June 2021

Progress in reducing
emissions2021 Report to Parliament

Progress in reducing emissions
2021 Report to Parliament
Climate Change Committee
June 2021

Presented to Parliament pursuant to Section 36(1) and Section 59 (1) of the Climate Change Act 2008. This
report is published in two volumes. Volume 1 (Progress in reducing emissions – 2021 Report to Parliament) andVolume 2 (Progress in adapting to climate change – 2021 Report to Parliament)
Both volumes were laid before Parliament on 24 June 2021 and are available online at:www.theccc.org.uk/publications
Book 1 of 22© Climate Change Committee Copyright 2021
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
copyright and the document title specified. Permission from copyright holders must be sought before any
photographs are reproduced. You can download this publication from www.theccc.org.uk/publications
ISBN: 978-1-5286-2544-9
CCS0421411500

3

Contents
Acknowledgements

5

Joint Foreword

6

Overall progress in climate policy: Net Zero and adaptation

8

The Committee

11

Executive Summary

14

1. Emissions in 2020 and underlying progress on decarbonisation

19

2. Ambition on the path to Net Zero22

3. Policy progress on the path to Net Zero26

4. Policy priorities and broadening progress across Government

29

5. The Committee’s changing role

33

Chapter 1

34

1. Global climate, emissions and energy use in 2020

37

2. Global progress in decarbonisation indicators

41

3. Progress in international climate policy

47

Chapter 256

1. Progress reducing UK emissions

60

2. Impacts of COVID-19 on emissions and behaviours in 2020

71

3. Progress reducing the UK’s carbon footprint

84

Chapter 3

90

1. Tracking underlying progress94

2. Underlying progress on key enablers of the path to Net Zero96

3. Underlying progress by sector

106

Chapter 4

138

1. The delivery challenge

142

2. Stated ambition and policy progress146

3. Policy priorities and gaps

157

4. Sectoral progress and next steps for policy

162

Annex

190

Recommendations by Department

191

Recommendations for Regulators and the ONS

217

Recommendations for Scotland, Wales & Northern Ireland219

4

Acknowledgements
The Committee would like to thank:
The team that prepared this report and its analysis: This was led by Chris Stark, Mike
Thompson and David Joffe and included Tom Andrew, Owen Bellamy, Marili
Boufounou, Peter Budden, Eoin Devane, Aaron Goater, Rachel Hay, Mike Hemsley,
Jenny Hill, Jaya Jassi, Miriam Kennedy, Ewa Kmietowicz, Bianca de Farias Letti, Luke
Maxfield, Richard Millar, Chloe Nemo, Simon Rayner, Victoria Root, Vivian Scott,Indra Thillainathan, Emma Vause and Louis Worthington.
Other members of the Secretariat who contributed to this report: Jo Barrett, Kathryn
Brown, Victoria de la Cruz, Tom Dooks, Brendan Freeman, Gemma Holmes, Cara
Labuschagne, James Lees, Annabella Okene, Penny Seera, David Style, and Sean
Taylor.
A number of organisations and stakeholders for their support, including the
Department for Business, Energy & Industrial Strategy; the Department forEnvironment, Food & Rural Affairs; and the Department for Transport.
A wide range of stakeholders who engaged with us or met with the Committee
bilaterally.
Our design and digital agencies: Pali Palavathanan and Anoushka Rodda(TEMPLO) and Mat Burhouse (Slingshot).

5

Joint Foreword
The UK’s Climate Change Act had extraordinary foresight. It laid the groundworkfor the nation’s escalating climate ambition. It anticipated, correctly, the need tocajole governments into climate plans that would not otherwise fit the political
cycle. It has kept UK climate policies rooted in the scientific realities and thetechnical feasibilities.
That framework now faces its sternest test, as demand grows to see Net Zerodelivered; as the urgency becomes more obvious; and as the inadequacies of ourplanning for the impacts of climate change become clear.
The rigour of the Climate Change Act helped bring COP26 to the UK, but it is notenough for Ministers to point to the Glasgow summit and hope that this will carry
the day with the public. Leadership is required, detail on the steps the UK will takein the coming years, clarity on tax changes and public spending commitments,
active engagement with people and businesses across the country. These steps
are essential, so people can see opportunity in climate-positive choices. We
cannot rely on good will alone.
This demands a step change in Government action, but it is hard to discern any
comprehensive strategy in the climate plans we have seen in the last 12 months.
There are gaps and ambiguities. Climate resilience remains a second-order issue, if
it is considered at all. We continue to blunder into high-carbon choices. Our
Planning system and other fundamental structures have not been recast to meet
our legal and international climate commitments.
We commend Ministers for accepting our advice on the future path for UK
emissions. The setting of the UK’s 2030 NDC, the passing into law of the Sixth
Carbon Budget, the decision to bring international aviation and shipping emissions
within the UK carbon budgets; all were made on the Committee’s
recommendation. But the Committee’s advice to step-up the ambition andresourcing of adaptation continues to go unheeded. And the willingness to set
emissions targets of genuine ambition contrasts with a reluctance to implement
the realistic policies necessary to achieve them.
It has therefore been a year of climate contradictions. Important statements ofambition, like the agreement to phase out the sale of petrol and diesel cars andvans, have been undermined by delays to essential legislation and much-neededplans to decarbonise buildings and improve their climate resilience. We await a
Treasury Net Zero Review, once promised in autumn 2020. The transport
decarbonisation plan is still slated, somewhat optimistically, for spring 2021. A
pattern has emerged of Government strategies that are later than planned and,
when they do emerge, short of the required policy ambition.
There is still time to address this. This Progress Report offers more than 200 policy
recommendations, covering every part of Government. The opportunity to
implement them is there. Before COP26, a Net Zero Strategy is promised, which will
carry the greatest weight if it is accompanied by Treasury’s review of funding. The
Government’s climate change risk assessment, due in early 2022, can change thetone on adaptation and climate risk management. But it is time for theGovernment to implement these changes with the urgency that the science
demands.

6

COVID-19 casts a long shadow, but there are three broad lessons from thepandemic: first, we have seen the critical importance of effective planning forhigh-impact eventualities; second, we have experienced the ability of government
to act with pace and scale when it is required; and third, we have learned thatpeople are willing to support change when they have the information before
them.
These lessons can shape a successful COP26 summit in November. With strong
climate plans at home, the UK Presidency can have global influence. Our message
to Government is simple: act quickly – be bold and decisive. Your moment has
arrived.

Lord Deben
Chairman, Climate Change Committee

7

Baroness Brown
Chair of the Adaptation Committee

Overall progress in climate policy: Net Zero and adaptation
The 2020s must be a decisive
decade for climate action.

We are in the decisive decade for tackling climate change. Global emissions ofgreenhouse gases are as high as they have ever been. Nevertheless, green shootsof progress suggest this can change. And it must. The 2010s was the hottest
decade on record globally, driving dangerous weather patterns and affecting
societies and ecosystems around the world. Without a much stronger and urgent
effort, we will breach 1.5°C of warming in the early 2030s and remain ill-prepared
for the future.

The world needs to cut
emissions and adapt to climate
risks.

Global emissions must be cut rapidly to Net Zero, integrated with actions to adapt
to the climate risks and impacts. Action must occur across the world, with richer
countries acting earliest, while offering support for poorer countries. As host of theupcoming UN climate talks (‘COP26’) the UK has a particular responsibility to
implement effective climate action and drive global efforts.
The UK’s record to date is strong in parts, but it has fallen behind on adapting to
the changing climate and has not yet provided a coherent plan to reduce
emissions in the critical decade ahead:

The UK has a strong trackrecord on climate action, but it
is incomplete.

•

Statutory framework for climate. The UK has a strong climate framework
under the Climate Change Act (2008), with legally-binding emissions
targets, a process to integrate climate risks into policy, and a central role forindependent evidence-based advice and monitoring. This model has
inspired similar climate legislation across the world.

•

Emissions targets. The UK has adopted ambitious territorial emissions targets
aligned to the Paris Agreement: the Sixth Carbon Budget requires anemissions reduction of 63% from 2019 to 2035, on the way to Net Zero by
2050. These are comprehensive targets covering all greenhouse gases andall sectors, including international aviation and shipping.

•

Emissions reduction. The UK has a leading record in reducing its own
emissions: down by 40% from 1990 to 2019, the largest reduction in the G20,
while growing the economy (GDP increased by 78% from 1990 to 2019). The
rate of reductions since 2012 (of around 20 MtCO2e annually) is
comparable to that needed in the future.

•

Climate Risk and Adaptation. The UK has undertaken three comprehensive
assessments of the climate risks it faces, and the Government has publishedplans for adapting to those risks. There have been some actions in response,
notably in tackling flooding and water scarcity, but overall progress inplanning and delivering adaptation is not keeping up with increasing risk.
The UK is less prepared for the changing climate now than it was when theprevious risk assessment was published five years ago.

•

Climate finance. The UK has been a strong contributor to international
climate finance, having recently doubled its commitment to £11.6 billion inaggregate over 2021/22 to 2025/26. This spend is split between support for
cutting emissions and support for adaptation, which is important given
significant underfunding of adaptation globally. However, recent cuts to
the UK’s overseas aid are undermining these commitments.

8

The UK’s record on climate change compares well with that of other countries. But
despite the recent willingness of the Government to raise ambition to cut emissions,delays in policy and implementation continue. Much greater urgency is now
required from Ministers:
Delivery must accelerate andbroaden.

Adaptation policy needs a stepchange in ambition andaction.

•The ambition of the last year must be turned into policy and real-world
delivery. The UK has begun to reinforce its new emissions targets with clear
ambition for specific sectors in line with the required path (e.g. 40 GW
offshore wind by 2030, phase-out of petrol and diesel cars and vans by2030, 30,000 hectares annual afforestation by 2025). However, somecommitments fall short and key strategies have been delayed, leaving
holes in ambition. Policies to deliver on the commitments are mostly still tobe developed.

•

Progress must extend across the economy. The relative success of reducing
emissions in the electricity sector to date has not been matched intransport, buildings, industry, or agriculture. Only a few sectors have strongplans to adapt to the current and future climate, leaving key risks to the
UK’s infrastructure and natural environment. Some government
departments are not sufficiently prioritising climate change, and none are
yet moving at the pace required.

•

A robust plan is needed for adaptation. The UK does not yet have a vision
for successful adaptation to climate change, nor measurable targets toassess progress. Not one of the 34 priority areas assessed in this year’s
progress report on adaptation is yet demonstrating strong progress in
adapting to climate risk. Policies are being developed without sufficient
recognition of the need to adapt to the changing climate. This undermines
their goals, locks in climate risks, and stores up costs for the future.

•

The climate challenge must be reflected throughout policy and planning.
Climate risks affect all aspects of society, while any new source of emissions
could put the Net Zero path at risk. Climate change must therefore be
integrated throughout policy and planning decisions, and must be a key
consideration in the Government’s proposed planning reforms.

As the UK rebuilds after the COVID-19 pandemic, there is an opportunity to makesystemic changes that will fill the gaps in the UK’s climate response. Now is the timeto invest in the UK’s future through accelerated action to cut emissions and adapt
to the changing climate, while supporting the global transition.
The Net Zero Strategy, dueahead of COP26, should
complete the picture on how
the UK will cut its emissions.

9•

Delivering Net Zero. The Government has promised a Net Zero Strategy
before COP26. It must set clear and integrated ambitions across the
economy that will meet the Sixth Carbon Budget, and indicate how they
will be funded fairly. Efforts must then shift quickly to focus on
implementation and delivery. The pace of policy development must
accelerate. Credible policies should be fully functioning and properly
funded by the end of the current Parliament (i.e. by 2024) to ensure that
almost all investments and purchases are low-carbon by the end of thedecade or soon after.

•

Adapting to climate risks. The Government should set out its vision for a UK
that is well-prepared for climate change. It should include clear quantified
targets, supported by policies and regulations. Climate adaptation must be
embedded in core policies if they are to succeed. Key current andupcoming policies include: the Plan for Growth, the National Infrastructure
Strategy, the Environment Bill, the Environmental Land Management

Climate Change Committee

Scheme, the Tree and Peat Action Plans, the Net Zero Strategy, thePlanning Bill and developments in energy, housing and health policy. *Adaptation is vital to achievingsociety’s goals and must be
embedded throughout
government policies.

•

Integrating climate policy. Achieving Net Zero will require effective
adaptation. The programmes must be properly integrated. For example, as
the energy efficiency of buildings is improved, they must also be protectedfrom overheating. The vast carbon stores of the UK’s peatlands and soils
must be protected. Trees planted to draw CO2 from the atmosphere
and/or to provide timber should be suited to the future climate and, where
possible, provide services such as flood defences, enhancing ecosystems,
urban cooling, and accessible green space.

•

Embedding climate action across society. Reducing emissions andadapting to climate change will require a whole-of-society endeavour.
Success will require the public to be engaged in the challenge, building
public consent for the changes with a broader understanding of what isrequired and why. Workers will need help to develop the required skills andto fill the jobs created during the transition. Businesses must be encouraged,
and in some cases required, to invest in solutions and make low-carbon,
climate-resilient choices.

•

Reinstating overseas aid commitments. Climate challenges arefundamentally integrated with wider challenges for ecosystems andeconomies. This means climate finance and climate action are not fully
isolated from cuts to the UK’s Official Development Assistance (ODA) inpractice. The Government has said the cut to ODA is temporary; now that
the UK’s economic recovery is underway, the Government should provide
a firm timeline for reinstating its previous commitment.

Government must lead the change. Reducing emissions and adapting to climatechange must be embedded throughout policy. All parts of government have arole, requiring strong coordination and an effective devolution of powers andresponsibilities to drive delivery. We set out detailed recommendations for eachgovernment department and the national Governments of Scotland, Wales andNorthern Ireland in an annex of Tables at the end of this report. We will revisit
progress against them at our next annual progress report in a year’s time. Our next
major report will be a thorough appraisal of the UK’s Net Zero Strategy.
Reaching Net Zero andaddressing climate risks canhelp to build a better UK.

The transition to Net Zero and the climate adaptation programme offer a positive
vision for the UK’s future and for the world. They involve an investment boost thatcan support the economic recovery. This investment will be rewarded with
reduced running costs and reduced costs of adapting to climate change in the
future. It will support good-quality new jobs across the country, and bring
opportunities to enhance our natural environment, our health and our well-being.

The UK can and should be a
global leader on climatechange.

The challenge of responding to climate change will not end with COP26 in theautumn or with the completion of the UK Presidency a year later. Global
commitments are increasingly moving into line with the Paris Agreement, but wehave entered a critical decade of action to consolidate and to deliver them. UK
action must continue to provide an attractive model of success to maintain our
climate leadership in support of a global response that meets the global
challenge.

* Some of these UK policies only cover England. Equivalent devolved policies must also reflect climate change.

10The Committee

The Rt. Hon John Gummer, Lord Deben,
Chairman
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.

Professor Keith Bell
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 Nick Chater

Professor Michael Davies

Nick Chater is Professor of Behavioural Science at Warwick
Business School. He has particular interests in the cognitiveand social foundations of rationality, and applying
behavioural insights to public policy and business. Nick is
Co-founder and Director of Decision Technology Ltd, a
research consultancy.

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

11

Climate Change Committee

Professor Piers Forster

Dr Rebecca Heaton FICFor

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 a significant roleauthoring Intergovernmental Panel on Climate Change(IPCC) reports, and has a coordinating lead author role for
the IPCC’s sixth assessment report.

Rebecca Heaton is responsible for Drax Group’s efforts
to mitigate climate change, ensuring that soundscience underpins climate change polices and businessstrategy. She is also responsible for developing
sustainability and climate change research
programmes. Rebecca has a 20-year global career
working at the interface between business, science andpolicy.

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.

The Committee

12Pete Betts
Expert Adviser to the Committee
Pete was a career civil servant and until 2018 led UK policy
on international climate change and energy. He was also
Lead Negotiator for the European Union in the UNFCCC
negotiations. His current portfolio includes roles at theEuropean Climate Foundation; Willis Towers Watson;
IRENA; Grantham School and Chatham House.

13

The Committee

Executive Summary

1. Emissions in 2020 and underlying progress on decarbonisation

19

2. Ambition on the path to Net Zero22

3. Policy progress on the path to Net Zero26

4. Policy priorities and broadening progress across Government

29

5. The Committee’s changing role33

14

We welcome the setting of the
Sixth Carbon Budget inaccordance with ourrecommendations.

With the adoption of the Sixth Carbon Budget, in accordance with theCommittee’s recommendations, the UK has committed to an ambitious path to
Net Zero. We welcome this decision and the inclusion of emissions frominternational aviation and international shipping in the legal scope of carbon
budgets for the first time. The Sixth Carbon Budget requires a 63% reduction inemissions from 2019 to 2035 (78% relative to 1990).

The challenge has shifted
decisively from target-setting todelivery. This decade will be
crucial in getting on track to
Net Zero.

This is now the foundation for the necessary scale-up of policy action in all sectors.
The challenge has shifted decisively from target-setting to delivery. The steps taken
during this Parliament, and the action taken in this decade, will be crucial. The
Committee’s focus must also shift, towards real-world progress and tougher scrutinyof Government plans.

The Net Zero Strategy has hugesignificance in setting out the
UK’s vision for meeting its
ambitious targets.

The Net Zero Strategy, promised ahead of November’s UN climate talks in Glasgow('COP26’), now has huge significance. It must set out a coherent vision. It must
make plans for the jobs transition, and the necessary supply of skills. It will be thebasis of the essential public engagement that must take place on the changes
ahead. And it must address the unanswered question of how the transition will befunded in a fair way. Effective leadership, coordination and governance acrossGovernment has never been more important.
In assessing the UK’s progress in the last year, we acknowledge the increase in thescale of Government efforts. But progress is not yet in step with the urgency of thechallenge:•

Effective policies must be developed at greater pace. The path to Net Zerorequires a rapid scale-up in low-carbon investment and low-carbon
choices across the economy. Government must lead that change withmore urgency than we have seen so far. Many vital and long-promisedplans, such as the Heat and Buildings Strategy and the Treasury’s Net Zero
Review, have been delayed by a year or more. As a result, there is a large
policy gap: credible policies for delivery currently cover only around 20% of
the required reduction in emissions to meet the Sixth Carbon Budget.

•

The Government has made significant commitments, but there are still
important gaps in ambition. Where ambitions have been set over the lastyear, they have tended to be a significant step up. Many are now alignedwith the path to Net Zero (e.g. 40 GW offshore wind by 2030, phasing out
petrol and diesel cars and vans by 2030). However, gaps remain in the
Government’s stated ambitions (e.g. on diets, aviation demand, waste,
low-carbon heat networks), while some announcements fall short of what is
likely to be needed (e.g. on peatlands, heat pumps, carbon capture andstorage). Together these imply a significant ambition gap: current
Government commitments that align to the Committee’s publishedpathways cover less than half of the emissions reductions to 2035.

•

Efforts must be increased markedly, especially in the lagging areas. There
are signs of a multi-speed approach within Government to raising ambitionand putting in place effective policies. Some departments (e.g. Defra,
MHCLG, but also parts of BEIS and the Treasury) are lagging behind others
and appear timid in their approach. The path to Net Zero requires highambition and an effective policy framework in all areas.

Progress in reducing emissions: 2021 Report to Parliament

16

The Net Zero Strategy must set
out a coherent vision of how
Net Zero and the Sixth Carbon
Budget will be met.

The Government should
introduce a Net Zero Test toensure that all policy decisions
are compatible with thelegislated targets.

17

The full Net Zero Strategy provides an opportunity for the Government todemonstrate that it means what it says on climate action. It should fill the gaps inambition, set up a programme of accelerated policy development, tackle thecross-cutting challenges in a joined-up way and ensure alignment of all policy
decisions with Net Zero so that the 2020s becomes the decisive decade it must be.
•

The public must be brought along with the transition. Better public
information is needed on the changes that people should expect, and on
the timing of their implementation. Meaningful public engagement will help
build stronger public consent for the transition, and people should expect
to understand the rationale for changes. They should also be able to see abenefit from making low-carbon choices and have easy access to theinformation and funding required to make changes happen.

•

The Net Zero Strategy must clarify ambition across the economy to matchthe targets in a credible way. Quantified, credible pathways for sectoral
decarbonisation, technology deployment and behaviour changes must be
set out, and backed by specific policies as far as possible. If ambition falls
short of the Committee’s pathways in some areas the Government must
explain how this shortfall will be made up elsewhere. The Net Zero Strategy
must include demand-side action, which can come with a range of cobenefits (e.g. healthier diets, more exercise and better air quality), and bebacked-up by policies that are carefully designed and implemented.

•

The Treasury must ensure a fair and long-term approach to funding thetransition. The Net Zero Strategy must be underpinned by an approach tofunding that distributes the costs, savings and wider benefits ofdecarbonisation fairly. It must encourage action across society, while
protecting vulnerable people and companies at risk of adverse
competitiveness impacts. A move to longer-term funding streams and lowrisk financing of Net Zero investments will be essential to making sustained
progress.

•

The Strategy should set clear timelines for policy development that matchthe urgency of the challenge. A strong, coherent and joined-up policy
framework is needed. Credible policies to deliver the ambitions of the Net
Zero Strategy should be fully in place by the end of the current Parliament
at the latest (i.e. by 2024) to ensure that almost all investments andpurchases (e.g. cars, heating appliances, new energy supplies) are lowcarbon by 2030 or shortly after. All departments must increase their pace.

•

The Strategy should initiate a strengthened role for local delivery. All levelsof government have committed to ambitious climate action: UK, devolved
administrations, city regions and local authorities. Better coordination andsupport is required across these levels, including workable business models,
the removal of barriers to action, dedicated funding and an approach thatenables sub-national action to complement action at the national level.

•

All policy decisions must be compatible with the Government’s climate
commitments. The Net Zero Strategy should set out how the Government
will achieve this, for example by introducing an explicit test to ensurecompliance. Both the Net Zero Strategy itself and policy more widely must
recognise the challenges of adapting as the climate changes. Planningpolicy (both at UK and devolved level) must also reflect these challenges.

Climate Change Committee

Transport emissions fell sharply
in 2020, but will rebound tosome degree as we move outof lockdown. Action is required
to keep positive changes.

Emissions fell sharply in 2020 (by 13%) to 435 MtCO2e, 48% below 1990 levels. The fall
was primarily in transport sectors as a result of the COVID-19 pandemic andlockdowns. Much of the 2020 fall is likely to be temporary, although that partly
depends on the Government’s choices. Action now can lock in beneficial
changes seen on walking, cycling and remote working for those that want it, forexample through investment in broadband, active travel and public transport.
More widely, there is an opportunity to accelerate low-carbon investments, forexample on energy infrastructure, homes and electric vehicles.
An effective Net Zero Strategy will support the UK to genuinely ‘build back better’and provide authority on the global stage into COP26 and beyond.
The rest of this executive summary is set out in five sections:
1. Emissions in 2020 and underlying progress on decarbonisation
2. Ambition on the path to Net Zero
3. Policy progress on the path to Net Zero
4. Policy priorities and broadening progress across Government
5. The Committee’s changing role
We provide our full recommendations, department by department, covering all
aspects of the Net Zero challenge, in an annex at the end of this report.

Progress in reducing emissions: 2021 Report to Parliament181. Emissions in 2020 and underlying progress on decarbonisation
The COVID-19 pandemic and the resulting restrictions caused a substantial drop inemissions, which fell to a level almost half those of 1990. But lasting changes to UK
emissions remain far from certain. The Committee’s provisional estimate is that UK
emissions fell by around 13% in 2020 to 435 MtCO2e, with the vast majority of the fallassociated with reductions in emissions from surface and air transport (Figure 1 andBox 1).
Estimated UK consumption emissions (i.e. the UK’s carbon footprint, including
emissions embedded in imports) are considerably higher than the UK’s ‘territorial’
emissions. They rose slightly in 2018, the most recent year for which data are
available, following a gradual decline over the preceding decade.
The impact of COVID-19 on
travel demand led to an
unprecedented 29% fall intransport emissions in 2020.

The impact of COVID-19 on travel demand led to an unprecedented 29% fall intransport emissions in 2020. The impact has been particularly pronounced on
demand for public transport, which fell more deeply and recovered more slowly
than private car travel following lockdowns being lifted. A new challenge fordecarbonisation policy is rebuilding the public’s confidence in the safety of public
transport to avoid a ‘car-led’ recovery, and providing people with reliable
alternatives to car travel.
The huge changes required during this period to how society operates are not amodel for the sustained changes needed for Net Zero, but nevertheless have been
instructive, across a range of sectors. We have learned that changes to working
and travel behaviour can be made rapidly if required. A consensus has developedthat the capital investment required for Net Zero can act to boost the economy as
it recovers. The importance of good broadband and telecoms provision has
become clearer, and we have seen that there is considerable scope to manage
offices and other non-residential buildings in a more energy-efficient manner,
especially when they are unoccupied.

Emissions in 2021 may well behigher than in 2020, even withpositive developments.

As travel returns, we can expect a significant rebound in transport emissions, even
if some of the positive behaviour changes (e.g. increased cycling, less businesstravel) made in response to the pandemic can be locked in through investment in
active travel and broadband. But even with progress in reducing emissions fromother sectors, UK emissions in 2021 may well be higher than in 2020.

Sustained progress in reducing
emissions will need underlying,
structural changes.

The focus must be on underlying progress in order to make lasting reductions interritorial and consumption emissions. Underlying progress to date has been
insufficient outside electricity generation:

19•

There has been little of the necessary progress in upgrading the building
stock. Insulation rates remain well below the peak market delivery
achieved up to 2012 before key policies were scrapped, demonstratingclear potential for growth if an effective policy package is put in place.
Despite a small improvement in the rates of heat pump installation, theseremain far below the levels that are necessary.

•

Progress in agriculture and land use has repeatedly failed to meet theindicators (e.g. for tree planting and on-farm efficiency measures) outlinedin the Committee’s progress reports in recent years. There are signs ofpotential consumer willingness to shift towards less carbon-intensive diets in

Climate Change Committee

future, but this has not yet translated to reduced meat consumption or
been backed up by policy to support the change.
Progress in reducing emissions from waste has stalled in recent years
following a period of steep emissions reduction from the late-1990s causedby the diversion of waste from landfill.

•

Deployment of renewable electricity generation has scaled up rapidly.
Although the increase in 2020 was at a much slower rate than the averageachieved over the previous five years, the growing project pipeline meansthat this slowdown is likely to be temporary.

•

Sales of electric vehicles and the deployment of supporting charging
infrastructure have increased considerably in recent years. Policies will be
required to drive the accelerated uptake required throughout the 2020s(e.g. a zero-emission vehicle mandate). There are also concerning trends,
notably the rapid growth in car and van travel during the past decade.

•

Although there have been emissions reductions in industry, it is unclear how
far this reflects structural changes driven by wider factors or genuine
improvements in efficiency and carbon intensity.

UK emissions are nearly 50% below 1990 levels, but the journey to Net Zero is far
from half done. Government must now match its bold statements of ambition witheffective policies and implementation, and it must move at pace if it is to deliver
against the UK’s stretching targets.

Figure 1 Changes in UK emissions by sector

0
-5

150
Annual change
2019-2020

100

2010

2020

Surface transport
Manufacturing & construction
Electricity supply
Fuel supply
Shipping-15-20

Buildings

Fuel supply

Shipping-25
Manufacturing& construction

0
2000Electricity supply

50

Surfacetransport

Aviation

Average annualchange 2009-2019-10

Change in emissions
MtCO2e5200

Annual emissions MtCO2e

UK emissions are nearly 50%
below 1990 levels, but thejourney to Net Zero is far fromhalf done.

•

Buildings
Agriculture & LULUCF
Aviation
Waste
F-gas

Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures.
Notes: LULUCF = Land use, land-use change and forestry. Estimates of emissions for sectors with large proportions of nonCO2 emissions are not shown on the right-hand chart. Final estimates of 2020 emissions in these sectors will be
published in early 2022. The sectoral emissions for aviation and shipping include the UK’s share of international
aviation and shipping emissions, and are CCC estimates.

Progress in reducing emissions: 2021 Report to Parliament

20

Box 1
Impacts of the COVID-19 pandemic on UK emissions in 2020
Lockdown measures led to a record decrease in UK emissions in 2020 (Figure 1). Emissions
fell by around 13% overall with the largest falls in aviation (-60%), shipping (-24%) andsurface transport (-18%). Home energy use increased, with residential buildings the only
sector to show an overall increase in emissions (+2%).
The fall in emissions in 2020 will have practically zero impact on the UK’s past and futurecontribution to global warming.
Most of the falls in sectoral emissions observed in 2020 are likely to be transient, as they do
not reflect structural changes in the underlying economic, social, energy, transportationor land systems. In the absence of these underlying changes, emissions are likely torebound to some extent in most sectors in 2021.
However, the last year has seen some large changes in patterns of behaviour due to thepandemic. The extent to which these changes will endure is currently unclear. In
particular, there is potential for lasting impacts from new working patterns and changes
to personal transport choices, with complex and uncertain implications for how ourdomestic and international transport systems work and the demand for energy in homes
and workplaces.
The lasting impacts of the pandemic are still far from certain, but the experience from thelast year has shown:•

Emissions fell rapidly, but they can rebound just as quickly. In the absence ofunderlying structural changes emissions are likely to rebound in most sectors in 2021.

•

There is a limited window to change behaviours. If sources of ‘behavioural friction’ inmoving from one pattern of living and working to another can be overcome, people
and organisations can often adapt quickly. There are now significant opportunities tolock in and build on positive developments, especially – though not exclusively –regarding travel demand.

•

The need for increasingly resilient networks and infrastructure. Our energy (anddigital) networks have demonstrated they can be resilient to profound changes inuse. The transition towards Net Zero will only increase the challenges of operating anelectricity system with high shares of variable and inflexible generation. The nonresidential buildings stock can also be improved to respond more efficiently tovariations in occupancy.

•

Lockdown is not a blueprint for decarbonisation. The fall in UK emissions in 2020 waslarger than the annual change needed on the pathway to Net Zero, but did notmaterially affect the structural changes that are needed to reach Net Zero.
Lockdowns heavily restricted movement and had damaging economic and social
consequences. This stands in contrast to the fair, well-planned and sustainabletransition to Net Zero that is possible. Net Zero should bring improvements to quality oflife: new jobs, cleaner air, quieter streets, more green spaces, comfortable homes
and healthier lifestyles.

It will be important to sustain climate-positive changes that have developed during the
pandemic, but also to act decisively to mitigate the negative changes that could
jeopardise efforts towards Net Zero.

21

Climate Change Committee

2. Ambition on the path to Net Zero
The Government has moved to align many of its sectoral commitments with those
implied by a Net Zero pathway, significantly strengthening its ambitions since the2017 Clean Growth Strategy. Individual plans and policies published in recent
months have set ambitions closer to those recommended by the Committee. But a
notable overall shortfall is now emerging between what has been announced so
far and the Committee’s detailed recommendations for the Sixth Carbon Budget.
The late publication of several strategies is also disappointing and means that wehave only a partial picture of ambition:

Announced ambition in many
areas is in line with, or close to,
the necessary level.

•

A number of the important elements of the overall Net Zero Strategy havebeen delayed. At the time of finalising this report, a range of strategies
expected in 2020 had not yet been published, including the Heat andBuildings Strategy, the Transport Decarbonisation Plan, the Treasury’s final
Net Zero Review, the Aviation Decarbonisation Strategy and the Nature
Strategy. Even with these, there are likely to be gaps. We highlight the needto fill a range of gaps on strategy and policy in section 4.

•

Announced ambition for electric cars and vans, offshore wind, low-carbonhydrogen production, industrial decarbonisation to 2030 (but not to 2035)
and tree planting to 2025 is broadly in line with the Committee’s scenarios(Table 1). This is commendable. Together, areas where ambition is
beginning to align with the CCC pathway cover almost half of theemissions reduction required for the Sixth Carbon Budget (Figure 2). We
expect this to rise further during 2021, as additional strategies are released.
– These clear commitments have seen responses in the market and fromthe public. For example, announcements from car manufacturers andincreased interest in electric cars have followed the Government’s
commitment to phase out petrol and diesel cars and vans by 2030.
However, clear policies will be required to make this a reality.
– In other areas, companies are also voicing support for increased
ambition, such as for full electricity decarbonisation by 2035, phasingout installation of high-carbon heating systems, rebalancing electricity
and gas prices to support electrification, and support for fitting carbon
capture, utilisation and storage (CCUS) on Energy from Waste plants.

However, there has been atendency for ambition to fallshort of our recommended
pathway to meet the Sixth
Carbon Budget.

•

However, where ambition has diverged from the CCC pathway to meet
the Sixth Carbon Budget, there has been a tendency for ambition to fallshort rather than go further (e.g. heat pump deployment that is a third
lower in 2028, total CCS ambition that is around half in 2030) (Figure 3).

The Government is not required to commit to the Committee’s detailed sectoral
pathways, nor to follow our policy advice. But it must set out a credible alternative
approach where it chooses not to. Our pathways are designed to be stretchingacross the economy, so it is difficult to compensate for lower ambition in one areawith greater ambition elsewhere. The Net Zero Strategy, released later this year, will
have to address the shortfall, strengthening weaker commitments to be closer tothe Committee’s pathways or setting out how emissions can be cut faster in otherareas to compensate.

Progress in reducing emissions: 2021 Report to Parliament

22

Important gaps remain in
Government ambition,
particularly on the demandside, and other ambitions needclarification.

The Net Zero Strategy will needto ensure that ambition acrossthe board adds up to acredible approach to meetingthe targets.

Important gaps also remain in terms of the scale of the Government’s ambition incertain sectors, while there is a danger that several of the broad ambitions
announced are implemented in a way that would fall short of the CCC scenarios:•

Consumer choices. So far, the Government’s announcements havefocused on technologies and largely ignored the potential for changes in
consumer choices to reduce emissions. These are particularly important tolimit emissions in ‘hard to abate’ sectors, such as aviation and agriculture.
We note that there are a wide range of levers available to promote
low-carbon choices, including enabling measures and nudges, ensuring
supporting infrastructure is available, and more interventionist measuresusing regulations and the tax system.

•

Ambiguity in ambition. While some commitments have been made that
could be at least as ambitious as our pathways, there remain risks that realworld implementation could fall short. For example, the announced 2030
phase-out date for sale of petrol and diesel cars and vans will allow sale ofvehicles with ‘significant zero-emission capability’ until 2035, well after the2032 date by which we recommend all such vehicles should be fully zeroemission. The definition of which vehicles can be sold after 2030, currently
subject to consultation, will be crucial in ensuring that emissions andmotoring costs are kept as low as possible by prioritising fully zero-emission
vehicles over hybrids.

There also remain a range of issues that have not yet been tackled, and which do
not fit neatly into sectoral strategies (see section 4). The Net Zero Strategy will needto fill remaining gaps, clarify existing ambitions, set out a vision for the governanceof the transition and ensure that the ambition across the board adds up to acredible and quantified approach to meeting the Sixth Carbon Budget and Net
Zero target.

Figure 2 Is Government ambition on track?
600
500

MtCO2e

400
300
200

Potentially on track

Some action but risk of falling behind

Falling behindBaseline emissions

Balanced Net Zero Pathway

Climate Change Committee

2035

2034

Fully on track

Source: CCC analysis; CCC (2020) The Sixt h Carbon budget – The UK’s path to Net Zero

23

2033

2032

2031

2030

2029

2028

2027

2026

2025

2024

2023

2022

2021

0

2020

100

Table 1
Government commitments compared to the CCC Pathway between 2025-2035
Headline actions

Government commitment ¹

CCC pathway

Offshore wind

40 GW by 2030

40 GW by 2030

Electric vehicles

Phase-out of new fossil fuelled vehicle
sales by 2030, with allowance for somehybrids out to 2035

Phase-out of all new fossil-fuelledvehicle sales by 2032

Heat pumps in homes

600,000 heat pump installations / year by
2028

900,000 heat pump installations / yearby 2028
1.1 million installations / year by 2030

Low-carbon heat networks(all buildings) ²

2 TWh of low-carbon heat networks by
2030

25 TWh of low-carbon heat networks
by 2030

Low-carbon hydrogen

5 GW (up to 42 TWh) by 2030

30 TWh by 2030

Carbon Capture and Storage ³

10 MtCO 2 captured and stored annuallyby 2030, across four industrial clusters,
including at least one power project

22 MtCO 2/year captured and stored in
2030, across at least five industrial
clusters, including multiple power
projects

Emissions reduction in
manufacturing and refining

Around two-thirds by 2035, compared to2018

73% by 2035, compared to 2018

Tree-planting

30,000 hectares / year by 2025

30,000 hectares / year by 2025
50,000 hectares / year by 2035

Peatland restoration 

32,700 hectares / year by 2025

67,000 hectares / year by 2025

Greenhouse gas removals

Innovation support provided, inrecognition that engineered removals will
be needed, but no firm commitment on
deployment yet

5 MtCO 2/year by 2030

Nuclear power 5

Final Investment Decision on at least one
new nuclear power plant by the end of
this Parliament

One new nuclear plant operational by
2030, and a further plant by 2035

Source: CCC analysis.
Notes:¹ Based on actions in the Ten Point Plan, Energy White Paper, Industrial Decarbonisation Strategy and England Tree and Peat Action Plans between 2025
and 2035 and the CCC’s Balanced pathway from the Sixth Carbon Budget.
² Government commitment on low-carbon heat network deployment is illustrative, and has been inferred from Government spending commitments, using
assumptions around expected leveraged investment and the proportion of funding targeted at low-carbon networks.
³ The difference in carbon captured and stored annually largely comes from projects in the power sector in CCC scenarios, so other technologies could
compensate for this shortfall.
 Government peatland restoration commitments include Scotland, Wales and England. CCC peatland restoration numbers in 2025 are UK-wide.
5 The Balanced Pathway produced for the CCC’s Sixth Carbon Budget assumed that two new nuclear power stations would be in operation by 2035, in

addition to Hinkley Point C.

