero in Wales.

(a) Policy assessment
The policies and plans associated with each sub-sector/policy area for this sector
are assessed in Table 3.7 to determine if they are credible and on track, according
to the criteria outlined in Annex 1. Detailed recommendations for this sector are
given in Annex 2 and in filterable and searchable tables on our website, with areference provided to each unique recommendation ID within the table.
Table 3.7
Policy scorecard for engineered removals
Sub-sector /policy area

Welsh Government policy progress, assessment and next steps

Bioenergy andCarbonCapture(BECCS) andDirect Air
CarbonCapture(DACCS)

Mostly reserved
Progress:•

In the Second Carbon Budget, the Welsh Government has committed to undertaking afeasibility study for different engineered removals approaches.18•

The Welsh Government has also committed to engaging in UK Government discussions anddecision-making on the governance and regulation of engineered removals.18

To be addressed:•

A feasibility study should be carried out as soon as possible (recommendation R2023-049). The
study should identify potential new-build and retrofit sites by considering the proximity to biomass
feedstocks, access to CCS networks and impacts on energy systems. The outcomes of the study
should also contribute to a Welsh Government view on the role it expects engineered removals
to play in delivering Net Zero in Wales.

•

The Welsh Government should explore the public acceptability of engineered removals in Wales,
sharing clear information on how different types of engineered removals work and taking the
public’s views into account when determining the technologies’ role in its Net Zero pathway.

•

The Welsh Government should work with industry to identify potential engineered removals
projects within the South Wales Industrial Cluster.

Risks due to UK Government action: Medium.
•

89

There is an urgent need for the UK Government to provide clarity on engineered removals
business models and produce guidance on MRV and biomass sustainability. Delays to theseactions pose significant risk to the UK Government’s ability to meet its 2030 5 MtCO2/year

Chapter 3: Progress in largely-reserved policy areas

removals ambition and Wales’s ability to begin development of engineered removals sites in thisdecade.
•Wood inconstruction
Mostlydevolved

BECCS and DACCS deployment rely on access to a functioning CCS network. Delays to theestablishment and expansion of the Track 1 and Track 2 clusters also pose risks to the UK
Government’s 2030 engineered removals target and to the Welsh Government’s ability to
deploy engineered removals this decade.

Some risks (Y)Progress:•

The Welsh Government has committed to develop a Timber Industrial Strategy and clarify its
planned uses of biomass, giving preference for high value add, long-life uses (such as wood inconstruction).

•

The Welsh Government and EU Rural Development Programme funded the Powys County
Council’s Home Grown Homes programme, completed in 2021. This programme has piloted
local measures that attempt to grow the Welsh timber construction supply chain and deliver lowcarbon social housing.

To be addressed:•

Publish the Timber Industrial Strategy, which was due to be released by the end of 2022
(recommendation R2023-050).

•

A target for timber used in construction in buildings in Wales could send a clear signal to industry
on the expected increases in volume they may need to service.

•

The Welsh Government should build on learnings from programmes such as the Home Grown
Homes to consider how policies and initiatives can be used to both encourage more Welshgrown timber to be used in construction and to encourage the use of timber in construction ofbuildings in Wales, particularly social housing.

Risks due to UK Government action: Low.
•

Levers that address the use of wood in construction are mostly devolved.

Progress Report: Reducing emissions in Wales

90

Endnotes
1 Welsh Government (2021) Energy Generation in Wales 2021,

https://www.gov.wales/sites/default/files/publications/2022-12/energy-generation-in-wales2021.pdf.

2 Welsh Government (2023) Review of Wales’ Renewable Energy Targets,

https://www.gov.wales/review-wales-renewable-energy-targets.

3 Welsh Government (2023) Press release: Wales’ new freeports unveiled,https://www.gov.wales/wales-new-freeports-unveiled.

4 BEIS and Welsh Government (2021) Decarbonisation readiness: Joint call for evidence on the

expansion of the 2009 Carbon Capture Readiness requirements,
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1001949/decarbonisation-readiness-call-for-evidence.pdf.

5 DESNZ (2023) Decarbonisation readiness: Consultation on updates to the 2009 Carbon Capture

Readiness requirements,
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1141902/decarbonisation_readiness_consultation.pdf.

6 Welsh Government (2021) Future Wales: The National Plan 2040, https://www.gov.wales/future-

wales-national-plan-2040.

7 South Wales Industrial Cluster (2023) Deployment project, https://www.swic.cymru/deployment.
8 UK Government (2022) Net Zero ambitions move a step closer in Wales,

https://www.gov.uk/government/news/net-zero-ambitions-move-a-step-closer-in-wales.

9 Cardiff Capital Region (2021) Putting the Plan in Place to Decarbonise our Industry,

https://www.cardiffcapitalregion.wales/news-events/latest-news/putting-the-plan-in-place-todecarbonise-our-industry/

10 South Wales Industrial Cluster (2023) Cluster Plan Project: A Plan for Clean Growth,

https://www.swic.cymru/clusterplan.

11 Welsh Government (2022) Net Zero Industry Wales established to support decarbonisation of

Welsh industry, https://www.gov.wales/net-zero-industry-wales-established-supportdecarbonisation-welsh-industry.

12 Welsh Government (2021) Beyond Recycling, https://www.gov.wales/beyond-recycling-0.
13 Welsh Government (2021) A Carbon Capture Utilisation and Storage Network for Wales,

https://www.gov.wales/sites/default/files/publications/2021-10/a-carbon-capture-utilisationand-storage-network-for-wales-report.pdf.

14 Development Bank of Wales (2023) Helping businesses cut energy costs,

https://developmentbank.wales/news-and-events/helping-businesses-cut-energy-costsdevelopment-bank-wales-and-welsh-government.

15 Welsh Government (2023) A Manufacturing Future for Wales,

https://www.gov.wales/manufacturing-future-wales-our-journey-wales-40.

16 Welsh Government (2023) Innovation strategy for Wales, https://www.gov.wales/innovation-

strategy-wales.

17 Welsh Government (2021) Coal Policy, https://www.gov.wales/coal-policy-statement.

91

Chapter 3: Progress in largely-reserved policy areas

18 Welsh Government (2021) Net Zero Wales Carbon Budget 2 (2021 to 2025),

https://www.gov.wales/net-zero-wales-carbon-budget-2-2021-2025.

19 Welsh Government (2019) Welsh National Marine Plan, https://www.gov.wales/welsh-national-

marine-plan.

20 UK Government (2017) Wales Act 2017, https://www.legislation.gov.uk/ukpga/2017/4/contents.
21 Climate Change Committee (2022) Climate compatibility of new oil and gas fields,

https://www.theccc.org.uk/publication/letter-climate-compatibility-of-new-oil-and-gas-fields/.

22 Climate Change Committee (2021) Deep coal mining in the UK,

https://www.theccc.org.uk/publication/letter-deep-coal-mining-in-the-uk/.

23 Welsh Government (2022) Developing the Hydrogen Energy Sector,

https://www.gov.wales/developing-hydrogen-energy-sector-wales.

24 UKRI (2021) Hydrogen Business Research & Innovation for Decarbonisation (HyBRID),

https://iuk.ktn-uk.org/opportunities/hydrogen-business-research-innovation-for-decarbonisationhybrid.

25 UK Government (2022) Jet Zero strategy dataset,

https://www.gov.uk/government/publications/jet-zero-strategy-delivering-net-zero-aviation-by2050.

26 Welsh Government (2023) Cardiff Airport: Our Role, https://www.gov.wales/cardiff-airport-our-role.

27 Welsh Government (2021) Wales Transport Strategy, https://www.gov.wales/llwybr-newydd-

wales-transport-strategy-2021.

28 UK Government (2022) Jet Zero strategy dataset,

https://www.gov.uk/government/publications/jet-zero-strategy-delivering-net-zero-aviation-by2050.

29 Welsh Government (2023) National Transport Delivery Plan (2022-2027),

https://www.gov.wales/sites/default/files/consultations/2022-07/national-transport-delivery-plan2022-to-2027.pdf.

Progress Report: Reducing emissions in Wales

92

Chapter 4

Cross-cutting issues
1. People and business96

2. Governance100

3. Adaptation

104

Progress Report: Reducing emissions in Wales

94

Introduction and key messages
This chapter assesses whether
cross-cutting areas of society
and the economy aresupporting Net Zero, and policy
progress in this regard.

The Net Zero transition will involve all of society and will rely on actions from many
actors including individuals, businesses and financial institutions. The transition will
impact on different groups in society in different ways, with a shift in the nature ofjobs and individual lifestyles depending on characteristics such as income andlocation.
Across all these aspects of society, the Welsh Government can shape the wider
environment in which these actors operate, to ensure their actions actively alignwith, and don’t slow, progress to Net Zero.
Effective governance structures and mechanisms are vital to coordinate and leadthe delivery of Net Zero, which requires action in all sectors of the economy. The
Welsh Government should ensure that relevant actors work together constructively
and understand the contributions for which they are responsible.
This chapter covers policy developments and requirements in cross-cutting areasof the economy. We discuss developments in people and business, and ingovernance.
Our key messages for this chapter are:•Public engagement. In 2022 Wales launched several public engagement
campaigns related to action on climate change and a draft Strategy for
Public Engagement and Action on Climate Change was published for
consultation in 2022. 1 In this area, Wales is a step ahead of UK-level progressand should now prioritise delivering on time and evaluating impacts.

•

Workers and skills. The Welsh Government has published a Net Zero Skills
Action Plan, which aims to identify Net Zero skill requirements acrosssectors. 2 This is encouraging, and better than what is happening at the UK
level, but the Welsh Government need to move to firm and more specificactions in this area.

There are promisingdevelopments to support
investment in renewableenergy, but smaller businesses
need support to engage withNet Zero.

•Business. Two Freeports are to be established in Wales to unlock renewableenergy opportunities. The Development Bank of Wales is set to offer
businesses favourable investment terms for renewables and energy
efficiency upgrades. More guidance and removal of barriers todecarbonisation is needed for smaller businesses and the Welsh
Government should embed Net Zero more fully in its procurement to drivechanges in business practices.

The Welsh Government has
taken steps to embed Net Zeroacross its activities but needs toclarify the role and resources of
local government.

•

Governance. The Welsh Government has made progress towards
embedding Net Zero across its activities, for instance by setting out a public
sector decarbonisation route map and introducing a Net Zero test for futureroad-building schemes. More work is needed to build on this, especially todevelop a shared understanding of the role for local government and how
this will be coordinated and funded. The Welsh Government should also
develop a plan for how it will manage interdependencies with UK policies.

Wales is a step ahead of the UK
in public engagement and skills
but needs to translate plans
into specific actions acrossboth areas.

95

Chapter 4: Cross-cutting issues

1. People and business(a) Indicators of progress
Concern around climate change and knowledge and awareness of Net Zero are
relatively high in Wales, similar to the wider UK (Figure 4.1). In winter 2022, 79% of
respondents in Wales stated that they are either very concerned or fairly
concerned about climate change. 3
Public knowledge andawareness of ‘Net Zero’ inWales is relatively high.

Figure 4.1 Knowledge and awareness of 'Net Zero'
100%
90%
80%
70%

% of respondents

60%
50%
40%
30%
20%
10%
0%
Nev er heard of thisHardly anything but I’v e heard of thisA little
A fair amount
A lot
Source: BEIS (2022) Public Attitudes Tracker (PAT), Winter 2022. Region: Wales.
Notes: Survey question for knowledge and awareness of 'Net Zero' was 'Before today, how much, if anything, did
you know about the concept of 'net zero'?'. Data collection was carried out via push-to-web methodology. Resultsfor Wales need to be interpreted with caution due to small sample size per region.

Business surveys indicate small
businesses are struggling toengage with Net Zero.

The CCC do not have formal indicators for business progress in Wales, but noteseveral findings from business surveys which cover Wales:•

45% of Welsh businesses indicated that ‘offering solutions to environmental
problems, such as climate change or food waste’ was important to them –around 10% higher than for businesses in England. 4•

Small businesses in Wales, as with other parts of the UK, are struggling toengage with Net Zero, citing a lack of certainty about how to respond.
Only 14% of Welsh businesses reported having implemented a strategy to
reduce emissions in 2021. 5

Progress Report: Reducing emissions in Wales96

(b) Policy progress
In Table 4.1 a summary of recent progress and what still needs to be addressed isgiven. The detailed recommendations for these areas are given in Annex 2 and in
filterable and searchable tables on our website, with a reference provided to eachunique recommendation ID within Table 4.1. The policies and plans associated witheach area are assessed here to determine if they are credible and on track,according to the criteria outlined in Annex 1.
Table 4.1
Policy scorecard for people and businessSub-sector /policy area

Welsh Government policy progress, assessment and next steps

Publicengagement
and awareness

Credible plans (G)Partly devolved•

Progress:
In 2022 Wales launched a number of campaigns interlinked with action on climate change
including a new Be Mighty campaign (focused on recycling of food waste), a Real Social
Network campaign led by Transport for Wales (with an active travel element) and a Wintercampaign (delivered as part of the NEST Warm Homes programme). 6, 7
– A draft ‘Strategy for Public Engagement & Action on Climate Change’ was published for
consultation in October 2022, with a final Strategy due to be published in summer 2023.1 It will
be informed by a behavioural science research project completed in early 2023.
– Plans are underway to develop a repeatable bi-annual tracking survey, deepening theevidence on people’s knowledge, awareness and attitudes on climate change.
– A new national ‘Climate Action Wales’ campaign and accompanying website will belaunched in summer 2023 to build knowledge, increase intention and encourage action in theareas of green travel, home energy, food and consumption behaviours. 8– Wales is showing leadership in actively considering promoting dietary shifts, including througha Food Bill introduced last year that aims to promote a more sustainable food system andhealthier diets, and cross-departmental work on promoting a ‘healthier and suitable diet’. 9, 10
Although the latter does not explicitly target sustainability, a shift to healthier diets may include
diets with lower emissions intensity.
To be addressed:

97•

Move forward with plans to develop a long-term strategy to promote a dietary shift, explicitly
integrating sustainability considerations and considering setting targets for dietary shifts(recommendation R2023-046).

•

Publish the new ‘Strategy for Public Engagement & Action’ and the new national ‘Climate
Action Wales’ campaign and website in summer 2023, including key topics such as road and air
travel, diet and home heating. Establish an effective monitoring approach to track theeffectiveness of public engagement communications and campaigns, and share lessons learnt
with the UK Government and other Devolved Administrations (recommendation R2023-047).

•

Consider the role of a Welsh Climate Assembly, including to address aspects of climate change
policy which most significantly interact with people’s everyday lives or may be challenging(recommendation R2023-055).

•

As discussed in Chapter 2 on agriculture and land use, develop and maintain a sustained
dialogue with farmers on a rural just transition (recommendation R2023-159).