Progress in reducing emissions: 2021 Report to Parliament

24

Figure 3 Differences in stated Government
ambition compared to CCC pathway
Behind CCC
pathway

Beyond CCC
pathway

CCS¹Diet change²
Aviation demand management³
Heat pump deployment⁵
Industrial Decarbonisation Strategy⁴
North Sea Transition Deal⁶
Low-carbon heat networks⁷
EV roll-out⁸-14 -12 -10
Range of potential
emissions impacts

-8

-6

-4

-2

0

2

4

Emissions reduction ambition relativeto CCC pathway (MtCO2e/year)

Notes: Comparisons are against the Balanced Net Zero Pathway (‘CCC pathway’) published in the Committee’s
Sixt h Carbon Budget advice.
¹ Government CCS ambition for is 10 MtCO2/year in 2030, compared to 22 MtCO2/year in the CCC pathway.
² The level of diet change without explicit policy to support it is uncertain. Emissions could be up to 7.2 MtCO2e/year
higher than the CCC pathway in 2030.
³ Lack of ambition for aviation demand management would result in higher emissions of 6.4 MtCO2e/year in 2030
relative to the CCC pathway for aviation emissions.
⁴ The Industrial Decarbonisation Strategy aims for a 67% reduction by 2035, compared to 73% in the CCC pathway.
⁵ Government ambition is for 600,000 installations in homes in 2028, compared to 900,000 in 2028 in the CCC
Pathway. The abatement gap in 2030 is inferred, based on an assumed trajectory of uptake to 2028 under theGovernment’s plans, with annual deployment remaining constant to 2030.
⁶ The North Sea Transition deal commits to a reduction that falls short of the CCC pathway by 3.7 MtCO2e/year in
2030.
⁷ Based on announced Government heat network investment of £0.7 billion (assumed to leverage £2.2 billion,
leading to a total investment of £2.9 billion, of which we estimate £1.7 billion will be for low-carbon, with resulting
deployment estimated by CCC).
8
A strict 2030 phase-out of petrol and diesel vehicles would be more ambitious than the CCC pathway, but thisdepends on the timing of when plug-in hybrid electric vehicles are phased out.

25

Climate Change Committee

3. Policy progress on the path to Net Zero
Policy progress is being made,but it is not yet happening at
the necessary pace.

Comprehensive policy frameworks are needed to drive the major scale-up indelivery required by the path to Net Zero. Of the 92 recommendations we made inour 2020 progress report, 72 (i.e. over 75%) have been either achieved, partly
achieved or are underway. Clearly, policy progress is being made, but it is not yet
happening at the necessary pace – only 11 have been achieved in full.
In many cases, a strategic commitment has been made, but details of policy
implementation have not yet caught up with the high-level ambition (Figure 4).
•

Progress on setting out policies is significantly behind that on ambition, with
only one-fifth of the emissions savings for the Sixth Carbon Budget having
policies that are ‘potentially on track’ for full delivery (e.g. renewableelectricity generation).

•

In many other areas, some policy plans have been set out but these lackdetail and/or do not comprehensively cover the necessary set of issues.
Together, areas in which policy is in danger of falling behind cover aroundthree-fifths of the emissions reduction required to 2035.

•

A further one-fifth of the emissions reductions still have major policy gaps,
including on demand-side action and tackling emissions from landfill andwaste incineration. We highlight the need to fill a range of policy gaps insection 4.

The Government has recognised the need to extend delivery, and has launchedor begun development of a major programme of strategies, consultations andpolicies covering all the major emitting sectors (i.e. energy supply, industry,transport, buildings, agriculture and land use). That process is ongoing as this reportis published (Box 2).
We have also seen, through the failure of the Green Homes Grant, the challengesof real-world implementation and the need for well-designed and well-executed
schemes that properly address the barriers to decarbonisation. Failures cannot be
avoided completely, but it is critical that effective replacement policies are put inplace quickly, drawing on the experience of previous schemes. The Net Zerotransition requires a consistent framework that enables supply chains and public
buy-in to build over time, without confidence being undermined by sudden policychanges or poor delivery. While the Local Authority Delivery part of the Green
Homes Grant scheme has been more successful, there is an urgent need for welldesigned, fully-funded policy that works for deployment of energy efficiency
improvements and low-carbon heat in the rest of the residential sector.
A coherent approach isneeded to achieving Net Zero.
All Government policies need
to be compatible with thetransition to Net Zero and theneed to adapt to climatechange.

More generally, there is a need for a coherent approach to achieving Net Zeroand to ensure that all Government policies are compatible with the transition to
Net Zero, together with adapting to climate change. Decisions on road building,planning, fossil fuel production and expansion of waste incineration are not only
potentially incompatible with the overall need to reduce emissions but also send
mixed messages and could undermine public buy-in to the Net Zero transition. We
recommend implementation of a ‘Net Zero Test’ to ensure that all Government
policy decisions are compatible with the legislated emissions targets.

Progress in reducing emissions: 2021 Report to Parliament

26

The Government should now focus on delivering their stated policy aims, scaling
up the rate of delivery rapidly and putting in place a comprehensive policy
framework this Parliament (i.e. to 2024).

Figure 4 Are Government policies on track?
600
500

MtCO2e

400
300
200

Fully on track

Potentially on track

Some action but risk of falling behind

Falling behindBaseline emissions

Balanced Net Zero Pathway

2035

2034

2033

2032

2031

2030

2029

2028

2027

2026

2025

2024

2023

2022

2021

0

2020

100

Source: CCC analysis; CCC (2020) The Sixth Carbon budget – The UK’s path t o Net Zero.

Box 2
Highlights of recent and upcoming policy developments
There have been several high-profile policy publications in the last eight months:

27•

The Ten Point Plan for a Green Industrial Revolution and the accompanying National
Infrastructure Strategy set a series of headline commitments across the economy that
could contribute to Net Zero. Key commitments by 2030 include: 40 GW of offshore
wind capacity, 5 GW of hydrogen production capacity, phasing out petrol anddiesel cars and vans by 2030 (with some hybrids permitted until 2035), four CCS
clusters capturing 10 MtCO 2 annually and 600,000 heat pumps installed annually(by 2028). The Plan allocated initial funding including a £1 billion Net Zero Innovation
Portfolio and kicked off processes to support delivery of the headline goals andothers such as tree planting, sustainable aviation fuels, low-carbon buses and HGVs,
greenhouse gas removals, nuclear power, and green finance. Job creation was a
key objective, supported by the launch of a Green Jobs Taskforce.

•

The Energy White Paper took further steps to support the Ten Point Plan. These
included consultations and explorations of policy options to support a fairer andmore flexible energy system, commitments to support at least one power CCS
project by 2030, an aim for a final investment decision on one nuclear power plant
this Parliament and additional funding for advanced nuclear innovation, a review of
institutional arrangements for the energy system, support for electric vehicle
charging, a commitment to phase out installation of fossil gas boilers by the mid2030s, a commitment to set up a UK ETS and to align its cap to the path to Net Zero,and announcements on hydrogen, CCS, industry and oil and gas extraction.

•

The Industrial Decarbonisation Strategy set a goal to cut industry emissions by around
two-thirds from 2018 to 2035. It committed to several calls for evidence, set out
preferred options for some funding mechanisms and allocated some initial funding.

Climate Change Committee

•

The North Sea Transition Deal set targets to reduce emissions from oil and gas supply
by 10% in 2025, 25% in 2027, and 50% in 2030 against a 2018 baseline. In addition, thedeal outlined how the oil and gas sector could support the deployment of hydrogenand CCS, as well as help hydrocarbon workers during the energy transition.

•

The Peat and Trees Action Plans published in May sets out England’s ambition forpeat restoration (30,000 hectares by 2025) and new woodland (7,000 hectares per
year by 2025). The Nature for Climate Fund will be the main source of public funding
during this period, providing £50 million for peat and £500 million for trees, with
options being developed to leverage private sector finance. There is no statedambition beyond 2025 for either restoration or tree planting, although there is acommitment in the Plan to consult in 2022 on the long-term woodland creation
target.

Other publications that have been promised but not yet delivered (by early June 2021,
when this report was finalised) include:•

Treasury Net Zero Review. HM Treasury (HMT) released its interim review in December,concluding that reaching Net Zero is essential for long-term prosperity, that the costsof tackling climate change are relatively small and depend on policy choices, that a
mix of policy levers will be required, and that well-designed policy can reduce costs
and risk for investors as well as supporting innovation and the deployment of newtechnologies The final report will look at reducing policy uncertainty to encourage
innovation, the scope for addressing risks to competitiveness, more detailed analysis
of household impacts, and crucially, how HMT can incorporate climate
considerations into spending reviews and fiscal events and how to embed theprinciples of the Net Zero Review into policy making.

•

The Heat and Buildings Strategy will set out further detail on the Government’s plansfor decarbonising heating in the UK, along with the ‘suite of policy levers’ it intends to‘use to encourage consumers and businesses to make the transition’.

•

The Transport Decarbonisation Plan is the Department’s ‘plan to decarbonise the UK’s
entire transport system’. It will cover active travel (i.e. walking and cycling) andpublic transport; the transition to zero-emission road vehicles (e.g. electric cars) fromthe perspective of the consumer, suppliers and the energy system; freight andlogistics; and aviation and shipping.

•

Net Zero Aviation Strategy. In light of the UK’s new Net Zero target, the Government
has committed to a new consultation on aviation decarbonisation in 2021, followed
by a Net Zero aviation strategy before COP26.

•

The Hydrogen Strategy will consider how to support the scale-up of low-carbonhydrogen production, as well as the interaction with storage, distribution andpotential end-use demand. It will set out details of hydrogen business models and arevenue mechanism for bringing through private-sector investment, and support forthe demand side such as heating trials and support for hydrogen in shipping.

•

The Biomass Strategy will coordinate across Government departments to assess how
biomass should be sourced and used across the economy to contribute best to Net
Zero. It will review the UK’s current biomass sustainability standards and outline therole of BECCS in delivering greenhouse gas removals.

•

National Food Strategy. Part Two of the Strategy will cover the environmental impactof our diets (including GHG emissions) and land use.

Alongside these major statements, there have been many smaller, but important, policy
developments, including in the buildings sector ahead of the delayed strategy. These arecovered in Chapter 4 of this report.
Source: Quotes on future policy plans taken from the Ten Point Plan, Energy White Paper, Net Zero Review: Interim
Report, National Infrastructure Strategy, Industrial Decarbonisation Strategy.

Progress in reducing emissions: 2021 Report to Parliament28

4. Policy priorities and broadening progress across Government
There has been important
progress in the last year.
However, we see evidence ofa multi-paced Government.

All parts of Government must
play their full role to deliver thepath to Net Zero.

29

Overall, there has been important progress in the last year. However, we see
evidence of a multi-paced Government, with some departments lagging behind
others (Table 2):•

The Ministry of Housing, Communities & Local Government (MHCLG) is not
fully supporting local government to play its part in the transition to Net
Zero. Progress has fallen short to date on ensuring that building standards
are fit for purpose and properly enforced. The current Planning Bill misses
the powerful opportunity to ensure that developments and infrastructure
are compliant with Net Zero and appropriately resilient to climate change.

•

While the Department for Environment, Food & Rural Affairs (Defra) has
made important steps forward on ambition for afforestation and peat
restoration, progress on agriculture and land use remains slow and partial,
and gaps in ambition remain. On waste, large gaps remain both onbanning materials from landfill and getting a grip on the rapid expansion ofEnergy from Waste facilities.

•

Even within departments that are performing better overall there arepockets of poor or slow performance. For example, BEIS’s Heat andBuildings Strategy has been delayed by almost a year, while theDepartment for Transport has not set out any plans for limiting growth inaviation demand.

•More generally, Government progress has been slow on overarching
challenges towards Net Zero, which has now been law for two years. The
most notable delay is to HM Treasury’s Net Zero Review, but there aredelays and uncertainty to a suite of other challenges: the just transition, jobs
and skills, public engagement. In the Spending Review later this year, theTreasury must prioritise Net Zero, ensuring departments are fully equipped todeliver the carbon budgets. There is also a need for strong governance ofthe transition within Government, including ensuring that wider policy
decisions are routinely made compatible with Net Zero.

For the full programme to align to the challenge, and to provide the leading
example that the Government wishes to take to COP26, these failures will have tobe addressed.

Climate Change Committee

Table 2
Progress against departmental recommendations in the Committee’s 2020 Progress Report to Parliament
Department

Progress against last year’s recommendations

Cabinet Office & No. 10
FCDO, BEIS & the COP26 Unit
HM Treasury
Department for Business, Energy and Industrial Strategy

Department for Environment, Food and Rural Affairs
Department for Transport
Ministry of Housing, Communities and Local Government
Department for Education
Department for International Trade
Department of Health and Social Care
Ministry of Defence
Home Office & Ministry of JusticeDepartment for Digital, Culture, Media and Sport
Department for Work and Pensions= action achieved,= underway,= partly achieved,= overdue,= not achieved.

Notes: Based on recommendations in the CCC’s 2020 Progress Report to Parliament. Recommendations for all departments, or those relating toadaptation are not included in this table. Some recommendations apply to more than one department, so the sum of recommendations in this table
does not add up to the 92 cited in the text. Tables of recommendations and scores is in the supplementary material published alongside this report.

Cross-cutting priorities
Cross-cutting issues must be
addressed to enable sectorspecific strategies and plans to
be rolled out effectively.

Several cross-cutting issues must be addressed to enable sectoral strategies andplans to be rolled out effectively. These are essential in calibrating the public’s
expectations for what lies ahead and building broad public support for thechanges:•

A comprehensive Net Zero strategy is needed this year to fill gaps inambition and pull together a coherent story of how sectoral efforts fit
together to achieve the Net Zero target and carbon budgets. The inclusionof international aviation and shipping in the Sixth Carbon Budget allows forthe first comprehensive look at a pathway to Net Zero covering all sectors.
It should also commit to a ‘Net Zero Test’ to ensure that all Government
decisions are compatible with the legislated emissions targets.

Progress in reducing emissions: 2021 Report to Parliament30•

A plan for achieving a just transition for people, workers, consumers andregions, which ensures that opportunities are taken to create jobs andimprove the skills base while maintaining international competitiveness.
Alongside this, a credible plan is needed for the fair funding of thetransition, starting with completion of the Treasury’s Net Zero Review, as wellas ensuring that investment is supported by strong financing.

•

Public engagement around the need for climate action, the healthco-benefits of low-carbon choices, information about how individual
actions can contribute to reducing emissions and involvement in decisions
on how best to achieve the transition.

•

A framework for local delivery to deliver ambitious climate objectives atdifferent scales (i.e. devolved administrations, regions and local authorities),
through workable business models, removal of barriers to action, dedicatedresource and an approach that facilitates sub-national action tocomplement action at the national level.

•

Plans must make climate adaptation an integrated part of the transition to
Net Zero. Across multiple areas, and in particular on buildings and land use,
there are benefits to thinking holistically about how policy can reduce
emissions, while ensuring it improves resilience to the UK's changing climate.
Like Net Zero, climate adaptation will also need to be integrated into core
Government policy.

Essential elements of the transition to Net Zero
We have identified sevenindispensable elements to thetransition, on which it is crucial
that good progress is made.

31

Progress is needed across a wide range of areas in order to get on track to Net
Zero. However, there are several indispensable parts to the transition. We haveidentified seven priority areas for the Government in which it is crucial that good
progress is made, covering a subset of the approximately 200 recommendations
for UK Government departments and the devolved administrations for the next
year. These are primarily focused on delivery:•

Develop and implement a comprehensive policy package to enable thedelivery of the 2030 transition to electric vehicles, to build on the phase-out
announcement and the positive response of automakers and motorists. Thisshould include a full strategy for widespread deployment of charging
infrastructure and a mandate requiring manufacturers to sell a rising
proportion of zero-emission vehicles.

•

Implement a comprehensive policy package for buildings decarbonisation,and enshrine the long-term standards framework in regulation and law, todeliver the ambitions of the upcoming Heat and Buildings Strategy andfinalise the roadmap for decarbonising the UK building stock.

•

Implement comprehensive delivery mechanisms for landscape-scale land
use change for afforestation and peatland restoration and a high take-up
of low-carbon farming practices. This should cover mechanisms for private
and public financing and a strategy to address non-financial barriers.
Interim policies will be needed to avoid a hiatus in action while awaiting
the implementation of the new mechanisms.

•

Advance policy for manufacturing decarbonisation by establishing
incentive mechanisms to support fuel switching and implementing CCS
proposals. Alongside this, initiate the development of product andconstruction standards both to improve energy and resource efficiency

Climate Change Committee

and to develop the option of managing carbon leakage by applying
carbon policy to imports.
•

Continue auctions for low-carbon power generation, together withsupporting actions to enhance system flexibility, to deliver an emissions
intensity of 50 gCO2/kWh or better in electricity generation by 2030.

•

Deliver a Hydrogen Strategy that sets out a vision of the role of hydrogen on
the path to Net Zero and the steps needed to realise it. The strategy should
focus on hydrogen use in sectors that cannot decarbonise without it andlow-carbon hydrogen production routes to 2035 with aims to start largescale hydrogen trials in the 2020s.

•

Enable domestic engineered greenhouse gas removals (GGR) to
contribute to UK carbon budgets and Net Zero, and establish GGR support
mechanisms and monitoring, verification and reporting (MRV) structures in
the UK that ensure that GGR is timely, sustainable and verifiable.

Gaps that must be addressed
There are specific policy gapsthat must be addressed on
unabated gas generation,
demand-side action, waste
and aviation demand.

We make a comprehensive setof recommendations in the
Departmental tables at theend of this report.

Our assessment of strategies and policies announced to date has identified
specific key gaps that need to be addressed by Government policy:•

Commit to phasing out unabated gas-fired electricity generation by 2035,
subject to ensuring security of supply. Publish a comprehensive long-term
strategy for unabated gas phase-out, including ensuring new gas plants areproperly CCS- and/or hydrogen-ready as soon as possible and by 2025 at
the latest, and thoroughly assessing the market challenges that will emerge
as part of the transition to a fully decarbonised electricity system.

•

Include contributions in the Net Zero Strategy from demand-side action, on
aviation, a shift towards healthier diets and a switch away from cars
towards active travel and public transport. This should be accompanied bypublic engagement to explain how low-carbon choices can contribute to
Net Zero and wider co-benefits to health, and policy frameworks that seek
to encourage and incentivise these changes.

•

Address with urgency the rising emissions from, and use of, Energy from
Waste (EfW), including by ensuring that the capacity and utilisation of EfWplants is consistent with necessary improvements in recycling and resource
efficiency, providing support to enable existing EfW plants to begin to be
retrofitted with CCUS from the late 2020s, and introducing policy to ensurethat any new EfW plants are built either with CCUS or are ‘CCUS ready’.

•

The overdue Net Zero Aviation Strategy must set out credible pathways andpolicies to encourage technological development in the sector but also
recognise the potential need to manage aviation demand in future, should
improvements in sustainable aviation fuels and low-carbon aircraft fall shortof Government and industry ambitions. An assessment of the UK’s airport
capacity strategy and a mechanism for aviation demand management
should be part of the aviation strategy.

We make a more comprehensive set of recommendations in the departmental
recommendation tables at the end of this report.

Progress in reducing emissions: 2021 Report to Parliament32

5. The Committee’s changing role
As Government makes the shift
to focusing on implementation,
the CCC’s task must also
evolve to focus on real-world
progress and tougher scrutinyof Government plans.

The Committee’s next major UK
report will be an assessment of
the Net Zero Strategy.

As Government makes the shift to focusing on implementation, the Committee’stask must also evolve towards a focus on real-world progress and tougher scrutinyof Government plans. Over the coming year the Committee will develop deeper
metrics of progress and consider a better dashboard of indicators. We are alsobroadening our outlook:•

Broader view of real-world progress. The transition to Net Zero requires
changes that go beyond the deployment-related metrics we have tended
to track to date. We will seek to broaden our assessment of real-world
progress, including public attitudes, corporate commitments, finance andthe green recovery, as well as consumption emissions and the factors
affecting them.

•Governance and enabling delivery. The challenge of tackling climatechange mitigation and adaptation in a joined-up, coherent way requires agovernance structure within central Government and at different
geographical scales. We will increasingly look at coordination within UK
Government and the interactions with action at the devolved government
and local levels.

•

Non-government action. The transition of UK society towards Net Zero must
involve a wide range of actors. We will seek to broaden our advice to give
more attention to enabling lifestyle changes and low-carbon choices,
corporate strategies, local authority action and community action.

•

The UK as part of global action. We will seek increasingly to locate the UK’stransition within the wider international transition, which is set to gain pace,with important implications for technologies, options and costs, and forpolicy design (e.g. because of carbon-border adjustment mechanisms).
We have also been engaging and sharing lessons with similar bodies to the
CCC around the world.

•

Fairness and the just transition. We are focusing more on fairness, jobs, skills
and the equitable distribution of costs and benefits over the transition.

We look forward to assessing the Government’s Net Zero Strategy later this year,
and will aim to align our progress metrics and monitoring with the Government’s
proposals where we consider those to be credible.
The rest of this report is set out in four chapters:
1. The global context
2. UK emissions and drivers
3. Underlying progress and enablers of progress
4. Policy progress and gaps
We then set out detailed recommendations for each UK Government department
and the national Governments of Scotland, Wales and Northern Ireland in anannex of tables at the end of this report.

33

Climate Change CommitteeChapter 1

The global context
1. Global climate, emissions and energy use in 2020

37

2. Global progress in decarbonisation indicators

41

3. Progress in international climate policy

47

34

Introduction
This chapter summarises global
developments in tacklingclimate change ahead of
COP26.

The 26th Conference of Parties (COP26) to the United Nations Framework
Convention on Climate Change (UNFCCC), which will take place in Glasgow later
this year, was conceived under the Paris Agreement as a key moment to raise
global ambition. This chapter outlines global progress in tackling climate changeahead of the COP26 negotiations.
Our conclusions are:•

COVID-19 related measures had a large, but temporary, impact on global
emissions in 2020. Global emissions fell by 6% in 2020 relative to 2019 levels
for the year as a whole, with significantly larger falls in individual countries(particularly developed countries) at the height of lockdowns. These
reductions in emissions have proved temporary, with global emissions rates
increasing when lockdown measures were lifted. Sustained reductions ofsimilar magnitude to those in 2020 will be required over several decades toachieve the Paris Agreement long-term temperature goal. Fundamentallydifferent ways of reducing emissions to those in 2020 will be required toachieve this, although behavioural changes (e.g. reduced long-haulbusiness travel) could have long-term benefits if maintained.

•

Transitions to low-carbon and low-cost alternatives in electricity and roadtransport are now underway around the world but need to be scaled up.
Rapid falls in the costs of renewable electricity generation and electricvehicles (EVs) mean that these technologies are now (or very soon will be)at cost-parity with fossil fuel-based alternatives in large parts of the world. In
these areas commitments from Governments and companies are being
made that would imply a rapid transition. However, commitments need to
be delivered and become more global to achieve the emissions reductions
over this decade consistent with the Paris Agreement. The provision of
supporting infrastructure (e.g. charging points for EVs) will also be necessary
to deliver this.

•

There has been a significant increase in global ambition ahead of COP26,
but even if met, expected emissions in 2030 would remain well above Paris
Agreement compatible pathways. Most G7 countries have now raised
ambition, with pledged decarbonisation pathways from these countries
approaching alignment (on aggregate) with those seen in modelled global
pathways consistent with the Paris Agreement. Significant additional
ambition will be required to close the remaining global ‘emissions gap’ topathways expected to keep warming ‘well-below’ 2⁰C, or ideally to 1.5°C,
above preindustrial levels. These necessitate rapid transitions in developing
and emerging economies, that are expected to make up the majority of
future emissions. Developed countries have an important role in helping
other countries to increase ambition, including through climate finance.
Achieving progress on issues of climate finance and adaptation at COP26
will be essential for achieving increases in global ambition on reducing
emissions.

Our analysis is summarised in three areas:
1. Global climate, emissions and energy use in 2020
2. Global progress in decarbonisation indicators
3. Progress in international climate policy
Progress in reducing emissions: 2021 Report to Parliament36

1. Global climate, emissions and energy use in 2020
2020 was one of the warmest years on record, with climate impacts felt around theworld. Global greenhouse gas (GHG) emissions remain high compared to historicallevels. This is despite emissions and energy use in 2020 being significantly affectedby the measures to combat the global COVID-19 pandemic, with a mixture ofshort-lived and longer-lasting effects.
This section covers the key indicators of global climate change and its drivers inthree subsections:a) Global climate changeb) Global greenhouse gas emissionsc) Global energy usea) Global climate change
Global temperatures continue
to rise rapidly – with human
influence the driver.

Estimated global human-induced warming has now reached around 1.2⁰C above
1850-1900 (an approximation for preindustrial levels) (Figure 1.1): *•Global mean surface temperature in 2020 was the joint warmest or second
warmest year on record across all prominent global temperature datasets,with the six most recent years being the warmest six-year period in theobservational record. †•All of the present day observed warming is estimated to be due to humanactivities (+/- 20% uncertainty). Natural climate cycles and events (e.g.
volcanic eruptions) are not thought to make a significant contribution to
the current level of global temperature above preindustrial levels.

•

Human-induced warming is rising at around 0.25⁰C per decade. ‡ At thispresent rate of increase, human-induced warming would exceed 1.5⁰C
above preindustrial levels (the lowest level referred to in the Paris
Agreement long-term temperature goal) by the early 2030s.

The temporary falls in global CO2 emissions in 2020 associated with measures toaddress COVID-19 (section b) did not significantly affect the evolution of
atmospheric carbon dioxide concentrations, global temperature or climate
hazards, all of which continued to increase as they are primarily determined bycumulative global CO2 emissions over time.

37*

Revisions to UK Met Office dataset (HadCRUT), including providing more spatially complete estimates of global
temperature have contributed to higher levels of warming above 1850 – 1900 and therefore contributed somewhat
to increases in the estimate human-induced warming compared to previous years.

†

The direct observational record of global temperature extends back to the mid-nineteenth century. In some records
2020 was the joint warmest year (with 2016) and in some the second warmest.

‡

This rate of increase in human-induced warming is based on a linear trend over the past decade.

Climate Change Committee

Figure 1.1 Global average surface airtemperature change
1.4

Warming (⁰C relative to 1850-1900)

1.2
1
0.8
0.6
0.4
0.2
0
-0.2
-0.4
1850

1870

1890

1910

1930

1950

1970

Berkeley

NOAA

GISS

ERA

Cowtan & Way

HadCRUT5

1990

2010

Human-induced warming
Source: CCC analysis
Notes: Each thin line represents a different global temperature dataset. The NOAA, GISS and ERA datasets are
expressed relative to 1850 - 1900 using the offset over the 1981-2000 period from the HadCRUT5 dataset. Humaninduced warming is taken from globalwarmingindex.org.

b) Global greenhouse gas emissions
COVID-19-related measures
had a large impact on global
emissions in 2020 – particularly
in developed countries and thetransport sector.

For the year as a whole, global CO2 emissions from energy fell by around 6% in2020 (relative to 2019 levels), largely resulting from the effects of measures toaddress COVID-19. 1 This drop in global emissions varied significantly across different
regions, sectors and GHGs:•

Sectors. Transport emissions displayed the biggest fall of all sectors through2020 as it was most affected by the COVID-19 lockdowns. Around half of all
global emissions reductions came from transport. This reduction comeslargely from road transport emissions but aviation emissions wereparticularly affected in proportional terms – falling around 50% below 2019
levels.

•Regions. The largest falls in emissions came from developed countries (e.g.
the United States and the European Union) where sectors that wereparticularly impacted by COVID-19 lockdowns (such as transport) make upa large share of emissions. China’s 2020 CO2 emissions increased by around
1% over 2019 levels – this was in part due to the earlier impact of COVID-19
in China giving more time for economic stimulus to drive up emissions.

•Greenhouse gases. Accurate global data on GHG emissions from nonenergy sectors and for other GHGs is not yet available. It is expected that
there would be much more limited COVID-19-related impacts on these

Progress in reducing emissions: 2021 Report to Parliament

38

emissions than energy related CO2 emissions as the industries responsible for
non-CO2 emissions (e.g. agriculture) were generally less disrupted.
Emissions rates around theworld have now significantly
recovered.

Temporary reductions due to COVID-19-related measures have now mostly
recovered as restrictions have been relaxed. Where significant restrictions are inplace emissions remain somewhat supressed below 2019 levels (Figure 1.2).

Figure 1.2 Monthly CO2 emissions from the UK andlarge emitters over the COVID-19 pandemic

Monthly CO2 emissions(% change rel to 2019 levels)

20%
10%
0%
-10%
-20%
-30%
-40%
-50%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2020

UK

China

India

2021

US

EU

World

Source: Carbon Monitorc) Global energy use and economic growth
Global GDP decreased in 2020
with knock-on impacts onenergy use.

Global GDP is estimated to have fallen by around 3.3% from 2019 levels in 2020 asa result of the pandemic.2 Contractions in GDP were generally larger in advanced
economies than developing ones, but with significant variation across countries(e.g. India saw GDP decline by around 7% relative to 2019 levels).
This large fall in economic activity had large impacts on the patterns of energy use
in 2020: 3

Fossil fuel use was more
affected than energy use
overall and global electricity
use only declined slightly.

39•

Global energy use fell by 4% in 2020, with the largest and most sustained
reductions occurring in advanced economies.

•

Fossil fuel use fell, with particularly large falls in oil use (9%) due to the large
curtailment in transport activity. Coal use fell by 4% primarily due to lower
electricity demand and the prioritisation of generation with low marginal
costs (e.g. renewables). Gas use was less affected than other fossil fuels,

Climate Change Committeeonly falling by 2% relative to 2019 levels, in part due to increased switching
to gas use in the power sector.
•

Global emissions are expected
to grow in 2021, but will likely
remain below 2019 levels.

Electricity demand fell by 1% in 2020 relative to 2019 levels largely due tocurtailment of industrial and commercial use in the first half of 2020.
Generation from renewable sources grew at the largest rate ever – they
now generate 29% of total electricity, up from 27% in 2019 (with the total
low-carbon generation share now at 39%).

Current expectations are for a large rebound in 2021 in global GDP (~6% above2020 levels, 3% above 2019 levels), energy use (~4.5% above 2020 levels, 0.5%
above 2019 levels) and CO2 emissions (~5% above 2020 levels, 1% below 2019
levels). 3 This would see annual global CO2 emissions rise back to close to (but stillslightly below) 2019 levels in 2021. Significant uncertainty remains regarding thelevel of global emissions in 2021, which will be affected by both the continuingcourse of the pandemic and the effects of the economic recovery efforts
underway around the world.

Progress in reducing emissions: 2021 Report to Parliament40

2. Global progress in decarbonisation indicators
This section looks at progress inthe development anddeployment ofdecarbonisation options
around the world.

The previous section described the considerable reductions in global energy use
and GHG emissions that occurred in 2020 as a result of measures to address the
COVID-19 pandemic. Although the impacts on global emissions were large, they
are proving temporary as economic activity recovers.
Achieving the global emissions pathways expected to be consistent with the Paris
Agreement long-term temperature goal requires rates of emissions reduction
nearly as large as those seen in 2020 to be sustained over several decades.* This
will need a rapid and sustained transformation towards a global economy without
GHG emissions – very different from the lockdown-related causes of emissions
reduction in 2020.
This section describes progress across several leading indicators of the global
transition towards Net Zero emissions. This is summarised in three sub-sections:a) Transitions with emerging low or no cost low-carbon alternativesb) Deep decarbonisation transitions needed for global Net Zeroc) Transitions in global land-usea) Transitions with emerging low or no cost low-carbon alternatives
Cost reductions means that
low-carbon alternatives in
power and road transport now
have no or limited additionalcosts.

Significant progress has been made in reducing the cost of several key low-carbon
technologies particularly driven through learning-by-doing following large-scale
deployment over the last decade.4 In two areas critical to rapid global emissions
reductions this decade, low-carbon technologies are now, or soon to be, as ormore cost-effective than high-carbon alternatives:•

Renewable electricity generation. Analysis from the International
Renewable Energy Agency (IRENA) indicates that more than half of
installed renewable electricity generation capacity in 2019 was cheaper
than new coal plant alternatives.5 IRENA estimated that over half of existingcoal capacity in 2020 would produce more expensive electricity thanreplacement with new utility-scale solar PV generation. Renewables arealso now increasingly cost-competitive with gas-fired generation with somesolar generation sources now producing the cheapest electricity in history.6•

Electric Vehicles. Analysis from Bloomberg New Energy Finance indicatesthat the cost of batteries (the most expensive part of an EV) has fallen bynearly 90% over the last decade and EVs are expected to be cheaper thanfossil fuel vehicles by the mid-2020s across a range of different vehicle
types. 7

The emerging cost-competitiveness of low-carbon options in these two areas
supports the prospect of a rapid global shift towards these technologies to meetdemand for new investments in electricity generation and road transport. A large
and rapid increase in the market penetration of these technologies is key to*

41

Global annual CO2 emissions fell by around 2.5 GtCO2 in 2020, with falls of around 1 – 2 GtCO2 per year in the global
emissions rate required each year over the 2020s and beyond to keep warming to the Paris Agreement long-term
temperature goal. Le Quéré, C, et al. (2021) Fossil CO2 emissions in the post-COVID-19 era. Nature Climate Change,
11, 197–199.

Climate Change Committee

supporting the large reductions in global emissions by 2030 required in global
pathways expected to be consistent with the Paris Agreement long-term
temperature goal.
Momentum is gathering behind
accelerated deployment inthese sectors.

Commitments and intentions from major markets suggest momentum is gatheringbehind a transition in several areas, but further and faster progress is still needed tomake a big impact on global emissions:•

Major car manufacturers are committing to a transition to EVs. A growing
number of car manufacturers are making commitments to end sales ofinternal combustion engine cars. For example, Jaguar has committed toonly selling EVs from 2025, Volvo has committed to becoming an electric
only retailer by 2030, General Motors by 2035, and Honda by 2040
(including fuel-cell vehicles). These manufacturer commitments support
end dates for new international combustion engine cars targeted byseveral large car markets such as Japan (2035 date for ending petrol anddiesel sales), California (2035 phase-out date) and the UK (2030).

•

EVs are rapidly growing as a market share of new car sales, but thesegrowth rates need to be sustained. In 2020, the EV share of new sales insome large regions reached new highs (e.g. 10% in Europe and 6% in
China). Despite the overall decline in passenger car sales these increased
shares correspond to increased numbers of EVs sold, but the impact of
COVID-19 on the global car market creates uncertainty about how the EV
sales share will change over the coming years. Most major car markets willneed to see battery EVs reach 100% of new sales by 2030 – 2040 underpathways expected to keep warming well-below 2⁰C.

•

Large electricity markets are signalling a shift to low-carbon sources. The
USA (the world’s second largest electricity producer) has stated its intention
to achieve a carbon-free electricity grid by 2035. Pathways to achieve thistarget require a large scale-up of low-carbon sources with the share of US
electricity generation coming from low-carbon sources (mainly
renewables) increasing from 37% today to 70-85% by 2030.8 China, theworld’s largest electricity producer, has recently raised its target for the
non-fossil electricity generation share for 2030 from 20% to 25%.

•

Projections for renewable deployment are being revised upwards, butinvestment needs to scale up faster. More than 80% of new electricity
capacity added in 2020 came from renewable sources.9 The International
Energy Agency (IEA) recently increased their forecast for capacity
installations for wind and solar electricity generation over the coming years
by around 40% relative to a year ago.10

Accelerating global
deployment significantly thisdecade will require that otherbarriers are also addressed.

Other factors will also be important for supporting a rapid increase in the market
penetration of these technologies. This includes adapting electricity systems forincreasing generation shares from variable renewable sources and ensuring thatsustainable supply chains, charging infrastructure, and recycling for the key
mineral resources are in place to support a widespread, rapid scale-up in global
EV sales.

The existing coal plants in the
global power system must also
be tackled.

Achieving rapid global emissions reduction this decade will also require addressing
the trends that are opposing emissions reduction (e.g. increasing sales of large
sports utility vehicles around the world) and tackling the existing high-carbon
capital stock in the global power sector which needs to be rapidly retired andreplaced (Box 1.1).

Progress in reducing emissions: 2021 Report to Parliament42

Box 1.1
Emissions from coal-fired power generation
Rapidly reducing global CO 2 emissions from coal electricity generation is one of the key
elements to rapid global emissions reductions consistent with the Paris Agreement. The IEANet Zero by 2050 pathway requires no new coal-fired power plants from today withunabated coal generation eliminated from developed countries by 2030 and all
countries by 2040.
Current trends are far from consistent with a rapid reduction pathway:•

The global pipeline for planned new coal power plants held constant in 2020
(following falls each year since 2015). This was almost entirely due to expansion in
China (which was the location for 76% of new capacity commissioned) as part ofstimulus measures related to COVID-19. New Chinese plants completed in 2020 morethan offset the net retirements in the rest of the world, increasing the global coal
generation capacity by 12.5 GW.

•

Net retirements in coal capacity have thus far largely occurred in developed regionswith older coal fleets. Today around 60% of the current global coal capacity is under
20 years old (typical lifetimes can be 40 years or more) and is concentrated inemerging and developing economies. If current plants are run to the end of theirnatural economic lifetimes, then they will account for a large fraction of the total
cumulative CO 2 emissions consistent with keeping warming to the Paris Agreement
long-term temperature goal.

•

Projections for global coal-fired generation over the coming years indicate an
expected plateau, as opposed to a significant decrease. Early retirement andretrofitting with carbon capture and storage on large fractions of the young-life
global goal fleet will be needed to achieve emission reductions consistent with theParis Agreement.

Although the vast majority of young-life and planned coal-fired power plants are in
emerging and developing countries, financial institutions in developed countries still play
an important role in supporting the planned coal pipeline. A study estimates thatdeveloped countries are linked with financing for nearly 40% of cumulative emissions fromthe existing global coal pipeline on a ‘financed-emissions’ basis. 11 Action from developed
countries to end support for coal finance from public sources (as recently pledged by theG7 countries) and to create frameworks for similar action from the private sector cantherefore contribute to a more rapid global coal phase-out.
Source: Global Energy Monitor (2021) Boom and Bust: Tracking t he global coal plant pipeline; IEA (2020) World
Energy Outlook 2020; Manych, N. et al. (2021) Finance-based accounting of coal emissions. Environmental
Research Letters, 16, 044028.

b) Deep decarbonisation transitions needed for global Net Zero
Other technologies outside ofpower and road transport
need to be developed further
this decade to enable an atscale global roll-out towards
Net Zero.