•

As discussed in Chapter 2 on buildings, raise awareness of the changes required to decarbonisebuildings (recommendation R2023-044).

•

As discussed in Chapter 3 on aviation, there is not currently an aviation demand pathway for
Wales (recommendation R2023-008).
Chapter 4: Cross-cutting issues

Risks due to UK Government action: Medium.
•

Fair fundingandaffordability

Some areas particularly significant to public engagement, such as buildings and transport, arepartly reserved powers, where progress is more dependent on UK Government decisions.
However, agriculture and land use and waste are largely devolved.

Mostly reserved
Progress:•

Funding and grant programmes that relate to Net Zero fairness and affordability are largely
reserved, and for the few grants that are Wales-specific (e.g. for energy efficiency
improvements) there have not been significant shifts since 2021.

Risks due to UK Government action: High.
Workers andskillsJoint
responsibility

Some risks (Y)Progress:•

In early 2023, the Welsh Government published its Net Zero Skills Action Plan which set out priority
actions to identify Net Zero skill requirements across sectors while building inclusive partnerships
to deliver skills policy.2 The plan is underpinned by pilots that have been supported by theGovernment to understand how to deliver Net Zero skills across different sectors.

•

Fairness and the just transition are embedded in the ambition of the Skills Action Plan to ‘prevent
existing labour market inequalities being carried through into the new net zero and digital
economies’.

•

The Personal Learning Accounts, which support workers in reskilling and upskilling to accessgrowing and priority sectors for Wales, have increasingly focussed on Net Zero sectors. 11 A £2
million pilot was introduced to target training and qualifications for Net Zero skills in construction,energy, engineering and manufacturing.2•

The Welsh Government is providing £4.5 million through its Flexible Skills Programme to help
employers with training and upskilling of their employees, which could benefit Net Zero skills. 12

To be addressed:•

The Welsh climate commitments will require faster and growing support for Net Zero Skills. A
thorough review of existing schemes is required to assess their ability to close Net Zero Skills gaps
in Wales (recommendation R2023-051).

•

More is needed from the Welsh Government on the delivery of a just transition, which should be
informed by the recent Just Transition consultation and Mainstreaming Equality Policy Framework(recommendation R2023-048). 13

Risks due to UK Government action: Medium.
•

Business andfinance
Joint
responsibility

While the UK Government will provide signals on the low-carbon economy and funding for
education and skills, education and skills policy are designed and delivered at the local level.

Some risks (Y)Progress:•

The ‘Net Zero Wales Carbon Budget 2’ report sets out several measures to support and enableWelsh businesses on the journey to Net Zero, including Net Zero as a priority within theDevelopment Bank of Wales Corporate Plan, embedding Net Zero in Welsh Government
procurement and supporting Welsh firms’ Net Zero responses through Business Wales. 14•

Dedicated support and funding schemes to support businesses’ Net Zero activities in Wales werelaunched in 2022, including the Net Zero Start-up Grant and Net Zero Industry Wales. 15, 16 The
Development Bank of Wales launched an ‘invest to save’ initiative in 2022, to provide favourable
terms to businesses looking to invest in energy efficiency projects. 17 This compliments the Green
Business Loans Scheme which combined free energy saving advice from Business Wales withaccess to discounted loans and long-term capital. 18

Progress Report: Reducing emissions in Wales98•In March 2023 it was announced that two new green-industry Freeports are to be established inWales. 19 The sites in Anglesey and Port Talbot will enable development in key emerging Net Zeroindustries such as floating offshore wind, carbon capture, utilisation and storage (CCUS),
hydrogen and tidal power.

•

The Welsh Government has sent several clear signals around putting Net Zero at the centre of
their infrastructure investment and development strategy, including moratoriums on new roadbuilding and Energy from Waste projects (without carbon capture and storage (CCS). Thesesignals will give the private sector greater clarity and confidence around the Welsh
Government’s commitment to develop infrastructure consistent with Net Zero.

•

Wales is introducing reforms to improve business recycling, including mandating separate
collections and providing advice to improve resource efficiency through Business Wales.

To be addressed:•

Small Welsh businesses must be enabled to participate in and benefit from the transition to Net
Zero, for example by removing planning barriers to low-carbon technologies in rural areas andproviding grid connectivity. The Welsh Government should provide small businesses withguidance and support to understand and effectively respond to Net Zero (recommendation
R2023-007).

•

The Welsh Government should publish a decarbonisation strategy for Welsh Businesses, including
a review of opportunities to use its powers, procurement, lending and funding to strengthen
incentives and requirements for businesses to adopt and deliver low-carbon solutions. This could
include introducing key performance indicators (KPIs) to track the emissions intensity of public
contracts (recommendation R2023-006).

Risks due to UK Government action: Medium.
•99

The UK Government holds some important levers for guiding business action, including electricity
markets and regulation, CCUS and in corporate regulatory requirements. However, Wales has ahigh degree of agency in key areas, particularly the extent to which it can support businesses to
respond to Net Zero, changes to planning regulations and building and waste regulations.

Chapter 4: Cross-cutting issues

2. Governance(a) Policy progress
The assessment of Welsh governance is split into two parts. The first section
considers the governance processes and mechanisms within Wales, including
policymaking approaches, coordination of delivery and partnership with local
government. The second section then addresses the structures for coordinating
actions between the Welsh and UK Governments, including questions around howinterdependencies and synergies will be identified and managed.

(i) Progress in WalesIn Table 4.2, a summary of recent progress and an assessment according to thecriteria outlined in Annex 1 is given. The detailed recommendations are given in
Annex 2 and in filterable and searchable tables on our website, with a reference
provided to each unique recommendation ID within the table.
This table assesses the Welsh Government’s governance processes andmechanisms in two broad areas to determine if they are credible and suitable forenabling effective and accountable delivery, according to the criteria outlined in
Annex 1. The first area is alignment of policy and coordination across Welsh
Government, and the second is partnership working with local government.
Table 4.2
Policy scorecard for governanceSub-sector /policy area

Welsh Government policy progress, assessment and next steps

Policyalignment andcoordination

Some risks (Y)Progress:•

The Net Zero Wales plan sets out the overall vision for delivering decarbonisation in Wales. 20 In
2022, the Welsh Government published a Net Zero Strategic Plan which sets out the actions thatwill need to be taken to deliver this. 21 Importantly, it identified 54 specific initiatives that will be
reviewed in 2025 and 2030.

•

Coordination of delivering the Net Zero pathway is governed through a dedicated Climate
Change Ministry, which was established in 2021.
– At official level, this is supported by a portfolio board which is chaired by the senior official
responsible for climate change and includes lead officials from each key emitting sector.
– The Programme for Government for 2021-26 identifies ‘embedding our response to the climate
and nature emergency in everything we do’ as a key commitment. 22•

The Welsh Government has taken the step of aligning its financial budgeting cycles with its
carbon budget periods, allowing spending decisions to be more directly linked to thedecarbonisation actions that are required.

•

The Welsh Government’s recent decision on how it will consider future road-building schemes
represents the sort of Net Zero Test that the CCC has called for across the economy.
– This effectively reverses the presumption that schemes should be approved unless they are
shown to be harmful, instead requiring all schemes to proactively demonstrate how they will
Progress Report: Reducing emissions in Wales100reduce carbon emissions, support modal shift and adapt to the impacts of climate change ifthey are to be approved.
– This sits alongside the commitments in the Well-being of Future Generations Act, which ensuresthat long-term impacts must be taken into account in policy development andimplementation.
•

The Welsh Government has set a target for the Welsh public sector (comprising 65 identified
bodies) to be Net Zero by 2030 and has set out a route map towards delivering this as well asreporting guidelines. 23, 24

To be addressed:

Partnership with
local
government•

In 2022, Audit Wales highlighted that public bodies need to do more to meet the 2030 public
sector decarbonisation goal. The Committee echoes these recommendations. The Welsh
Government should require all public bodies to identify the actions needed to deliver on the2030 public sector decarbonisation goal and embed these within their corporate plans andreporting (recommendation R2023-028).

•

The Welsh Government should build on the approach taken in its response to the Roads Review
to ensure that other areas of decision-making are similarly aligned to the Net Zero pathway. 25

Significant risks (O)Progress:•

19 of Wales’s 22 local authorities have declared a climate emergency, with 14 of these having a
climate action plan. 26•

The Welsh Local Government Association has received Welsh Government funding to deliver adecarbonisation support programme, aimed at offering guidance to local authorities indeveloping these plans. 27

To be addressed:•

The Welsh Government should work together with local authorities to develop a sharedunderstanding of where the roles and responsibilities for various aspects of Net Zero delivery lie
between central and local government, as well as how these will be coordinated(recommendation R2023-029).

•

In Climate Emergency UK’s 2021 scorecard exercise, Welsh local authorities’ climate action plans
received an average score of 31%. 28 This is below the national average of 50%, with shortfalls
across all assessed areas. Only Cardiff Council (70%) scored above this national average. The
Welsh Government should seek to share lessons from this exercise to help authorities improve thequality of their plans (recommendation R2023-030).

•

The Active Travel Fund’s approach of allocating core funding to all local authorities on the basisof assessed need, in addition to capital funding available through competitive bidding
processes, is a positive step. 29 The Welsh Government should build upon this to develop a
programme of longer-term funding for local authority delivery on Net Zero that is aligned to theiridentified roles and responsibilities (recommendation R2023-031).

(ii) Coordination with UK Government
Delivery of Wales’s
decarbonisation objectives will
depend on complex
interactions with UK policies.
The Welsh Government should
ensure it understands theseinteractions and develops
plans for how to manage them.

Delivery of the emissions reductions required to meet Wales’s decarbonisation
objectives will depend on a range of complex interactions between devolved andreserved powers. This includes not just regulatory dependencies, but also relianceon shared UK markets and infrastructure. The Welsh Government should develop aplan for how it will manage areas in which these dependencies pose significant
risks to the deliverability of its decarbonisation pathways (recommendation R2023
032).
•

101

Table 4.3 sets out a summary of the key interdependencies for the transport
sector, emphasising that there are risks posed by Wales’s dependency on

Chapter 4: Cross-cutting issues

the UK Government for ambitious regulation as well as on wider UK markets
and shared UK infrastructure. This most directly affects aspects of thetransition that rely on the adoption of new technologies and energy-using
products.

There are coordinating
structures for collaboration
between the UK and devolved
governments, but it is not yet
clear that these are working
effectively for Net Zero.

•

The Welsh Government should conduct an equivalent mapping exercise
across all sectors and should use this to develop a plan for how it will
manage areas in which these dependencies pose significant risks to thedeliverability of its pathways. The map of how responsibilities for policy anddelivery are shared across governments, local authorities and the private
sector in the recent National Transport Delivery Plan is a good example ofthis. 30•

Wales’s decarbonisation pathways are particularly dependent on reducing
industrial emissions, which entails substantial reliance on both national
regulation and the development of UK-wide infrastructure. It will be
particularly important for the Welsh Government to understand theseinterdependencies and work effectively with the UK Government tomanage them and ensure that barriers to delivery are resolved.

•

These interdependencies pose a risk to cost-effective and timely delivery of
the pathways required and should be managed actively throughcollaboration between the UK and Welsh governments.

The UK Government’s Net Zero Strategy recognised the need for joined-up action
across the UK to deliver the Net Zero pathways. This has been supported by the
introduction of coordinating structures, which have been used to facilitate
discussions on shared objectives that have fed into various recent UK-wide
strategies, although it is not clear that these are yet reliably leading to effective
engagement between the nations.
•

The UK Government has established a bimonthly Net Zero, Energy andClimate Change Inter-Ministerial Group to bring together ministers from all
four nations to discuss emerging policies. This is supported by a crossdepartmental official-level board, as well as direct engagement between
corresponding departmental officials.

•

The ability for devolved administrations to effectively engage with thedevelopment of the UK Net Zero Strategy was limited. In developing its
recent Carbon Budget Delivery Plan, the UK Government consulted with
devolved governments although the final outputs still lack transparency onwhat delivery outcomes are being assumed across each nation. This risks
missing opportunities for enhanced collaboration to deliver on sharedobjectives that could help in delivering on both UK and devolved emissions
reduction goals.

•

The structures that enable collaboration between the nations should be
used to involve the devolved administrations in early-stage policy
development and decision-making on areas that will affect theirjurisdictions. These discussions should explore synergies between therespective governments’ goals and plans to maximise the benefits that canbe delivered across the UK.

Progress Report: Reducing emissions in Wales

102

Table 4.3
Interdependencies between UK and Welsh powers in the surface transport sector
Sub-sector

Dependencies onreserved powers

Zero-emission
vehiclesSignificant dependencies beyond devolved powers
Regulations on whatvehicles can be sold(e.g. zero-emission
vehicle (ZEV)
mandate) likely to be
based on trajectories
required for UK.
Main price signals(e.g. vehicle
taxes/subsidies andfuel duties) are set by
the UK Treasury.

Reducing demand forcarbon-intensive
travel103

Dependencies on UK
markets

Dependencies onshared UK
infrastructure

Manufacturing
strategies based onlarger UK/EU market
could restrict ability
to go faster.

Low-carbon power
for use in electricvehicles (EVs) comesfrom a sharedelectricity grid.

UK-focused vehicle
advertising strategies
will influence
consumer demand(e.g. for hybrids).

Hydrogen supply andrefuelling facilities arelikely to be planned
nationally.

Outcomes that are
independent of thewider UK

Procurement of ZEVs
for public fleets.
Developing
workforce skills tobuild and maintain
ZEVs.

Minor dependencies beyond devolved powers
Decisions on national
taxation schemes(e.g. road pricing)that could shapedemand are madeby the UK
Government.

Many public
transport services areoperated by UK-widebusinesses.
Public behaviours
likely shaped by both
UK and Welsh
engagement.

Chapter 4: Cross-cutting issues

Improvements tocross-border rail links
and services dependon UK investment.

Investment toimprovepublic/active/shared
travel infrastructure.
Local schemes tomanage traffic.
Education policy andpublic information
campaigns caninfluence public
choices.

3. Adaptation
Further climate change in Wales over the coming decades is inevitable. The recent
average land temperature is 0.9°C warmer than in the period of the mid-1970s to
the mid-2010s and there are increases in annual mean rainfall and incidences ofextreme heat events. These changes are now having clear impacts on Wales’s
people and ecosystems. The most recent UK Climate Risk Assessment highlighted
critical areas where more action is needed in Wales to adapt to these current andfuture climate risks in areas such as flooding, coastal erosion, increasing hightemperatures and risks to the natural environment. 31(a) A resilient Net Zero society
Emissions-cutting measures should be combined with strong adaptation policies to
respond to these climate risks. Without proactive and well-planned adaptation
action, many of the climate risks facing Wales will put efforts to reduce emissions at
risk.
•

Increasing long-term carbon storage. There are risks and opportunities fromclimate change for the ability of land to contribute to Net Zero. For
example, degradation of peatlands under a warmer climate could lead tohigher carbon emissions, as well as the loss of vital ecosystems. Tree andhedgerow planting and catchment-sensitive farming can have benefits forincreasing climate resilience and biodiversity, as well as carbon
sequestration. However, careful planning about species mix, location andmanagement is necessary to ensure such benefits are maintained over thelong term despite a changing climate.