A pathway to global Net Zero emissions around or soon after mid-century will
require large-scale global deployment of decarbonisation options beyond thepower and road transport sectors. Unlike in electricity generation and roadtransport, low-carbon alternatives in these sectors generally have a cost premium
associated with them today, although costs are falling in many areas.
Development and deployment of decarbonisation options in these areas thisdecade will be important for enabling a rapid large-scale global deployment in
the following decade.
Around the world there are relevant initiatives underway in several areas:•

43

Carbon capture and storage (CCS). There are presently 65 CCS projects on
power and industry in operation or in development globally.12 Most
operating facilities are in North America, supported through tax incentives
and in most cases income from use of the captured CO2 for enhanced oil

Climate Change Committee

recovery. In Europe, a handful of projects based around using CO2 storage
under the North Sea are in advanced stages of planning.
•Greenhouse Gas Removals (GGR). There is growing international researchand development into engineered GGRs, with a small number of test
facilities in operation globally. Additionally, several major global companies
have recently made commitments to purchase GGRs to compliment theuse of renewables and improved resource efficiency to meet their Net Zerotargets. Although small at present, corporate commitments such as these, if
replicated more widely, could provide an early market for dedicated GGRcredits – helping to facilitate the development and cost discovery neededfor engineered removals to play a role in reaching Net Zero.

•

Hydrogen. By 2030, significant electrolyser capacity (for hydrogenproduction) is being planned for in France, Germany and the Netherlands(5 GW, 6.5 GW and 3-4 GW respectively) and the European Commission
has recently released a new hydrogen strategy aiming to reach 40 GW ofelectrolyser capacity across the EU.

Rapidly moving from demonstration projections towards constructing clear
business models to help support wider deployment will be important to enableglobal use at scale over the coming decades. Behavioural changes will also be an
important complement to moving towards global Net Zero. The IEA recently
published a roadmap for how these key pillars of decarbonisation can be
deployed together to reach global Net Zero CO2 emissions by 2050. This roadmap
can act as a global guide to investment decisions that may (or may not) bealigned with the more ambitious end (i.e. 1.5⁰C) of the Paris Agreement long-term
temperature goal (Box 1.2).
Box 1.2
International Energy Agency Net Zero Energy 2050 pathway
In May 2021 the International Energy Agency (IEA) published Net Zero by 2050 A
Roadmap for the Global Energy Sector (NZE2050). This set out a comprehensive pathway
to global Net Zero CO 2 energy and industry emissions (around three-quarters of global
GHG emissions) consistent with limiting peak warming to 1.5°C (~50% probability).
The scenario keeps biomass use, residual fossil fuel use, and engineered greenhouse gas
removals to the low end of the range from global pathways assessed by the IPCC, anddoes not use offsetting removals in the land sector. The pathway also involves rapid anddeep reductions in methane emissions from the energy sector (falling by 75% by 2030).
Rapid transitions to low-carbon options are required in all energy sectors in the IEA
roadmap, with many parallels with the CCC pathway for the UK:•

Power sector: Rapid build-out of renewables (particularly solar and wind) enables Net
Zero emissions from the power sector to be reached by 2035 in advanced
economies, and by around 2040 in developing economies. In 2050 nearly 90% of
global power generation is from renewable sources (solar, wind, hydro andbioenergy), with nuclear contributing most of the remainder.

•

Transport: CO 2 emissions from transport fall 90% by 2050 (from today’s levels) despite
global passenger demand doubling by 2050 and freight transport increasing by two
and a half times. Globally, almost all new light duty vehicle sales are zero emissions
vehicles (mostly battery electric) by 2035, and nearly all heavy-duty vehicle sales arefuel cell or electric by 2050. Low-carbon fuels and behaviour change help reduce
emissions from aviation and shipping.

•

Buildings: Widespread retrofitting of existing buildings and requiring all new builds
across the world by 2030 to be zero-carbon-ready leads to emissions falling by 40% by
2030 and more than 95% by 2050 relative to today. From 2025, oil and coal boiler

Progress in reducing emissions: 2021 Report to Parliament

44

sales end and all new gas boilers installed are hydrogen-ready. Heat pumps become
the main space heating technology worldwide from around 2045.
•

Industry: Fuel-switching to hydrogen and carbon capture both play a major role indecarbonising emissions from industry, which fall 20% by 2030 and 90% by 2050. Key
technologies are demonstrated during the 2020s such that from 2030 all new
industrial facilities are near-zero emissions.

•

Fuel supply: No new oil and gas fields and coal mines are approved fordevelopment (beyond already committed projects) in the IEA pathway. Low-carbonhydrogen is produced from both natural gas with CCS and electrolysis.

Behaviour change plays a role in almost two thirds of the emissions reductions. Most of thiscomes through consumer adoption of low-carbon technologies such as electric cars, but
8% of total emissions reductions come from directly changing practices such as reduced
business flights.
The IEA estimate that all the technologies required to achieve deep reductions in global
emissions by 2030 exist today, with real-world examples of policies to drive their adoption.
Sustaining the required rates of decarbonisation after 2030 will require further
commercialisation and development this decade of additional options for deeper
decarbonisation. The investment for the transition could bring significant additional
benefits to global GDP (additional 4% increase in 2030), global energy sector jobs (9million net increase in employment in 2030) and development (universal access to clean
energy by 2030 and major air quality improvements for millions across the world).
Source: International Energy Agency (2021) Net Zero by 2050 A Roadmap for the Global Energy Sector.

c) Land-use transitions
Reducing emissions from global
land use change is a key partof pathways towards Net Zero.

CO2 emissions from land-use change and forestry are about 13% of total global
GHG emissions, arising primarily from tropical deforestation of land with very highcarbon content, often associated with agricultural expansion.* Many global
pathways consistent with the long-term temperature goal of the Paris Agreementtransform this net source of emissions into a net sink over the next few decades.

The world is not on track toachieve its deforestation
reduction targets – althoughsome progress has been made.

There has been some progress towards reversing global forest loss (Figure 1.3)
but the world is not on track to achieve the UN Strategic Plan for Forests target toincrease the global forest area by 3% by 2030 (relative to 2015 levels). Forest coveris still being lost overall as deforestation more than offsets forest expansion:

Rapidly reducing tropicaldeforestation is essential tosignificantly reducing global
land-use change emissions.

Deforestation. Around 95% of deforestation occurs within the tropics – 17%of global deforestation occurs within Brazil alone (by area).13 Around 1015% of global deforestation is driven by demand for agricultural and foodproducts (e.g. beef) for export to developed countries.14•

Forest expansion. Forest expansion is comprised of afforestation (intentional
creation of new forests) and natural forest expansion (return of forest to
previously forested land). Afforestation rates are highest in China where
over one million hectares per year are being planted. Natural regeneration
contributes another one million hectares per year of increasing forest coverin China – meaning that over 40% of global forest expansion is locatedthere. Net loss of forest is largely concentrated in South America and Africa.

Reducing global emissions from land-use change requires a focus on ending
tropical deforestation. This is because deforestation in this part of the world isprimarily removing very high-carbon stock primary forest that has never been cut
*

45

•

Including agricultural emissions around 25% of total global GHG emissions come from the agricultural and land-use
sectors. IPCC (2019) Special Report on Climate Change and Land.

Climate Change Committeebefore, leading to very large carbon losses into the atmosphere. Emissions fromtropical deforestation cannot be compensated with equal areas of afforestation inother parts of the world, although afforestation efforts elsewhere in the world arealso important levers for the global effort to reduce emissions and restore
biodiversity.
Tropical deforestation is primarily driven by agricultural expansion (for both
domestic consumption and export). Developed countries can support ending
tropical deforestation by improving corporate supply chain standards to provide
incentives for tropical exporters to avoid deforestation, and capacity building to
improve agricultural yields in tropical countries to reduce the pressure to convert
forested land.

Figure 1.3 Trends in global forest cover15

million hectares per year

10
5
0
-5
-10

Forest expansion

Deforestation

2015 - 20202010 - 20152000 - 2010-20

1990 - 2000

-15

Net

Source: FAO (2021) St ate of the World’s Forests 2020.
Notes: Forest expansion is a combination of intentional afforestation and natural forest regeneration.

Progress in reducing emissions: 2021 Report to Parliament46

3. Progress in international climate policy
This section looks at progress inall aspects of the Paris
Agreement long-term goal.

The Paris Agreement has three aspects to its long-term goal:
1. Mitigation. Holding warming to ‘well below’ 2°C above preindustrial levels
and ‘pursuing efforts’ to limit it to 1.5°C above preindustrial levels.
2. Adaptation. Enhancing adaptive capacity, strengthening resilience andreducing vulnerability to climate change.
3. Finance. Aligning financial flows with a pathway towards low greenhousegas emissions and climate-resilient development.
COP26, to be held in Glasgow in November 2021, is an opportunity to assess
progress and raise global ambition across all three aspects of the Paris Agreement
long-term goal.
This section looks at progress in all three aspects in turn, before summarising thepath to COP26 and the UK’s role as the COP26 president.

a) Progress in mitigation policy
Countries were expected to ‘re-communicate’ their Nationally Determined
Contributions (NDCs) including emissions reduction commitments for the period to2030, by the end of 2020. Countries were also asked to submit mid-century longterm low GHG emission development strategies by the same date. There is an
expectation from many parties that NDC ambition should be raised as parties resubmit their plans, consistent with the ambition ‘ratchet’ mechanism envisaged
under the Paris Agreement.
Countries have been
submitting strengthened
emissions reduction pledges
ahead of COP26.

Strengthening of national emissions reduction targets has focused on two separate
time horizons:

*

47

•

Mid-century. More global Net Zero commitments are being made withdates of Net Zero around the middle of the century. Several large emitters
including China, USA, EU and Japan have Net Zero commitments for midcentury (2050 – generally including all GHGs – except for China, which has
a 2060 commitment). It is estimated that 68% of GDP and 61% of global
GHG emissions are now covered by some kind of national Net Zerocommitment for mid-century.15* The stringency of these Net Zerocommitments varies, with most coverage being from ‘aspirational’ targets
that aren’t backed up by law or official policy documents.

•

Near-term. There has been less commitment for enhanced emissions
reduction for the period to 2030 (the period for the first NDCs). The UNFCCC
estimated that 40% of countries had submitted revised 2030 NDCs by end of
2020. Significant increases in ambition have been adopted by large G7
emitters over recent months (including the USA, EU, Japan, UK and
Canada), aligning their NDC commitments with mid-century Net Zerotargets. Under current pledges for 2030, emissions are expected to be

These Net Zero targets are of variable stringency, with a wide range of standards applied. Corporate action,
including the UN sponsored ‘Race to Zero’, have also significantly expanded over recent years with even greater
variation in the associated conditions.

Climate Change Committeearound 15% lower than 2019 levels (around 5% lower than 2010 levels). 16 It
remains unclear whether a significant increase in ambition from China(~25% of global emissions) will be seen ahead of COP26.
If achieved, current commitments (both for 2030 and mid-century), could beconsistent with pathways keeping expected (central estimate) warming by 2100 toaround 2⁰C above preindustrial levels. However, global emissions in 2030 would be
far above emissions in pathways expected to keep warming to ‘well-below’ 2⁰C or
1.5⁰C (Figure 1.4). Significant increases in Chinese ambition to 2030 will be essential
to any efforts to close this gap alongside enhanced commitments from other large
emitters that have yet to strengthen their 2030 commitments.
In nearly all cases significant strengthening of climate policies will be required todeliver on the pledged emissions reduction commitments. Current policies imply
emissions continuing at recent levels, which would lead to expected warming by
2030 of around 3°C above preindustrial levels.
There is an increasing prevalence of ‘framework’ climate laws around the worldalongside an increasing number of expert climate advisory bodies. These can help
provide a structure to support delivery of NDCs and long-term targets if they aredesigned with robust governance standards to hold Governments effectively to
account on delivery over both the long- and short-terms.17

Figure 1.4 Global emissions gaps to Paris
Agreement consistent pathways
40
35
30
25
GtCO2/yr

Current trajectories indicate aplateau for global emissions
over the coming decade, witha significant gap to Paris
Agreement consistentpathways.

20
15
10
5
0
2010

2015

2020

2025

Current policies
Well-below 2⁰C
Historical

2030

2035

2040

2045

2050

Current targets
1.5⁰C

Source: IEA (2021) Net Zero By 2050: A roadmap for the Global Energy Sector: IEA (2020) World Energy Outlook 2020.
Notes: ‘Current policies’ uses the IEA Stated Policies Scenario (STEPS), ‘Current targets’ the IEA Announced Pledges
Case, the ‘Well-below 2⁰C’ the IEA Sustainable Development Scenario (SDS) and ‘1.5⁰C’ the IEA Net Zero Emissions
2050 scenario. Emissions are CO2 only emissions from energy and industrial process emissions.

Progress in reducing emissions: 2021 Report to Parliament

48b) Progress in adaptation
Making progress on adaptation
is a key priority for COP26.

Climate impacts are already being experienced around the world at today’s levelof warming and will increasingly make the achievement of some of the global
Sustainable Development Goals (SDGs) more challenging. 81% of developing
countries are taking steps to develop National Adaptation Plans, while 20 countries
have submitted full plans.* Around 70% of countries have adopted at least one
national-level adaptation planning instrument, but with large variation in theirdetail. 18 Making progress on the global adaptation goal has been signalled as oneof the key priorities for COP26 by the incoming UK Presidency.
Countries can support the raised adaptation ambition across at least three areas:

All countries can do more to
mainstream adaptationconsiderations into policy
making.

Better evidence bases –particularly in developing
countries – will be key toimproving resilience to climate
risks.

•

Embedding adaptation in national policy making. Adaptationconsiderations need to be mainstreamed across national policy to properly
help limit future climate risks. Integration into planning systems will be
particularly important to reduce the risks of locking in climate exposure
through long-lived infrastructure under construction around the world
today. Similarly, adaptation considerations need to be integrated betterwith mitigation plans to ensure that efforts to achieve NDC and mid-century
targets are not compromised by climate risks and that co-benefits for
reducing climate risks are maximised.

•International collaboration. Building capacity around the world is key toimproving resilience to climate impacts. Collaboration between countries
to share best practices, technical expertise and policy structure can help
accelerate this. New international alliances such as the Climate Adaptation
Alliance – launched by the UK and others at the end of 2020 – can help
facilitate these collaborations and skill-sharing.

•

Improving the evidence base for effective adaption. In many parts of theworld taking evidence-based actions to improve climate resilience ishampered by a lack of good data sources on past and present local
weather hazards and their impacts. For example, there is a lack of
documented data on the history of heatwaves impacts across Africa,
making it harder to construct effective early warning systems and heataction plans.19 The evidence base for assessing the effectiveness ofadaptation interventions for reducing climate risks also needs to be
improved across the world. The global research capacity can be directed
to help close these important evidence gaps.

A successful COP26 outcome will not be possible without significant progress on
issues related to global adaptation to climate impacts being experienced today
and expected for the future. Developed countries also have a key role to playthrough the provision of climate finance, and technology/knowledge transfer.

c) Progress in finance
Delivering the rapid reductions in global emissions needed to restrict warming to
the Paris Agreement long-term temperature goal, while building resilience toclimate impacts, requires a large shift in global investment patterns. Access tocapital sources for this investment is key to realising this, particularly in developing
countries.

*49

14 countries have submitted Adaptation Communications (detailing the action that they are taking on adaptation)
to the UNFCC as requested under Article 7 of the Paris Agreement.

Climate Change Committee

Developed countries are noton track to deliver the $100
billion per year climate financegoal pledged for 2020.

Prior to the Paris Agreement, parties to the UNFCCC adopted a goal of reaching a$100 billion per year flow of climate finance from developed to developing
countries by 2020. Indications are that this commitment has not been met:

A more equal split between
mitigation and adaptation
climate finance is needed.

•

There is currently no agreed way to measure these climate finance flows,
but a report by the UN indicated that it was highly unlikely that the $100
billion per year commitment was achieved in 2020.20 The OECD estimatesthat $78 billion was mobilised by developed countries in 2018 (Figure 1.5).

•

The $100 billion per year in mobilised climate finance is itself a small fractionof the global investments needed to transform the global economy but haslarge political significance. Many developing countries see it as a key testof whether developed countries will take their commitments seriously. Many
‘conditional’ NDCs from developing countries explicitly mention needingclimate finance to deliver on the higher level of ambition.

•

Due to the effects of COVID-19, spending on emergency healthcare
investments and economic relief has restricted many developing countries’
capacity for financing adaptation and resilience. Investment in adaptation
fell globally in 2020 despite a record number of floods, droughts, wildfires
and storms affecting more than 50 million people worldwide. 21 The vast
majority (~80%) of adaptation finance is from public sources, but
adaptation finance is only around 20% of total climate finance mobilised
by developed countries. Developed countries can improve the access tofinance for adaptation by allocating it a much larger share of their climate
finance spending and by supporting private sector investment.*

Meeting this commitment is a key expectation from developing countries ahead of
COP26. Countries have also agreed that $100 billion per year in mobilised climate
finance should be a floor level for beyond 2020 with an expectation for a newhigher goal to be set by 2025. Negotiations on this are expected to start at COP26.

*

For example the UN has launched a ‘Race to Resilience’ initiative to involve non-state actors (including companies)
to reduce vulnerability to climate impacts.

Progress in reducing emissions: 2021 Report to Parliament

50

Figure 1.5 Progress towards the $100 billion peryear climate finance goal from developed
countries
90
80
70$bn per year

60
50
40
30
20
10
2018

2017

2016

2015

2014

2013

0

Bilateral public

Multilateral public (attributed)

Export credits

Mobilised private (attributed)

Source: OECD (2020) Climate Finance Provided and Mobilised by Developed Countries in 2013-18.
Notes: In 2015 there was no data available for mobilised private finance.

d) The path to COP26 and beyond
The period ahead of COP26 iscritical for a successful
outcome in Glasgow.

The coming months contain several events which will lay the groundwork for a
successful COP26. These include important multilateral forums (such as the G20)
which present key opportunities for countries to bring forward new commitments
on climate finance and emissions reductions from large economies. UNFCCC
negotiations sessions in June and at the pre-COP in October will also be critical for
securing the negotiated outcome at COP26 itself in Glasgow.

The UK has an important role inensuring sufficient progress isbeing made over the months
before COP26 as incoming
COP president.

The UK has now submitted a full set of commitments to the UNFCCC as required
under its international obligations (Box 1.3). Its focus now should be on best utilising
the COP26 presidency to secure a genuinely beneficial outcome (Box 1.4).

51

Climate Change Committee

Box 1.3
The UK’s submissions to the UNFCCC in 2020
In December 2020, the UK submitted a set of documents to the UNFCCC in accordancewith its international obligations.
•

The UK’s first NDC. The NDC submission contained a target to reduce aggregated
GHG emissions by at least 68% in 2030 (relative to 1990 levels) in accordance with theCommittee’s advice. This headline target does not include the UK’s share ofemissions from international aviation and shipping – as advised by the Committee. A
commitment to include these emissions within the Sixth Carbon Budget has now
been made by the Government. The NDC document specified that the Government
intends to achieve the target through domestic emissions reductions.

•

Adaptation Communication. The Government submitted an Adaptation
Communication, separate to the UK’s NDC. This document summarises the climate
risks facing the UK and actions being taken to address them – including the National
Adaptation Programme. Progress on adapting to climate change in the UK isassessed in the companion report to this one which finds that, despite progress,
significant gaps remain to deliver improved resilience to climate impacts in the UK.
No new commitments to raise UK adaptation ambition beyond the actions andpolicies already being implemented were provided in either the NDC or Adaptation
Communication.

•

Finance Biennial Communication. The document provided a summary of theactivities that the UK has supported through its climate finance provision. It alsomentions the UK’s 2019 commitment to provide £11.6 billion in dedicated climate
finance over the 2021/22 – 2025/26 period. This is double the level of support over theprevious five-year period and is protected at this level against the announced
temporary cuts in UK Official Development Assistance (ODA) from 0.7% to 0.5% of
Gross National Income. The £11.6 billion funding is additional to the UK’s contribution
to the ‘core’ budget of large multi-lateral development banks, some of which will be
used to support climate-related projects. The UK has also committed to align the full
extent of its ODA spend with the Paris Agreement and has implemented an end toexport finance for overseas fossil fuel investments. The communication also reiterated
the UK’s commitment to maintaining an approximately equal split between
mitigation and adaptation projects in its climate finance.

These documents, together with the legislation of the UK’s Sixth Carbon Budget, represent
a full summary of the UK’s current level of ambition in tackling climate change. The UK
should update its mid-century long-term low greenhouse gas emission development
strategy with the UNFCCC (currently the Clean Growth Plan - targeting the previous longterm target of an 80% reduction in emissions by 2050) with its new Net Zero Strategy when
it is published ahead of COP26, This will provide a vision of the actions and policies thatwill be brought forward to achieve the domestic carbon budgets and Net Zero target.

Progress in reducing emissions: 2021 Report to Parliament52

Box 1.4
The UK’s role in delivering a COP26 with global climate benefits
The UK will have an important role in delivering a successful COP26 outcome as the COP
President (in partnership with Italy), alongside its presidency of the G7 group of countries
this year. Updated NDCs are expected from all countries ahead of the main COP26
negotiations and will not be negotiated directly at the conference.
There are several aspects where the UK will be required to play an important role:•Continuing to support increases in ambition and implementation. Several large
emitter nations have now updated their 2030 NDCs. However, other large emitters(including China) have yet to update their headline ambition. The UK will need tocontinue to champion increased NDC ambition through to COP26 and should also
bring focus to improving implementation plans to achieve these strengthened
targets. Internationally agreed commitments on key aspects of delivery (e.g. ending
coal fired power generation) could help facilitate this.

•

Securing buy-in from all countries for a COP26 outcome. UNFCCC outcomes need to
be unanimously agreed by all parties. The UK presidency has a critical role in building
support across all countries ahead of the conference. This will mean giving issues ofadaptation, climate finance, and loss and damage prominence in the negotiations.
The UK can support this by providing a clear commitment ahead of COP26 on thetimetable by which the UK’s ODA contribution will return to 0.7% of Gross National
Income, and by helping to leverage additional finance commitments from otherdeveloped countries to demonstrate a clear pathway to achieving and exceeding
the $100 billion per year goal.

•Championing a ‘climate-aligned’ recovery from COVID-19. The global aggregate
effects of economic recovery measures resulting from the ongoing COVID-19
pandemic are not consistent with the investment profile needed to sustain continued
declines in global emissions this decade. 22 These investments are critical for the
trajectory of global emissions this decade and keeping the Paris Agreement longterm temperature goal in reach. Having taken on leadership of UN work on‘Recovering Better For Sustainability’, the UK should use its presidency to support a
step up in efforts on this front globally. The UK should also be sensitive to the wider
challenges facing developing countries emerging from the COVID-19 pandemic andcontribute actively to international efforts to address this.

•Carbon markets and the Paris Agreement rulebook. A major focus of thenegotiations is expected to be finalising the outstanding aspects of the rulebook for
the Paris Agreement, including rules on carbon markets and transparency of NDCs
under the Agreement. As COP President, the UK has an essential role to ensure thatany new rules for international carbon markets have the highest standards, ensuringthat they are genuinely supportive of efforts to reduce global emissions. Postponing
agreement on market rules at COP26 (as at COP25) would still be preferable to acompromised deal that could lock in a system which may undermine global
ambition and accountability. The UK presidency can also champion high-integrity
standards in voluntary carbon markets through its COP26 Finance workstream.

Action in these areas, alongside the recommendations to align domestic policy ambition
with the UK’s Net Zero target, NDC and Sixth Carbon Budget elsewhere in this report, canhelp the UK maximise the chances of delivering a successful COP26 with genuine
benefits for the global effort to address climate change.
The UK should prioritise
maintaining international
momentum for tackling climatechange over the period
between COP26 and theglobal stocktake in 2023.

53

After COP26 the next significant moment in the Paris Agreement cycle isanticipated to be the first global stocktake in 2023. The UK can help maintaininternational momentum for the post-COP26 period by championing longer-term
initiatives that can help ensure activities and outcomes feeding into COP26 (suchas the COP26 campaigns) are maintained and lead to long-term benefits for
global efforts to tackle climate change.

Climate Change Committee

As part of this, the UK should publish a new strategy for its international climate
policy during its COP26 presidency (which extends for a year after COP26) torefresh its strategy and signal its commitment to supporting international climate
action over the long term. * This should include a recognition of the need forcountries to produce credible plans now to deliver on strengthened emissions
reduction commitments. The UK’s recent commitment to include international
aviation and shipping emissions within the Sixth Carbon Budget can also beleveraged internationally, including through international forums to agree a Paris
Agreement compatible emissions target for international aviation and amechanism to deliver it that is fit for purpose.

*

This strategy should flesh out the UK’s commitment to place climate change as the number one priority in the recent
Integrated Review of foreign and defence policy and ensure that a joined-up perspective is maintained on how the
UK’s climate finance is spent.

Progress in reducing emissions: 2021 Report to Parliament

54

Endnotes

55

1

IEA (2021) Global Energy Review: CO2 Emissions in 2020.

2

International Monetary Fund (2021) World Economic Outlook (April 2021)

3

IEA (2021) Global Energy Review 2021.

4

IRENA (2020) 10 years: Progress to Action.

5

IRENA (2020) Renewable Power Generation Costs in 2019.

6

IEA (2020) World Energy Outlook 2020; Lazard (2020) Levelized Cost of Energy and Levelized Costof Storage.

7

Bloomberg New Energy Finance (2021) Hitting the EV inflection point.

8

Princeton (2021) Net Zero America.

9

IRENA (2021) Renewable Capacity Statistics 2021.

10

IEA (2021) Renewable Energy Market Update 2021.

11

Manych, N. et al. (2021) Finance-based accounting of coal emissions. Environmental Research
Letters, 16, 044028.

12

Global CCS Institute (2020) Global Status of CCS Report 2020.

13

United Nations Food and Agriculture Organisation (2020) Forest Resources Assessment 2020.

14

Pendrill, F. et al. (2019). Deforestation displaced: trade in forest-risk commodities and theprospects for a global forest transition. Environmental Research Letters, 14 (5), 055003; Ritche, H.
& Roser, M. (2021) Forests and Deforestation. Published at OurWorldInData.org

15

ECIU & Oxford Smith School (2021) Taking stock: A global assessment of net zero targets.

16

Climate Action Tracker Initiative (2021) Global Update: Climate Summit Momentum.

17

Eskander, S. & Frankhauser, S. (2020) Reduction in greenhouse gas emissions from national
climate legislation. Nature Climate Change, 10, 750–756; Dudley, H. et al. (2021) Independent
expert advisory bodies facilitate ambitious climate policy responses. ScienceBrief Review.

18

UNEP (2020) Adaptation Gap Report.

19

Harrington, L. & Otto, F. (2020) Reconciling theory with the reality of African heatwaves. Nature
Climate Change, 10, 796–798.

20

UN Independent Expert Group on Climate Finance (2020) Delivering on the $100 billion climate
finance commitment and transforming climate finance.

21

IFRC, World Disasters Report 2020, 2020

22

Global Recovery Observatory (2021) Are We Building Back Better? Evidence from 2020 and
Pathways for Inclusive Green Recovery Spending; Vivid Economics (2021) Greenness of Stimulus
Index.

Climate Change CommitteeChapter 2

UK emissions and drivers
1. Progress reducing UK emissions

60

2. Impacts of COVID-19 on emissions and behaviours in 2020

71

3. Progress reducing the UK’s carbon footprint

84

56

Introduction
This chapter outlines UK progress towards reducing the UK’s greenhouse gas
emissions, including the UK’s share of international aviation and shipping emissions
as covered by the Sixth Carbon Budget.
UK emissions have reduced consistently since 1990, with average annual falls ofaround 18 MtCO2e since 2012, similar to those needed to meet the Sixth Carbon
Budget. However, progress so far has been dominated by the power sector, while
progress in future will need to cover the whole economy.
The pandemic and resulting restrictions have caused sharp falls in economic
activity, energy demand and emissions in 2020. * UK emissions and output willalmost certainly increase as lockdown restrictions are lifted, but the permanent
impact of the pandemic on UK emissions and economic activity is still unclear.
Our key messages are:•UK greenhouse gas emissions were 499 MtCO2e in 2019. This includes theUK’s share of international aviation and shipping emissions.

•

Our greenhouse gas consumption footprint was 703 MtCO2e in 2018. This
includes emissions embedded in the goods and services consumed in the
UK even if they are produced overseas. Consumption emissions were 37%
higher than production emissions in 2018. Data for 2019 will be publishednext year.

•

From 1990 to 2019, UK emissions fell by 40%, while the economy grewby 78%. The UK’s consumption footprint has fallen at a comparable ratesince 2007, but by less (29%) since 1990 (Figure 2.1).

•

UK emissions fell by a record 13% in 2020 to 435 MtCO2e, 48% below 1990
levels. The fall in 2020 was almost entirely due to the impacts of thepandemic, particularly reductions in road and air travel, as well as lower
overall energy demands.

•

It is unclear how far the impacts of the pandemic on emissions will persist in
future, but transport emissions are likely to rebound to some extent in 2021
as lockdown measures are lifted.

•

Progress outside the power sector has been limited. If annual changes inemissions return to the same per-sector trend as the previous decade, theSixth Carbon Budget will be missed by a huge margin. Now is the time toextend progress across all sectors of the economy.

We set out our analysis in the following three sections:
1. Progress reducing UK emissions
2. Impacts of COVID-19 on emissions and behaviours in 2020
3. Progress reducing the UK’s carbon footprint*

Estimates of the UK consumption footprint for 2020 are not yet published, but they will certainly be lower than in 2019
due to both lower territorial emissions and a fall in goods imported to the UK in 2020.

Progress in reducing emissions: 2021 Report to Parliament

58

The UK economy has grown bynearly 80% from 1990 to 2019
while both territorial andconsumption emissions havefallen.

Figure 2.1 The UK economy has grown while
territorial and consumption emissions have fallen
200

1990 = 100

150

100

50

0
1990

1995

2000

2005

2010

2015

2020

UK GDP (Gross Domestic Product)
UK consumption GHG emissions
UK territorial GHG emissions
Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures; ONS (2020) Gross Domestic Product:
chained volume measures: Seasonally adjusted £m; Defra (2019) UK’s carbon footprint; CCC analysis.
Notes: The UK’s share of International aviation and shipping emissions is included in both the territorial andconsumption emissions statistics.

59

Climate Change Committee

1. Progress reducing UK emissions
This section reviews trends in UK emissions in the decade up to 2019, and thechange in emissions in 2020 during the pandemic.
In 2020 emissions fell at a record rate, almost entirely due to the COVID-19
lockdowns and the resulting reduced demand for energy, particularly for travel. *Without action now to lock in beneficial changes to the way people work andtravel, these factors are likely to be mostly temporary and will not significantly
contribute to the fundamental changes that will be needed to achieve Net Zero,which must be more structural in nature (see Chapter 3).
To meet the Sixth Carbon Budget, UK emissions outside of the power sector must
fall by an average of around 17 MtCO2e over the next fifteen years – compared toan average fall of just 5 MtCO2e per year from 2009 to 2019 – and emissions in the
power sector must continue to fall in the context of growing demand.

a) UK greenhouse gas emissions before 2020
Prior to 2020, electricity
decarbonisation was a major
success story, but other sectors
including surface transport,
buildings, agriculture and land
use had made little progress in
reducing emissions.

Emissions reductions varied significantly across sectors in the ten years before 2020
(Figure 2.2). Our 2020 Progress report set out a detailed breakdown of progress in
reducing emissions in each sector since 2008. The key trends in sectoral emissions
prior to the pandemic were:•Electricity supply was the major success story of the past decade. Emissions
decreased by 65% over the period 2009-2019, while the carbon intensity of
the grid fell from nearly 500 gCO₂/kWh in 2009 to 200 gCO₂/kWh in 2019.
Electricity generated from variable renewables was 9 TWh in 2009 (3% of
total generation), and rose to 73 TWh in 2019 (26%).

•

Surface transport is off track, and since 2015 has been the highest-emitting
sector in the UK. Emissions have been broadly flat over the past decade,falling only 1% between 2009 and 2019. Improvements to the efficiency ofcars have been lost to a trend towards both driving larger vehicles anddriving more miles.

•

Industry saw significant reductions in emissions, largely resulting from a
combination of the changing structure of the UK's manufacturing sector(responsible for around 20% of the fall), improved energy intensity (40%) anda shift to lower-carbon fuels (40%), while overall output has grown.†•

Buildings saw some progress from policy-driven action in the first half of thepast decade. Temperature-adjusted emissions fell by 7% between 2009 and2016, but have risen since. The overall efficiency of the boiler stock has
improved, but there has been minimal progress on improving insulation or
switching to low-carbon heating in recent years.

*

This fall in emissions was also due to warmer than average temperatures, which tend to suppress heating demand,increase cooling demand and on balance decrease overall energy demand, particularly in homes.

†

A decomposition analysis covering the period 2012-2017 shows that UK industrial output grew 14%. The 12% fall in
direct CO₂ emissions across that period can be attributed to a structural movement towards a less carbon-intensive
mix of industrial output (accounting for 20% of the change), improvements in energy intensity (40%) and changes infuel mix (40%). It is not clear whether these reductions were driven by policy.

Progress in reducing emissions: 2021 Report to Parliament60

If progress does not extend
outside the power sector, theSixth Carbon Budget will bemissed by a huge margin.

61•

Agriculture and land use emissions were broadly flat, increasing by 2% overthe period 2009-2019. These sectors repeatedly failed to meet the indicators
outlined in the Committee’s progress reports (e.g. for tree planting and onfarm efficiency measures).

•

Aviation emissions and passenger numbers were increasing. Over the 20092019 period, the total number of UK terminal passengers rose by 36% tonearly 300 million in 2019. Efficiency improvements were not enough tooffset this rise in demand, with emissions up 7% from 2009 levels to
40 MtCO2e in 2019.

•

Shipping emissions fell, mostly due to reductions in domestic shipping along
coasts and in international export shipping. In particular, fewer tonnes of dry
and liquid bulk (including coal and crude oil) were transported by ship,
although container and roll-on/roll-off freight increased. Emissions in 2019were 24% lower than in 2009.

•

Waste sector falls were driven exclusively by reductions in landfill emissions.
Waste emissions fell by 28% from 2009 to 2019, but this was primarily due tothe landfill tax diverting biodegradable waste away from landfill to otherwaste treatment, particularly Energy from Waste (EfW) incineration.
Recycling rates plateaued, and more local authority waste is now
processed by EfW than is recycled or composted in England.

•

F-gas emissions increased, but began to fall towards the end of the 2010s as
new regulations restricting the use of the most harmful gases took effect.
Emissions increased by 20% from 2009 to 2017, but fell by 7% in two years to
13.4 MtCO2e in 2019.

To meet the Sixth Carbon Budget and to deliver the UK’s 2030 Nationally
Determined Contribution to the Paris Agreement, progress will have to extend
quickly beyond the power sector. If annual changes in emissions return to the same
per-sector trend as the previous decade, the Sixth Carbon Budget will be missed
by a huge margin (Figure 2.3).

Climate Change Committee

Figure 2.2 Changes in UK emissions by sector

0
-5

150
Annual change
2019-2020

100

2010

2020

Surface transport
Manufacturing & construction
Electricity supply
Fuel supply
Shipping-15-20

Buildings

Fuel supply

Shipping-25
Manufacturing& construction

0
2000Electricity supply

50

Surfacetransport

Aviation

Average annualchange 2009-2019-10

Change in emissions
MtCO2e5200

Annual emissions MtCO2e

Progress has been unevenamong sectors in the last
decade.

Buildings
Agriculture & LULUCF
Aviation
Waste
F-gas

Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures.
Notes: LULUCF = Land use, land-use change and forestry. Estimates of emissions for sectors with large proportions of
non-CO2 emissions are not shown on the right-hand chart. Final estimates of emissions in these sectors will be
published in early 2022. Aviation and shipping include the UK’s share of international aviation and shipping
emissions.

Progress in reducing emissions: 2021 Report to Parliament62

If individual sectoral emissions
stay on the same trend as thelast decade, the Sixth Carbon
Budget will be missed by ahuge margin.

Figure 2.3 Concerted action is required beyond
electricity to meet the Sixth Carbon Budget
700
600

MtCO2e500
400

Gap to target if
pre-2020 trends
continue inevery sector

300
200
100

2035

2033

2031

2029

2027

2025

2023

2021

2019

2017

2015

2013

2011

2009

0

Total GHG emissions
Electricity supply emissions
All other emissions
If per-sector trends from 2009-2019 continue
Recommended pathways to meet Sixth Carbon Budget
Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures; CCC analysis.
Notes: Emissions in this chart are adjusted for future increases to the Global Warming Potentials (GWPs) of non-CO2
gases, and therefore do not match the total published in the latest greenhouse gas inventory. The Sixth Carbon
Budget target was recommended on this basis (see Box 2.2).

63

Climate Change Committeeb) UK greenhouse gas emissions in 2020
The COVID-19 pandemic and the resulting restrictions caused a substantial drop inemissions, but the lasting changes on UK emissions remain far from certain.
Section 2 of this Chapter explores the short-term impacts of COVID-19 on UK
emissions in more detail.
Emissions fell by 13% in 2020,
almost entirely due to theimpacts of lockdown measures.

The Committee’s provisional estimate (Box 2.1) shows that UK emissions fell byaround 13% in 2020, with the vast majority of the fall associated with reductions inemissions from transport (Figure 2.4).
2020 was the UK’s third warmest year on record. Warmer temperatures, particularly
during winter months, led to reduced demand for heating and lower greenhousegas emissions. The temperature-adjusted emissions data presented in Figure 2.4
shows the ‘true’ underlying change in emissions (i.e. a bigger increase) from 2019
to 2020 if temperatures had instead been average. The temperature effect alone,which has its biggest impact in the residential buildings sector, caused around a 5%
fall in UK emissions.

Figure 2.4 Change in UK CO2 emissions 2019-2020
+7%
(+2%)

10
5

-24%

-9%

Fuel supply

-10

-7%

Shipping-5

Manufacturing& construction

0
-4%
(-8%)

-14%

-15
-20
-19%

Residentialbuildings

Surface transport-30

Non-residentialbuildings-60%
Electricity supply-25

Aviation

Change in annual emissions (MtCO2)

Milder winter temperatures
mean that emissions werelower than they would havebeen in a year of averagetemperatures.

Non-temperature-adjusted buildings emissions
Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures; CCC analysis.
Notes: The bar for change in emissions from residential and non-residential buildings shows the temperatureadjusted data, which adjusts emissions for warmer average temperatures in 2020. The change in actual buildings
emissions in 2020 is shown in brackets.

Progress in reducing emissions: 2021 Report to Parliament

64

Estimates of all sources ofemissions in 2020 are available,
but some (particularly nonCO2) estimates are less reliable.