•

Maintaining a resilient power system. A decarbonised energy system will
not be reliable if it is not climate resilient. The cascading impacts ofelectricity failure on critical services will continue to grow as the economy
becomes increasingly electrified and as extreme weather events become
more common and severe. The consequences of failure will be moreacutely felt by the more vulnerable in society. The growing dependence onelectricity and the move towards an energy system with high levels ofvariable renewables makes it essential that changing climate hazards are
considered in energy system planning. Much of the Net Zero electricity
system is yet to be built and requires significant additional investment toreplace existing generation assets and significantly expand the system. This
investment must not lock in poor climate resilience.

•

Decarbonisation of the building stock. Without consideration of the futureclimate when undertaking retrofit programmes, emissions reduction
measures, such as increasing energy efficiency of homes, may
inadvertently increase the risk of overheating in buildings and worsenindoor air quality.

The Committee will provide an assessment of adaptation progress in the upcoming
Welsh Adaptation Progress report later this year, along with a separate briefing on
the interrelationships between adaptation and decarbonisation.

Progress Report: Reducing emissions in Wales

104

Endnotes
1 Welsh Government (2022) Climate Change – A Strategy for Public Engagement and Action(2022-2026), https://www.gov.wales/sites/default/files/consultations/2022-10/part-a-draftstrategy-for-engaging-the-general-public-in-action-on-climate-change.pdf.

2 Welsh Government (2023) Stronger, Fairer, Greener Wales: Net Zero Skills Action Plan.

https://www.gov.wales/sites/default/files/publications/2023-02/nzs-actions-we-will-delivermoving-forward.pdf.

3 BEIS (2022) BEIS Public Attitudes Tracker: Winter 2022: Crosstabulations.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1140669/BEIS_Public_Attitudes_Tracker_Crosstabulations_Winter_2022.xlsx.

4 BEIS (2021) Small Business Survey Reports, https://www.gov.uk/government/collections/small-business-survey-reports#2021.

5 Chambers Wales (2021) Results of Quarterly Economic Survey, https://cw-

seswm.com/news/action-on-net-zero-held-back-by-lack-of-understanding/.

6 Welsh Government (2023) Be Mighty. Recycle Now, https://www.walesrecycles.org.uk/news-

and-campaigns/be-mighty-recycle-campaign.

7 Welsh Government (2023) The real social network, https://tfw.wales/real-social-network.
8 Welsh Government (2023) Climate Action Wales, https://www.gov.wales/climate-action-wales.
9 Welsh Parliament (2022) Food (Wales) Bill,https://business.senedd.wales/mgIssueHistoryHome.aspx?IId=40509.

10 Welsh Parliament (2021) Food (Wales) Bill, https://senedd.wales/media/lkinkfad/pri-ld15535-

e.pdf.

11 Careers Wales (2023) Personal Learning Accounts, https://careerswales.gov.wales/courses-and-training/funding-your-studies/personal-learning-accounts.

12 Welsh Government (2023) Flexible Skills Programme,

https://businesswales.gov.wales/skillsgateway/flexible-skills-programme.

13 Mainstreaming Equality and Just Transition Evidence Panel (2023) An Equal and Just Transition to

Net Zero,https://orca.cardiff.ac.uk/id/eprint/157749/7/An%20Equal%20and%20Just%20Transition%20%20Mainstreaming%20Equality%20Evidence%20Panel%20%20Summary%20Report%20150323%20%281%29.pdf.

14 Welsh Government (2021) Net Zero Wales Carbon Budget 2 (2021-25),

https://www.gov.wales/sites/default/files/publications/2021-10/net-zero-wales-carbon-budget2-2021-25.pdf.

15 Welsh Government (2022) Net Zero carbon start-up grant,

https://businesswales.gov.wales/news-and-blogs/news/net-zero-carbon-start-grant.

16 Welsh Government (2022) Net Zero Industry Wales established to support decarbonisation of

Welsh industry, https://www.gov.wales/net-zero-industry-wales-established-supportdecarbonisation-welsh-industry.

17 Welsh Government (2022) Development Bank of Wales to offer Net Zero incentive,

https://www.gov.wales/development-bank-wales-offer-net-zero-incentive.

105

Chapter 4: Cross-cutting issues

18 Welsh Government (2023) Helping businesses cut energy costs, https://www.gov.wales/helping-businesses-cut-energy-costs-welsh-government-and-development-bank-launch-new-greenbusiness.

19 Welsh Government (2023) Wales’ new freeports unveiled, https://businesswales.gov.wales/news-

and-blogs/news/wales-new-freeports-unveiled.

20 Welsh Government (2021) Net Zero Wales, https://www.gov.wales/net-zero-wales.
21 Welsh Government (2022) Net Zero Strategic Plan,

https://www.gov.wales/sites/default/files/publications/2022-12/welsh-government-net-zerostrategic-plan.pdf.

22 Welsh Government (2021) Programme for government 2021 to 2026,

https://www.gov.wales/sites/default/files/publications/2022-01/programme-for-governmentupdate-december-2021.pdf.

23 Welsh Government (2021) Net Zero carbon status by 2030: public sector route map,

https://www.gov.wales/net-zero-carbon-status-2030-public-sector-route-map.

24 Welsh Government (2022) Public Sector Net Zero data and recommendations,

https://www.gov.wales/public-sector-net-zero-data-and-recommendations.

25 Roads Review Panel (2023) The future of road investment in Wales,

https://www.gov.wales/roads-review.

26 Climate Emergency UK and mySociety (2023) UK council climate action plans database,https://cape.mysociety.org/about/.

27 Welsh Local Government Association (2021) Decarbonisation support programme for Welsh

local authorities, https://www.wlga.wales/decarbonisation-support-programme-for-welsh-localauthorities.

28 Climate Emergency UK (2021) Council climate action scorecards,

https://councilclimatescorecards.uk/.

29 Welsh Government (2022) Active Travel Fund: guidance for applicants 2023 to 2024,

https://www.gov.wales/active-travel-fund-guidance-applicants-2023-2024-html.

30 Welsh Government (2023) National transport delivery plan 2022 to 2027,

https://www.gov.wales/national-transport-delivery-plan-2022-2027.

31 Netherwood, A. (2021) Third UK Climate Change Risk Assessment Technical Report: Summary for

Wales, https://www.ukclimaterisk.org/wp-content/uploads/2021/06/CCRA-Evidence-ReportWales-Summary-Final.pdf.

Progress Report: Reducing emissions in Wales

106

Annex 1

Policy scorecards

Progress Report: Reducing emissions in Wales108

(a) Key for policy scorecards
The credibility of the Welsh Government’s policies and plans is scored using thecriteria in Table A1. In addition, we have scored the risk to progress posed by UK
Government action in each policy area. This is highly relevant in sectors where
policy is mostly reserved to Westminster; for sectors where decision-making isdevolved to the Welsh Government, the score is meant to account for indirect
impacts that can affect progress in that sector (for example, through thedevelopment of relevant market forces).
Our scoring criteria for the risk due to UK Government action are as follows:•High. there is a high dependency on the UK Government for progress in thisarea, and a high probability of them not taking the action necessary intime for Wales to make sufficient progress.