Box 2.1
The provisional estimate of UK emissions in 2020
BEIS have published a provisional estimate of emissions for 2020 that covers most sources,
based on various analytical approaches. To produce a complete estimate of UK
emissions, the Committee has added its own estimate for international transport emissions
that is based on official statistics:•

CO2 emissions in the major 'energy system' sectors are based on fuel consumption
data, and therefore account for the impacts of the pandemic (electricity supply,
buildings, manufacturing and construction, fuel supply, surface transport anddomestic aviation & shipping).

•

CO2 emissions from other sectors – particularly CO 2 emissions that are not associatedwith the combustion of fossil fuels – are held constant from their final estimates for2019 (mostly in waste, agriculture, LULUCF).

•

Non-CO2 emissions are assumed to fall in line with the latest BEIS emissions forecasts
for 2019 to 2020. This simple approach does not capture any impact of thepandemic, although we can expect these emissions to be less affected bylockdowns than emissions related to energy use. *•BEIS do not publish a provisional estimate of international aviation and shipping (IAS)
emissions. This year, the Committee has produced a provisional independent
estimate of the UK’s share of international aviation and shipping emissions based on
fuel sales data in 2020. †These estimates for 2020 are all provisional and will vary to some extent from the final BEIS
data for 2020, which will be published in 2022.

Previous large annual falls inemissions were very different tothose in 2020, and were driven
by cold winter temperatures,
recession and/or genuine
underlying progress in theelectricity sector.

65

Other years that saw large falls in emissions often reflected temporary factors that
saw emissions rebound the following year. While the fall in emissions in 2020 isstructurally different (Figure 2.5) to previous falls, it is likely to be largely temporary.
There are likely to be lasting, but highly uncertain, changes in behaviour (seesection 2) that will have consequences for UK emissions in the future:•

In 2009, the global financial crisis hit multiple sectors, most notably
manufacturing and construction, electricity supply, and surface transport.
Emissions rebounded in 2010 as the economy began to recover.

•2011 saw a significant fall of just over 20% in emissions from residentialbuildings. This was almost entirely driven by milder winter temperatures andlower demand for gas compared to the previous year. The underlying
changes were far less significant, with temperature-adjusted emissions
actually increasing by around 2% in residential buildings in 2011. Emissions
from buildings increased in the following year as temperatures fell relative
to 2011.

•

In 2014, there was another 17% fall in emissions in residential buildings, again
driven by milder winter temperatures, and equivalent to a 1% rise inemissions from residential buildings when temperature-adjusted. That year
did, however, see the acceleration of a major success story in electricity
generation, with a 16% fall in power sector emissions. This was driven by
structural changes in the GB electricity market, and emissions from this
sector have continued to fall in every year since.

*

For example, emissions from landfills, livestock or forest growth were less affected by lockdown restrictions than fuelconsumption for travel or manufacturing.

†This is a change from our approach in previous reports, where IAS emissions were held constant at the previous
year’s level. The pandemic means that this approach would not have produced a valid estimate of IAS emissions in
2020.

Climate Change Committee•

In 2020, the vast majority (74%) of the total fall in emissions was associatedwith unprecedented pandemic-related reductions in air, sea and land
travel. The pandemic also led to falls in emissions from fuel supply andmanufacturing and construction (-7%), of a scale that would have been
seen as significant in a ‘normal’ year.

It therefore seems likely that at least some of the fall in emissions made in 2020 will
be reversed in 2021, with some increase in transport emissions to be expected. We
explore this risk further in the next section and in Chapter 3 seek to identify
underlying progress that could underpin sustained progress.

Figure 2.5 Annual change in UK emissions, 1990 to
2020+20
Change in annual emissions(MtCO2e)

+10
0
-10
-20
-30
-40
-50
-60
-70
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

Emissions reductions in 2020
were largely due to pandemicrelated restrictions, with little
contribution from underlying
structural progress.

Electricity supply
Fuel supply
Non-residential buildings
Aviation
Agriculture
Waste
Net change

Manufacturing and construction
Residential buildings
Surface transport
Shipping
LULUCF
F-gases

Source: BEIS (2021) 2020 UK Greenhouse Gas Emissions, Provisional Figures; CCC analysis.
Notes: The years containing the most significant annual fall in emissions have been highlighted by sector.

Progress in reducing emissions: 2021 Report to Parliament66c) Changes to the UK inventory
The UK produces an annual greenhouse gas inventory, a consistent time series ofall estimated sources and sinks of UK greenhouse gas emissions from 1990 onwards.
Every year, the inventory is
updated to reflect the best
available evidence and latest
IPCC guidance.

Each year, the UK greenhouse gas inventory is updated to include emission
estimates for any new sources identified in the UK, revised estimates for sources
where there is an improved understanding of emissions (i.e. new data sources or amore accurate estimation methodology), and data revisions (for example toenergy statistics) (Box 2.1).
The most significant change to the UK inventory this year was due to large revisions
in the land use, land-use change and forestry (LULUCF) sector (Figure 2.6). These
result from new estimates for peatlands emissions consistent with the 2013 IPCC
Wetlands Supplement.1 There were also revisions of around -1.5 MtCO2e to theestimation of annual wastewater methane emissions compared to the previous
inventory.
Our Sixth Carbon Budget recommendation anticipated an increase in the estimateof UK emissions due to peatlands of between 17 and 21 MtCO2e in 2018. The
published revision in UK peatland emissions in the latest inventory is similar to,though marginally smaller than, the range assessed in the Sixth Carbon Budget
report, and does not affect the recommended level of the target (Box 2.2).
Box 2.2
Recent and future changes to the UK inventory
Methodology changes to the UK inventory are designed to increase the transparency,
accuracy, consistency, comparability, and completeness of the inventory. There arethree primary sources of uncertainty in the UK inventory:•

Changes to the scope of the inventory. Certain sources of emissions and activities
can be added to or removed from the scope of the UK inventory – adding to (orreducing) overall GHG estimates.
– Peatlands. The most significant change to the UK inventory this year is due to achange of scope, with large revisions to the land use, land-use change andforestry (LULUCF) sector. These result from new estimates for peatlands emissions
consistent with the 2013 IPCC Wetlands Supplement. This change added around 15
MtCO 2e to the UK inventory in 2018 (Figure 2.6) and has turned the LULUCF sector
from a net sink (of around 10 MtCO 2e) to a net source of GHG emissions of almost 6
MtCO 2e in 2019.
– Blue Carbon. The term ‘Blue Carbon’ refers to the carbon stored in coastal andmarine habitats such as salt marsh, mangroves, and sea grasses. These have had
an increasingly important role in both climate change mitigation and adaptation.
Chapter 4 of the Wetlands Supplement (Coastal Wetlands) has not yet been
adopted in the UK inventory, and uncertainties remain. More research is needed tobetter understand how much carbon is stored in coastal and marine eco-systems,
the annual flux of carbon release and rate of sequestration, and the impact onthese of habitat restoration. Government should set out a comprehensive plan toassess the latest science and research gaps with a view to developing
measurement protocols to enable emissions impacts of these habitats to be
included in the GHG inventory.

•

67

Changes to Global Warming Potentials (GWPs) assigned to GHGs. GWPs are used toconvert emissions from different gases into a single comparable metric (tonnes of
CO 2-equivalent, or tCO₂e), and are agreed internationally. There have been multiplechanges to the GWP estimates used for CH₄, N₂O and F-gases since the inception of
the inventory.

Climate Change Committee

The UK inventory will update its GWPs before 2024, adding between 3 and 20
MtCO 2e to the latest estimate of UK emissions, depending on the methodology thatis used. * We expect further updates when available when the IPCC AR6 (Working
Group 1) report is published in August 2021.
•

Uncertainty in the current GHG inventory. This comprises the statistical uncertainty inemission factors and activity data used in estimating emissions. It is internal to theinventory, is well quantified, and it is possible to formally assess the probability oferrors through methods set out in IPCC guidelines. For the most recent inventory
publication, the uncertainty was estimated as ±3% with 95% confidence for the UK asa whole. At sector level, land use emissions estimates have the highest uncertainty,
followed by waste management and agriculture.

The UK inventory will continue to be updated each year in line with the latest IPCC
guidance and to include the most up to date statistics and estimation methodologies.

The land use, land-use change
and forestry (LULUCF) sector
has seen the biggest changes
in emissions. Around 15 MtCO2eof annual emissions from UK
peatlands have now been
included in the scope of theinventory. This change was
expected.

Figure 2.6 Changes to the UK greenhouse gas
inventory
20

LULUCFAll GHGs

1000

15

800

10
600
MtCO2e

MtCO2e

5
0

400

-5
200

-10
-15
1990

2000

2010

2020

Latest inventory

0
1990

2000

2010

2020

Last year's inventory

Source: BEIS (2021) Provisional UK greenhouse gas emissions national statistics 2020; CCC analysis.
Notes: LULUCF = Land use, land-use change and forestry.

*

At COP24 in December 2018 the international community decided to standardise reporting under the Paris
Agreement transparency framework using the GWP100 metric (the GWP evaluated over a 100-year time frame).
The values to be used are those from the IPCC 5th Assessment Report (AR5). There are two methodologies
presented in AR5, with different GWPs, and it is not yet clear which will be used.

Progress in reducing emissions: 2021 Report to Parliament68d) Emissions in Scotland, Wales and Northern Ireland
The governments of Scotland, Wales and Northern Ireland will have an increasingly
important role to play in tackling climate change as progress extends beyond thepower sector and into sectors where key powers are devolved.
Emissions data for the devolved administrations are only available up to 2018
(Figure 2.7). New data for 2019 were due to be published in June 2021, but this was
too late for inclusion in this report. The Committee will comment in more detail on
2019 emissions in our annual Scottish Progress Report later this year.
Emissions data for Scotland,
Wales and Northern Irelandlags the UK data by more thana year.

Scotland has decarbonised faster than the UK average, while Wales and Northern
Ireland have been slower. The most significant factor determining the relative rates
of decarbonisation in Scotland, Wales and Northern Ireland compared to the UK
average has been the speed and scale of power sector decarbonisation (Figure
2.8).

Emissions data up to 2018shows that the power sector
was the biggest driver ofchanges in emissions.

As UK-wide emissions reductions extend beyond the power sector, the next
decade presents an opportunity for Scotland, Wales and Northern Ireland tomatch or exceed UK Government action in key devolved areas such as
agriculture, tree planting, waste management, buildings efficiency, and public
transport.

Figure 2.7 Greenhouse gas emissions in Scotland,
Wales, Northern Ireland and England 2008-2018
1202008 = 100

100

20 MtCO 2e80

39 MtCO 2e42 MtCO 2e60

402008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Northern Ireland

Wales

England

ScotlandUK
Source: NAEI (2020) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2018.

69

Climate Change Committee

Figure 2.8 Sectoral emissions in Scotland, Walesand Northern Ireland, 2008-2018

F-gas

Aviation

Shipping

Fuel supply

M&C

2020

Surface transport

Wales

+0.2
0.0
-0.2
-0.4

2010

2020

Aviation

Agri & LULUCF

F-gas

Shipping

Waste

Fuel supply

Buildings

M&C

Surface transport

0
2000

Electricity supply

5

7

Northern Ireland

-0.8

+0.2

6
0.0

5

Agri & LULUCF

Fuel supply

F-gas

0
2000
2010
2020
Surface transport
Buildings
Manufacturing & construction
Agriculture & LULUCF
Electricity supply
Aviation
Fuel supply
Waste
Shipping
F-gas

Shipping

Buildings

1

Surface transport

2

Aviation

3

M&C

4
Waste

Annual emissions MtCO2e

-0.6

10

Electricity supply

Annual emissions MtCO2e

15

Change in emissions
MtCO2e20-0.2

Change in emissions
MtCO2e2010

Agri & LULUCF

0
2000

Waste

5

Buildings

10
Electricity supply

Annual emissions MtCO2e

15

+0.2
0.0
-0.2
-0.4
-0.6
-0.8
-1.0
-1.2
-1.4

Change in emissions
MtCO2eScotland20

Averageannual change
2008-2018

Source: NAEI (2020) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2018.
Notes: M&C = manufacturing and construction, LULUCF = land use, land-use change and forestry.

Progress in reducing emissions: 2021 Report to Parliament70

2. Impacts of COVID-19 on emissions and behaviours in 2020
In this section, we analyse the major changes that caused the sharp drop inemissions in 2020, and identify how lasting changes in behaviour could affect UKemissions in future.
Lockdown measures led to arecord decrease in UK
emissions in 2020. Most of thefalls in sectoral emissions
observed in 2020 are likely tobe temporary.

Lockdown measures led to a record decrease in UK emissions in 2020. Most of thefalls in sectoral emissions observed in 2020 are likely to be transient, as they do notreflect structural changes in the underlying economic, social, energy,transportation or land systems. In the absence of underlying changes, emissions arelikely to rebound in most sectors in 2021.
The temporary fall in emissions in 2020 will have practically zero impact on the UK’s
past and future contribution to global warming. Sustained reductions are needed.
However, the last year has seen some large changes in patterns of behaviour due
to the pandemic, and it is currently unclear the extent to which these changes will
endure (Table 2.1). It is important to sustain some of the climate-positive changes
that have developed during the pandemic, and important to act decisively to
mitigate the negative changes that could jeopardise efforts towards Net Zero
(Chapter 4).

Some behavioural changes
could last that would have asignificant impact on
decarbonisation – particularly
home-working and travel
choices.

There is potential for longer-lasting impacts brought about by permanent changes
in working and transport behaviour in some sectors, particularly surface transport,
buildings and aviation:•

Working patterns are likely to be affected long term – people want tocontinue working from home to some degree, 2 many can continue to doso effectively 3 and many employers are already adapting to this new
reality. 4– Business travel demand may fall, with a shift to remote working andvideo conferencing during the pandemic enabling a longer-term
reduction in business travel emissions, in both surface transport andaviation. Corporate travel budgets may also be constrained due toincreased financial pressures even as the global economy recovers.
Business travellers accounted for a significant proportion (25% at
Heathrow, and around 15% at other major UK airports) of all UK
passengers prior to the pandemic.5– Home-working is likely to affect energy demand in homes andworkplaces, while changes to commuting patterns will affect emissions
from transport. Around 25% of typical annual car mileage is due tocommuting, 6 so reducing this could offer significant scope for
reducing these emissions. However, estimating the net impact on UK
emissions is complex and far from certain, as increases in emissions
from residential buildings could exceed savings in non-residentialbuildings. Potential lasting effects also include workers moving out ofcities, and undertaking less frequent but longer commutes.

•

71

Personal transport choices may see enduring changes that could affecttravel behaviour, demand and emissions in the future:

Climate Change Committee– Decreases in non-business flying. Aviation demand may be supressedin the medium term, especially if COVID-19 transmission continues
worldwide to some degree. Survey data show that people intend to fly
less after lockdowns are lifted.7 Government should not plan for
unconstrained leisure flying at or beyond pre-pandemic levels in its
strategy for airport capacity and demand management.
– Increases in cycling and walking could be sustained. Nearly 95% of
people said they were likely to continue walking and cycling more
after the pandemic. 8 Sustained Government investment ininfrastructure to support walking and cycling can help encouragethese positive changes.
– Decreases in public transport use. Hesitancy to use public transport
may continue in the medium term. Around half of people surveyed
said they will rethink how they use public transport in the future,
reducing use compared to before the pandemic.9 Shifting private car
travel to public transport is important for decarbonisation and brings
significant co-benefits for air quality, reduced congestion and publichealth. Government must act to address concerns about safety that
could deter use of public transport.
Table 2.1
Potential short- and long-term impacts of COVID-19 by sector

SectorAverageannualchangerequired
for CB6

Emissionschange2018-19

Emissionschange2019-20

Shorter-term COVID impacts

Passenger numbers 78%
lower in August 2020
compared to 2019. 9

Aviation

+6%

+1%

-60%

Travel restrictions andconcerns around safety
likely to result in lower
passenger numbers
compared to prepandemic levels over the
next year. 10

Medium- / longer-term COVID
impacts

Impact on business travel is
uncertain – the shift to remote
working and videoconferencing
during the pandemic may resultin a lasting reduction in businesstravel, especially aviation. 11,12
Leisure travel may also be
impacted – survey data suggest
some people intend to fly lessthan they did before thepandemic. 13
The size of the aviation sector
that will emerge post-pandemic
is still unclear.

Shipping

0%

-2%

-24%

9% drop in global maritime
trade in 2020 andcomparable fall in tonnes ofgoods traded in the UK. 14,15

Rebound likely – thougheconomic scarring could havepermanent reduction in shipping
volume in some sectors.

Lower trade than prepandemic levels expected
in 2021. 16

Progress in reducing emissions: 2021 Report to Parliament

72

Demand for travel dropped
considerably across alltransport modes except
walking and cycling during
periods of national
lockdown.

Surfacetransport

-5%

-2%

-18%

Demand rebounded during
the period between
lockdowns, but the extent
of this varied across modes,
with car demand
recovering more quickly.
Public transport use remains
far below pre-pandemic
levels, with safety concerns
remaining for many. 17
Record falls in new car
purchases.

Residentialbuildings

-3%

-1%*

+7%*

Non-residentialbuildings

-3%

-1%*

-4%*

Electricity
supplyFuel supply

Manufacturing& construction

-6%

-5%

-14%

-1%

-15%

-8%

-3%

-7%

Notes: *Based on temperature-adjusted emissions.

73

Climate Change Committee

Some of the increase in homeworking seen during the
pandemic is likely to remain,which could result in fewer (butpotentially longer distance)
commuting trips. 18
Increases in walking and cycling
could last, especially if support
for necessary infrastructure ismaintained and enhanced.
Reduced use of public transport
may endure – 32% of people
said they will reduce use
compared to before thepandemic. 19

Changing patterns ofoccupancy and energy use
due to the pandemic
response meant directemissions from homes
increased by 7%* and fell
by 4% from non-residentialbuildings. 20

Home-working may be sustained
over the long term which would
have consequences foroccupancy of workplaces andenergy use in homes and in nonresidential buildings.

Reduction in non-domestic
electricity use resulting in a
4.7% drop in total
consumption in 2020, withdomestic energy
consumption up by 2%. 21

Possible changes in profile ofelectricity demand, depending
on extent of structural shifts suchas more flexible working
patterns.

Low oil and gas prices
resulted from worldwide
lockdowns and associatedfalls in demand. Output inthe UK oil and gas sector
also fell as a result.

Assessments of long-term
impacts of COVID-19 on oil andgas markets vary, with some
expecting demand to reach2019 levels by 2021-22 23 andothers suggesting peak oil will bereached earlier than previously
expected. 24

Global oil and gas demand
partially recovered since
the beginning of thepandemic. Prices are close
to pre-pandemic levels. 22-5%

Substantial uncertainty aroundhow the impact of COVID-19 will
influence the transport system inthe longer term.

Short-term fall due tonational lockdowns,
manufacturing revenues
temporarily fell to 65-70% of
pre-COVID level, andlargely recovered.

Rebound likely – thougheconomic scarring could havepermanent reduction onemissions in some sectors.

a) Aviation (60% fall in emissions in 2020)
Aviation emissions have been
most heavily impacted by
COVID-19 and continue toface the greatest uncertainties.
We estimate that total
emissions from aviation fell by
60% between 2019 and 2020 to
16 MtCO2e.

Of all emitting sectors, aviation emissions have been most impacted by COVID-19
and continue to face the greatest uncertainties. We estimate that total emissions
from aviation fell by 60% between 2019 and 2020 to 16 MtCO2e.
International aviation is likely to continue to be constrained in the medium term, as
the UK implements restrictions on international travel and concerns around thesafety of international and domestic air travel continue. Longer-term impacts are
harder to assess:•

The easing of restrictions during summer 2020 resulted in an increase inflights between June and September, although flights remained far below
pre-pandemic levels – air passenger numbers in August were only at 22% ofAugust 2019 levels. Between June and July 2020, the number of passengers
departing and arriving in UK airports went from 2% to 12% of 2019 levels. 25
This suggests that pent-up demand may result in surges in flight bookings as
travel restrictions are eased.

•

The International Air Transport Association (IATA) forecasts a recovery in air
passenger numbers to pre-pandemic levels by 2024 and sustained average
growth of 2.2% per year to 2030 in all European markets. 26 Their new outlook
for the global airline industry points to lower passenger numbers in 2021
than their forecast made in 2020, due to a new surge in virus cases andassociated increase in global travel restrictions. The result has been asignificant increase in airline debt in 2020,27 which could impact the longerterm viability of some airlines.

•

Health concerns around flying also remain – 88% of people taking part in
the National Travel Survey still had concerns with taking flights in August and
September 2020, and 55% of respondents said they did not intend to planan overseas holiday by plane within the next year.28

While it is unclear what the combined impact of these factors will be on the size ofthe sector in the longer term, this year should be used as an opportunity todevelop a strategy for managing aviation demand.
This should be based on a reasonable level of international aviation for the UK,consistent with a Net Zero by 2050 target for the sector, and include an assessmentof the UK’s airport capacity. Government must recognise that planning for an evergrowing aviation sector is not consistent with the UK’s Net Zero target as part of its
aviation decarbonisation consultation and strategy, due to be published ahead of
COP26.
See Chapter 4 for further details on next steps for aviation policy.

Progress in reducing emissions: 2021 Report to Parliament74b) Shipping (24% fall in emissions in 2020)
Shipping saw the secondlargest sectoral fall in emissionsin terms of percentagechange. Uncertainties remainaround the future level ofshipping activity.

Our estimates suggest UK emissions from shipping fell by 24% between 2019 and2020, to 11 MtCO2e. Proportionately, this was the second-largest sectoral fall inemissions. Uncertainties also remain around the future level of shipping activity,
especially while COVID-19 remains widespread globally. The World Trade
Organisation’s latest forecasts suggest a 9.2% decline in the volume of world goods
traded in 2020 followed by a 7.2% rise in 2021, while highlighting the high degree of
uncertainty surrounding these forecasts as they depend on the pandemic andglobal responses to it.29
Provisional 2020 data show that total freight shipped through the UK’s major ports
fell by 10% in 2020, 30 largely due to the impacts of the COVID-19 pandemic:• This effect was particularly pronounced in Quarter 2 of 2020, when freight
volumes were 18% lower than normal.

75•

We expect the impacts to continue to be felt in 2021 as the UK comes outof lockdown, but volumes are expected to return to normal levels of
demand by 2022. However, the long-term impacts of COVID-19 on the
global shipping sector are uncertain.

•

The shipping sector has also been impacted by the uncertainty surrounding
the UK’s exit from the European Union. This may have caused some part of
the reduction in demand seen during 2020.

Climate Change Committeec) Surface transport (18% fall in emissions in 2020)
Emissions from surface transport
fell by 18% due to lockdown
restrictions.

Emissions from the surface transport sector fell by 18% in 2020. This is almost entirely
due to the impacts of the COVID-19 pandemic and the resulting restrictions on
travel, which have lowered demand across modes (Figure 2.9). There is substantial
uncertainty around how the impact of COVID-19 will influence the transport systemin the longer-term.

120%
100%
80%
60%
40%

HGVs
Cars
Bus (outside London)
TfL Tube

04/21

03/21

02/21

01/21

12/20

11/20

10/20

09/20

08/20

07/20

06/20

05/20

0%

04/20

20%

03/20

Percentage of typical demand (7-day average)

Figure 2.9 Travel demand by mode during the
COVID-19 pandemic

Vans
TfL Bus
National Rail

Source: DfT (2021) Transport use during t he coronavirus (COVID-19) pandemic; CCC analysis.
Notes: Figure shows travel relative to typical demand on an equivalent day. For rail and TfL data, this equivalent
day is the same week in 2019, whereas for road transport and non-London bus travel, it is a day in early 2020.
Therefore, these road and bus figures have not been normalised for any seasonality. The shaded regions represent
the periods of national lockdown in England. TfL = Transport for London.

Impacts were different acrossdifferent travel modes. Cycling
increased dramatically, public
transport use remains very low,
and car, van and HGV use
seem to be moving backtowards pre-pandemic levels.

During the periods of national lockdown* (shown by the shaded regions inFigure 2.9), demand for travel dropped considerably across all transport modes,
except cycling and walking. Demand rebounded during the period between
lockdowns, but the extent of this varied across modes.
•

Travel by public transport both fell more deeply during the lockdown
periods than private car demand and rebounded more slowly following thefirst lockdown. As of April 2021, public transport usage remained 50-80%
lower than pre-pandemic levels, and car travel around 20% lower.

•

Van and HGV travel fell slightly less sharply than car travel in the first
lockdown, but levels are now similar to those pre-COVID-19.

* The shaded regions show the lockdown periods for England. Those in Scotland, Wales and Northern Ireland will vary.

Progress in reducing emissions: 2021 Report to Parliament

76

The impacts on travel
behaviour are currently
uncertain, but there is likely tobe some lasting impact of thepandemic in the medium tolong term.

•

Cycling rates rose dramatically during the first lockdown and into thesummer 2020, but then declined back close to normal during the second
half of 2020. Cycling rates are now around pre-pandemic levels, but these
may increase again as commuting resumes and the weather improves.

•

Walking is the only way of getting around that people are now doing moreregularly. Survey evidence shows that 56% of people are walking threetimes a week or more, compared with 36% before the pandemic.31

Underpinning these trends are significant changes people have made in theirnormal way of life and the development of new social behaviours and values. For
travel patterns, key changes have been observed in the car market, attitudes
towards public transport, increased home-working and online shopping.

Working from home increased
sharply and is likely to stay. This
will have implications forcommuting patterns as well ashome and workplace energy
consumption.

•

Home-working and avoiding non-essential travel. Periods of lockdown andguidance on avoiding non-essential journeys led to lower travel demand,
including a significant reduction in commuting as home-working increased
dramatically. This led to large reductions in emissions from surface transport,
although the overall emissions impacts are complex and uncertain(Box 2.3). It is likely that some of this shift will be retained beyond the
pandemic.

Public transport use remains
much lower than prepandemic levels.

•

Public transport use. The reduction in public transport use was driven by
restrictions on travel, social distancing rules and the perception of it being
unsafe. Research shows that the pandemic has had a negative impact on
people’s attitudes towards public transport use, but that there is a gap
between perception and experience.
– In a survey conducted in February 2021,32 half of respondents said they
will rethink how they use public transport in the future, with 32%
reporting they are expecting to reduce use compared to before thepandemic. This was more marked for people with disabilities, and lesslikely for younger people.
– Nearly 40% of people were concerned about their financial
circumstances in the future, which could impact on public transportuse. This was higher for ethnic minorities, households with children andyounger age groups. Similar concerns could apply to ride-sharing andcar-pooling schemes, which could hinder progress in increasing
average car occupancy.
– These results suggest that there are risks that public transport use willtake time to recover, particularly as most people report having
alternative travel choices. It is likely to be a difficult transition period for
operators as social distancing rules reduce capacity and they need toregain trust in services.

New car sales have fallen to
the lowest level since 1992.

77•

Total new car sales in 2020 fell by 30% in 2020 to 1.6 million, the lowest level
since 1992. 33 Sales in the second-hand market fell by 15%.34 However, thecar market began to rebound during late-2020 and evidence 35 suggeststhat consumer purchasing confidence is rebuilding. Where new vehicles
are purchased, the Government and vehicle manufacturers should look toprioritise electric vehicle sales wherever possible (see Chapter 4).

Climate Change Committee– Overall, recent research36 suggests that the pandemic has beenreported as being a greater factor in reducing car ownership than it
has been in increasing it to date, with one-quarter of those choosing
to give up their car citing a change in work situation or not needing
the car as much as before.
– Going forward, the market is likely to be affected by economic
considerations, perceptions of safety of public transport andenvironmental decisions.
• The increased priority consumers are now placing on healthconsiderations may further stimulate the recovery of this market,
although economic factors such as affordability may hinder this.
• Potential changes in consumer purchasing power as a result of
COVID-19 could risk further progress if more affordable EVs,
appropriate purchase incentives and a robust second-handmarket are not made available.
Box 2.3
The potential impact of increased levels of working from home on transportdemand and emissions
The number of people who work at home has generally increased over time, but thisshifted dramatically during the COVD-19 pandemic.
•

Before the pandemic, around 5% of people in employment worked mainly from
home, while a further 12% did so occasionally. 37 As a result of the COVID-19
pandemic, levels of home-working have risen substantially, with an average ofaround 30% of the workforce working exclusively from home each week between
May and December 2020. 38– Both before and during the pandemic, those with higher-skilled occupations * weremore likely to work from home than lower-skilled workers. Those working in
administrative and secretarial occupations saw an increase in home-working from
37% to 57% between 2019 and 2020. 39,40– In April 2020, levels of home-working were highest in London, with 57% of workers
doing some work from home – 92% of these people citing COVID-19 as the main
reason why. Home-working levels were lowest in the West Midlands, with 35% ofworkers doing some work from home, compared to the UK average of 47%. 41•

A recent study 42 found that if people continue to work from home at least two days
per week in the future, then the number of commuting trips by car would fall by 14%.
– Our analysis suggests that this could lead to an overall reduction of 15 billion carkilometres each year, potentially avoiding over 2 MtCO 2e of emissions per year. For
comparison, the abatement delivered by reducing car travel and modal shift in
our Balanced Pathway in 2030 is around 7 MtCO 2e/year.
– Around a quarter of workers surveyed said that they would work from home a little
or much more in the future, with 23% saying they would conduct business meetings
online that they would have previously travelled for.
– Major companies have responded by allowing for more flexible working, with some
expecting that employees will work from home for around two days per week.

•

The overall impacts of home-working are uncertain and complex.
– At the household level, working from home increases residential energy demandfor heating and electricity in homes and reduces transport energy demand forcommuting.

* Professional, associate professional, technical occupations and managers, directors and senior officials.

Progress in reducing emissions: 2021 Report to Parliament78

A study by the IEA 43 suggests that the net impact of these is a reduction in overall
energy consumption where private vehicles are the main means of commuting.
The impact may increase emissions, however, where people normally walk, cycle
or use public transport.
– There is likely to be reduced energy consumption from office buildings, with the net
impact being context-specific. In the UK, offices include a greater share of electricheating suggesting they could also be lower-emission.
– A review of 30 studies 44 suggested that in most cases there was some improvement
in energy use and emissions from home-working.
– Wider and potential rebound impacts, such as changing consumption patterns
and where people choose to live and work, are also important and add to theuncertainty.

d) Buildings (4% increase in temperature-adjusted emissions in
2020)
Emissions from homes
increased and emissions from
non-residential buildings
decreased due to changes in
occupancy.

There is potential to improvethe design and operation ofbuildings and their systems tobetter respond to variations in
occupancy.

Temperature-adjusted buildings emissions in 2020 were 96 MtCO2e – an increase of
4% on 2019. Changes to emissions were driven by shifting patterns of occupancy
due to the pandemic response:•

Temperature-adjusted emissions from homes increased by 7% due toincreased occupancy.

•

Temperature-adjusted emissions from non-residential buildings fell by 4%:commercial buildings fell by around 8%, while those from public buildings
increased slightly by 1%.

The net effects of the pandemic on emissions from public buildings appear to havebeen relatively insignificant, in part expected to be associated with the diverse
nature of public buildings, which include hospitals and schools.
Despite dramatic reductions in occupancy, 45 the reduction in emissions fromcommercial buildings was limited. Analysis suggests that savings achieved acrossthe stock vary widely, but are constrained by limits on adjusting levels of heating
and ventilation – particularly in buildings which remain partially occupied, or haveolder plant and controls. 46 There is scope to enhance the design and operation ofbuildings and their mechanical and electrical systems, to better respond tovariations in occupancy.
It is unclear to what extent shifts in occupancy patterns and behaviour brought
about by the COVID-19 pandemic will persist; the impacts of such changes on
emissions are uncertain and complex. The overall effects will depend on the levels
of increases in energy consumption in residential buildings and decreases in nonresidential buildings, and their relative efficiencies, as well as secondary impacts on
patterns of living and travel.47,48

79

Climate Change Committeee) Manufacturing, construction, fuel supply and electricity
generation (average 10% fall in emissions in 2020)
Emissions across these sectors fell by an average of 10% between 2019 and 2020.
This was primarily driven by a short-term fall in economic activity and energy
demand due to UK and international lockdowns:
Manufacturing andconstruction revenues andemissions fell temporarily, but
are likely to recover as
lockdown measures are lifted.

•

Manufacturing revenues temporarily fell by 30-35%, and have since largely
recovered to pre-COVID levels. 49 Manufacturing emissions fell by around 7%
across the year.

•

Emissions in fossil fuel production in the UK fell by 8% in 2020, as production
fell in response to low prices resulting from low global demand for oil.
– UK demand fell for road fuels (-20%) and jet fuels (-60%) compared to
2019. Global demand for petroleum products was also down byaround 9%. 50 This was a driving force for lower production of petroleum
products in the UK, which was down by 17%.51– UK demand for gas decreased by 6% compared to 2019 levels,reflecting lower demand particularly for electricity generation. Gas
production in the UK was stable, while imports were down 6% andexports increased by 17%. The UK remains a significant net importer ofnatural gas, importing around five times more than was exported in
the last five years. 52– Assessments of the long-term impacts of COVID-19 on oil and gas
markets vary,53 but it is expected that demand could potentially returnto 2019 levels as early as 2021-22. 54 Sustained impacts on fossil fueldemand largely depend on potential sustained changes in travel
patterns (see earlier subsections). Recovery plans that accelerate thepace of a transition for transport towards electrification could
contribute to reducing oil demand and reaching peak oil earlier thanpreviously expected.

Fossil fuel demand fell
worldwide, with impacts on thevolume of oil produced in the
UK. It is unclear how long thesechanges in demand will last
and the impacts on the UK
market.

•Lockdown restrictions had a significant impact on the electricity systemover the course of 2020. Lower electricity demand, coupled with higher
renewables output, highlighted some of the challenges that will need to be
overcome in future for Net Zero (Box 2.4).

The medium- to long-term impacts in these sectors will depend on UK andinternational economic recoveries post-COVID. A rebound is likely, althougheconomic scarring or sustained low oil and gas prices could lead to a permanent
reduction in emissions in some sectors.

Progress in reducing emissions: 2021 Report to Parliament

80

The electricity system wastested under large changes indemand and high levels ofvariable renewables on thegrid.

Box 2.4
Impacts of COVID-19 on the UK electricity system in 2020
Restrictions that were put in place during 2020 had a significant impact on the electricity
system, with reduced demand during lockdown periods. Combined with higher
renewable output, this highlighted some of the challenges that will need to be overcomein the future as electricity generation decarbonises.
•

Electricity demand fell significantly during the lockdown periods in 2020, but was
similar to previous years outside those periods.
– Electricity demand in 2020 as a whole was only 5% lower than in 2019.
– The biggest COVID-19 impacts were felt in the lockdown periods, particularly in thesecond quarter where demand was 12% lower than the same period in 2019.
– During the lockdown periods, the profile of demand was flatter as well as being
lower in aggregate, with within-day peaks much less pronounced (particularly forthe morning peak) and differences being smaller between weekdays andweekends.

•

The carbon intensity of electricity generation fell, through a combination of higher
renewables output and lower demand.
– Renewables output was 15% higher in 2020 compared to 2019, due to
exceptionally windy and sunny conditions early in the year.
– To compensate for lower demand and higher renewables output, the share of fossil
generation fell from 43% in 2019 to 38% in 2020. The country set a record 67-day
period without using coal between April and June 2020.

•

The combination of lower demand and higher renewables output had implications
for the running of the electricity system, and led to lower wholesale prices and risingcosts of running the network.
– The wholesale cost of electricity was 42% lower in the second quarter of 2020
compared to the same period in 2019, reflecting both lower demand and thehigher share of zero-marginal-cost generation in the mix. Periods of negative prices
were common.
– The electricity system was able to remain balanced even with lower demand andwith record-breaking levels of intermittent renewable generation (e.g. wind
generation set new daily records in 2020 for both level of power – 17 GW, and forshare of generation – 60%). However, keeping the electricity system balanced wasmore challenging. Balancing costs rose by 50%, and curtailment costs (paying
generators to switch off or reduce their output) doubled.

The challenges of operating with high shares of variable and inflexible generation arelikely to be increasingly felt over the coming decade as the electricity system
decarbonises. They highlight the importance of a system that is more flexible and provides
adequate dispatchable low-carbon generation, and the need for market arrangements
which enable that.
Sources: Drax (2020, 2021) Electric Insights Q1, Q2, Q4 2020, UKERC (2020) Electricity demand during week one of
COVID-19 lockdown, National Grid ESO (12 January 2021) 2020 greenest year on record for Britain.

81

Climate Change Committeef) Other impacts and lessons learned
Estimates of emissions from other sectors in 2020, including agriculture, land use
and waste have not yet been produced, though emissions in these sectors are lesslinked to energy demands and therefore the impacts of lockdown are less certain.
However, there are several impacts are notable outside those outlined in previous
subsections:
There is some evidence thatless food was wasted during
lockdown, and some of thoseeffects remained whenrestrictions were eased.

•

Reduced food waste. A survey of over 4,000 people undertaken by WRAP
on how the pandemic had impacted people’s relationship with foodrevealed that during the first lockdown, people adopted behaviours tobetter manage food, including freezing, batch cooking and using up
leftovers. It is estimated that levels of food waste declined by 43% between
November 2019 and April 2020. Even with the easing of lockdown, some ofthese behaviours persisted and by November 2020, the amount of foodwasted was over a fifth less compared to November 2019. Centre for
Climate Change and Social Transformations (CAST) survey data alsosuggest people reduced their food waste during the pandemic, althoughsome of this progress may have reversed between the first lockdown andthird lockdowns – 89% of people said they threw away at least some food in
October 2020, compared to 84% in May, and 92% before the pandemic. 55

Support for climate action
remains high.

•Climate change attitudes. Concern over the pandemic does not seem tohave dampened concern with climate change and other environmental
issues. 74% of people surveyed by CAST agreed that tackling climatechange was urgent in separate surveys carried out in May and October
2020, compared to 62% in August 2019. Support for measures to tackle
climate change (e.g. walking and cycling more, reducing meat and dairy
consumption, replacing gas boilers) was high throughout the pandemic(with different measures receiving different levels of support), increasing
between May and October 2020. 56

There is a renewed focus oninequalities. The need for a justtransition is arguably greaterthan ever.

•Just transition and inequality. The pandemic has affected all people in the
UK negatively, but has harmed some groups more than others. Inequality
has been highlighted – and in many cases increased – across multiple
demographic groups, including by age, income, ethnicity, employment
type, and geography. Mortality rates from COVID-19 in the most deprived
areas in England are double those in the least deprived57 and were higher
in both Black and South Asian ethnic groups than the national average. 58
The lowest-earning 10% of workers were much more likely to work in sectorsthat closed during lockdown, and less likely to be able to work fromhome. 59 At the same time, others have been able to work from home andaccumulate savings due to reduced opportunities to spend. The need toensure the transition to Net Zero is a fair and equitable one is arguably evengreater now that than before the pandemic (see Chapter 3).

•

Air quality. Positive air quality outcomes can be linked to virtually all of thechanges needed to get to Net Zero, and is likely to be amplified further if
similar strategies are adopted neighbouring countries.60 The mostpronounced changes in UK air quality during lockdown were in the urban
environment, notably for nitrogen oxides (NOx) as emissions from vehicles
fell. Urban NOx concentrations over the lockdown period up to 30 April 2020
were typically 30-40% lower than average. Impacts of lockdown on
exposure to other pollutants were not necessarily positive – particulatematter (PM2.5) concentrations increased but this was largely due to weather
effects, and urban ozone (O3) concentrations increased due to secondary
air chemistry effects caused by the fall in nitric oxide (NO) emissions.61

Progress in reducing emissions: 2021 Report to Parliament

82

The experience from 2020 has highlighted several key lessons for decarbonisation.
We have considered these in our policy advice and reflected them where possible(Chapter 4):
There are new lessons we candraw from the experience in2020 to sustain climate-positivechanges that have developed
and mitigate the negativechanges that could jeopardise
efforts towards Net Zero.

•

Emissions fell rapidly, but they can rebound just as quickly. Across several
sectors, including manufacturing & construction, surface transport andfreight, activities are beginning to return to near pre-pandemic levels. In
general, this should be welcomed as a positive return to economic activity
as lockdowns are eased. However, there are some instances where
beneficial changes could be lost unless action is taken to support them.

•

There is a limited window to change behaviours. There are behaviouralsources of ‘friction’ in moving from one pattern of living and working toanother, but if those frictions can be overcome, people and organisations
can often adapt quickly.62 In the light of the changes in response to COVID19, there are now significant opportunities to lock in and build on positive
developments, especially – though not exclusively – regarding levels of
demand for transport. This includes:– Sustaining increases in ‘active travel’ by providing support for walking,cycling and e-bikes.
– The possible need for active measures to encourage people backonto public transport, where there has been a shift to car travel.
– The opportunity to change the narrative on the need for an everincreasing number of flights and accompanying airport expansion.

•

The need for increasingly resilient networks and infrastructure. Our energy(and digital) networks have demonstrated they can be resilient to profoundchanges in use. The transition towards Net Zero will only increase thechallenges of operating an electricity system with high shares of variable
and inflexible generation. The non-residential buildings stock can be
improved to respond more efficiently to variations in occupancy. Our
systems need to be more flexible as well as low-carbon, and that can bedelivered through long-term planning and clear market mechanisms thatincentivise flexibility.

•

Lockdown is not a blueprint for decarbonisation. The fall in UK emissions in2020 was much larger than the annual change needed on the pathway to
Net Zero. However, it did not materially affect the structural changes thatare needed in our underlying economic, social, energy, transportation orland systems to reach Net Zero. In order to combat COVID-19, people in
the UK have heavily restricted their movement with damaging economic
and social consequences. This stands in contrast to the fair, well-plannedand sustainable transition to Net Zero that is possible. It can bring
improvements to our quality of lives: new jobs, cleaner air, quieter streets,
more green spaces, comfortable homes and healthier lifestyles.

The pandemic has also demonstrated the importance of preparing for known risks
and the value of scientific advice, which will both be vital in successfully
confronting the climate challenge. It will be important to sustain the beneficial
changes that have developed during the pandemic, but also to act decisively to
mitigate the negative changes that could jeopardise efforts towards Net Zero.

83

Climate Change Committee

3. Progress reducing the UK’s carbon footprint
Under the UK carbon budgets and the Paris Agreement, the UK’s greenhouse gas(GHG) emissions reduction targets are based on the UK territorial emissions (i.e.
emissions physical occurring within the boundaries of the UK), in accordance withinternationally agreed rules for emissions accounting.*
Tracking the UK’s carbon
footprint can help us identify
actions to reduce emissions
from our supply chains and thegoods and services we
consume.

Our consumption emissions
footprint has fallen over the last
decade.

It is also important to examine the UK’s total carbon footprint which allocates GHG
emissions along economic supply chains, no matter where in the world they occur.
This method allocates emissions to the country where the consumer of the final
good or service is based. This is known as consumption-based accounting or as the
carbon footprint of a country. Tracking the UK’s consumption emissions footprint isimportant to consider alongside the legally binding targets set out for UK territorial
emissions as it can help identify additional actions that UK consumers andcompanies can take to help reduce the emissions along their supply chains (suchas using low-carbon suppliers) that are not covered within the UK’s territorial
emissions targets.
Our 2020 Progress Report showed a sustained decline in the UK’s consumption
emissions footprint over the last decade (Figure 2.10). Over the period 2009 to 2017,
the UK’s consumption emissions footprint fell by around 2% per year on average,
driven by improvements in the energy- and carbon-intensity of the UK and global
economy outweighing the effect of increased overall consumption and changes
in the structure of the global economy. This fall in the UK’s consumption emissions is
slower than for territorial emissions, but there is little evidence that this is associatedwith ‘offshoring’ UK territorial emissions as part of decarbonisation efforts over thelast decade.
Updated data are now available for the UK’s consumption emissions footprint in
2018, showing a 1% increase in emissions relative to 2017 levels.† This small change
is likely to be well within the estimated margin of uncertainty for the UK’s
consumption emissions account (previously estimated to be 3.5-5.5%, 63 although
this may have reduced with recent improvement to the methodology). As such,analysing the breakdown underpinning this change is not useful for identifying
robust underlying changes in actions that create emissions at home and abroad. ‡As consumption emissions accounts are generally more variable year-to-year thanterritorial emissions accounts, looking at the trend over several years is likely to be amore representative picture of underlying trends than year-to-year changes.

*

Emissions from international aviation and shipping are included for the Sixth Carbon Budget.

†

F-Gases are included within the UK’s carbon footprint statistics for the first time this year.

‡

The consumption emissions statistics suggest this increase was a combination of an increase in UK-sourced emissions
and overseas emissions, in particular those arising from the European Union and other OECD countries. On a source
basis, increases in emissions from domestic heating (2018 contained a cold winter with the ‘Beast from the East’ coldsnap) and (non-household) transport outweighing decreases from electricity generation and agriculture.

Progress in reducing emissions: 2021 Report to Parliament

84

Figure 2.10 Changes in UK consumption andterritorial emissions since 1990
1200
1000

MtCO2e

800
600
400
200
0
1990

1995

2000

2005

2010

2015

2020

UK consumption GHG emissions
UK territorial GHG emissions

Source: Defra (2021) The UK’s carbon footprint; BEIS (2021) Final UK greenhouse gas emissions national statistics.
Notes: Emissions from international aviation and shipping are included within both the UK’s consumption andterritorial emissions accounts in this figure. Emissions from land-use, land-use change and forestry (LULUCF) are notcurrently included within the UK’s consumption emissions accounts.

We outlined exploratory future scenarios for the UK’s carbon footprint in our advice
on the UK’s Sixth Carbon Budget report. These scenarios showed 3-7% averageannual reductions between now and 2050 could be possible, depending on UK
actions and the degree of global decarbonisation.
Nearly half (45%) of the UK carbon footprint emissions occurring outside the UK areassociated with the production of inputs for a domestic economic activity (e.g.
imported raw materials or parts, as opposed to finished products or services for an
end user).
In our Sixth Carbon Budget Advice Report we highlighted corporate action to
reduce emissions along their supply chain as one of the levers that could help
reduce this part of the UK’s carbon footprint. Recent estimates indicate thataround 75% of FTSE100 companies disclose some information related to their
Scope 3 emissions (share of emissions arising from the upstream and downstream
supply chains), with around one-third having a target to reduce their Scope 3
emissions. 64
Changing trade patterns
present both a risk andopportunity for the UK’s
consumption emissions andsupport of global
decarbonisation efforts.

85

Recent context changes will affect estimated UK consumption emissions – the UK’s
trade patterns have been changing due to the end of the transition period forexiting the European Union and have been disrupted due to the COVID-19
pandemic, which has also changed UK consumption patterns. The effects of thesechanges will not be apparent within the UK’s consumption emissions accounts until
2023-2024. The climate considerations in the UK’s new trade agreement (including
with the EU) are summarised in Box 2.5.

Climate Change Committee

As the UK’s trade relationships continue to change, this presents for risks andopportunities for further decreasing the UK’s consumption emissions. Increased
trade with high-carbon producers could lead to increased overseas supply-chain
emissions, while also potentially undermining domestic decarbonisation efforts
through increased availability of low-cost imported products with a high carbon
footprint.
Conversely, new trade deals and/or implementation of carbon-border policies
could help support global decarbonisation. The UK should explicitly consider
climate-related issues when agreeing trade deals and consider supporting traderelated measures such as carbon border adjustments and product standards, tohelp minimise the global emissions footprint of its international trade.
Box 2.5
Climate considerations in the UK’s trade agreements
Since deciding to leave the European Union, the UK has been working to put in place anumber of bilateral trade deals to cover trade flows that were previously covered under
the European Union’s agreements.
The most significant commitments regarding climate change within these trade deals is
contained within the UK-EU Trade and Cooperation Agreement:•

Commitment to the Paris Agreement. The Cooperation Agreement reaffirms bothparties’ commitment to achieving the goals of the Paris Agreement. Efforts to tackle
climate change under the Paris Agreement is referenced as an ‘essential element’ of
the Agreement, violations of which by either side could lead to the Agreement being
suspended.

•

Maintaining domestic ambition on climate change. Commitments are included thatboth sides will maintain and strive to improve their ‘climate level of protection’ (whichrefers to their emissions reductions targets for 2030). The Agreement specifically refers
to the EU’s previous 40% reduction NDC (relative to 1990 levels) and the UK’s share ofthis target (which the Committee previously estimated to be around a 57% reductionin emissions). This has now been superseded by increased emissions reduction
ambition for both the EU (55% reduction relative to 1990 levels) and the UK (a 68%
reduction relative to 1990 levels).

•

Cooperation on climate change. Climate change and emissions reduction is
explicitly highlighted as an area for cooperation between the UK and EU, alongside
the role of trade as a relevant driver of GHG emissions. The UK is no longer part of theEuropean Energy Union or EU Emissions Trading Scheme (EU ETS). The Agreement
commits both parties to work together to find a system for sharing electricity throughinterconnectors and to ‘give serious consideration’ to the possibility of linking the new
UK ETS to the EU ETS. No decision on whether the UK ETS will be linked with the EU ETS
has yet been made.

Aside from the UK-EU Cooperation Agreement there is limited concrete detail related toclimate change in other UK trade deals. The need for new trade deals not to contradict
existing ones means that the climate commitments within the UK-EU deal could be used
more widely as a template for other trade deals agreed by the UK in the future.
Source: HMG (2020) Trade And Cooperation Agreement Between The European Union And The European Atomic
Energy Community, Of The One Part, And The United Kingdom Of Great Britain And Northern Ireland, Of The Other
Part .

Progress in reducing emissions: 2021 Report to Parliament

86

Endnotes

87

1

IPCC (2014) 2013 Supplement to the 2006 IPCC Guidelines for National Greenhouse Gas
Inventories: Wetlands, Hiraishi, T., Krug, T., Tanabe, K., Srivastava, N., Baasansuren, J., Fukuda, M.
and Troxler, T.G. (eds). Published: IPCC, Switzerland.

2

YouGov (2020) YouGov - Working from home. Fieldwork: 2nd - 6th September 2020

3

YouGov for Microsoft and CIPD (2020) Work Smarter to Live Better.

4

CIPD (2020) Embedding new ways of working post-pandemic

5

Department for Transport and CAA (2020) Purpose of travel at selected UK airports.

6

Department for Transport (2019) National travel survey.

7

YouGov (2021) Business Flights Survey Sample: 14th December 2020 - 20th January 2021.

8Department for Transport (2021), National travel attitudes study: wave 4 (final).

9

CAA (2021) Air Passengers by Type and Nationality of Operator.

10

Department for Transport (2019) National travel survey.

11

IATA (2020) Air Passenger Market Analysis.

12

IATA (2021) Outlook for the global airline industry – April 2021 update.

13

CAST (2020) CAST Briefing 05 - Tracking the effect of COVID-19 on low-carbon behaviours andattitudes to climate change.

14

Department for Transport (2020) Port freight quarterly statistics: July to September 2020.

15

WTO Secretariat (2020) Trade statistics and outlook: Trade shows signs of rebound from COVID19, recovery still uncertain.

16

WTO Secretariat (2020) Trade statistics and outlook: Trade shows signs of rebound from COVID19, recovery still uncertain.

17

Department for Transport (2021) Transport use during the coronavirus (COVID-19) pandemic.

18

Hook, A., Court, V., Sovacool, B. and Sorrell, S., (2020) A systematic review of the energy andclimate impacts of teleworking. Environmental Research Letters, 15(9), p.093003.

19

Transport Focus (2021) Travel during COVID-19 attitudes to travel post-lockdown.

20

CCC analysis; BEIS (2021) Provisional UK greenhouse gas emissions national statistics 2020.

21

BEIS (2021) Energy Trends: UK electricity.

22

Reuters (2021) Total back to pre-pandemic profit levels as oil prices rise.

23

McKinsey & Company (2021) Global oil supply-and-demand outlook to 2040.

24

Reuters (2021) Pandemic brings forward predictions for peak oil demand.

25

CAA (2021) Air Passengers by Type and Nationality of Operator.

26

IATA (2020) Air Passenger Market Analysis.

27

IATA (2021) Outlook for the global airline industry – April 2021 update.

28

CAST (2020) CAST Briefing 05 - Tracking the effect of COVID-19 on low-carbon behaviours andattitudes to climate change.

Climate Change Committee

29

WTO Secretariat (2020) Trade statistics and outlook: Trade shows signs of rebound from COVID19, recovery still uncertain.

30

Department for Transport (2021) Port freight statistics, Table 0502.

31

CREDS (2021) At a crossroads – travel adaptions during Covid-19 restrictions and where next?

32

Transport Focus (2021), Travel during COVID-19 attitudes to travel post-lockdown.

33

SMMT (2021) UK automotive looks to green recovery strategy after -29.4% fall in new car
registrations in 2020.

34

SMMT (2021) Used car sales: Q4 2020.

35

McKinsey & Company (2020), How consumers’ behaviour in car buying and mobility is changing
amid COVID-19.

36

ONS (2020) Coronavirus and homeworking in the UK labour market: 201937

ONS (2020) Coronavirus and homeworking in the UK labour market: 2019.

38

ONS (2021) Social behaviours during the different lockdown periods of the coronavirus (COVID19) pandemic dataset.

39

ONS (2020) Coronavirus and homeworking in the UK labour market: 2019.

40

ONS (2020) Coronavirus and homeworking in the UK: April 2020.

41

ONS (2020) Coronavirus and homeworking in the UK: April 2020.

42

CREDS (2021) At a crossroads – travel adaptions during Covid-19 restrictions and where next?

43

IEA (2020) Working from home can save energy and reduce emissions. But how much?

44

W. O’Brien and F. Aliabadi (2020), Does telecommuting save energy? A critical review ofquantitative studies and their research methods, Energy and Buildings, 15 October 2020.

45

Data suggests office occupancy was down more than 85% for half of the year. Metrikus (2021)
Metrikus Occupancy Index. https://index.metrikus.io/

46

Carbon Intelligence (2020) ‘Businesses can do more to cut emissions and save costs during
lockdown reveals buildings data’. https://carbon.ci/news/press-release-businesses-can-domore-to-cut-emissions-and-save-costs-during-lockdown-reveals-buildings-data/47

IEA (2020) Working from home can save energy and reduce emissions. But how much?
https://www.iea.org/commentaries/working-from-home-can-save-energy-and-reduceemissions-but-how-much

48

W. O’Brien and F. Aliabadi (2020), Does telecommuting save energy? A critical review ofquantitative studies and their research methods, Energy and Buildings, 15 October 2020.

49

ONS (2020) The impact of the coronavirus so far: the industries that struggled or recovered.

50

US Energy Information Administration (2021) Short-Term Energy Outlook (STEO) supplement:
Developments in Global Oil Consumption.

51

BEIS (2021) Energy Trends: March 2021.

52

BEIS (2021) Energy Trends: March 2021: Natural gas imports and exports (ET 4.3 - monthly).

53

Reuters (2021) Pandemic brings forward predictions for peak oil demand.

54

McKinsey & Company (2021) Global oil supply-and-demand outlook to 2040.

55

CAST (2020) CAST Briefing 05 - Tracking the effect of COVID-19 on low-carbon behaviours andattitudes to climate change.

Progress in reducing emissions: 2021 Report to Parliament

88

89

56

CAST (2020) CAST Briefing 05 - Tracking the effect of COVID-19 on low-carbon behaviours andattitudes to climate change.

57

Public Health England (2020) Disparities in the risk and outcomes of COVID-19.

58

ONS (2020) Updating ethnic contrasts in deaths involving the coronavirus (COVID-19), Englandand Wales: deaths occurring 2 March to 28 July 2020.

59

IFS (2020) Sector shutdowns during the coronavirus crisis: which workers are most exposed?

60

AQEG (2020) Impacts of Net Zero pathways on future air quality in the UK.

61

AQEG (2020) Estimation of changes in air pollution emissions, concentrations and exposure
during the COVID-19 outbreak in the UK.

62

N. Chater for CCC (2020) Net Zero after Covid: Behavioural Principles for Building Back Better.

63

Defra (2021) UK's Carbon Footprint 1997 – 2018.

64

EcoAct (2020) The 10th Annual Sustainability Reporting Performance of the FTSE 100.

Climate Change CommitteeChapter 3

Underlying progress and enablersof progress
1. Tracking underlying progress94

2. Underlying progress on key enablers of the path to Net Zero96

3. Underlying progress by sector

106

90

Introduction
Delivering the Sixth Carbon Budget will require an immediate scale-up in action
across the economy, building an annual investment programme reaching around£50 billion per year by 2030, up from around £10 billion per year today. This must be
accompanied by significant changes in individual and organisational behaviours,
alongside major changes in the way we farm and use our land.
This chapter sets up (but does
not conclude) a discussion of
how to monitor Government
progress towards the Sixth
Carbon Budget.

The transformation presents a major policy challenge for Government and adelivery challenge for UK business. Both Government and businesses have signalled
their commitment to meeting these challenges, but much remains to be done.
Now that the Net Zero target and Sixth Carbon Budget have been set, focus mustswitch to delivery.
In this new context, the Committee’s role must also evolve. This chapter sets up(but does not conclude) the discussion of metrics of progress and the right way tomonitor Government action.
We look forward to assessing the Government’s full Net Zero Strategy later this year,
and will aim to align our progress metrics and monitoring with the Government’s
proposals where we consider those to be credible.
The key messages of this chapter are:•Focus on delivery. Our Sixth Carbon Budget advice identified andquantified many of the changes that need to happen in the next three
decades. Now that the target has been set, focus must switch to delivery.
– Decreases in non-business flying. Aviation demand may be supressedin the medium term, especially if COVID-19 transmission continues
worldwide to some degree. Survey data show that people intend to fly
less after lockdowns are lifted.1 Government should not plan for
unconstrained leisure flying at or beyond pre-pandemic levels in its
strategy for airport capacity and demand management.

•

There are some signs of progress on key enablers of the path to Net Zero.
– The transition to Net Zero requires changes that go beyond thedeployment-related metrics we have tended to track to date. We willseek to broaden our assessment of real-world progress, including
governance, public attitudes, corporate commitments, finance, justtransition and the green recovery, as well as consumption emissions
and the factors affecting them.
– Early signs of progress on key enablers include two Cabinet
Committees, the UK Climate Assembly, Scotland’s Just Transition
Commission, publication of the interim report of the HM Treasury Net
Zero Review, and a rapid increase in climate commitments and action
from UK businesses.

•

The pace of progress varies across sectors. Some sectors of the economy
are making strong progress towards Net Zero, while others are lagging
behind:Progress in reducing emissions: 2021 Report to Parliament92

– Sales of electric vehicles and the deployment of supporting charging
infrastructure have increased considerably in recent years. Policies will
be required to drive the accelerated uptake required throughout the2020s (e.g. a zero-emission vehicle mandate). There are also
concerning trends, notably the rapid growth in car and van travel andshift towards larger vehicles during the past decade.
– There has been almost none of the necessary progress in upgrading
the building stock. Despite a small improvement in rates of heat pumpinstallation, these remain far below levels that are necessary. Insulation
rates remain well below the peak market delivery achieved up to 2012
before key policies were scrapped, demonstrating clear potential for
growth if an effective policy package is in place.
– Deployment of renewable electricity generation has scaled up rapidly.
The increase in 2020 was at a much slower rate than the averageachieved over the previous five years, however, the growing projectpipeline means that this slowdown is likely to be temporary.
– Progress in agriculture and land use has repeatedly failed to meet theindicators (e.g. for tree planting and on-farm efficiency measures)
outlined in the Committee’s progress reports in recent years. There aresigns of potential consumer willingness to shift towards less carbonintensive diets, but this has not yet translated to reduced meat
consumption or been backed up by policy to support the change.
– Progress in reducing emissions from waste have stalled in recent years
following a period of steep emissions reductions from the late 1990s
caused by the diversion of waste from landfill.
– In the decade prior to 2020, air passenger demand increased by 36%.
Efficiency improvements were not enough to offset this rise in demand,
leading to a rise in emissions.
– Although there have been emissions reductions in industry, it is unclear
how far this reflects structural changes driven by wider factors or
genuine improvements in efficiency and carbon intensity. Tracking
progress against our recommended pathway for manufacturing andconstruction is currently challenging because of a lack of data, which
in some cases is because the technologies or approaches are still at
an early stage of deployment.
This Chapter is set out in three sections:
1. Tracking underlying progress
2. Underlying progress on key enablers of the path to Net Zero
3. Underlying progress by sector

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Climate Change Committee

1. Tracking underlying progressa) Why we care about underlying progress
Tracking underlying progress isimportant, to understandwhether lasting changes arebeing put in place that willlead to the necessary emissions
reductions later on.

The end goal of domestic emissions reduction policy is to reduce UK greenhousegas emissions to Net Zero by 2050. Reporting changes in annual greenhouse gas(GHG) emissions and setting targets to reduce those emissions is a fundamental
element of monitoring the UK’s progress on tackling climate change.
However, reporting annual GHG reductions does not tell the complete story.
Chapter 2 sets out how the largest changes in annual emissions in the last decadewere driven not only by reductions in the power sector, but also by external factors
including winter temperatures, economic recessions, and most recently by
lockdown measures during the pandemic (Figure 2.5).
Tracking underlying progress is therefore crucial to understanding what is driving
current and future trends in UK emissions, and for identifying areas where the UK isperforming well or falling behind.
In particular, we are interested in identifying a sustained shift towards low-carbon
investments and behaviours (e.g. an expansion of renewable electricity
generation, an increase in the share of electric cars being bought, higher rates ofplanting trees, a shift from car use towards walking/cycling).

b) Our basis for monitoring underlying progress in future
In December 2020 the Committee published a Balanced Pathway to Net Zero as
the basis for the recommended Sixth Carbon Budget, along with a range ofalternative pathways to Net Zero. These pathways identify the changes ininvestments, choices and behaviours that would deliver the budget and put the UK
on track to Net Zero. They give us a reasonable basis against which progress canbe measured.
We can compare real-world
deployment to the CCC
pathway to see whether things
are on track.

We recognise that there are options and uncertainties associated with pathways
to meet the Net Zero 2050 target and the Sixth Carbon Budget. While theBalanced Pathway – referred to in this report simply as the ‘CCC pathway’ – sets abasis for the budget, it is not intended to be prescriptive. Rather it is illustrative ofwhat a broadly sensible path without extreme assumptions would look like. A little
more or a little less may be achieved in any given area, or alternative low-carbon
solutions could be used, but the overall level of ambition and delivery must match.
Since the pathway is, by design, stretching in all areas there is only limited scope todiverge significantly in any one area, as credible options to go significantly further
in others are limited.
Our pathway modelling approach for the Sixth Carbon Budget was rooted in thetechnologies, investments and behaviours that are needed to decarbonise. Thisapproach allows us to produce a large range of quantitative metrics of what isneeded to achieve Net Zero. These are referenced throughout this chapter.

We will extend our progress
reporting in the next year tocover a wider set of underlying
drivers of emissions reductions

However, we have not fully quantified all the leading indicators and enablers
needed to deliver them, such as strengthening of supply chains, expansions of theskilled workforce, or changes in public attitudes. Over the next year, theCommittee will work towards a more complete set of indicators that also aim to
track those real-world drivers of underlying progress.
Progress in reducing emissions: 2021 Report to Parliament94

Where we assess them to becredible, we will aim to alignour progress monitoring to theGovernment’s plans andproposals.

The Committee’s ability to monitor Government performance on climate change
also rests heavily on publication of the UK’s Net Zero strategy, anticipated later thisyear. This publication will raise two key questions that will guide the Committee’s
scrutiny of underlying Government progress in future reports:•

Does the Net Zero Strategy set out a credible pathway to the Sixth Carbon
Budget and Net Zero targets?

•

Is the Government on track to deliver what was promised in its own Net
Zero strategy?

We will aim to align our progress metrics and monitoring with the Government’s
proposals where we consider those to be credible and practical.

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Climate Change Committee

2. Underlying progress on key enablers of the path to Net Zero
This section reviews some of the key cross-cutting enablers for delivering Net Zero,and identifies underlying progress in each theme. Our future work will expand oneach of these themes in more detail.

a) Governance and delivery
Government will need to work
together effectively at all levels
to deliver the pathway to Net
Zero.

Good governance will be crucial in enabling delivery of the path to Net Zero.
Mitigating and adapting to climate change are challenges that cut across theentire economy, requiring Government to work together at all levels. There has
been some activity on this challenge in the last year:•

There are now two Cabinet sub-committees (for Climate Action Strategy,
chaired by the Prime Minister, and Climate Action Implementation, chairedby the Secretary of State for Business, Energy and Industrial Strategy). The
Government does not report on the content or frequency of thesemeetings, but it is clear from the increased policy activity and theCommittee’s own experience that they are being used.

•

The Government has recently separated the roles of Secretary of State for
Business, Energy and Industrial Strategy and President of COP26.

•

At senior official level there is a Climate Change National Strategy
Implementation Group, a Net Zero Steering Board and various coordinating
working groups. The Business and Energy Secretary has also recently
convened a new Net Zero Expert Group as part of Task Force Net Zero,which aims to adopt a whole-system approach to decarbonising the UK
economy.

•

The Government has set the Bank of England a new mandate to support
the Net Zero transition.2 It has also established a Net Zero Business
Champion (see part e) of this section).

•In the past year, parliamentary Select Committees have opened at least 20
inquiries into aspects of the UK’s path to Net Zero.

•

Both the National Audit Office (NAO) and the Institute for Government (IfG)
have made recommendations 3,4 based on their assessments of what
structures and approaches would be best within the centre to coordinate
the work that is required across all areas of Government business. The
recent Dasgupta Review5 suggested including natural capital within an‘inclusive wealth’ approach to national accounting systems toappropriately value sustainable economic growth and development.

This process of embedding Net Zero throughout Government departments must
continue through the 2021 Spending Review, for which plans to contribute to Net
Zero should be a key criterion.
Government must set a clear
strategy for how Net Zero will
be delivered across the wholesystem.

There are further challenges beyond central Government. There will need to be astrong, clear strategy set from the centre, with clear lines of responsibility andaccountability alongside appropriate empowerment of those tasked with delivery.
The UK Government must coordinate effectively with devolved governments andthere must be a clear expectation of, and support for, local government.
Progress in reducing emissions: 2021 Report to Parliament

96Much of the activity that isrequired to deliver Net Zero will
be carried out at the local
level. Therefore, it is vital that
local actors are properly
empowered and supported todeliver these actions.

•

Net Zero and the recent legislation of the Sixth Carbon Budget set a clear
direction, but these now need to be developed into a full strategy fordelivering the necessary decarbonisation. The build-up to COP26 provides
an opportunity for the UK to show leadership in setting out ambitious
decarbonisation plans and a roadmap for delivering these. This momentum
and Government ambition must be sustained and built upon beyond
COP26.

•

Each of the devolved administrations contributes to the UK’s overall Net
Zero target, while Scotland and Wales each have their own Net Zerotargets. As such, each devolved administration is developing andimplementing policy to reduce emissions – this presents both challenges interms of aligning policy signals and outcomes, and also opportunities tolearn from best practice.

•

A lot of the delivery required for Net Zero is inherently local in nature, but
local actors (including local authorities, sectoral bodies and businessgroups) are frequently not properly empowered and supported to deliver
the actions required.
– Nearly three-quarters of local authorities have declared a climate
emergency. However, there can be uncertainty around what actions
they should take to address this, and delivery of Net Zero can be achallenge in the context of funding shortfalls and competing needs todeliver statutory obligations.
– As part of our advice on the Sixth Carbon Budget, we commissioned
an assessment of the role of local government. 6 This produced several
recommendations for how to enable collaborative delivery, including
the need for an agreed framework incorporating local and national
action, the importance of aligning policy and local powers with
ambition and the requirement for appropriate long-term
programmatic funding.

We intend to consider the governance challenges further during the 2021-22 year,
including the work of other organisations and potential lessons from other delivery
challenges. We will report back on our findings in our 2022 Progress Report.

b) People and public engagement
Meeting the Sixth Carbon Budget and the Net Zero target will require increased
action from people, as consumers, workers, households, businesses and citizens.
Our analysis shows that over half the emissions reductions needed to meet the Sixth
Carbon Budget involve people making low-carbon choices, whether adjusting to
the different characteristics of low-carbon technologies (e.g. electric cars), or bychanging their current consumption patterns (e.g. by eating less meat).
The Climate Assembly UK was
an important start in engaging
the public more in climate
policy decisions.

97

The experience of the Climate Assembly UK shows that people will support thetransition to Net Zero if they understand what is needed and why, if they have
options and can be involved in decision-making processes. However, for wider
society in general, while there is an increased awareness of the need for climate
action, there is still a gap in understanding what this means for them. For example,
while 80% of people are concerned about climate change, only half are awarethat their gas boiler produces emissions. 7 Climate Assembly UK also demonstrated
that there is much that government can learn from citizens’ lived experience andvalues that can help in formulating better policy.
Climate Change Committee

There is a clear requirement for the Government to tell a better story on how
people can engage in the transition, while also learning from people’s
experiences. The need for a Government public engagement strategy was
identified as a key policy priority area in our Sixth Carbon Budget advice.
Our future work will include
looking at ‘what works’ forpublic engagement, further
analysing what meeting the
Sixth Carbon Budget means forindividual choices, andassessing the Government’s
own public engagement plans.

The Committee will be undertaking further work on how people can be engaged
effectively on this path, with a view to making more detailed recommendations toGovernment in 2022. The work will be informed by stakeholder engagement,
literature review, survey data and work with the Climate Citizens project at
Lancaster University. It will cover:•Establishing the principles of what good public engagement for Net Zerolooks like. This will include a synthesis of the main findings of different public
engagement strategies and models used in the UK and overseas, bothwithin climate change and other policy areas, in order to demonstrate
what works and what we can learn from successful engagement.

•

Unpacking the key Sixth Carbon Budget actions that actively involve
people changing how they do things. This will allow us to identify:– Priority areas for engagement.
– The most appropriate engagement model(s), policies and key delivery
partners, drawing on evidence from case studies.
– The key indicators and survey data with which to track progressagainst and identify key data gaps.

•

Assessing the public engagement aspects of the Government’s Net Zero
Strategy.

Progress in reducing emissions: 2021 Report to Parliament98c) Just Transition – who pays and who gains?
The costs and the benefits must
be shared in a way that is fairand is perceived to be fair.

A key challenge on the path to Net Zero is how to spread the costs and benefits ofthe transition across the economy: for households, businesses and the Exchequer.
The Treasury published their initial findings on this challenge in December, in theinterim report of their Net Zero Review. Its conclusions echoed the Committee’s in
our Net Zero report and in the Sixth Carbon Budget, as well as the conclusions of
our Expert Advisory Group on the costs and benefits of Net Zero.8 Conclusions
include that the effects of decarbonisation on economic growth are likely to besmall and that the costs of the transition are uncertain but can be minimised withgood policy, which should rely on a range of levers (Box 3.1).

There is currently an imbalance
between gas and electricity
prices. This does not fairly
spread the costs of polluting
nor incentivise the rightdecarbonisation decisions.

In the long term, the transition should result in lower energy costs and energy bills,
but in the coming decade our scenarios involve further increases in electricity costs
before these begin to fall. To date, climate policy costs have been primarily added
to electricity prices rather than to gas prices. This has adversely affected particulargroups (those with electric heating, who are often fuel poor) and had adistortionary effect by undermining the case for electrification, which should play amajor role in meeting the Sixth Carbon Budget both in homes and in industry.
There is growing consensus on the need to tackle the imbalance between
electricity and gas prices. For example:

Reaching Net Zero will bringtangible benefits to people’s
lives that overwhelmingly
outweigh the negatives. Thesebenefits should be shared as
widely as possible.

•

Public First, supported by five major energy companies, produced anassessment of policy options for energy bill reform that would remove therunning cost disincentive on electrified heating, while maintaining
affordability of heating for average households across the country, notsubstantially increasing costs for the fuel poor and without putting an
undue fiscal burden on public finances. 9 The 750,000 electrically-heated
fuel poor households would benefit. Particular issues include how better totarget fuel-poor households and impacts on people moving in and out offuel poverty (fuel poverty ‘churn’), who would be hit by a large bill increase
under their proposals.

•

In their Fourth Annual Report, the Committee on Fuel Poverty (CFP)
recognised the adverse incentives under the current system, which
discourage the necessary move away from gas or oil to electricity. The
CFP’s preference is that climate policy costs are not passed on to
consumers via bills but rather recovered in income taxation. However, inthe short term they support a shift of policy costs to gas bills, as long as
measures are taken to protect fuel-poor households against any resulting
bill increases.10

Alongside the benefits in mitigating climate change, and the potential for lower
energy prices in the long term and economic benefits, there are additional
benefits on the path to Net Zero. These include significant, tangible improvements
to public health, the environment and biodiversity:•

99

Chapter 5 of the Sixth Carbon Budget set out in detail the range of coimpacts that are likely to arise from decarbonising our economy. The
Committee appointed an expert advisory group on health to support ouradvice on the Sixth Carbon Budget, which concurred strongly with ourprevious assessment that climate action could bring significant benefits tohealth, including through healthier diets, more exercise and better air
quality.

Climate Change Committee•

HM Treasury’s Net Zero Review
final report is now two years in
the making and has manyquestions still to answer.

We concluded in the Sixth Carbon budget that the positive co-impacts ofreaching Net Zero overwhelmingly outweigh the negatives, especially if
supported by the right policy decisions from the Government to maximise
societal benefits and minimise the risks.

The final report of the Treasury’s Net Zero Review, which was planned for Spring
2021, has been delayed and is now expected later this year – over two years since
the Committee recommended it. We expect the Review to address many of theissues around who pays and who gains from a transition to Net Zero, including:•

Developing a plan for funding decarbonisation and reviewing the
distribution of costs for businesses, households and the Exchequer. Thisshould set out the main areas where action and funding will be required,
the principles on which the distribution of costs should be determined andclarity over how costs will be allocated.

•

Considering near-term as well as long-term decarbonisation funding needs
and policy implications. One Government cannot make funding
commitments that bind future Governments, but the review can set out
principles to inform the scale and nature of long-term Government funding
and make concrete proposals for action and funding over the next five toten years, or at least be accompanied by a spending review or budget
which does the same.

•

Reforming price signals, including the potential to raise offsetting revenues
by greater use of carbon taxes (e.g. for sectors like aviation that are
currently under-taxed and where equity concerns are less present) and theneed to rebalance policy costs between gas and electricity to ensure thetake-up of low-carbon electricity solutions is not hindered.

For climate action to be effective, it must reduce global emissions, not just UK
territorial emissions. Emissions reductions from UK industry must result from reduced
UK consumption and from decarbonising the UK’s own industries, rather than‘offshoring’ production to other countries (i.e. 'carbon leakage'). It is vital therefore
to consider competitiveness as part of the just transition.
Emissions can be reduced
while maintaining
competitiveness, but this will
require policy to support UK
industries.

Our advice on the Sixth Carbon Budget identified how emissions can be reduced
while managing competitiveness. Government has also set out a vision of how thiscan be achieved, through strategies including the Industrial Decarbonisation
Strategy. The Strategy stated that ‘In the immediate future, government’s preferred
method for mitigating the risk of carbon leakage will continue to be free allocationof UK ETS emissions allowances, which will be decreasing throughout the 2020s.’
The Government is consulting on the future of free allocation.
Going forward, we will monitor progress on the development of these policies andconsider indicators to track progress on managing competitiveness. We will also
consider how policies to manage competitiveness can be designed to reduce theembodied emissions of UK imports.
Managing the transition fairly will be an ongoing process and must continue
beyond the publication of the final report of the Treasury’s Net Zero Review. We willcontinue to monitor the Government’s progress in delivering a transition that sharescosts and benefits fairly across different groups. Our further work on this theme, in
addition to tracking government progress, will depend on the findings of the Net
Zero Review.

Progress in reducing emissions: 2021 Report to Parliament100Box 3.1
Findings of the interim report of HM Treasury’s Net Zero Review
In May 2019 the Committee’s Net Zero report recommended that the Treasury undertakea review of how the costs of achieving Net Zero emissions should be distributed and thebenefits returned. The Treasury agreed to undertake the review and published its interim
report in December 2020. Key findings of the interim report include:•

Reaching Net Zero is essential for long-term prosperity. Global action to limit
greenhouse gas emissions is needed to avoid catastrophic climate change withalmost unimaginable consequences for societies across the world. But thistransformation will also create opportunities for the UK economy, like new industries
and jobs that emerge as existing sectors decarbonise or give way to low-carbon
equivalents.

•

The effect of UK and global climate action on UK economic growth is likely to berelatively small. The scale, distribution and balance of new growth opportunities andchallenges will depend on how the economy and policy respond to the changes
required.

•

The costs of the transition to Net Zero are uncertain and depend on policy choices.
Investment requirements to reach Net Zero and impacts on operating costs areaffected by a range of factors which are subject to significant uncertainty (e.g. theprecise path of the transition, changes in behaviour and the rate at which
technology costs fall and efficiency gains are made).