•

Medium. there is either a high dependency on the UK Government but alow probability of that being an issue, or a low dependency but a highprobability of it being an issue.

•

Low. there is both a low dependency on the UK Government and a low
probability of that being an issue.

Table A1
Scoring criteria for assessing policies and plans
Overall score
Credible plans (G)Credible plans with funding, enablers and timelines in place.

Some risks (Y)Some adjustment to plans may be needed to mitigate uncertainties and delivery or
funding risks.

Significant risks (O)Plans under development and/or further work needed to enact policies andovercome uncertainties and delivery or funding risks.

Insufficient plans (R)Plans are either missing, clearly inadequate, or lack funding, and new proposals areneeded.

109

Annex 1: Policy scorecards

Annex 2

Recommendations
1. Recommendations – Priority

111

2. Recommendations - Cross-cutting

113

3. Recommendations – Agriculture and land use

115

4. Recommendations – Waste

117

5. Recommendations – Surface transport

118

6. Recommendations – Buildings

119

7. Recommendations – Electricity supply

121

8. Recommendations – Industry

121

9. Recommendations – Fuel supply

122

10. Recommendations – Aviation

122

11. Recommendations – Shipping

123

12. Recommendations – F-gases

123

13. Recommendations – Engineered removals

124

Progress Report: Reducing emissions in Wales110

1. Recommendations – Priority

ID

SectorPriority recommendations

TimingPriority:
R2022-199

Crosscutting

Publish a transparent and quantified link between policies and milestones, andthe emissions reduction they correspond to in the sectoral pathways set out in
the Second Welsh Carbon Budget.

2022
Overdue

Responsibility: Mostly devolved
Priority:
R2023-029

CrosscuttingWork with local authorities to develop an agreed framework of what aspects of
Net Zero central and local government are responsible for and how these will becoordinated. This should lead to a clearer shared understanding of roles andresponsibilities which can be communicated across local government.

2023

Responsibility: Mostly devolved
Priority:
R2023-034

Agriculture& land use

Urgently address the funding gap for new land management actions in the
farmed landscape for the year 2024, between the Glastir Scheme ending in late2023 and the new Sustainable Farming Scheme beginning in 2025, to ensure
delivery does not lose momentum.

Q3 2023

Responsibility: Mostly devolved
Priority:
R2022-043

Agriculture& land use

Provide detail on how post-CAP agricultural subsidies and schemes in Wales will
target incentives and delivery for climate mitigation alongside wider
environmental goals such as climate change adaptation and biodiversity.

2022
Overdue

Responsibility: Mostly devolved
Priority:
R2023-054

Agriculture& land use

Implement a strategy to address non-financial barriers to achieve annual treeplanting rates of at least 4,500 hectares/year in Wales by 2030, rising to
7,500/year by 2035.

H1 2024

Responsibility: Mostly devolved
Priority:
R2022-327

Waste

Set ambitious recycling targets for 2030 and beyond, improving on the 70%
target for 2025.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-004

Waste

Set out policies or support to capture methane emissions from landfill sites, inaddition to improving the monitoring of emissions.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-005

Waste

Set out how Wales's pathway for reducing emissions in the waste sector will beachieved - including policies, funding/investment needs and provision, and any
dependencies or implications for other UK nations.
Responsibility: Mostly devolved

111

Annex 2: Recommendations

H1 2024

Priority:
R2023-018

Surfacetransport

Monitor EV uptake in Wales and assess whether there are opportunities forfurther policies and incentives to drive adoption forward more quickly than
through the ZEV mandate alone. This should consider opportunities to maximiseemissions savings and deliver co-benefits for Welsh people.

Ongoing

Responsibility: Mostly devolved
Priority:
R2023-020

Surfacetransport

Develop and publish a full delivery plan for how to realise the ambition of
reducing per-person car demand by 10% by 2030. This should include
consideration of how measures that limit car usage will interact with those thatenable more sustainable modes.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-039

Buildings

Develop a detailed plan for decarbonising buildings and reaching Net Zerotargets, incorporating data from Local Area Energy Plans. The plan should
include estimates of investment requirements and yearly targets for deploymentof low carbon heating and energy efficiency measures. It should identify policy
areas which are under Welsh Government control and those which require
coordination with the UK Government.

2024

Responsibility: Equal responsibility
Priority:
R2023-040

Buildings

Fully assess the level of investment required to decarbonise social housing andmake long-term plans for delivering the funding required. Evaluate the costeffectiveness of retrofitting social housing to reach an EPC ‘A’ rating, and review
the proposed target.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-112

Buildings

Fully assess the level of investment required to decarbonise fuel poor homes andmake long-term plans for delivering the funding required.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-041

Buildings

Fully assess the level of investment required to decarbonise public buildings andmake long-term plans for delivering the funding required.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-131

Electricity
supplyWork closely as part of a Minister-led infrastructure delivery group, and in
conjunction with the new Electricity Networks Commissioner, to ensure enabling
initiatives for energy infrastructure are taken forward at pace and necessary
policy changes are implemented in Wales, to deliver a decarbonised andresilient power system by 2035. Wales's spatial planning regime shouldadequately balance local impacts on natural capital with the need for sufficientelectricity network capacity, delivered in a timely fashion, to accommodate
expansion of renewable electricity generation capacity in line with UK
Government targets and Welsh Government ambition.

2023

Responsibility: Mostly reserved
Priority:
R2023-027

Industry

Continue to work with the UK Government on industrial decarbonisation in
Wales, formally requesting some specific support measures, including for the
adoption of CCUS and hydrogen in the South Wales Industrial Cluster.

Ongoing

Responsibility: Mostly reserved

Progress Report: Reducing emissions in Wales112

2. Recommendations - Cross-cutting

ID

SectorCross-cutting recommendations

TimingPriority:
R2022-199

GovernancePublish a transparent and quantified link between policies and milestones, andthe emissions reduction they correspond to in the sectoral pathways set out in
the Second Welsh Carbon Budget.

2022
Overdue

Responsibility: Mostly devolved
Priority:
R2023-029

GovernanceWork with local authorities to develop an agreed framework of what aspects
of Net Zero central and local government are responsible for and how thesewill be coordinated. This should lead to a clearer shared understanding of roles
and responsibilities which can be communicated across local government.

2023

Responsibility: Mostly devolved
R2023-006

Business andFinancePublish a decarbonisation strategy for Welsh Businesses, including a review ofopportunities to prioritise Net Zero objectives within Welsh Government
incentives, procurement requirements, finance provisions and planning policy
levers.

H1 2024

Responsibility: Mostly devolved
R2023-007

Business andFinanceStrengthen support available to SMEs in Wales to respond to Net Zero,
including through expanding assistance available through Business Wales andDevelopment Bank of Wales.

Ongoing

Responsibility: Mostly devolved
R2023-028

GovernanceRequire all public bodies to identify the actions required to meet the 2030
public sector decarbonisation goal and embed these actions within theircorporate plans and reporting.

Q1 2024

Responsibility: Mostly devolved
R2023-030

Governance

Share best practice to enable local authorities to improve the quality of theirclimate action plans.

2023

Responsibility: Mostly devolved
R2023-031

Governance

Build on the approach taken in the Active Travel Fund to develop a
programme of longer-term funding for local authority delivery on Net Zero thatis aligned to their identified roles and responsibilities.