•

Government needs to use a mix of policy levers to address multiple market failuresand support decarbonisation. Government policy should seek to target market
failures directly where possible, subject to distributional and international
competitiveness impacts. Carbon pricing is an important lever in addressing thenegative externality problem but should be supplemented by other policies.

•

Well-designed policy can reduce costs and risk for investors, support innovation andthe deployment of new technologies. A clear policy framework setting out the
government’s approach at different levels of technological development can help
address uncertainties. Where uncertainty is at its greatest, government may need toprovide more direct support.

•

The risk of carbon leakage will increase with efforts to reduce emissions. Changes
required for the transition could lead to carbon leakage if policies achieve their goalof lowering emissions in one jurisdiction but inadvertently increase emissions
elsewhere. The size of the risk depends on each sector’s costs of decarbonising, theirtrade exposure and international policies. The government has a number of ways toseek to mitigate this risk, including through its climate diplomacy and the design ofpolicies to support the transition.

•

Government needs to consider household exposure to the transition through theirconsumption, labour market participation and asset holdings in designing policies.
Different types of household will have different levels of exposure to the transition.
Where costs fall will depend on a range of factors, including the cost ofdecarbonising each sector, the availability of alternative low-carbon products andthe distribution of new green jobs in the economy. Government will need to be
mindful of these issues as they consider the best way to design policy to support thetransition.

Source: HM Treasury (2020) Net Zero Review: Interim Report.

101

Climate Change Committeed) Just Transition – workers and skills
There is a transition risk toemployment, as high-carbon
activity declines and new lowcarbon industries are created.

The transition to Net Zero will need more of some jobs and fewer of others. There is
no reason to think that the total number of jobs should be any lower than in a highcarbon world – a recent report by the Confederation of British Industry set out thepotential for the transition to Net Zero to create 240,000 new green jobs by 2030
across the UK, 11 and the International Energy Agency’s Roadmap for the Global
Energy Sector results in 14 million jobs created globally by 2030. 12 But the shift in jobs
from some areas to others brings a significant transition risk.

A strategy is needed to ensure
a just transition for workers.

The transition will affect the whole of the UK, with impacts differing across regions,sectors and workers. Risks of negative localised impacts must be a particular focus
for policy. The deindustrialisation that has occurred in the UK to date has alreadyleft some regions disproportionately worse off, with previous efforts in the UK totransition workers in declining industries to new jobs achieving limited success.13 A
strategy for the just transition is required to ensure no group is left behind.
Key developments over the last year include publication of the final report of theScottish Just Transition Commission, establishment of the Green Jobs Taskforce and
the Government’s plans for a Skills and Post-16 Education Bill:•The Scottish Just Transition Commission published its final report in March
2021. 14 The report acknowledged that transitioning to Net Zero means afundamental transformation of the nation’s economy, which offers great
opportunities, but must be implemented fairly. It made 24
recommendations to ensure the transition is made “by the people of
Scotland, not done to the people of Scotland”, including four practical
recommendations to equip people with the skills and education they needto transition to Net Zero:– A flexible and accessible skills and education system.
– A skills guarantee for workers in carbon-intensive sectors.
– Support for small and medium enterprises to invest in their workforces.
– Equipping farmers and land managers with the skills, training andadvice they need.

•

The Green Jobs Taskforce was convened by BEIS to focus on both
immediate and longer-term challenges of delivering skilled workers for thetransition to Net Zero. It will produce a Green Jobs Action Plan with solutions
and recommendations. These documents had not been published as thisyear’s Progress Report was being finalised and its recommendations were
not considered as part of our assessment of progress.

•

The 2021 Queen’s Speech set out plans for the Government’s Lifetime Skills
Guarantee, which will offer adults loans to retrain in later life and help them”to gain in-demand skills and open up further job opportunities”, as part of
the Skills and Post-16 Education Bill. The Bill will also aim to realign the
education system around the needs of employers to fill skills gaps in sectors
including construction, digital, clean energy and manufacturing.15

We will continue our work in this area, drawing on existing external research andanalysis and identifying knowledge gaps which the Committee could help to fill.

Progress in reducing emissions: 2021 Report to Parliament102

We will draw on the pathways we developed for the Sixth Carbon Budget andconsider in particular the implications for employment and skills policy, andconsider what indicators could be used to track success in ensuring a just transition.

e) Other key drivers of progress
We will continue to develop ourunderstanding of what progress
towards Net Zero looks like forbusinesses, the financial system,
UK innovation, carbon pricing,international engagement, andmore.

Further enabling actions will be required to meet Net Zero. The Committee’s future
work on cross-cutting areas will build on previous reports and explore new areas. As
with policy development more generally (see Chapter 4), there has been progressin these areas in the last year.
•

Business action. While the UK government must set the frameworks for thetransition and citizens must make low-carbon choices, the private sector
must invest and transform their business models. This will often be driven andsupported by the third sector. Increasingly, businesses are delivering onthese ambitions, by procuring low-carbon electricity, switching to electricvehicles and decarbonising their own operations. Our future work will aim
to help businesses make informed decisions that are in line with Net Zero(see Box 3.2) and track how corporate commitments are progressing in the
UK. Key developments in the past year include:– The UK had the largest share of companies (94 out of 300) in the
Financial Times’ Europe’s Climate Leaders list of companies that haveachieved the greatest reduction in greenhouse gas (GHG) emissions
intensity * since 2014. 16– The BSI Net Zero Barometer found that 7 out of 10 businesses in the UK
have made or are considering making a commitment to Net Zero, but
the vast majority (82%) require more guidance if they are to achieve
the target, with cost cited as the biggest barrier. 17– Nearly one in three FTSE100 companies have signed up to the UN's
Race to Zero campaign. 18 Small and micro businesses are now also
being encouraged to commit to cutting their emissions (in half by 2030
and to Net Zero by 2050 or sooner) through the Together for our Planet
campaign and newly-established UK Business Climate Hub.
– The Government has established a Net Zero Business Champion withdirect responsibility to support as many UK businesses as possible tocommit to net-zero emissions targets.

Investment and finance. The Committee’s Expert Advisory Group on Net Zerofinance concluded that the investment programme required for the Sixth Carbon
Budget is deliverable, but that delivering at the lowest overall cost is dependent onpolicy in both the ‘real’ and ‘financial’ economies. The Group highlighted theneed for a regular assessment of investment needs and financial flows for climate
action in the UK. Such an assessment would consider the level and sufficiency of
capital investment flows made by households, firms and public authorities toachieve the UK’s climate goals of Net Zero, adaptation and a just transition. It
would also aim to assess the overall alignment of the UK’s stock of financial assets
with the Paris Agreement and for Net Zero and resilience at both a UK and global
scale. Key recent developments in low-carbon finance include:*

103

This ranking covers only Scope 1 and Scope 2 emissions, and does not cover Scope 3 emissions from companies’
supply chains and the end-use of their products and services.

Climate Change Committee– London remained top of the Global Green Finance Index (GGFI).19 The
index ranks cities based on the quality and depth of their green
finance offerings, capabilities and mechanisms. Ratings rose in almost
all centres globally, but Western Europe continues to be the mostmature market, accounting for nine of the top 10 and 12 places acrossthe respective rankings.
– From May 2019 to May 2021, the UK climbed from eight to fourth in EY's
rankings for international attractiveness of renewable energy
investment and deployment opportunities.20– The UK has announced its intention to make Task Force on Climaterelated Financial Disclosures (TCFD) aligned disclosures mandatory
across the economy by 2025, with a significant portion of mandatory
requirements in place by 2023.
– The UK Government announced at least £15 billion of ‘green gilts’sovereign bonds for this financial year, and the Bank of England’s
climate change stress test will be published in June 2021.
– The remits of the Bank of England’s Monetary Policy Committee (MPC)and Financial Policy Committee (FPC) were updated to reflect theGovernment’s economic strategy to achieve economic growth that is
consistent with Net Zero.
– The Prime Minister's Finance Adviser for COP26 has published a Private
Finance Strategy for climate change.
•

Innovation and infrastructure have played a critical role in driving down thecosts and improving the efficiencies of the low-carbon technologies we use
today. Sustained support for innovation – at all stages of the technology life
cycle, including deployment – can ensure costs and efficiencies continue
to improve in the future. Scaling up low-carbon technologies will rely on
new infrastructure (e.g. electric vehicle charging points, electricity network
upgrades and new CO2 storage and hydrogen networks). This must be
reflected in infrastructure decisions in the 2020s and be resilient to achanging climate. Monitoring progress will involve tracking technology
costs and uptake, funding available for Net Zero research and innovation,
as well as whether the necessary infrastructure is being built. Key recent
developments include:– HM Treasury confirmed a new Net Zero Innovation Portfolio (NZIP) withfunding totalling £1 billion. Funding will be allocated on a competitive
basis to sectors including long-duration energy storage; floating
offshore wind; biomass and regenerative agriculture.
– Progress has been made on plans and funding for infrastructure,including the National Infrastructure Strategy, Plan for Growth, and theestablishment of the UK Infrastructure Bank.

•

Cross-economy carbon pricing and obligations. To incentivise the transition
to Net Zero, prices will need to reflect carbon content sufficiently to favour
low-carbon options over high-carbon options. That can be achieved
through explicit carbon pricing or other financial levers, although these will
not be sufficient by themselves and must be backed up by other policy. In
principle, all sectors of the economy could be exposed to carbon pricing,although care must be taken in managing impacts when doing so.

Progress in reducing emissions: 2021 Report to Parliament

104

Monitoring the impact of carbon pricing will involve tracking the price ofemitting (or removing) carbon in the UK, the scope of emissions that iscovered by such a scheme, and the impact it is having on real-world
decisions. The UK Emissions Trading System (UK ETS) launched at the start of
the year. The Government has committed to consulting by September 2021
on a cap for the UK ETS consistent with the Sixth Carbon Budget.
•

International / engagement with other ‘Climate Councils’ worldwide. The
Committee is working with over 20 other climate councils from around theworld to share knowledge and insights, recognising the significant common
ground and importance of independent, evidence-led advice in
implementing the Paris Agreement. This is being taken forward as a formalinternational network with events planned around the COP and in futureyears.

Box 3.2
The role of business in delivering the Sixth Carbon Budget
Corporate action is already driving significant change across the UK and internationally,
and accelerating this action will enable the policy, technological, behavioural, andbusiness model changes needed for a zero-carbon society. Yet many businesses within
the UK are increasingly looking for information and a better understanding of the futurecontext in which they will operate.
Alongside our advice on the Sixth Carbon Budget we developed a briefing note on how
businesses in the UK can act to support the UK’s transition to Net Zero. This suggests thefollowing principles to guide business ambition in the UK:•

Do the basics well – measure, disclose, target, act, adjust. Companies should
account for, and take action on, all emissions they are responsible for and betransparent about their objectives to reduce emissions, and how they plan to do it.

•

Adopt the highest possible ambition, acknowledging that some, particularly large,
businesses may be able to achieve Net Zero earlier than the UK’s national objective.

•

Address all emissions, and go beyond. In particular companies should look at theemissions that occur in their supply chains (‘Scope 3’ emissions), and go beyond this.
In particular we identify two areas to advance progress:– Companies can lead the transition to electric vehicles in the UK, and should switch
their vehicle fleets to EVs over the 2020s– Companies should ensure corporate renewables procurement pays for new lowcarbon electricity to be installed, rather than just purchasing existing renewables.

•

Ensure Climate Change is addressed at the highest levels of corporate leadership,including ensuring climate action is given board level and CEO responsibility.

•

Minimise offsets, phase them out, and ensure only permanent emissions removals
remain, in line with our recommendations around how the UK should meet its
national carbon budgets.

Source: CCC (2020) The role of business in delivering the UK's Net Zero ambition.

105

Climate Change Committee

3. Underlying progress by sector
This section assesses underlying progress by sector, showing changes in the ‘key
metrics’ that could be used to track progress against our recommended pathway
to Net Zero and discussing broader underlying developments that are likely toaffect technology deployment, changes in individual and business behaviours,
and ultimately UK emissions in future years.
These key metrics are not yet a full indicator framework, but many of these metrics
will continue into future progress reports.

a) Surface transport (113 MtCO2e, 23% of UK emissions in 2019)
Surface transport remains the UK’s highest-emitting sector. Delivery of the
Balanced Net Zero Pathway (‘CCC pathway’) from our 2020 Sixth Carbon Budget
Report will require substantial progress over the coming years:
During the 2020s, we need tosee rapid uptake of EVs,
supported by widespread
deployment of charging
infrastructure.

Government needs to invest in
attractive alternatives to car
travel, to reduce the use ofhigh-carbon transport.

•

Rapid ramp-up of sales of fully electric cars and vans through the 2020s,
reaching almost 50% of all new sales by 2025 and 100% by 2030.

•

This will need to be supported by the deployment of almost 280,000 publiccharge points across the country by 2030.

•

Trials of zero-emission HGVs to commence in the early 2020s, alongside
logistics and efficiency improvements for existing HGV fleets.

•

Investment in high-quality public transport and active travel infrastructure,
to support a 6% reduction in demand for car travel by 2030 relative tobaseline forecasts.

Key surface transport indicators cover emissions intensity, new vehicle efficiency,
electric vehicle (EV) take-up, biofuels and travel demand (Table 3.1).

Progress in reducing emissions: 2021 Report to Parliament

106

Table 3.1
Key metrics for surface transport in the CCC Pathway to meet the Sixth Carbon Budget
Latest IndicatorYear

Annualchange

Value

2025

2030

2035

2050

BEV car registrations(thousands)

2020

+184%

108

1,290

2,750

2,960

3,360

Market share (%)

2020

6.5%

48%

97%

100%

100%

PHEV car registrations(thousands)

2020

67

698

0

0

0

Market share (%)

2020

4.1%

26%

0%

0%

0%

Electric van registrations(thousands)

2020

6

237

439

460

502

Market share (%)

2020

2.0%

56%

99%

100%

100%

New car CO 2 emissions(gCO 2/km)

2020

-12%

113.0

51.4

3.3

0.0

0.0

New van CO 2 emissions(gCO 2/km)

2020

-2%

163.0

74.7

0.1

0.0

0.0

HGV emissions intensity(gCO 2/km)

2020

-12%

592.0

537.0

450.0

246.0

8.1

Biofuel uptake (% fuelsales by energy)

2020

+16%

4.7%

4.2%

4.7%

6.3%

17.0%

Car-km per driver (km)

2020

-25%

10,00012,50012,30012,100

11,100Car distance driven(billion kms)

2020

-25%

351

441

453

466

483

Van distance driven(billion kms)

2020

-9%

84

92

99

107

122

HGV distance driven(billion kms)

2020

-6%

28

26

25

26

28

MetricIntensity

DemandMilestones in the CCC pathway

+92%

+64%

Trend

Source: DfT, SMMT and HMRC (2021); CCC analysis
Notes: 1. New car CO2 figures are calculated on an NEDC test-cycle basis, to enable comparison with previous years. 2. While indicators that arecalculated using travel demand (car-km per driver, car distance driven, van distance driven and HGV distance driven) currently look on track to meet or
ahead of CCC Pathway milestones, it is important to note that travel demand in 2020 was significantly lower compared to previous years as a result of
COVID-19.

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Climate Change Committee

Sales of EVs and the deployment of supporting charging infrastructure haveincreased considerably in recent years. This will need to accelerate throughout the2020s. However, there are also concerning trends, notably the rapid growth in car
and van travel during the past decade.
•While total car sales fell 30% in 2020, sales of EVs more than doubled, to
175,000 vehicles or 10.6% of all new car sales (Figure 3.1). There has also
been a shift towards battery-electric vehicles (BEVs) from plug-in hybrids(PHEVs) – BEVs now represent over 60% of EV sales, from around 50% in
2019.
– Manufacturers are increasingly scaling up their EV offerings. There are
now around 45 BEV car models on the market, with at least a further 3
expected over the remainder of 2021.
– Advancing EV technologies are lengthening driving ranges andcutting prices. 21 Research shows that battery prices have fallen by 13%
from 2019 to 2020 22, and popular EV manufacturers 23 have been
reducing prices in 2021.
– Evidence 24 suggests consumers are giving increasing consideration toenvironmental issues as part of their purchasing decisions.

Figure 3.1 Number of UK new electric car sales
and market share of total car sales

60,000

6%

40,0004%

20,000

2%

0

0%

BEVs

PHEVs

2020

8%

2019

80,000

2018

10%

2017

100,000

2016

12%

2015

120,000

Market share

New electric car sales

EV sales rose to record levels
during 2020. Manufacturers are
increasingly scaling up their EV
offerings.

Market share (%)

Source: DfT (2021); CCC analysis
Notes: Market share, shown on the right-hand axis, represents the combined sales of BEVs and PHEVs as aproportion of all new car sales in the given year.

Progress in reducing emissions: 2021 Report to Parliament

108

There are now over 20,000
public EV chargers in the UK.
Deployment needs to continue
to accelerate to makecharging readily available
across all areas of the country.

•

The UK’s public charge point network is expanding quickly (Figure 3.2), andthere are now 20,800 public EV charge points across the UK, up from 16,500
at the end of 2019. 25 This provision is inconsistent across the country. On a
per-capita basis, charge points in England and Northern Ireland are lower
than in Scotland and Wales. A disproportionate share of public charge
points in England are located in London and other urban areas in the South
East.

60

10,000

40

5,000

20

0

0

Chargers up to 43 kW

2020

2019

15,000

2018

80

2017

20,000

2016

100

2015

25,000Devices/1,000 plug-in vehicles

Charging devices

Figure 3.2 Total publicly accessible charging
devices installed across the UK, and ratio of
devices to the number of plug-in vehicles

Rapid chargers (above 43 kW)

Devices per thousand vehicles
Source: DfT, OZEV and ZapMap (2021); CCC analysis.
Notes: Includes all publicly accessible charge points across the UK at the end of October in the given year. The
ratio, displayed on the right-hand axis, is over all plug-in vehicles operating at the end of Q3 in the given year.

New car CO2 intensities haverisen in recent years, driven by
the high proportion of large
SUVs purchased.

109•

Between 2007 and 2016, the average CO2 emissions of a new car
decreased by 27%. This trend reversed between 2017 and 2019, mainly due
to increasing sales of higher emitting SUVs. Efficiency improved again in2020 by 12% 26, but this was almost entirely due to record sales of electricvehicles (EVs). The high proportion of SUVs, representing one in four new car
sales, remains a concern.

Climate Change Committee

Demand for road transport hascontinually grown year-on-year
in recent decades. This is partly
due to the falling real-terms
cost of driving.

•

Road transport demand has risen markedly over the past decade * , which
continued with a 2% increase in 2019 (Figure 3.3). The falling real cost ofdriving, a large increase in van travel (due in part to the growth in online
shopping27) and slower growth in HGV demand are key contributors.
– Over the past decade, the average cost of driving has risen by lessthan average wages and the cost of living, whereas rail and bus fares
have increased more steeply.28 A recent study 29 linked the freeze infuel duty since 2011 to a 4% increase in traffic levels, 60 million fewer
rail journeys, 200 million fewer bus journeys and 4.5 MtCO2 of emissions
in 2017.
– From 2021 to 2022, rail fares will increase by the Retail Price Index (RPI)
plus 1%, a 2.6% rise.30 In contrast, the long-haul rates of Air Passenger
Duty will increase in line with RPI and short-haul rates will not rise.31

Figure 3.3 Changes in travel demand by mode
since 2010

Change in travel demand since 201040%
89.4bn km
30%
68.6bn p-km
20%447.8bn km
5.6bn km10%28.0bn km
0%26.8bn p-km

-10%
2010

2012

Cars

Vans

2014

HGVs

2016

Buses

2018

Rail

Cycle

Source: DfT, ORR (2021); CCC analysis.
Notes: The chart shows the percentage change in the number of kilometres travelled by each type of transport(total kilometres driven for cars, vans, HGVs, and cycles; total passenger-kilometres for buses and rail) in each year,
compared to levels in 2010. The data labels show the absolute levels of demand for each mode in 2019.

The Committee intends to continue tracking these key indicators of EV uptake,charging infrastructure deployment, vehicle efficiency and travel demand bymode, for the Sixth Carbon Budget pathway, in future progress reports. We will also
explore opportunities to monitor other key enablers of the transition, including
public attitudes to various modes of travel, the scaling-up of EV supply chains andthe availability of safe, reliable and attractive alternatives to car travel.

*

The reductions in travel demand seen in 2020 were due to the impacts of the COVID-19 pandemic, and notreflective of the underlying trends observed over recent years.

Progress in reducing emissions: 2021 Report to Parliament

110b) Buildings (88 MtCO2e, 18% of UK emissions in 2019)
The path to Net Zero set out in our advice on the Sixth Carbon Budget sees
substantial near-term growth in the deployment of energy efficiency measures andheat pumps as two of four priority areas over the next decade, alongside roll-out of
low-carbon heat networks and hydrogen trials. We should not delay on heatpumps or low-carbon heat networks as viable solutions for most of the country –hydrogen can be part of the mix but has not yet been proven at scale and should
not be a cause to delay other options.
Substantial near-term growth isneeded in the deployment ofenergy efficiency measuresand heat pumps, but delivery
rates have continued tostagnate.

Despite this, progress in upgrading the building stock with the necessary measuresover the last decade has been very poor. Underlying delivery rates continued tostagnate, with a small improvement in heat pump delivery rates driven by retrofit
installations under the Renewable Heat Incentive (RHI) (Table 3.2).32

Table 3.2
Key metrics for buildings in the CCC Pathway to meet the Sixth Carbon Budget
Latest Indicator

Milestones in the CCC pathwayYear

Annualchange

Value

2025

2030

2035

2050

Heat pumpinstallations(thousand per year)

2020

9%

36

415

1,075

1,435

1,525

Lofts insulated(thousand per year)

2020

26%

32

710

675

200

0

Cavity walls
insulated (thousand
per year)

2020

-3%

40

215

175

55

0

Solid walls insulated(thousand per year)

2020

-22%

10

255

245

45

0

Metric

Trend

Source: CCC analysis; BSRIA (2021) Heat pumps market analysis 2020: United Kingdom, BSRIA World Market Intelligence; BEIS (2021) Household Energy
Efficiency Statistics: Headline Tables.
Notes: Our scenarios deploy the majority of domestic energy efficiency measures in the 2020s, given the carbon, bill and health benefits, and the need toprepare the stock for widespread low-carbon heat uptake in the 2030s. For this reason, in-year energy efficiency deployment declines in later years
relative to deployment levels in the coming decade. Out-turn data for heat pump installations may include some installations which serve multiple
dwellings, slightly underestimating the number of homes heated by heat pumps relative to the milestones.

111

Climate Change Committee

Insulation rates remain well below the peak market delivery achieved up to 2012
(the point at which the Carbon Emissions Reduction Target and the Community
Energy Saving Programme ended), which illustrate the growth potential where aneffective policy package is in place (Figure 3.4).

Figure 3.4 Home insulation rates by measure and
year
1.6
1.4

Installations (millions)

1.2
1.0
0.8
0.6
0.4
0.2

Lofts insulated

Cavity walls insulated

2020

2018

2016

2014

2012

2010

2020

2018

2016

2014

2012

2010

2020

2018

2016

2014

2012

2010

0.0

Solid walls insulated

CCC indicator (annualised) based on Fifth Carbon Budget
Source: DECC (2014) Dat a tables: Green Deal, ECO and Insulation Levels, up to March 2014, Green Deal, Energy
Company Obligation (ECO) and Insulation Levels in Great Britain; BEIS (2021) Household Energy Efficiency Statistics:
Headline Tables; CCC analysis.
Notes: The CCC indicator shown represents the annualised rates of installation based on the Committee’s 2015
advice on the Fifth Carbon Budget, which we judged to be a realistic and appropriate annualised installation rate
at that time.

Progress in reducing emissions: 2021 Report to Parliament112

Annual heat pump installations in homes rose slightly from 33,000 in 2019 to 36,000
in 2020, driven mainly by an increase in retrofit installations to just under 23,000. Thisremains significantly below the rates needed over the next few years, which
require just over 400,000 heat pump installations per year by 2025, rising to just over
900,000 per year by 2028 (Figure 3.5). These deployment rates remain a fraction ofcurrent annual boiler sales of around 1.8 million per year. Deployment in nondomestic buildings also remains very limited, with installations (for systems <50 kW)
currently running at less than 1000 per year.

Figure 3.5 Current heat pump installation rates inhomes set against the CCC’s Balanced Pathway
1.1
1.0

Annual installations (millions)

0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0.0

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

CCC trajectory - new homes

CCC trajectory - existing homes

Actual installations - new homes

Actual installations - existing homes

Source: CCC analysis; BSRIA (2021) Heat pumps market analysis 2020: United Kingdom, BSRIA World Market
Int elligence.

We will be developing a new
indicator framework over the
coming year. There is a needfor public statistics to evolve tobetter support monitoring of
the low-carbon transition.

113

We are developing a new indicator framework over the coming year, consistent
with the path to Net Zero and the Sixth Carbon Budget:•

We will continue to monitor key areas including heat pump sales andinsulation installations alongside biomethane injection. There is substantial
scope for publicly available statistics here to be improved to consolidate
data on the quantity and nature of UK heat pump and insulation
installations, including those outside of government schemes.

•

In two key areas there are no annual public statistics: on low-carbon heat
networks and on insulation rates in public and commercial buildings.
Government should prioritise annual reporting on total heat delivered
through heat networks, split by heating technology. We will set out our
indicators for public and commercial buildings next year.

•

We will also be considering what new indicators may be appropriate, forinstance on consumer attitudes, building performance, measures toaddress overheating and ventilation, building level flexibility, supply chain
development and skills.

Climate Change Committee•Finally, we will put in place a set of policy milestones which factor in
Government ambition in the forthcoming Heat and Buildings Strategy, Net
Zero Strategy, Hydrogen Strategy, buildings regulations and heat networks
policy developments, along with the key phase-out dates from the Sixth
Carbon Budget.

c) Manufacturing and construction(65 MtCO2e, 13% of UK emissions in 2019)
The recommended pathway
set out in our advice on the
Sixth Carbon Budget sees
emissions from manufacturing
and construction reduce by
43% by 2030 and 71% by 2035
from 2018 levels.

The path to Net Zero set out in our advice on the Sixth Carbon Budget sees
emissions from manufacturing and construction reduce by 43% by 2030 and 71%
by 2035 from 2018 levels, through improved resource and energy efficiency,
material substitution, fuel switching and CCS, as set out in Table 3.3 and Figure 3.6.
In addition, supply chains scale up at pace in the pathway, more workers acquire
skills to implement low-carbon measures, and the availability of finance increases.
The Government’s Industrial Decarbonisation Strategy set out a similar pathway,
with slightly lower ambition due to lower levels of electrification (see Chapter 4).

Table 3.3
Key metrics for manufacturing and construction in the CCC Pathway to meet the Sixth Carbon Budget
Milestones in the CCC pathway

Latest indicator

MetricEfficiency

Electrification,hydrogen andcarbon captureand storage

Year

Increase inlongevity ofelectronics vs 2019
Manufacturing
energy use fromelectricity orhydrogenCCS
in manufacturing(MtCO 2)

Annualchange

Value

2025

2030

2035

2050

2019

-

0%

30%

80%

120%

120%

2019

+2% points
(+8%)

27%

27%

37%

52%

76%

2020

-

0

0.2

2

6

9

Trend

Source: CCC analysis; BEIS (2020) Digest of UK Energy Statistics (DUKES) 2020

Progress in reducing emissions: 2021 Report to Parliament

114

Figure 3.6 Source of abatement in the CCC
Pathway for the manufacturing and construction
sector
90
70
60
50
40
30
20

2050

Reduced end-user consumption of new resources
Improved resource efficiency in production
Material Substitution
Energy efficiency
Electrification
HydrogenBiofuels
BECCS
CCS
Other
Outturn and baseline
Balanced Net Zero Pathway

2045

2040

2035

2030

2025

2020

0

2015

10
2010

Emissions andabatement (MtCO₂e)80

Source: CCC analysis, BEIS (2020) Provisional UK greenhouse gas emissions national statistics 2019.
Notes: The abatement from BECCS in this graph does not include the carbon captured, which is accounted for in
the removals subsection of Chapter 3.

Tracking progress against our pathway for manufacturing and construction iscurrently challenging because of a lack of data, which in some cases is because
the technologies or approaches are still at an early stage of deployment.
The limited current data
indicate that energy efficiency
in manufacturing may have
improved and there areexamples of early
developments with fuelswitching and CCS.

115

The limited current data indicate that energy efficiency in manufacturing may
have improved, and there are examples of early developments with fuel switching
and CCS.
•

The energy intensity of manufacturing output fell from 1,120 GWh/£bnGVA
in 2010 to 837 GWh/£bnGVA in 2018 and further to 747 GWh/£bnGVA in
2019. However, this partly reflects shifts of GVA from more-energy-intensive
subsectors to less-energy-intensive subsectors rather than energy efficiency
improvements. At a subsector level (Figure 3.7), energy intensity of
manufacturing output has fallen in the 2010-19 period in seven subsectors
but risen in four. Within these sectors, this could still reflect shifts from higherenergy-intensity operations to lower-energy-intensity operations, rather thanenergy efficiency – the available data are not clear.

•

However, Government estimate that existing energy efficiency policies33 inindustry have led to abatement of at least 1.1 MtCO2e in 2019, up from
0.9 MtCO2e in 2018, according to BEIS Energy and Emissions Projections.34

Climate Change CommitteeWe will develop an indicator
framework for the M&C sector
and will monitor progressagainst this framework
beginning with next year’s
Progress Report.

•

The UK’s household recycling rate has plateaued at 44% from 2012 to 2018,indicating that progress on this aspect of resource efficiency has stalled. It
will be important for recycling rates to rise to at least 68% by 2030, together
with actions to reduce material inputs and increase product longevity,
reuse and sharing in order for resource efficiency to contribute fully toachieving the emissions reductions necessary for the Sixth Carbon Budget.

•

The carbon intensity of energy use in manufacturing has fallen more slowly
than energy intensity, from 155 gCO2e/kWh in 2010 to 129 g/kWh in 2018,with no change between 2018 and 2019. The long-term reduction is a resultof falling shares from coal and petroleum products, and rising relative
contributions from natural gas, bioenergy and waste, and electricity. At asubsector level (Figure 3.7), the emissions intensity of energy inmanufacturing has fallen in the 2010-19 period in six subsectors (including
paper and pulp, mineral products, and textiles), but risen in five (including
non-ferrous metals, construction and mechanical engineering).

•

Fuel-switching pilots, such as a commercial-scale biodiesel trial for glass
manufacturing, have begun under the Government’s Industrial FuelSwitching competition, with the intention of assessing the merits of different
low-carbon fuels. CCS pilots are supported under the Carbon Capture andUtilisation Demonstration competition. Some (low) levels of fuel switching forheating in manufacturing have also been supported by the Renewable
Heat Incentive, which Government estimate to have contributed 1.9
MtCO2e of emissions abatement in 2019, up from 1.7 MtCO2e in 2018. 35 This
abatement is largely due to uptake of bioenergy supported by the
Renewable Heat Incentive. 36•

The Renewable Transport Fuels Obligation incentivises fuel suppliers fortransport and off-road mobile machinery to provide a certain level of
biofuels – currently set at 9.75% in 2020 and increasing to 12.4% by 2032.

The Committee will develop an indicator framework based on available data forthe manufacturing and construction sector and will monitor progress against thisframework beginning with next year’s Progress Report. The Government shouldseek to improve collection and reporting of relevant data to allow for progress to
be monitored more effectively.

Progress in reducing emissions: 2021 Report to Parliament

116

Figure 3.7 Energy intensity of GVA and directemissions intensity of energy in manufacturing
and construction: 2010 - 2019250

gCO2e/kWh

200

150

100

50

0
2010

2012

2014

2016

2018

6000

GWh/£bnGVA

5000
4000
3000
2000
1000
0
2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Iron and steel

Non-ferrous metals

Mineral products

Chemicals

VehiclesFood, beverages & tobacco

Textiles, leather etc

Paper, printing, & publishing

Construction

Mechanical Engineering

Electrical Engineering

Total M&C

Source: DUKES, ONS - GDP low-level aggregates; CCC Analysis
Notes: Unclassified and Other Industry are not shown. In the lower plot, only direct emissions are considered, i.e. notincluding emissions from electricity production or upstream fuel production.

117

Climate Change Committeed) Agriculture and LULUCF (52 MtCO2e, 10% of UK emissions in 2020)
Reaching the Sixth Carbon
Budget will mean taking action
to reduce emissions on farms,
removing emissions from theatmosphere using natural land
sinks, shifting to lower-carbon
diets and reducing food waste.

The path to meeting the Sixth Carbon Budget and the Net Zero target in 2050
requires a reduction in agricultural emissions of around 30% from 2019 to 2035, anda reversal of the land use sector from a net source currently to a net sink by themid-2030s. Delivery will require substantial action over the coming years:•

A high take-up of farming practices and technologies to reduce non-CO2
emissions from managing soils and livestock, and a switch away from fossil
fuel use in agricultural machinery to low-carbon alternatives such as
electricity.

•

Sustainable improvements in agricultural productivity to deliver higher crop
yields and increased livestock stocking rates on grassland.

•

A significant release of land out of agricultural production (9% by 2035) toenable an acceleration in the planting of trees, hedges, energy crops andthe restoration of degraded peatland, all of which can be achieved while
delivering other essential functions of land, including maintaining foodproduction and adapting to climate impacts. Other measures include
sustainable management of existing broadleaf woodlands and lowland
agricultural peat.

•

A significant shift in behaviours by 2030, with 20% less meat and dairy
consumed on average, and the volume of food waste falling by half.

Key land-based indicators cover agricultural and land use emissions, agricultural
productivity, societal behaviour change, and land use change (Table 3.4)

Progress in reducing emissions: 2021 Report to Parliament

118

Table 3.4
Key metrics for agriculture and LULUCF in the CCC Pathway to meet the Sixth Carbon Budget
Latest IndicatorYear

Annualchange

Value

2025

2030

2035

2050

Agriculture(MtCO 2e)

2019

+1%

55.4

48.6

41.5

39.3

34.9

Land use, forestry and peat
sector1 (MtCO 2e)

2019

+3%

12.9

10.4

6.5

0.9

-19

Crop yields (wheat t/ha),equivalent increases forother crops

Average2017-19

0

8.2

8.6

9.1

9.5

11.0

Livestock numbers2 (million)

2019

-1%

48

46

41

39

35

Weekly meat consumption3(g/person)(includes fresh andprocessed meat)

2020

0

1,045

950

840

800

680

Food waste (edible)(million tonnes)

2018

-

8.0

6.5

5.3

5.2

4.7

Afforestation(000 hectares/year)

2019 /
2020

+1%

13.7

30

30

50

50

Energy crops(000 hectares/year)4

2018

0

10

6

27

30

30

Peat area restored (000hectares/year)5

2020

-

8.5

67

67

67

9

Active broadleaf woodland
management (%)

2020

0

20%

40%

80%

80%

80%

MetricAgriculture
and landuse - GHG
emissions

Agricultural
practices

Demandreduction

Milestones in the CCC pathway

Land use

Trend

Source: CCC analysis
Notes: 1. Land use net GHG emissions for 2019 is based on the high forestry peat estimate; 2. Covers cattle, sheep and pigs; 3. Per person. 2020 value is an
estimate based on the average of the two previous years; 4. 2018 value is total area of SRC and miscanthus in England only; 5. Restoration in 2020 fundedby the National Peatlands Action Programme, 2020 (Wales), the £10m Peat Capital Grant Scheme, 2019/20 (England) and Scottish Government funding,
2020.

Underlying progress to reduce
emissions from agriculture andland is currently falling behind.

Underlying progress to meet our ambition remains short in most of these areas:•

119

Releasing land out of agriculture requires an improvement in agricultural
productivity. Cereal crop yields have largely plateaued in the last two
decades, but better agronomic practices coupled with advances in crop
breeding are required to deliver sustainable yield increases. Increasing theutilisation of grassland area by grazing livestock from around 50% currently
could allow for increases in stocking rates without impacting feed
requirements (quantity and quality), thereby allowing some grassland area
to switch to other uses.

Climate Change Committee•Current rates of UK afforestation of over 13,000 hectares/year in 2018/19
and 2019/20 remain well below the level required to meet theGovernment’s commitment (as set out in the England Tree Strategy
consultation (2020)), which matches the Sixth Carbon Budget
recommendation of 30,000 hectares/year in 2025 (Figure 3.8).

•

Peat restoration has been focused on the uplands to date, but meeting the
Sixth Carbon Budget pathway will require both an acceleration in the levelsof upland restoration to 50,000 hectares/year, and extending activity tolowland peat, which can emit ten times more emissions per hectare
compared to the uplands. Options to sustainably manage the area of
lowland peat that remains in agricultural production need to be
developed.

•

The area planted with perennial energy crops (miscanthus and shortrotation coppice) totals 10,000 hectares (England only),37 which has fallen
by over a quarter since 2008. The planting of short rotation forestry forbioenergy is non-existent. Combined annual planting rates of all threebiomass types need to ramp up to over 25,000 hectares by 2030.

•

Take-up of on-farm practices to reduce soil, livestock and waste emissions
needs to increase significantly; emissions in agriculture have remained flat
for the last ten years. Agricultural survey data reveal more farmers are
considering emissions when making decisions on land, with 64% reportingthat it was 'very' or 'fairly' important in 2020,38 increasing from the 49%
surveyed in 2017. The same survey found that 66% of farmers were taking
actions to reduce emissions, up from 56% in 2017.

•

Decarbonising agricultural vehicles will require the market
commercialisation of low-carbon solutions beyond the current use of
biofuels, including electrification of large machinery (e.g. tractors), which isstill at the proto-type stage.

•

Official data show that consumption of meat and meat products rose 3%
between 2015/16 and 2018/19. 39 There has been a reduction in fresh meatproducts, but this is more than offset by a rise in processed meat. Morerecent survey data suggests an increased willingness to eat less meat in the
future, with 65% of over 2,000 people surveyed stating that more
knowledge on how to plan and cook less meat dishes would help them tocut back. 40•

Reducing food waste is resource efficient and could free up agriculturalland for natural sequestration options. The Waste Reduction Action
Programme (WRAP) announced last year that the UK was halfway toachieving the UN’s Sustainable Development Goal 12.3 to cut post-farmgate food waste in half by 2030. As of September 2020, around 260
organisations, including 16 retailers and 162 producers/manufacturers had
signed up to the Road Map.