2024

Responsibility: Mostly devolved
R2023-032

Governance

Map out interdependencies between reserved and devolved powers andhow they might impact decarbonisation in all economic sectors and use theresults to identify significant risks to the delivery of Net Zero and construct aplan to manage them.
Responsibility: Joint responsibility

113

Annex 2: Recommendations

H1 2024

R2023-048

Just transition

Set out a strategy to support a just transition.

2024

Responsibility: Mostly devolved

R2023-046

Publicengagement

Move forward with plans to develop a long-term strategy to promote a dietaryshift, and consider explicitly integrating sustainability considerations andconsidering setting targets for dietary shifts.

H1 2024

Responsibility: Mostly devolved

R2023-047

Publicengagement

Publish the new ‘Strategy for Public Engagement and Action’, and the newnational ‘Climate Action Wales’ campaign and website in summer 2023,
including key topics such as road and air travel, diet and home heating.
Establish an effective monitoring approach to track the effectiveness of public
engagement communications and campaigns, and share lessons learnt with
the UK Government and other Devolved Administrations.

Q3 2023

Responsibility: Mostly devolved
R2023-055

Publicengagement

Build on the UK Climate Assembly process and consider the creation of a
Welsh Climate Assembly, including to address aspects of climate change
policy which most significantly interact with people’s everyday lives or may bechallenging.

2024

Responsibility: Mostly devolved
R2023-051

Workers andskills

Review existing skills and training programmes in coordination with Scotland,
Northern Ireland, and England and set out how these will close Net Zero Skills
gaps and where new schemes are needed to address gaps.

Q1 2024

Responsibility: Joint responsibility

Progress Report: Reducing emissions in Wales

114

3. Recommendations – Agriculture and land use

ID

SectorRecommendations for agriculture and land use

TimingPriority:
R2023-034

CAP reform

Urgently address the funding gap for new land management actions in the
farmed landscape for the year 2024, between the Glastir Scheme ending inlate 2023 and the new Sustainable Farming Scheme beginning in 2025, toensure delivery does not lose momentum.

Q3 2023

Responsibility: Mostly devolved
R2023-033

CAP reformMove beyond the voluntary nature of current CAP replacement schemes by
setting a strong regulatory baseline that strengthens rules such as those underthe Basic Payment Scheme and retains them in Welsh legislation.

2024

Responsibility: Mostly devolved
Priority:
R2022-043

CAP reform

Provide detail on how post-CAP agricultural subsidies and schemes in Wales
will target incentives and delivery for climate mitigation alongside wider
environmental goals such as climate change adaptation and biodiversity.

2022
Overdue

Responsibility: Mostly devolved

R2023-035

Peatlands

Ensure that funding and incentives are set at the correct level to meet the
Welsh Government peatland restoration target of 1800 hectares per year by2030. By 2035, 58% of peatland should be under restoration management, and
79% by 2050. All upland peat should be under restoration management by2045.

H1 2024

Responsibility: Mostly devolved
Priority:
R2023-054

Forestry

Implement a strategy to address non-financial barriers to achieve annual treeplanting rates of at least 4,500 hectares/year in Wales by 2030, rising to
7,500/year by 2035.

H1 2024

Responsibility: Mostly devolved
R2023-122

Forestry

Proposals to attract private sector investment into woodland creation need tobe firmed up as soon as is practicable

Q3 2023

Responsibility: Mostly devolved
R2023-036

Agroforestry
andhedgerows

Maintain and enhance incentives to support agroforestry and hedgerows in
the Welsh farmed landscape over the transition to the new post-CAP
framework. Plant trees on 2% of farmland by 2025 while maintaining its primaryuse, rising to 5% by 2035, and extend hedgerows by 20% by 2035 and better
manage existing hedgerows.

H1 2024

Responsibility: Mostly devolved
R2023-123

Bioenergy

Where appropriate, the SFS should consider rewarding the environmental
benefits that the planting of perennial energy crops can deliver on arable landin the same way that England’s Sustainable Farming Incentive has confirmed it
will
Responsibility: Mostly devolved

115

Annex 2: Recommendations

2024

R2023-159

Publicengagement

Develop and maintain a sustained dialogue with rural communities tounderstand and embed their views into a rural just transition.

2024

Responsibility: Mostly devolved

Progress Report: Reducing emissions in Wales

116

4. Recommendations – Waste

ID

SectorRecommendations for waste

TimingPriority:
R2022-327

Wasteprevention

Set ambitious recycling targets for 2030 and beyond, improving on the 70%
target for 2025.

H1 2024

Responsibility: Mostly devolved

R2022-328

Wasteprevention

Set out and implement additional policies necessary to achieve waste
reduction and recycling targets, as part of delivering the Beyond Recycling
Strategy more broadly. Specifically, greater focus on removing plastics andtextiles from residual waste as well as greater focus on waste prevention andcircular economy are needed.

2023

Responsibility: Mostly devolved
Priority:
R2023-004

Landfill

Set out policies or support to capture methane emissions from landfill sites, inaddition to improving the monitoring of emissions.

H1 2024

Responsibility: Mostly devolved

Priority:
R2023-005

Strategy

Set out how Wales's pathway for reducing emissions in the waste sector will beachieved - including policies, funding/investment needs and provision, andany dependencies or implications for other UK nations.
Responsibility: Mostly devolved

117

Annex 2: Recommendations

H1 2024

5. Recommendations – Surface transport

ID

SectorRecommendations for surface transport

Timing

R2023-017

Electric carsand vans

Work with other devolved administrations and the UK Department for Transport
to ensure that published vehicle licensing statistics present an accurate pictureof EV uptake by nation.

H1 2024

Responsibility: Joint responsibility
Priority:
R2023-018

Electric carsand vans

Monitor EV uptake in Wales and assess whether there are opportunities forfurther policies and incentives to drive adoption forward more quickly than
through the ZEV mandate alone. This should consider opportunities to maximiseemissions savings and deliver co-benefits for Welsh people.

Ongoing

Responsibility: Mostly devolved
R2023-019

Charging
infrastructure

Increase chargepoint deployment to meet the ambition to provide one publicchargepoint for every 7-11 EVs by 2025.

2025

Responsibility: Mostly devolved

Priority:
R2023-020

Car demand

Develop and publish a full delivery plan for how to realise the ambition of
reducing per-person car demand by 10% by 2030. This should include
consideration of how measures that limit car usage will interact with those thatenable more sustainable modes.

H1 2024

Responsibility: Mostly devolved
R2023-021

Active travel

Agree and publish funding settlements for active travel beyond 2024/25.
Ideally, these should provide certainty on funding availability for a number ofyears.

2023

Responsibility: Mostly devolved
R2023-022

Publictransport

Develop a more joined-up, straightforward, and affordable system of public
transport fares across Wales.

2023

Responsibility: Mostly devolved

R2023-023

Freight
demandPublish the National Freight and Logistics Plan, including policies on demandside measures such as urban consolidation and modal shift.

2024

Responsibility: Mostly devolved

Progress Report: Reducing emissions in Wales

118

6. Recommendations – Buildings

ID

SectorRecommendations for buildings

TimingPriority:
R2023-039

Buildings
decarbonisation

Develop a detailed plan for decarbonising buildings and reaching Net Zerotargets, incorporating data from Local Area Energy Plans. The plan should
include estimates of investment requirements and yearly targets for
deployment of low carbon heating and energy efficiency measures. It
should identify policy areas which are under Welsh Government control
and those which require coordination with the UK Government.