The measures outlined above to meet the Sixth Carbon Budget pathway will
deliver wider benefits to the natural environment critical to all other economic
activity and human well-being. These include flood protection, improved air
quality, health and recreation benefits of woodlands, water regulating services aswell as improving the natural environment’s ability to adapt to climate impacts.

Progress in reducing emissions: 2021 Report to Parliament120

Current levels of tree planting
are well below where theyneed to be. The majority of all
UK tree planting in the last five
years has happened in
Scotland.

Figure 3.8 UK Afforestation rates (1971-2020)

45
40
35

thousand hectares

30
25
20
15
10
5
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019

0

ScotlandEngland

Wales

Northern Ireland

Source: Forestry Commission, Natural Resources Wales, Forest Service and Forestry Commission statistics.
Notes: Planting year ends end March. Data not available for Northern Ireland from 1971-1975.

To allow the Committee to track progress against the Sixth Carbon Budget
Pathway, we will be developing a comprehensive indicator framework for the
agriculture and land use sectors to be included in next year’s Progress Report. Key
indicators that we will be developing include: agricultural emissions by source (e.g.
soils, enteric fermentation) and GHG type; take-up of particular low-carbon
farming practices and measures; planting rates of trees on-farm; peat restoration
by type (e.g. lowland, upland and forestry); attitudes to diet change and reducing
food waste; and the impact of non-financial barriers to changes in land.

121

Climate Change Committeee) Electricity supply (52 MtCO2e, 10% of UK emissions in 2019)
Electricity generation should befully decarbonised by 2035, toenable full benefits to be
drawn from the widespreadelectrification that is needed
for Net Zero.

Electricity generation should be fully decarbonised by 2035, while meeting a 50%
increase in annual demand. This will require large-scale deployment of new lowcarbon generating capacity that is resilient to a changing climate, phasing out
unabated gas-fired generation, action on contracting models and on planningand consenting regimes, as well as ensuring networks are ready to accommodate
new demands and generation (Figure 3.9).

Figure 3.9 Timeline of key outcomes and policy requirements forelectricity generation under the CCC Pathway (2020-50)

Unabated
Unabated gas
gas phase
phase-out
out

Generation

Demand

2020

2025

2030

2035

2040

2045

2050

Demand (TWh)

290

460

Widespread electrification from 2030

610

Flexible demand (TWh)

~15

100

Increasing potential, inc H2 production

135

Renewables share (%)

31

Deploy at scale

70

Deploy at scale to meet new demands

80

Dispatchable low low-carbon(%)
Dispatchable-carbon(%)

0

Develop markets for gas CCS and H 2

15

Deploy at scale from mid -late 2020s

10

Unabated gas share (%)

360100% clean electricity from 2035

By Spring 2022

Publish a comprehensiv elong-term strategy forphasing-out unabatedgas generation.

Policy actions required2023

Market design
strategy for adecarbonised
2030s system.

2025

New gas plants
to be properly
CCS and/orhydrogen ready.

2030

Regulate for a 2035
unabated gas phase-out.
No new-build unabatedgas plants from 2030.

Source: CCC (2020) Policies for the Sixth Carbon Budget and Net Zero.
Notes: Renewables share includes wind and solar. Dispatchable low-carbon generation includes gas CCS, BECCS, and hydrogen plants. Demand islower than generation, accounting for losses, flexibility services, and interconnection.

The reductions seen in the
power sector in the past five
years reflect genuine
underlying progress.

Power sector emissions fell by 15% in 2020, in line with the average rate over thepreceding five years. That reflects an increase in the capacity and utilisation of
low-carbon generation, together with lower demand due to the COVID-19
pandemic that reduced required fossil generation (Table 3.5):•

Installed capacity of variable renewables increased in 2020 by 0.8 GW. Thisis a much slower rate than the average of 3.8 GW achieved over theprevious 5 years, although the slowdown is likely to be temporary.
– Half of the increase in capacity was offshore wind increasing to10.4 GW of operational capacity. The 0.4 GW increase compares to aminimum growth of 4 GW required per year from the mid-2020s
onwards in order to meet the Government’s target for 40 GW installedcapacity in 2030.
– This slowdown is likely to be temporary, given the pipeline of new
offshore wind projects underway:• Offshore wind capacity under construction increased by 60% in2020 to 7.2 GW, with a further 2.6 GW having secured Government
contracts.

Progress in reducing emissions: 2021 Report to Parliament122• 20 GW of capacity is in development and/or pre-planning.
• In February 2021 the Crown Estate auctioned seabed leases for an
additional 8 GW of capacity.
Low-carbon generation
increased 5% in 2020. Offshore
wind generation increased by
26% due to particularly windy
conditions early in the year.

•

Low-carbon generation increased by 5% in 2020 compared to 2019, against
a backdrop of lower overall demand due to COVID-19 restrictions.
– The majority of that increase was accounted for by offshore wind
generation, which rose by 26% due to particularly windy conditions
early in the year.
– As a result, low-carbon generation increased to 62% of total electricity
generation in 2020, up from 57% in 2019. The share of variable
renewables in total generation increased from 26% to 31%.

Fossil generation fell by 17% in
2020, as unabated gas was
squeezed out by higher
renewables output, lower
demand, and the continued
decline of coal.

•

Fossil generation decreased by 17% in 2020, the largest annual percentage
fall in the last 20 years. The reduction was primarily in gas-fired generation,
but coal use also continued to decline.
– Unabated gas generation fell by 17%, as it was squeezed out by a
combination of increased renewables output and lower overall
demand. As a result, unabated gas comprised 36% of the overall
generation mix. This needs to continue to fall, to zero by the mid-2030s,
in order to meet the Sixth Carbon Budget.
– Coal generation fell by 21% in 2020, as further coal plants were closed
at Aberthaw and Fiddlers Ferry. This meant coal-fired generation only
comprised 2% of total generation in 2020, continuing the long-term
decline towards the Government’s target of phasing out coal use in
the power sector by 2024.

Emissions intensity fell 10% in
2020, reflecting lower demand,higher renewables output andreduced fossil generation.

•

*

123

Grid intensity. The combination of lower demand, increased renewables
output, and reduced fossil generation meant the carbon intensity ofelectricity fell by 10% in 2020 to 182 gCO2/kWh. This needs to continue to fall
substantially over the 2020s, to less than 50 gCO2/kWh in 2030 and around
10 gCO2/kWh in 2035. *Our recommendation is for a fully decarbonised electricity generation sector by 2035. That is consistent with a small
positive emissions intensity, which reflects some residual emissions (e.g. from gas CCS) and that negative emissions
from use of bioenergy with carbon capture and storage (BECCS) are accounted for separately.

Climate Change Committee

Table 3.5
Key metrics for electricity supply in the CCC Pathway to meet the Sixth Carbon Budget
Latest Indicator

Milestones in the CCC pathway

MetricYear

Annualchange

Value

2025

2030

2035

2050

Grid intensity(gCO2/kWh)

2020

-20

182

125

45

10

2

Offshore wind capacity
(GW)

2020

+0.4 GW

10.4

25

40

50

95

Variable renewablegeneration (%) *2020+5% points

31%

45%

55%

70%

80%

Dispatchable lowcarbon generation
(%)**

2020

0

0

0

10%

15%

10%

Unabated gas
generation (%)

2020-5% points

36%

30%

10%

0

0

Trend

Source: CCC analysis based on BEIS (2021) Energy Trends.
Notes: *Wind and solar generation. **Includes gas with carbon capture and storage, hydrogen and bioenergy with carbon capture and storage.

We will continue to track these milestones over the coming year, while developing
additional indicators for assessing the use of flexibility on the demand-side (e.g.
through heat pumps and electric vehicles).

f) Aviation (40 MtCO2e, 8% of UK emissions in 2019)
Air passenger demand saw
annual growth of around 1.5%
per year before 2020. The sizeof the sector that will emerge
post-pandemic is uncertain.

While aviation emissions fell significantly in 2020 this reduction was not driven byunderlying progress in decarbonising the sector but rather was a result of thepandemic and associated restrictions.
While there is still uncertainty around the size of the sector that will emerge postpandemic (see Chapter 2), passenger demand is expected to increase again
after travel restrictions are eased, potentially recovering to close to pre-pandemic
levels by the mid-2020s. Action to accelerate efficiency improvements and somedemand management will therefore be needed to drive emissions gradually down
to 2035:

Improvements in flightefficiency must be sustained tomeet the Sixth Carbon Budget.

•

The pathway used to determine the Sixth Carbon Budget includes anincrease in aviation emissions out to 2024 as travel restrictions are eased.
Emissions reduce gradually thereafter due to efficiency improvements,
demand management and a modest contribution from sustainableaviation fuels (SAF) starting in the mid-2020s. Emissions fall by 16% and 23%
to 2030 and 2035 respectively, from 2019 levels.

•

Efficiency, as measured by fuel consumption per passenger-kilometre,
improved by 1.5% between 2018 and 2019, following on from an averageannual improvement of 2.1% between 2008 and 2018. Progress will need tocontinue at pace to meet the Sixth Carbon Budget – in our pathway fuelProgress in reducing emissions: 2021 Report to Parliament124

efficiency improves by 1.7% each year between 2020 and 2050, reaching
0.25 kWh/passenger-km by 2050, from 0.44 kWh/passenger-km in 2019.
•

Demand, as measured by plane-km flown per person, increased by 1.9%
between 2018 and 2019, following on from an average annual increase of
1.5% between 2008 and 2018. The pandemic and related restriction led toa major reduction in demand in 2020. Our pathway assumes somerecovery in demand over the first half of the 2020s, to close to prepandemic levels, and assumes a modest increase in plane-km per person
thereafter (0.3% each year). This growth is considerably less than a ‘businessas usual’ baseline, though clearly what happens next is highly uncertain.
Some moderation of demand growth is likely to be required to meet thelegislated emissions targets, as pre-pandemic trends in demand growth
exceed what we expect can be accommodated in a Net Zero world.

Table 3.6
Key metrics for aviation in the CCC Pathway to meet the Sixth Carbon Budget
Latest indicatorYear

Annualchange

Value

2025

2030

2035

2050

Passenger-km per person

2019

+2.0%

5,400

5,500

5,500

5,700

6,800

Fuel consumption(kWh of fuel used per
passenger-km)

2019

-1.5%

0.41

0.39

0.36

0.33

0.25

Electric-hybrids (% of km
flown)

2020

-

-

-

-

-

9

SAF fuel share (%)

2020

-

-

0.1

2

8

25

MetricDemandEfficiency
and hybrids

Sustainableaviation
fuels

Milestones in the CCC pathway
Trend

Source: CCC analysis and Department for Transport analysis of Civil Aviation Authority passenger-km data.
Notes: the demand milestone corresponds to passenger-km from departing flights only, which is the convention when measuring aviation demand. Thisdiffers to the aviation demand milestones reported in the Sixth Carbon Budget report (Table 2, p27 of the main report), which relate to both departing
and arriving flights; CO2 emissions are from fossil fuel sources only. Fuel efficiency improvements also differ to those cited in the Sixth Carbon Budget (Table
8.1, p261 of the methodology report) as they are based on fuel consumption per passenger-km, and Sixth Carbon Budget figures are based on
CO2/passenger.

125

Climate Change Committeeg) Fuel supply (37 MtCO2e, 7% of UK emissions in 2019)
The fuel supply sector covers fossil fuel* , hydrogen, and bioenergy supply. While
new emissions could arise from the production of low-carbon hydrogen in the
future, current emissions in the sector come from fossil fuel supply only. In future, wewill include in this sector any emissions associated with hydrogen production for use
as a fuel in the energy end-use sectors (but not hydrogen produced for other uses,
such as fertiliser production).
Fossil fuel supply is currently the
only source of emissions in fuelsupply.

Emissions associated with hydrogen and bioenergy are currently accounted for inother sectors of the UK inventory and other sections of this chapter.
•

Section d) of this chapter covers emissions associated with the cultivationof energy crops and UK forestry.

•

Section c) accounts for emissions from current UK high-carbon hydrogenand ammonia production (e.g. for use in industry and agriculture) as well as
bioenergy conversion.

•

Sections a) f) and i) include emissions from transporting fuels and biomassby land, air and sea.

Table 3.7
Key metrics for fuel supply in the CCC Pathway to meet the Sixth Carbon Budget
Latest Indicator

Milestones in the CCC pathwayYear

Annualchange

Value

2025

2030

2035

2050

HydrogenLow-carbon hydrogenproduction (TWh)

2020

-

-

1

30

105

225

Fossil fuelproduction

Demand for unabatedoil and gas (TWh)

2019

-1%

1750

1500

1050

665

110

Fall in emissions from2018 levels - fossil fuelsupply (%)1

2019

1% point
fall

-1%

-22%

-54%

-77%

-97%

Fall in emissions from2018 levels - oil andgas production andprocessing (%)2

2019

1% point
increase

+1%

-28%

-68%

-87%

-98%

Trend

Source: CCC analysis; BEIS (2020) 2020 UK Greenhouse Gas Emissions, Provisional Figures; BEIS (2020) Digest of UK Energy Statistics (DUKES)
Notes: All figures in TWh have been rounded to the nearest 5. 1. Abatement from fossil fuel supply is relative to 2018 levels. This category refers to emissions
associated with oil refining, oil and gas production, oil and gas production terminals (including compression stations and LNG terminals), gas distribution
networks, and open and closed coal. 2. Abatement from offshore oil and gas production is relative to 2018 levels. This category comprises emissions fromoil and gas platforms and terminals in line with the scope of the North Sea Transition Deal.

*

Fossil fuel supply covers oil refining, oil and gas production, oil and gas processing terminals, gas transmission anddistribution networks and open and closed coal mines.

Progress in reducing emissions: 2021 Report to Parliament

126

There have been limited emissions reductions resulting from active efforts todecarbonise the sector. Emissions will need to fall sharply across the sector to alignto our Sixth Carbon Budget advice, in which emissions reduce by around 75% by
2035.
There have not yet been strong
efforts to decarbonise fossil fuelsupplyEmissions reductions in fossil fuelsupply will need to increase
rapidly to align to UK targets•

Coal production. The use of coal across the economy has decreased
notably due to reduced demand associated with the phase out of coal inelectricity supply. In addition, the closure of the last deep coal mine in2016, and recent closures of surface mines in England have contributed toreducing emissions from 22 MtCO2e in 1990 to less than 1 MtCO2e in 2020.
Around 75% of remaining emissions can be attributed to the leakage of
methane from closed coal mines.

•

Electrification and reduced methane flaring and venting in oil and gas
production is limited. There will need to be a rapid ramp up to achieve therequired 68% emissions reductions from oil and gas production by 2030
underlying the path to the Sixth Carbon Budget (Table 3.7).

•

Methane leakage has reduced due to the Iron Mains Risk Reduction
Programme, which has contributed to reducing emissions. However, it isunclear whether this policy alone is sufficient to achieve the additional 2.3
MtCO2e of abatement required in our analysis by 2030, particularly in thecontext of possible network decommissioning due to reduced use ofnatural gas.

•

Carbon capture and storage can be used in refineries to reduce emissions
in the sector, especially in clusters around other manufacturing and power
generation sites (see section c)). Our scenarios for the Sixth Carbon Budget
advice included use of CCS to reduce emissions by 1.3 MtCO2e in 2030. This
will require wider deployment of CCS infrastructure to support
decarbonisation of industry and electricity generation as well as
contributing to Net Zero through hydrogen production and greenhouse gas
removals.

The Committee will develop a new set of indicators to track progress in fuel supply
in next year’s Progress Report, potentially including indicators on the early-stage
developments in hydrogen production, the emissions intensity of oil and gas
production, private sector plans/commitments, and the monitoring of methaneleakage from gas networks.
Government should seek to improve collection and reporting of relevant data toallow for progress to be monitored more effectively.

h) Waste (25 MtCO2e, 5% of UK emissions in 2019)
The path to Net Zero set out in our Sixth Carbon Budget advice sees emissions in
the waste sector reduce by 78% compared to today’s levels by 2050.
To align to our recommended
Net Zero pathway urgent
action is needed to address
emissions from landfill andEnergy from Waste plants,
primarily through improvements
to recycling and waste
prevention.

127

To get on track, urgent action is needed to reduce methane emissions from landfill,alongside improvements to recycling and resource efficiency, with minimisation of
the quantity of waste going to Energy from Waste (EfW) and the emissions fromthose plants:

Climate Change Committee

•

The UK’s combined recycling rate * needs to increase from 52% to at least
59% by 2025 (45% to 50% for household waste), from which point key biodegradable waste streams should be banned from going to landfill.

•

Energy from Waste (EfW) emissions, which have been rising rapidly, need tobe constrained at approximately today’s levels through increased waste
prevention, re-use and recycling, and policy to enable EfW plants to be
fitted with CCS from the late 2020s.

•

Methane capture rates need to increase from 55% to 80% by 2050 toaddress fugitive emissions from landfill, while further actions are needed toreduce methane emissions from composting and wastewater treatment.

Table 3.8
Key metrics for waste in the CCC Pathway to meet the Sixth Carbon Budget
Latest Indicator

Milestones in the CCC pathwayYear

Annualchange

Value

2025

2030

2035

2050

Resource
Efficiency

Residual waste percapita (kg/yr)

2018

+2%

490

400

310

280

300

Recycling

Combined (Household +C&I) Recycling Rate for
UK (%)1

2018+1% point

52

59

68

68

68

Household Recycling
Rate for UK (%)

2018

-0.5%
point

45

56

56

56

Biodegradable Waste
Sent to Landfill in UK(Million tonnes)

2018

-3%

7.2

1.2

0.9

0.9

0

Landfill Methane
Capture Rate (%)2

2019

-1% point

55

60

64

68

80

2019

+12%

5.5

6.5

5.0

5.1

0.4

Landfill

Energyfrom
Waste

Energy from Waste
Emissions (MtCO 2e)

50

Trend

Source: Milestones: CCC analysis, Methane Capture Rates: NAEI UK GHG Inventory 2019, Household Recycling Rate and Biogenic Municipal Waste toLandfill: DEFRA UK Waste Statistics Publication 2018
Notes: 1. There are inconsistencies in the way waste arisings and recycling data are reported across the UK, and significant data gaps remain – mostnotably around the availability of recycling data for Commercial and Industrial waste (C&I). Our Balanced Pathway for Waste uses a ‘Combined’
Recycling Rate for the UK, comprised of Household (approximately equivalent to Waste from Household statistics) and C&I (municipal and nonmunicipal). The C&I portion of this indicator and associated milestones are based on assumptions of C&I recycling rates. 2. Currently DEFRA only publishes
statistics on municipal biodegradable waste to landfill, which is a reasonable proxy for overall biodegradable waste to landfill.
We understand DEFRA is in the process of developing new waste and recycling indicators and statistics, including for municipal and C&I recycling, andbiodegradable waste to landfill, which we will seek to reflect in future iterations of this indicator framework.

*

The CCC Pathway for Waste uses a ‘Combined’ Recycling Rate for the UK, comprised of Household (approximately
equivalent to Waste from Household statistics) and C&I (municipal and non-municipal).

Progress in reducing emissions: 2021 Report to Parliament128

Progress in reducing emissions
from landfill and in improving
recycling have stalled in recent
years, while emissions fromEnergy from Waste plants haverisen sharply.

Progress in reducing emissions from waste at a UK level has stalled in recent years
as reductions in landfilling of biodegradable municipal waste and improvements torecycling rates have slowed, and landfill methane capture rates have declined.
•

The amount of biodegradable municipal waste being sent to landfill in 2019
was around 80% lower than 1995 levels but has plateaued at between 7-8
million tonnes a year since 2015 (Figure 3.10)•

Following rapid improvements through the 2000s * UK recycling rates haveremained at around 44% since 2012 and the EU-derived target of achieving
50% recycling by 2020 looks almost certain to have been missed.

•

Landfill methane capture rates peaked at over 74% in 2016 but have sincedeclined to 55%.

•

Wales continues to outperform the rest of the UK in terms of recycling, witha ‘waste from households’ † rate of well over 50%, and a municipal
recycling rate of 65% in 2019 (Figure 3.11).

Meanwhile, recent years have seen sharp increases in emissions from EfW which
has become an increasingly popular waste treatment solution for Local
Authorities. 41•

In 2019, the latest year for which emissions data is available, emissions from
EfW increased by over 10% on 2018, putting it on course to overtake
emissions from coal power in 2020.

•

If EfW usage continues to rise unchecked, then its emissions will exceed the
CCC pathway while potentially undermining recycling and re-use efforts.

We are in the process of developing our indicator framework for the waste sector
with a view to reporting on this from 2022. This will seek to provide better alignment
to UK waste reporting statistics, greater granularity at a devolved administrationlevel and improved coverage of resource efficiency.

129*

England’s Local Authority Combined Recycling Rate increased from 12% in 2000 to 40% in 2020.

†‘Waste from Households (WfH)’ is the agreed harmonised UK measure that was previously used to report household
recycling to comply with the Waste Framework Directive (2008/98/EC). Under this Directive the UK was required tomeet a target to recycle 50% of household waste by 2020.

Climate Change Committee

8

30

6

20

4

10

2

0

0
1990

2050

40

2045

10

2040

50

2035

12

2030

60

2025

14

2020

70

2015

16

2010

80

2005

18

2000

90

1995

20

Landfill emissions (MtCO2e)100

Tonnage of waste to landfill (million tonnes)

Figure 3.10 UK emissions from Landfill andtonnages of Biodegradable Waste to Landfill

Landfill emissions
Landfill emissions in CCC pathway
Biodegradable municipal waste to landfill
Biodegradable waste to landfill in CCC pathway
Source: Defra (2018) UK Statistics on Waste; BEIS (2021) Provisional UK greenhouse gas emissions national statistics
2020.
Notes: ‘CCC pathway’ is the Balanced Net Zero Pathway published in our December 2020 advice on the Sixth
Carbon Budget. Emissions in this chart are adjusted for future changes to the Global Warming Potentials (GWPs) of
non-CO2 greenhouse gases.

Progress in reducing emissions: 2021 Report to Parliament

130Figure 3.11 Waste from Household Recycling Rates
across the UK
60%

50%

45%

40%

35%

ScotlandNI

EnglandWales

UK

UK (CB6)

2030

2029

2028

2027

2026

2025

2024

2023

2022

2021

2020

2018

2017

2016

2015

2014

2013

2012

2011

30%
2010

Waste from Households Recycling Rate

55%

Source: Defra (2020) UK Statistics on Waste (2018).
Notes: UK (CB6) is the ‘Balanced’ pathway for household recycling rates set out in our Sixth Carbon Budget Report.

Welsh progress on recycling
and resource efficiency is an
example to the rest of the UK.
Statuatory requirements andsustained investment havebeen key factors to its successto date.

131

Box 3.3
Welsh Progress on Recycling and Resource Efficiency
Wales continues to lead by example on waste prevention, re-use and recycling, driven byambitious targets, continued investment in infrastructure and services, and a holistic
approach to resource efficiency policy.
•

2019 again saw improvements in recycling, with municipal recycling rates up to
65% from 63% in the previous year – one of the highest recycling rates in theworld.

•Key measures to boost recycling have included the setting of statutory Local
Authority recycling targets, over £1 billion of investment in recycling services andthe provision of separate food waste collections.

•

By 2025, Wales has set ambitious targets to reach a 70% recycling rate, and sendzero waste to landfill, alongside a 50% reduction in avoidable food waste arisings.

•

In March 2021, the Welsh Government published ‘Beyond Recycling’ – its
updated circular economy strategy. This includes a commitment to become
zero-waste by 2050 and to make resource efficiency part of Welsh culture.

•

The Welsh Government has provided funding and set out robust policy measures
to follow through on their commitments, including through an £80m Circular
Economy Fund, requirements for non-domestic recycling and Extended Producer
Responsibility.

•

The Strategy demonstrates an understanding of the need to take a systems
approach to resource efficiency, including measures to prevent recyclable
materials being diverted to Energy from Waste, efforts to tackle all unnecessary

Climate Change Committee

single-use items (as opposed to just plastics) and consideration of a technicalstandard for embodied carbon in buildings.
If the activities and commitments set out in the ‘Beyond Recycling’ strategy aresuccessfully delivered, they would significantly reduce Wales’ emissions from waste. The
UK Government and other Devolved Administrations should seek to replicate the strong
progress made by the Welsh Government in this area, including by learning from theWelsh approach.
Source: Welsh Government (2021) Beyond recycling.

i) Shipping (14 MtCO2e, 3% of UK emissions in 2019)Low-carbon fuels make up thelarge majority of shipping
emissions savings in our CCC
Pathway. This will require
investment and R&D during the2020s.

Global shipping emissions arestill rising – the UK should lead inworking internationally toreverse this.

Within the path to Net Zero set out in our Sixth Carbon Budget advice, over 80% ofshipping abatement is due to the transition to low-carbon fuels, such as ammonia(Table 3.9). This will require important enabling actions over the coming years:•

While uptake of these fuels in volume is not expected until the 2030s,
investment and research and development should ramp-up during the2020s to showcase proof-of-concept and develop an early market.

•

Global shipping emissions have risen by 7% over the decade to 2019. The
UK should lead in working with the International Maritime Organisation(IMO) and other willing partners to strengthen international targets andpolicy mechanisms to meet them.

Table 3.9
Key metrics for shipping in the CCC Pathway to meet the Sixth Carbon Budget
Latest Indicator

Milestones in the CCC pathwayYear

Annualchange

Value

2025

2030

2035

2050

Use of low-carbon fuels(% of demand)

2020

-

0.0%

0.0%

0.2%

34%

91%

Use of electricity (% ofdemand)

2020

-

0.0%

0.2%

1%

2%

4%

Trend

Source: CCC analysis.
Notes: Low-carbon fuels comprise the large majority of the emissions savings from shipping within our Balanced Pathway. Deployment of these fuels is
expected to ramp up mainly during the 2030s – R&D and market development, alongside progress on vessel efficiency and shore-side electrification, areneeded during the 2020s.

Over the decade to 2019, domestic shipping activity fell by 26% and outboundinternational freight shipping reduced by 7% (Figure 3.12).42 Overall freight
tonnages have fallen by 3%,43 driven by substantial reductions in imports of oil andcoal.

Progress in reducing emissions: 2021 Report to Parliament132

Figure 3.12 UK international and domestic total
port traffic, by freight volume

Freight movements (mt)

300

250

200

150

100

50

0
2000

2002

2004

2006

International imports

2008

2010

2012

2014

International exports

2016

2018

Domestic

Source: DfT (2020) Port and domestic wat erborne freight statistics.
Notes: Domestic figures include both coastwise and one-port shipping. International imports are shown with adashed line since they will typically refuel outside the UK and are thus not included within our UK emissions
inventory. See the Section 3 of Chapter 2 on consumption emissions for further discussion.

Global shipping carbon intensities have improved by around 30% over 2008-2018. 44
The IMO has recently introduced new binding energy efficiency and carbon
intensity indicators which will increase this to a 40% improvement by 2030.
However, there are concerns45 that this may be insufficient to drive emissions
reductions across the sector.
Increasing investment in anduse of low-carbon energy andimprovements to vessel
efficiency will be key indicatorsof progress in this sector.

133

In future Progress Reports, we will seek to monitor progress in the enabling actions
required to increase availability of low-carbon fuels and vessel efficiency in the
shipping sector.
• Government’s March 2021 consultation on the future of the Renewable
Transport Fuel Obligation (RTFO) proposes to extend the scope of the RTFO
to make renewable fuels of non-biological origin (RFNBOs; includinghydrogen, ammonia and methanol) for use in the shipping sector eligible
for support. We will monitor the levels of investment and production that
result from this change.
•

Clean maritime clusters and other innovative trials, such as the proposedhydrogen transport hub in Tees Valley, will be important in stimulating the
emergence of a market for low-carbon shipping.

•

Further improvements could be delivered through shore-side electrification(which could also offer strong air quality benefits 46 by avoiding the use offossil-fuelled engines in ports, but will require action to surmount barriers to
its deployment), provision of the requisite supporting infrastructure andsmart efficiency measures, which are all included within the recently
launched Clean Maritime Demonstration Competition.

Climate Change Committee

The Committee will seek to monitor progress in each of these areas as part of afuller indicator framework, which will be used to monitor progress from next year’s
Progress Report, in 2022.

j) F-gas emissions (13 MtCO2e, 3% of UK emissions in 2019)
The majority of the required fall in emissions of F-gases is expected to fall understrict existing regulations. Our ‘baseline’ scenario for emissions sees existing
regulations drive F-gas emissions down by 75% from current levels by the time of the
Sixth Carbon Budget period.
There is some limited evidence that underlying progress is being made against theadditional measures we have identified outside the baseline.
•

Enforcing regulations. Regulations are only as good the rate of compliance.
The Environment Audit Committee has reported evidence of suspected
non-compliance, especially as the EU F-Gas Regulation increases demand
for refrigerants with lower Global Warming Potential (GWP), and a lack ofresources for the Environment Agency to carry out adequate inspections.47•

Inhalers. High GWP metered dose inhalers (MDIs) are still the main type of
inhaler used in the UK.
– NHS England’s Long Term Plan has set targets to deliver significant andaccelerated reductions in the total emissions from the NHS by moving
to lower-carbon inhalers, such as dry powder inhalers (DPIs) that areused widely in Europe.
– Two major pharmaceutical suppliers to the NHS have committed toaction on reducing the carbon impact of their MDIs and, from 2025,
reformulating their inhalers so they can be used with low-GWP
propellants.

•

Alternative refrigerants. There is some potential for the low-GWP HFC-32 tobe replaced by an ultra-low-GWP alternative. Doing so could reduce F-gas
emissions below the level in our Sixth Carbon Budget pathway. Preliminary
research is being done into the technical capacity for hydrocarbons toreplace HFC-32.

Progress in reducing emissions: 2021 Report to Parliament134k) Greenhouse gas removals
Our assessment is that both engineered Greenhouse Gas Removals (GGR) andland-based removals (such as tree planting and peatland restoration - see sectiond) above), will be essential for reaching Net Zero.
Engineered Greenhouse Gas
Removal technologies,
presently in early stages ofdevelopment, will need tomake a key contribution toreaching Net Zero.

Engineered removals via Bioenergy with Carbon Capture and Storage (BECCS)
applied in a variety of sectors, and Direct Air Capture with Carbon Capture andStorage (DACCS) are at an early stage of development. A small number of BECCS
and DACCS test facilities are presently in operation worldwide. Investment inresearch and development needs to be complemented with policy design tosupport engineered GGR scale-up during the mid-to-late 2020s.

Table 3.10
Key metrics for greenhouse gas removals in the CCC Pathway to meet the Sixth Carbon Budget
Latest indicator

Removals(all valuesin MtCO2)

Milestones in the CCC pathway

Year

Value

2025

2030

2035

2050

Total

2020

-

<1

-4.8

-22.5

-58.3

BECCS

2020

-

-

-4.6

-22.3

-52.9

DACCS

2020

-

-

-

-

-5

Wood inConstruction

2020

-

-0.1

-0.2

-0.2

-0.4

Trend

Source: CCC analysis.
Notes: Present usage of wood in construction is included in land use, land use change and forestry (LULUCF) inventory account.

A key milestone on the Sixth Carbon Budget pathway is progress towards thecommissioning of the first commercial-scale BECCS plant in the late 2020s. This willneed to be underpinned by the construction of CO2 pipeline and storage
infrastructures as part of the wider establishment of CCS in the early 2020s, which
are capable of timely expansion to accommodate CO2 from BECCS or DACCS.
Progress towards this underpinning infrastructure delivery and the development of
support policies for GGR deployment will be considered in next year’s Progress
Report, in 2022.

135

Climate Change Committee

Endnotes
1

CAST (2020) CAST Briefing 05 - Tracking the effect of COVID-19 on low-carbon behaviours andattitudes to climate change.

2

Bank of England (2021) MPC remit statement and letter and FPC remit letter.

3

National Audit Office (2020) Achieving Net Zero.

4

Institute for Government (2020) Net Zero: how Government can meet its climate change target.

5

Partha Dasgupta for HM Treasury (2021) The economics of biodiversity: the Dasgupta review.

6

Louise Marix Evans for the CCC (2020) Local Authorities and the Sixth Carbon Budget.

7

BEIS (2020) Public Attitudes Tracker; Energy Systems Catapult (2020) Net Zero: A Consumer
Perspective

8

CCC (2019) Report from the Advisory Group on Costs and Benefits of Net Zero.

9

Public First (2021) Options for Energy Bill Reform.

10

Committee on Fuel Poverty (2020) Fourth Annual Report.

11

CBI (2021) Seize the moment.

12International Energy Agency (2021) Net Zero by 2050: A Roadmap for the Global Energy Sector.

13

IDDR (2017) Lessons from previous ‘coal transitions’.

14

Just Transition Commission (2021) A National Mission for a fairer, greener Scotland.

15

HM Government (2021) The Queen’s Speech 2021.

16

Financial Times (2021) Europe’s Climate Leaders 2021.

17

BSI (2021) Net Zero Barometer Report.

18

UNFCCC (2021) Race To Zero Campaign.

19

Z/Yen Group (2021) The Global Green Finance Index 7.

20

EY (2021) Renewable Energy Country Attractiveness Index (RECAI)

21

McKinsey & Company (2020) McKinsey Electric Vehicle Index: Europe cushions a global plungein EV sales.

22

Bloomberg New Energy Finance (2020) Battery price survey.

23

Nissan (2021) Price reduction for Nissan LEAF 40kWh and 62kWh unlocks full Nissan EV range forrevised plug-in car grant.

24

Royal Haskoning DHV (2020) The impacts of COVID-19 on travel patterns in the UK.

25

Department for Transport (2021) Electric vehicle charging device statistics.

26

Society of Motor Manufacturers and Traders (2021) Response to CCC request for data.

27

CCC (2018) Annex to the 2018 Progress Report: growth in van demand.

28

RAC Foundation (2021) Transport price index.

29

David Begg and Claire Haigh (2018) The unintended consequences of freezing fuel duty.

30

Department for Transport (2020) Rail fare rise to be delayed.

31

HM Revenue & Customs (2020) Changes to Air Passenger Duty rates from 1 April 2021.

Progress in reducing emissions: 2021 Report to Parliament

136

137

32

BSRIA (2021) 'Heat pumps market analysis 2020: United Kingdom', BSRIA World Market
Intelligence.

33

This includes estimated abatement from the following policies: Building regulations part L 2010
and 2013; CRC-ees; ESOS; Industrial Heat Recovery Support; Products policy, PRS Regulations
and Streamlined energy and carbon reporting framework for business (SECR). It does notinclude any estimate of abatement from carbon pricing policies or Climate Change
Agreements, which will have also contributed to improving energy efficiency.

34

BEIS(2020) Updated energy and emissions projections: 2019.

35

BEIS (2020) Updated energy and emissions projections: 201936

BEIS (2020) Digest of UK Energy Statistics (DUKES) 2020.

37

Defra (2020) Crops for bioenergy dataset.

38

Defra (2020) Agriculture statistics and climate change.

39

Defra (2020) Family Food Survey 2018/19.

40

Yonder for Eating Better Alliance (2020) Eating Better Survey ONLINE Fieldwork: 21st to 22nd
September 2020.

41

The amount of residual waste processed by EfW plants in 2019 increased by 10.5% on 2018
levels. Source: Tolvik (2021) UK Energy from Waste Statistics 2020.

42

Department for Transport (2019) Port freight annual statistics, Table 0102.

43

Department for Transport (2019) Port freight annual statistics, Table 0201.

44

International Maritime Organisation (2020) Fourth greenhouse gas study.

45

International Council for Clean Transportation (2020) Potential CO2 reductions under the Energy
Efficiency Existing Ship Index.

46

Tyndall Centre for Climate Change Research at the University of Manchester (2021) Barriers andsolutions for UK shore power.

47

UK Parliament Environmental Audit Committee (2018) UK Progress on reducing F-gas Emissions.

Climate Change CommitteeChapter 4

Policy progress and gaps
1. The delivery challenge

142

2. Stated ambition and policy progress146

3. Policy priorities and gaps

157

4. Sectoral progress and next steps for policy

162

138

Introduction
Two years ago, the UK was aiming to reduce emissions to at least 80% below 1990
levels, by 2050 (from 48% below 1990 levels in 2020 * ).As of 2019, the emissions
reduction goal for 2050 is now at least 100% (‘Net Zero’) and the Government has
committed to a reduction in emissions of 78% by 2035, based on the Committee’s2020 advice on the Sixth Carbon Budget.
Having set the level of the Sixth Carbon Budget, the Government must develop acomprehensive set of policies to ensure that it is met. Importantly, the Sixth Carbon
Budget will be the first to include emissions from international aviation and shipping(IAS). This ensures that, from now on, the Government’s emissions reductions
strategies have a formal requirement to cover all areas of the economy, rather
than merely leaving ‘headroom’ for IAS emissions as in previous strategies.
This year is the start of a new era of UK climate action, with the Sixth Carbon
Budget legislated, the publication of new evidence for the third Climate Change
Risk Assessment (CCRA3) and the UK’s hosting of the 26th United Nations Framework
Convention on Climate Change (UNFCCC) Conference of the Parties (COP26) in
Glasgow in November. Government policy needs to ramp up to match. We
expect the Government’s forthcoming Net Zero Strategy, ahead of COP26, toprovide a blueprint for action over the coming decades.
As part of our advice on the Sixth Carbon Budget, we published a report on
Policies for the Sixth Carbon Budget and Net Zero. This set out potential ways toaddress what needs to be done in each emitting sector and an overview of thepolicy challenges. With Net Zero by 2050 in mind, policy needs to enable a scaleup and roll-out of low-carbon technologies and behaviours, so that by the early2030s nearly every new investment and purchase is low-carbon.
Our policy report is still the most current overview of the policy challenge for the
Sixth Carbon Budget. This chapter recaps the main aspects of that report andcovers key developments since. It also offers an appraisal of the Government’s
current plans, looks back on progress departments have made on last year’s
recommendations and identifies priority policy recommendations and gaps thatneed to be addressed.
The key messages in this chapter are:*•

The early foundations for a decade of delivery are being put into place. The
Government is starting to demonstrate that it is taking the Net Zerochallenge seriously. It has set up climate action committees on strategy
and delivery in Cabinet, it has published a Ten Point Plan for a Green
Industrial Revolution, an Energy White Paper, an Industrial Decarbonisation
Strategy, an interim Net Zero Review from HM Treasury on the fair allocationof costs during the transition and launched a new UK Emissions Trading
Scheme.