2024

Responsibility: Joint responsibility
Priority:
R2023-040

Residentialbuildings

Fully assess the level of investment required to decarbonise social housing
and make long-term plans for delivering the funding required. Evaluate thecost effectiveness of retrofitting social housing to reach an EPC ‘A’ rating,and review the proposed target.

H1 2024

Responsibility: Mostly devolved
R2022-111

Fuel-poor homes

Drawing on the recommendations of the Auditor General for Wales, publish
plans for future iterations of the Warm Homes Programme to tackle fuelpoverty and decarbonise homes, addressing the scheme's reliance on fossil
fuel heating and slow roll-out.

2023

Responsibility: Mostly devolved
Priority:
R2023-112

Fuel poor homes

Fully assess the level of investment required to decarbonise fuel poor homes
and make long-term plans for delivering the funding required.

H1 2024

Responsibility: Mostly devolved

R2023-043

New buildings

Update building regulations to ensure that all new buildings are resilient toclimate change impacts, and incorporate ultra-high energy efficiency
standards and low-carbon heating. Ensure that these new standards will bein place by 2025. Ensure that the standards mean that no new buildings areconnected to the gas grid from 2025. Define clear transitionalarrangements which will require any buildings which have not meaningfullycommenced on site within a year of the implementation date to meet the
new standards.

2024

Responsibility: Mostly devolved
Priority:
R2023-041

Public buildings

Fully assess the level of investment required to decarbonise public buildings
and make long-term plans for delivering the funding required.

H1 2024

Responsibility: Mostly devolved

R2023-045

Workers and skills

Quantify the skills and workforce requirements for decarbonising buildings,
and develop policies to support meeting these requirements.
Responsibility: Mostly devolved

119

Annex 2: Recommendations

H1 2024

R2023-044

Publicengagement

Design and implement a public engagement strategy which will raiseawareness of the changes required to decarbonise buildings and provide
advice to consumers on retrofitting homes.

2024

Responsibility: Joint responsibility
R2023-042

Planning
regulations

Conduct an urgent review of planning policies (including the details of
permitted development rights) which may restrict installations of lowcarbon heating and energy efficiency measures, and amend regulations
where appropriate.

H1 2024

Responsibility: Mostly devolved

Progress Report: Reducing emissions in Wales120

7. Recommendations – Electricity supply

ID

SectorRecommendations for electricity supply

TimingPriority:
R2023-131

Networks;
Renewables

Work closely as part of a Minister-led infrastructure delivery group, and in
conjunction with the new Electricity Networks Commissioner, to ensure
enabling initiatives for energy infrastructure are taken forward at pace andnecessary policy changes are implemented in Wales, to deliver adecarbonised and resilient power system by 2035. Wales's spatial planningregime should adequately balance local impacts on natural capital with
the need for sufficient electricity network capacity, delivered in a timely
fashion, to accommodate expansion of renewable electricity generation
capacity in line with UK Government targets and Welsh Government
ambition.

2023

Responsibility: Mostly reserved to the UK Government

8. Recommendations – Industry

ID

SectorRecommendations for industry

TimingPriority:
R2023-027

Business

Continue to work with the UK Government on industrial decarbonisation in
Wales, formally requesting some specific support measures, including forthe adoption of CCUS and hydrogen in the South Wales Industrial Cluster.

Ongoing

Responsibility: Mostly reserved to the UK Government
R2023-026

Planning

Identify local and national requirements for, and opportunities from,industrial decarbonisation in the National Energy Plan for Wales and Local
Area Energy Plans.

2024

Responsibility: Mostly reserved to the UK Government
R2023-052

Workers and skills

Define the skills and workforce requirements for low-carbon manufacturing
in Wales and develop policies to support meeting them.
Responsibility: Joint responsibility

121

Annex 2: Recommendations

2024

9. Recommendations – Fuel supply

ID

SectorRecommendations for fuel supply

Timing

R2023-024

Hydrogen

Assess the potential for large-scale hydrogen production and supporting
infrastructure in Wales beyond 2023/24 and coordinate with the UK
Government on how Wales can best contribute to UK wide plans.

Q1 2024

Responsibility: Mostly reserved to the UK Government
R2023-025

Bioenergy

Produce a Bioenergy Action Plan clarifying the position on bioenergy inWales, setting out its best use, key delivery mechanisms, available funding,licensing requirements and future timelines.

2024

Responsibility: Mostly reserved to the UK Government

10. Recommendations – Aviation

ID

SectorRecommendations for aviation

Timing

R2023-008

DemandSet out an aviation decarbonisation pathway to 2050 in line with Wales's
Carbon Budgets and Net Zero target.

H1 2024

Responsibility: Mostly devolved

R2023-015

DemandThe Welsh Government should work with the Civil Aviation Authority to
begin collecting passenger origin data to track Welsh passengers travelling
to English airports to fly.

Q3 2023

Responsibility: Mostly devolved
R2023-009

Sustainableaviation fuelWork with the UK Government to ensure that Cardiff Airport is prepared for
SAF uptake from 2025 onwards. This includes an enabling regulatoryenvironment, infrastructure and locally upskilled workers.

Ongoing

Responsibility: Mostly reserved to the UK Government

Progress Report: Reducing emissions in Wales12211. Recommendations – Shipping

ID

SectorRecommendations for shipping

Timing

R2023-011

International

Support the UK Government in pushing for inclusion of a Net Zero 2050
target in the International Maritime Organisation's 2023 update of its
Greenhouse Gas Strategy.

H1 2023

Responsibility: Mostly reserved to the UK Government
R2023-014

Cross-cutting

Set out in the Wales National Ports and Maritime Plan a shipping
decarbonisation pathway in line with Wales's Carbon Budgets and Net Zerotarget and how Ports will enable uptake of low carbon shipping fuels andelectrification.

Q3 2023

Responsibility: Mostly reserved to the UK Government
R2023-013

Low carbon
fuels

Develop a plan for deploying shore power and electric recharging
infrastructure at all of Wales’s major ports. This should include identifying
roles and responsibilities for delivery and providing support and incentives
to drive investment. This could be included in the Welsh National Ports andMaritime Plan.

Q3 2023

Responsibility: Joint responsibility

12. Recommendations – F-gases

ID

SectorRecommendations for f-gases

Timing

R2023-003

F-gases

Review the use of F-gases in Wales’s health service and take action toeducate clinicians and patients on the global warming impacts of inhalers.

Ongoing

Responsibility: Mostly reserved to the UK Government

R2023-002

F-gases

Participate in the planned GB-wide F-gas cap scheme, either administeredby the Environment Agency or through a Welsh regulator.
Responsibility: Mostly reserved to the UK Government

123

Annex 2: Recommendations

2023

13. Recommendations – Engineered removals

ID

SectorRecommendations for engineered removals

Timing

R2023-049

Engineered
removals

Carry out a feasibility study that assesses the deployment potential ofdifferent engineered removals technologies, considering input requirements
including biomass, access to CCS networks and impacts on energy systems.

2024

Responsibility: Mostly reserved to the UK Government
R2023-050

Wood inConstruction

Publish the Timber Industrial Strategy. This document should set out anambitious target for increased use of Welsh-grown timber in construction
and introduce policies that encourage the use of timber in the constructionof buildings in Wales.

2023

Responsibility: Mostly devolved

Progress Report: Reducing emissions in Wales

124June 2023
Progress report:
Reducing emissions in Wales
Climate Change Committee
1 Victoria Street
Westminster
SW1H 0ET
www.theccc.org.uk@theCCCuk