•However, several key strategies and plans are not yet published, or havebeen delayed. At the time of finalising this report at the start of June, theHeat and Buildings Strategy, the Transport Decarbonisation Plan, the final
HM Treasury Net Zero review, the Net Zero Aviation Strategy and the Nature
Strategy had not yet been published. These are needed in order to extend

This reduction reflects the impact COVID-19 had on emissions in 2020, much of which is not expected to bepermanent. The fall in emissions between 2019 and 1990 was 40%.

Progress in reducing emissions: 2021 Report to Parliament140

action to reduce emissions into all areas of the economy, within a portfolioof policy that accelerates a fair and just transition to Net Zero.
•

The Government has made significant commitments, but there are still
significant gaps in ambition. Where ambitions have been set over the lastyear, they have tended to be a significant step up. Many are now alignedwith the path to Net Zero (e.g. 40 GW of offshore wind, phasing out petrol anddiesel cars and vans by 2030). However, gaps remain in the Government’s
stated ambitions (e.g. on diets, aviation demand, waste, and low-carbon
heat networks), while some announcements fall short of what is likely to beneeded (e.g. on peatlands, heat pumps, and carbon capture andstorage). Together these imply a significant ambition gap: current
Government commitments that align to the Committee’s publishedpathways cover less than half of the path to Net Zero.

•

Efforts must be increased markedly, especially in the lagging areas. There
are signs of a multi-speed approach within Government to raising ambitionand putting in place effective policies. Some departments (e.g. Defra,
MHCLG, but also parts of BEIS and HM Treasury) are lagging behind others,
and appear timid in their approach. The path to Net Zero requires highambition and an effective policy framework in all areas.

•

A major delivery challenge will remain even once the Net Zero Strategy setsout how the Government intends to drive the transition. Of the 92
recommendations from last year’s Progress Report, just 11 have beenachieved in full, with 29 partly achieved and 34 underway. Translating
strategy into effective policy across the wide range of emitting sectors will
require continued focus across Government over the rest of this Parliamentand beyond. We set out several priority areas for action as well as
approximately 200 recommendations for UK Government departments andthe devolved administrations.

This chapter is set out in four sections:
1. The delivery challenge
2. Stated ambition and policy progress
3. Policy priorities and gaps
4. Sectoral progress and next steps for policy

141

Climate Change Committee

1. The delivery challenge
Achieving Net Zero and the
Sixth Carbon Budget will requirea significant scale-up indelivery of low-carbon policies
and actions.

The Committee’s December 2020 advice on the Sixth Carbon Budget set out apathway to achieving the UK’s Net Zero 2050 target, based on a comprehensive
programme of delivery in the 2020s that covers all areas of decarbonisation. If therequired scale-up over the coming decade is to occur, the key building blocks ofpolicy must be introduced in the coming months and developed over the next few
years (Figure 4.1, Table 4.1). This Government must be the one to shift the UK
decisively onto the path that ends its contribution to global warming.
The Government has committed to set out its plans in the Net Zero Strategy,required by the Climate Change Act and due ahead of the COP26 UN climate
talks in Glasgow in November this year. COP26 gives the Net Zero Strategy added
significance. Setting out a strong and credible policy package to deliver the scaleup over the next decade would put the UK firmly on track to Net Zero, greatly
strengthening its credibility as a climate leader.

The transformational change
required means Net Zero andclimate adaptation must be
integrated into allpolicymaking.

The Government has accepted the overall challenge by setting the UK’s Nationally
Determined Contribution (NDC) to the Paris Agreement for 2030 and legislating the
Sixth Carbon Budget for 2033-37. Given the scale of the challenge and the oftencomplex interactions involved, a piecemeal or sector-specific approach will not
be enough. Net Zero should be integrated into all policymaking, as should climate
adaptation.

a) Scaling up and rolling out low-carbon technologies andbehaviours
The next decade is critical forbuilding supply chains, with
policy focussing on widespreadroll-out of measures thereafter.

Accompanying our advice on the Sixth Carbon Budget was a report on Policies for
the Sixth Carbon Budget and Net Zero (‘the Sixth Carbon Budget policy report’),which provides recommendations on how to achieve a transition that involves two
distinct phases for UK climate policy, with the next decade being vital:•

The 2020s: scale-up. The UK must build supply chains and new markets for
low-carbon consumer offerings (e.g. electric cars and heat pumps) so thatthese can scale from being niche offerings to dominating the market andfully pushing out sales of high-carbon alternatives by 2030, or soon after.
Alongside this, new options must be developed and scaled up for industrial
decarbonisation such as carbon capture and storage (CCS), low-carbonhydrogen and engineered emissions removals, while finishing the job of
power sector decarbonisation. Annual tree-planting rates must increase
from 13,000 hectares per year today to 30,000 by 2025 in line with theGovernment’s commitment – and continue to rise to 50,000 year by 2035.

•

From the early 2030s to 2050: roll-out. Having scaled up the required
markets for low-carbon technology sales, these will then take around 15
years to flow through the stock of vehicles and buildings as high-carbon
assets reach the end of their lives. Mechanisms driving implementation inindustry and land use should be well developed and continue to drive rollout at similar rates. Policy will be less about aiming to scale up markets,
instead focusing on continuing achieved rates of roll-out, tackling emerging
barriers and systems challenges and ensuring fairness across society.

Most of the recommendations in our Sixth Carbon Budget policy report still stand.
What follows in this chapter are the priorities already set out in that report andProgress in reducing emissions: 2021 Report to Parliament

142

updates where recent policy developments have occurred. Government progresson tackling the delivery challenge to date is also addressed. Key milestones forpolicy and delivery are set out in Table 4.1 and Figure 4.1.

Figure 4.1 Timeline for the decade of delivery, and beyond

Source: CCC analysis based on the Sixth Carbon Budget and HMG (2020) The Government Response to the Committee on Climate Change’s
2020 Progress Report to Parliament.
Notes: Table 4.1 has a complete list of the milestones and targets to be reached on the path to 2050.

143

Climate Change Committee

Table 4.1
Key outcomes to target over the next few years, and milestones towards 2050
Date
Before COP26

By the end of2022

Outcomes and Milestones
Legislate the Sixth Carbon Budget at
965 MtCO2e, including emissions frominternational aviation and shippingUpdated Nationally Determined Contribution(NDC) for at least a 68% reduction on 1990
levels (excl. IAS)•Net Zero Strategy, setting out how the
Sixth Carbon Budget and Net Zero are to
be met

Build on the UK’s NDC to increase global
climate ambition in the run up to COP26

Energy White Paper•

Strengthened UK Adaptation Plans•

Heat and Buildings Strategy

Updated Green Book guidance on climatechange

New carbon pricing regime following EU
ETSDecision on funding model for CCS
infrastructure•

Transport Decarbonisation Plan••

Final HMT Net Zero Review

Ministry of Defence review of climate change
and defenceEngland Trees Action PlanEngland Peat Action Plan, including an
end to rotational burning of certain
upland peat sites

Call for evidence on policy for GHG Removals(GGRs)

•

Hydrogen Strategy, and consultation onhydrogen business models

Consultation on Waste Prevention Programme
for England and associated consultations on
recycling collections, Extended Producer
Responsibility and Deposit Return Scheme.

•

Governance framework and timeline fordecisions on the conversion to hydrogenof the gas transmission and distribution
networks•

Consultation on mandatory food waste
reporting•Consultation on including maritime in the
Road Transport Fuel Obligation (RTFO)

Scottish Government updated Climate
Change plan•

Conclusion of Green Jobs Taskforce andpublication of Green Jobs Action Plan

Environmental Land Management pilots•

Implementation of minimum device standards
for EV chargers•

National Food Strategy and white paper•

Welsh Government to publish a plan for
meeting the second carbon budget•

Net Zero Aviation Strategy

North Sea Transition Deal•

Defra to publish a Nature Strategy for England•

ICAO negotiations to set long-term Pariscompatible target for global aviation (align &strengthen CORSIA in 2023)•

Strategy for shipping (including international
shipping) that reflects UK Net Zero•

Rail Decarbonisation StrategyIndustrial Decarbonisation Strategy•

Net Zero carbon hospital standard, andfurther commitments towards delivering a
Net Zero NHS•

Publication of Greening Government
Commitments•

Ofgem’s final business model approvals
for the RIIO-ED2 period should
accommodate network upgrades for EVs
and heat pumps•

Next Contract-for-Difference allocation
round, targeting large volumes ofrenewables, towards 40 GW offshore
wind by 2030•

Carbon capture, utilisation and storage(CCUS) business models decided for
power, hydrogen and manufacturing
and construction•

3rd Climate Change Risk Assessment
published by Government (CCRA3)•

Cross-Government Bioenergy Strategy

Progress in reducing emissions: 2021 Report to Parliament144

By 2024

Mid-2020s

By 2030

Over the 2030s

By 2050•

Business models for hydrogen, CCS, GHG
removals and industrial decarbonisation
up and running. First plants being built.

•

IMO negotiations revise 2050 target for global
shipping in 2023, set new policies•

Environmental Land Management (ELM)
scheme up and running in England•

Coal phased out of the power system•

Legislation for the Future Homes and Future
Buildings Standards introduced ahead of2023, and should come into force by 2025 at
the latest•

Universal waste collections and recycling
facilities in place across England•

Implement a trading or auctioning
system to deliver private sector
investment in tree planting•

Large-scale trials for HGVs in place•

Demonstrate low-carbon hydrogen atscale via 1 GW of hydrogen production
capacity by 2025•

CO 2 transport and storage infrastructure
operational•

Strategic decisions on the future of thegas grid, including the extent of zoning
for heat networks, electrification and any
planned conversions of the gas grid tohydrogen•Annual tree-planting rates of at least 30,000
hectares / year•

First UK sustainable aviation plants
operational, policy support in force•

Main biodegradable municipal and nonmunicipal waste streams banned from landfill
from 2025•

CCS and low-carbon hydrogen across 5
industrial clusters, capturing and storing 10
MtCO 2 per year and producing 25 TWh/yearof low-carbon hydrogen•

All new boilers ‘hydrogen-ready’ by 2025
at the latest•

Nearly 100% of new cars and van sales
are battery-electric (or other zeroemission) vehicles•

Heat pump installations at scale (1 million/ year) ahead of a natural gas boiler
installation phase-out date pre-2035••

All buildings except owner-occupied
non-fuel poor homes achieve Energy
Performance Certificate (EPC) C

40 GW of offshore wind installed in UK waters,
reducing emissions from electricity generation
to less than 50 gCO 2/kWh••

Sales of oil and coal heating in homes
phased out (2028)

Commercial roll-out of low-carbon ammonia
and hydrogen starts in shipping, with at least
one cluster (>2 TWh/year)••

Rented homes achieve EPC C andhomes for sale achieve EPC C (2028)

Recycling rate of at least 68% achieved
across the UK, food waste 50% reduction••

Phase-out of the most harmful F-gases
and restricting the use of all F-gases by
80%

Commercial scale engineered GHG removals
plants operational•

Sales of gas boilers to all homes andbusiness phased out (by 2033)•

Phase-out of unabated combustion of fossil
gas for electricity generation (by 2035)•

Phase-out of sales of new diesel HGVs (by
2040)

•

Widespread roll-out of CCS, including on
Energy from Waste plants•

All diesel trains removed from passenger
rail operations (by 2040)•

Annual tree planting rates of at least 50
kha/year (by 2035)•

All ore-based steel-making near-zeroemissions (by 2035)

Any residual sources of emissions are offset through emissions removals in the UK. Low-carbon
electricity, hydrogen and bioenergy provide all the UK’s energy, in combination with CCS.
Low-carbon technologies and behaviours continue to roll out at scale and all asset replacements
continue to be low-carbon.

Source: CCC analysis based on the milestones to delivering the Sixth Carbon Budget pathway, and HMG (2020) The Government Response t o theCommit tee on Climate Change’s 2020 Progress Report t o Parliament, Policy Exchange (2020) UK Energy & environment policy t imeline.
Notes: Ticks mark refer to actions that have been concluded.

145

Climate Change Committee

2. Stated ambition and policy progressMaterial progress has been made since our last Progress Report to Parliament inJune 2020. The Government has accepted the Committee’s advice on the level ofthe Sixth Carbon Budget, and the level of the UK’s NDC for 2030, setting the UK on
an ambitious decarbonisation pathway towards 2050.
Setting the level of the Sixth
Carbon Budget and the UK’s
2030 NDC are significant steps
in the last year and
Government is starting todevelop policy across all areas.

The Government has also recognised the need for extensive policy strengthening
and has started to develop plans in all areas of UK emissions, with significant policy
announcements having been set out in the Ten Point Plan for a Green Industrial
Revolution, Energy White Paper, Industrial Decarbonisation Strategy and England
Trees and Peat Action Plans (Table 4.2).
These publications have significantly strengthened commitments, with manyheadline ambitions now aligned to the CCC pathway (e.g. 40 GW offshore windby 2030, phase-out of conventional petrol and diesel cars by 2030, 30,000 hectares
afforestation annually by 2025). However, some of the specific targets in theseannouncements, while improvements on previous commitments, fall short of thosein the CCC pathway (e.g. heat pump deployment that is a third lower in 2028,
total carbon capture and storage ambition in 2030 that is around half of what we
set out) – see Figure 4.2.

There are still gaps andambiguity in government
ambition, including aroundinfluencing consumer choices
on issues like aviation and diets.

The Net Zero Strategy will haveto make up for emerging
shortfalls in ambition and bring
together action across every
sector.

Some important ambition gaps remain in certain sectors, while there is a danger
that several of the broad ambitions announced are implemented in a way thatwould fall short of the CCC scenarios:•

Consumer choices. So far, the Government’s announcements havefocused on technologies and largely ignored the potential for changes in
consumer choices to reduce emissions. These are particularly important tolimit emissions in ‘hard to abate’ sectors, such as aviation and agriculture.
There are a wide range of levers available to promote low-carbon choices,
including enabling measures and nudges, ensuring supporting infrastructure
is available, as well as more interventionist measures using regulations andthe tax system.

•

Ambiguity in ambition. While some commitments have been made that
could be at least as ambitious as our pathways, there remain risks that realworld implementation could fall short. For example, the announced 2030
phase-out date for sale of petrol and diesel cars and vans will allow sale ofhybrid vehicles with “significant zero-emission capability” until 2035, wellafter the 2032 date by which we recommend all such vehicles should befully zero-emission. The definition of which vehicles can be sold after 2030,
currently subject to consultation, will be crucial in ensuring that emissions
and motoring costs are kept as low as possible by prioritising fully zeroemissions vehicles over hybrids.

We expect the Government’s forthcoming Net Zero Strategy, promised for thisyear, to provide a blueprint for action over the coming decades. The Net Zero
Strategy will need to make up for the shortfalls in ambition illustrated in Figure 4.2
and Table 4.2 and clarify policy mechanisms to meet that ambition:•

The Government is not required to commit to the Committee’s detailed
sectoral pathways, nor our policy advice. But it must set out a credible
alternative approach where it chooses not to.

Progress in reducing emissions: 2021 Report to Parliament

146

Our pathways are designed to be stretching across the economy, so it isdifficult to compensate for lower ambition in one area with greater
ambition elsewhere.
•

The Net Zero Strategy, released later this year, will have to address theshortfall, strengthening weaker commitments to be closer to theCommittee’s pathways or setting out how emissions can be cut faster inother areas to compensate.

•With the path to 2050 becoming clearer, plans must translate into near-term
action and Government must organise for the major delivery challenge of
Net Zero.

Figure 4.2 Differences in stated Government
ambition compared to CCC Pathway
Behind CCC
pathway

Beyond CCC
pathway

CCS¹Diet change²
Aviation demand management³
Heat pump deployment⁵
Industrial Decarbonisation Strategy⁴
North Sea Transition Deal⁶
Low-carbon heat networks⁷
EV roll-out⁸-14 -12 -10
Range of potential
emissions impacts

-8

-6

-4

-2

0

2

4

Emissions reduction ambition relativeto CCC pathway (MtCO2e)

Notes: Comparisons are against the Balanced Net Zero Pathway (‘CCC pathway’) published in the Committee’s
Sixt h Carbon Budget advice.
¹ Government CCS ambition for is 10 MtCO2/year in 2030, compared to 22 MtCO2/year in the CCC pathway.
² The level of diet change without explicit policy to support it is uncertain. Annual emissions could be up to 7.2
MtCO2e higher than the CCC pathway in 2030.
³ Lack of ambition for aviation demand management would result in higher annual emissions of 6.4 MtCO2e in 2030
relative to the CCC pathway for aviation emissions.
⁴ The Industrial Decarbonisation Strategy aims for a 67% reduction by 2035, compared to 73% in the CCC pathway.
⁵ Government ambition is for 600,000 installations in homes in 2028, compared to 900,000 in 2028 in the CCC
Pathway. The abatement gap in 2030 is inferred, based on an assumed trajectory of uptake to 2028 under theGovernment’s plans, with annual deployment remaining constant to 2030.
⁶ The North Sea Transition deal commits to a reduction that falls short of the CCC pathway by 3.7 MtCO2e in 2030.
⁷ Based on announced Government heat network investment of £0.7 billion (assumed to leverage £2.2 billion,
leading to a total investment of £2.9 billion, of which we estimate £1.7 billion will be for low-carbon, with resulting
deployment estimated by CCC).
8
A strict 2030 phase-out of petrol and diesel vehicles would be more ambitious than the CCC pathway, but thisdepends on the timing of when plug-in hybrid electric vehicles are phased out.

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Climate Change Committee

Table 4.2
Government commitments compared to the CCC Pathway between 2025-2035
Headline actions

Government commitment ¹

CCC pathway

Offshore wind

40 GW by 2030

40 GW by 2030

Electric vehicles

Phase-out of new fossil fuelled vehicle
sales by 2030, with allowance for somehybrids out to 2035

Phase-out of all new fossil fuelledvehicle sales by 2032

Heat pumps in homes

600,000 heat pump installations / year by
2028

900,000 heat pump installations / yearby 2028
1.1 million installations / year by 2030

Low-carbon heat networks(all buildings) ²

2 TWh of low-carbon heat networks by
2030

25 TWh of low-carbon heat networks
by 2030

Low-carbon hydrogen

5 GW (up to 42 TWh) by 2030

30 TWh by 2030

Carbon Capture and Storage ³

10 MtCO 2 / year captured and stored by
2030, across 4 industrial clusters, including
at least one power project

22 MtCO 2 / year captured and stored
by 2030, across at least 5 industrial
clusters, including multiple power
projects

Emissions reduction in
manufacturing and refining

Around two-thirds by 2035, compared to2018

73% by 2035, compared to 2018

Tree-planting

30,000 hectares / year by 2025

30,000 hectares / year by 2025
50,000 hectares / year by 2035

Peatland restoration 

32,700 hectares / year by 2025

67,000 hectares / year by 2025

Greenhouse gas removals

Innovation support provided, inrecognition that engineered removals will
be needed, but no firm commitment on
deployment yet

5 MtCO 2 / year by 2030

Nuclear power 5

Final Investment Decision on at least one
new nuclear power plant by the end of
this Parliament

One new nuclear plant operational by
2030, and a further plant by 2035

Notes:¹ Based on actions in the Ten Point Plan, Energy White Paper, Industrial Decarbonisation Strategy and England Tree and Peat Action Plans between 2025
and 2035 and the CCC’s Balanced pathway from the Sixth Carbon Budget.
² Government commitment on low-carbon heat network deployment is illustrative, and has been inferred from Government spending commitments, using
assumptions around expected leveraged investment and the proportion of funding targeted at low-carbon networks.
³ The difference in carbon captured and stored annually largely comes from projects in the power sector in CCC scenarios, so other technologies could
compensate for this shortfall.
 Government peatland restoration commitments include Scotland, Wales and England. CCC peatland restoration numbers in 2025 are UK-wide.
5

The Balanced Pathway produced for the CCC’s Sixth Carbon Budget assumed that two new nuclear power stations would be in operation by 2035.

Progress in reducing emissions: 2021 Report to Parliament

148a) Progress against last year’s recommendations
11 of the Committee’s 94
recommendations from lastyear have been fully achieved,
29 partly achieved and 32 areunderway.

We are reporting on a moving
picture of progress as several
critical policy documents have
not yet published, with many ofthese delayed.

We see evidence of a multispeed Government, with somedepartments’ progress lagging
behind others.

149

The Committee made 92 recommendations to Government departments in ourJune 2020 Progress Report. Of these, 11 have been achieved in full (which includes
the critical cross-cutting recommendations on the level of the Sixth Carbon Budget
and the UK’s 2030 NDC). Some progress is being made, or is expected soon, against
many others, with 29 recommendations partly achieved and 34 underway. Seven
recommendations are overdue and 13 have not been achieved (Table 4.3).
While several critical policy documents have been published over the last year,
other key strategies and plans remain to be published, or have been delayed:•

At the time of finalising this report in early June, the Heat and Buildings
Strategy, the Transport Decarbonisation Plan, the final HM Treasury Net Zeroreview, the Net Zero Aviation Strategy and the Nature Strategy had not yet
been published. These are needed to extend action to reduce emissions
into all areas of the economy, within a portfolio of policy that accelerates afair and just transition to Net Zero.

•

The absence of these documents means we are reporting on a moving
picture. It will only be possible to judge the overall approach to meet the
Sixth Carbon Budget and the Net Zero target when the Government’s Net
Zero Strategy, as well as other overdue and underway documents, arepublished.

As the disparities in progress in Table 4.3 illustrate, we see evidence of a multipaced Government, with some departments lagging behind others:•

The Ministry of Housing, Communities & Local Government (MHCLG) is not
fully supporting local government to play its part in the transition to Net
Zero. Progress has fallen short to date on ensuring that building standards
are fit for purpose and properly enforced. The current Planning Bill does not
ensure that developments and infrastructure are compliant with Net Zeroand appropriately resilient to climate change. It would be serious were thisopportunity to be missed.

•

While the Department for Environment, Food & Rural Affairs (Defra) has
made important steps forward on ambition for afforestation and peat
restoration – though the latter is short of the CCC pathway andimplementation is slow – progress on agriculture and land use remain slow
and partial, and gaps in ambition remain. On waste, large gaps remainboth on banning materials from landfill and getting a grip on the rapid
expansion of Energy from Waste facilities.

•

Even within Departments that are performing better overall there arepockets of poor or slow performance. For example, the Department for
Business, Energy and Industrial Strategy’s (BEIS) Heat and Buildings Strategy
has been delayed by almost a year, while the Department for Transport(DfT) has not set out any plans for limiting growth in aviation demand.

•More generally, Government progress has been slow on overarching
challenges towards Net Zero, which has now been law for two years. The
most notable delay is to the HM Treasury’s Net Zero Review, but there aredelays and uncertainty to a suite of other challenges: the just transition, jobs
and skills, public engagement. With a Spending Review later this year, it isessential that the Treasury clarifies its strategic priorities for the remaining
carbon budget in the UK. There is also a need for strong governance of the

Climate Change Committee

transition within Government, including ensuring that wider policy decisions
are routinely made compatible with Net Zero.
For the full programme to align to the challenge, and provide the leading example
that the Government wishes to take to COP26, government will have to addressthese failures.
Table 4.3
Progress against departmental recommendations in the Committee’s 2020 Progress Report to Parliament
Department

Progress against last year’s recommendations

Cabinet Office & No. 10
FCDO, BEIS & the COP26 Unit
HM Treasury
Department for Business, Energy and Industrial Strategy

Department for Environment, Food and Rural Affairs
Department for Transport
Ministry of Housing, Communities and Local Government
Department for Education
Department for International Trade
Department of Health and Social Care
Ministry of Defence
Home Office & Ministry of JusticeDepartment for Digital, Culture, Media and Sport
Department for Work and Pensions= action achieved,= underway,= partly achieved,= overdue,= not achieved.

Notes: Based on recommendations in the CCC’s 2020 Progress Report to Parliament. Recommendations for all departments, or those relating toadaptation are not included in this table. Some recommendations apply to more than one department, so the sum of recommendations in this table
does not add up to the 92 cited in the text. Tables of recommendations and scores is in the supplementary material published alongside this report.

Progress in reducing emissions: 2021 Report to Parliament

150

Progress across the devolved
administrations has also beensignificant over the past year.

Delivering Net Zero by 2050 will require strong policy frameworks across all levels of
Government, and collaboration between the governments of Wales, Scotland andNorthern Ireland with Westminster to develop the required policies. The past year
has also seen important developments in climate policy in the devolved
administrations (Box 4.1), including:•

The Scottish Government updated its Climate Change Plan, which
integrates the 2045 Net Zero target and its new interim targets into itsdelivery plan for emissions reductions out to 2032.

•

The Welsh Government increased its 2050 emissions target to Net Zero, from
a 95% reduction on 1990 levels, following advice from the Committee.

•

The Northern Ireland Assembly is working towards legislating a Climate
Change Bill before the next Assembly election in 2022.

•

Both Scotland and Wales created ministerial portfolios that focus on Net
Zero and decarbonisation following the May 2021 elections.

Box 4.1
Policy progress in Scotland, Wales and Northern Ireland
The past year has seen significant developments in climate policy in Scotland, Wales andNorthern Ireland, even in the midst of the response to the pandemic. This box sets out
major climate policy developments since our 2020 Progress Report.
Scotland:•The Scottish Government committed to significant spending in low-carbon areas in its
Budget and Programme for Government, including £1.8 billion for low-carbon
infrastructure and £1.6 billion for heat and energy efficiency measures (or: including£2 billion to decarbonise travel and heating, and promote woodland creation). 1,2•

Published an update to the Climate Change Plan to integrate the 2045 Net Zerotarget and new interim targets into the plan for the delivery of Scottish emissions
reductions until 2032. The update aligns sectoral emissions pathways to the higher
ambition of the 2045 goal. We will scrutinise elements of that update in our 2021
Scottish Progress Report. 3•

Following the May 2021 election, the Scottish Government created a new cabinet
position for Minister for Net Zero, Energy and Transport, with a portfolio that includes
the delivery of Net Zero and COP26, as well as transport, biodiversity, infrastructure
and circular economy.

•

The Just Transition Commission published its final report, and the findings from
Scotland’s Climate Assembly are due to be published around the same time as thisProgress Report. 4•

Scotland’s Draft Heat in Buildings Strategy was published, setting out a pathway forachieving Net Zero emissions in Scotland’s buildings.

Wales:

151•

The Welsh Government legislated a 2050 Net Zero target and a set of targets on thepathway to that goal, in line with the Committee’s advice. 5•

Published a Transport Strategy (Llwybr Newydd), which places decarbonisation by
2050 at the centre of transport and infrastructure planning. 6•

Published ‘Beyond Recycling’, a circular economy strategy that sets out policy topromote resource efficiency and make Wales ‘zero waste’ by 2050. 7•

Continues to work on the second Low Carbon Delivery Plan, which will outline thedelivery of the Second Welsh Carbon Budget and beyond.

Climate Change Committee•

Following the May 2021 election, the Welsh Government has created a new cabinet
position Minister for Climate Change, with responsibilities including decarbonisingtransport, the housing sector and energy generation.

Northern Ireland:•

The Executive requested the Committee’s advice on setting emissions targets thatreflect Northern Ireland’s equitable contribution to the UK’s 2050 Net Zero target. We
published this advice in December 2020. 8•

The Northern Ireland Assembly is in the process of legislating a Climate Change Bill
before the next Assembly election in 2022. The Committee will continue to provide
evidence throughout the legislative process.

•In March 2021, the Northern Ireland Executive consulted on an Energy Strategy andpublished a set of decarbonisation scenarios that would see Northern Ireland’s
energy systems reach net-zero carbon by 2050. The final strategy is scheduled for
publication in November 2021. 9,10b) Judging progress towards the Sixth Carbon Budget
We have assessed Government progress towards the Sixth Carbon Budget by
judging whether sufficient ambition is in place, and whether policy is being
developed to meet that ambition, for each source of abatement in the CCC
pathway to Net Zero * . Figure 4.3 illustrates our assessment of progress against
required emissions abatement, and Table 4.5 sets out our scoring and justification
across some of the most significant sources of abatement in the economy. We finda mixed picture:

Progress in setting out policies issignificantly behind ambition,
which is broadly on track withsome important gaps.

•

Ambition is beginning to align with what is needed, although there is more
limited action or major risks for almost half of the abatement in the CCC
pathway (e.g. heat networks, emissions from landfill and waste incineration,
developing greenhouse gas removals). Precise intentions still need to beclarified for around a third of the remaining abatement that is broadlyaligned with the targets (e.g. zero-emission cars, energy efficiency inbuildings).

•

Progress in setting out policies is significantly behind ambition, with less than
one-fifth of the emissions savings for the Sixth Carbon Budget having
policies that are ‘potentially on track’ or ‘fully on track’ for delivery (e.g.
renewable electricity generation).
– In many other areas, some policy plans have been set out but theselack detail and/or do not comprehensively cover the necessary set ofissues (e.g. in terms of funding, appropriate mechanisms, timing).
Together, areas in which policy is in danger of falling behind cover overthree-fifths of the emissions reduction required to 2035.
– A further one-fifth of the emissions reductions still have major policy
gaps, including on demand-side action and tackling emissions fromlandfill and waste incineration. We highlight the need to fill a range ofpolicy gaps in section 4.

*

The ‘CCC pathway’ refers to the Balanced pathway to Net Zero developed by the Committee in our December
2020 report, CCC (2020) Sixt h Carbon Budget – The UK’s pat h to Net Zero.

Progress in reducing emissions: 2021 Report to Parliament

152

Table 4.4 provides an overview of the scoring criteria which informed theCommittee’s judgement in Figure 4.3. A list of scores for all sources of abatement isavailable in the supplementary materials accompanying this report.
Effective policies must be developed at greater pace. The path to Net Zerorequires a rapid scale-up in low-carbon investment and low-carbon choices acrossthe economy. Government must lead that change with more urgency than wehave seen so far, and speed up delivery, which will need to accelerate even
where ambition is broadly on track, for example:•

Although the Government’s 2030 target for offshore wind is in line with the
CCC pathway, a minimum of 4 GW of additional offshore wind capacity
will be needed each year from the mid-2020s onwards, significantly greaterthan the current 2 GW per year.

•

The Ten Point Plan set a direction to phase out new internal combustion
engine van sales by 2030, which is broadly in line with the pace of thetransition required to meet the Sixth Carbon Budget, provided only a limited
role for hybrid vehicles is allowed beyond this point. However, the batteryelectric van market share was only 2% in 2020.

•

Government ambition on tree planting, which reaches 30,000 hectares oftrees each year, is in line with the CCC pathway out to 2025 (although
there is not yet a commitment post 2025) but only 13,000 hectares wereplanted in 2019/20.

Delivery is falling short even
where ambition is broadly on
track.

Table 4.4
Scoring criteria for ambition and policy against each source of abatement in the CCC pathway
High-level ambition

Specific policies in place (or imminent)

Fully on track,
limited risks

Clear ambition fully in line with or
beyond CCC recommendations

Credible, proven policy that is already working

Potentially on
track, some risks

Broadly in line with CCC
recommendations, subject toclarification

Credible policy in place (or imminent) but not yet
proven, or policy only covers the next few years of scaleup but not out to Sixth Carbon Budget period (2033-37)

Some action,
more significant
risks

Some commitments but there aregaps, or commitments are notambitious enough

Policy in place (or imminent) that is limited in ambition,or policy is in place but there are risks of it ending without
replacement

Falling behind,major risksNo, or very limited, ambition statedNone, very limited, or clearly ineffective policy in place

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Climate Change Committee

Figure 4.3 Is Government progress on track?
Ambition

600

MtCO2e

500
400
300
200

2029

2030

2031

2032

2033

2034

2035

2029

2030

2031

2032

2033

2034

2035

2028

2027

2026

2025

2024

2023

2022

2021

0

2020

100

Policy600

MtCO2e

500
400
300
200

2028

2027

2026

2025

2024

2023

2022

2021

0

2020

100

Fully on track

Potentially on track

Some action but risk of falling behind

Falling behindBaseline emissions

CCC Balanced Pathway

Source: CCC analysis; CCC (2020) The Sixt h Carbon budget – The UK’s path to Net Zero.

Progress in reducing emissions: 2021 Report to Parliament

154

Table 4.5
Ambition and policy progress on significant sources of abatement

Manufacturing and construction

Buildings

Surface transport

Abatement source

Ambition

PolicyRationale

Zero-emission cars

The confirmation of a 2030 phase-out date is a welcome step, but
policy is lacking for how to deliver it. The market share of new batteryelectric cars reached 6.5% in 2020, up substantially from 1.6% in 2019.

Demand-side
behaviour change
and modal shift

Despite the recent ‘Gear Change’ and ‘Bus Back Better’ strategies,
Government focus on reducing the need to travel and increasing car
occupancy is lacking. Substantial road-building investment continues
and car demand is increasing.

Residential – lowcarbon heat inexisting homes

UK Government has only set a clear fossil phase-out ambition forhomes off the gas grid i.e. 15% of all homes. 600,000 heat pumps ayear committed to by 2028, which is below the 900,000 required in the
CCC pathway. Insufficient financial support planned for heat pumps
or low-carbon heat networks.

Residential –energy efficiency
and low-carbon
heat in new homes

Uplifts in buildings standards announced, but ambition lags for energy
efficiency and airtightness, and legislation is not planned until 2024.
Risks policy design may not drive heat pump uptake needed from2021 – heat pumps were installed in 5% of new homes in 2020, farbehind the 20% level required by 2021 in the CCC pathway.

Residential –energy efficiency
in existing homes

Success contingent on a comprehensive framework of standards,
Energy Performance Certificates and Standard Assessment Procedure(SAP) being made fit for purpose to drive the right measures, and on a
successor to the Green Homes Grant. Installations of loft and solid wallinsulation are only a third of the rate needed by 2021 in the CCC
pathway.

Non-residential –energy efficiency
and behaviourchangeCommitments of 20% efficiency savings in business and 50% reductionof public emissions by 2032 are in line with the CCC pathway. Policy
proposals only cover private-rented and larger buildings to date andthere is little evidence for reduced energy demand at present.

Resource
efficiency

The Waste Prevention Programme consultation sets out planned
actions, but is not backed up with sufficient ambition on pace or
estimated abatement, which is mostly not indicated.

Energy efficiency

Abatement from energy efficiency in the Industrial Decarbonisation
Strategy is in line with our Sixth Carbon Budget analysis, but it is notclear that this could be delivered by existing policies, such as Climate
Change Agreements and the Industrial Energy Transformation Fund.

Electrification

There is a lack of ambition on future levels of electrification, no specificbusiness models have been developed and there is insufficient policy
to address the cost issues around electrification.

HydrogenAmbition potentially exceeds the level in the CCC pathway. BEIS havepublished updates on a potential hydrogen supply business model. The
proposals could provide some support for hydrogen use in
manufacturing but may falter as they are not designed for this purpose.

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Climate Change Committee

Fuel Supply –electrification of oil andgas production

The North Sea Transition Deal stated an ambition of 50% emissions
reductions by 2030 (from 2018 levels), which falls well below theunderlying 68% in the CCC pathway. No credible policy has been
implemented beyond the EU Emissions Trading Scheme, which alone
was not sufficient to incentivise decarbonisation.

Offshore wind

The Government’s 40 GW target for 2030 is stretching, and Contracts
for Difference (CfDs) have been working well to deliver capacity,
though clarity is needed on the auction schedule and pathway ofvolumes to be procured to 2030.

Other renewables

While onshore wind and solar are now eligible for CfDs, there is noclear medium- to long-term ambition. CfDs are a proven policy fordelivering new capacity, but clarity is needed on the auction
schedule and pathway of volumes to be procured to 2030.

NuclearGovernment has made a commitment for at least one further plant
and recognises the potential for advanced nuclear innovation. The
CCC pathway assumes two large-scale plants are operational by themid-2030s. Further clarity is needed on contracting models, anddeployment of already contracted capacity is falling behindschedule.

Dispatchable lowcarbon generation

Government has committed to deliver at least one Power CCS projectby 2030 but there is no equivalent for hydrogen, both of which fallshort of the CCC pathway. No commercial deployment but trials areunderway globally.

Diet change

There has been no stated ambition on the role of diet change inmeeting climate targets or policy development aimed at diets.

Peatlandrestoration

Defra’s restoration target of 30,000 hectares by 2025 is less ambitious
than the CCC pathway and there is no target beyond 2025. The banon rotational burning introduced in May 2021 only covers 40% of all
upland bog in England, while the commitment to end the sale of peatin horticulture by 2024 captures the amateur market only.

Aviation – demand
management

No recognition that demand needs to be managed and several
policies (e.g. proposed Air Passenger Duty reductions and airport
expansion) are encouraging growth in the sector. Passengerkilometres travelled per person have been increasing (pre-COVID-19)
faster than can be accommodated in the CCC pathway.

Waste

Despite some progress in 2021, e.g. Defra’s Waste Prevention
Programme for England, delivery of key measures has been delayedand critical gaps remain. Recycling rates have stalled and Energy
from Waste emissions are rising.

Removals

Recognition of need for removals but expected amount/timing
unspecified. Growing innovation funding committed, but underlying
policy frameworks and CCS infrastructure need urgent delivery.

Agriculture and Land use

Electricity supply

CCS in manufacturing
and refining

The Industrial Decarbonisation Strategy has a target of 3 MtCO 2
captured from industry by 2030 that aligns to our advice. Government
has also set out a ‘minded to’ position for an industrial carbon capturebusiness model, although some aspects of the model are yet to be set
out in detail.

= falling behind, major risks;= some action, more significant risks;= potentially on track, some risks;= fully on track, limited risks

Notes: See Table 4.4 for further description of the ‘ambition’ and ‘policy’ scores given to each source of abatement.

Progress in reducing emissions: 2021 Report to Parliament156

3. Policy priorities and gaps
We have identified crosscutting priorities, essential
elements of the transition andsignificant policy gaps,
alongside a detailed set of
departmental
recommendations for thisProgress Report.

Through our analysis for the Sixth Carbon Budget and an updated assessment ofprogress for this report, we have identified a set of five cross-cutting policy priorities
and seven essential elements of the Net Zero transition, as well as four significant
policy gaps which require urgent action. We make a detailed and comprehensive
set of approximately 200 recommendations for UK Government departments andthe devolved administrations in the tables in the Annex to this report. These tables
also include recommendations on climate change adaptation, which arecovered in detail in the Adaptation Progress Report to Parliament.

a) Cross-cutting priorities
We recommend
implementation of a Net Zerotest to ensure policy iscompatible with climate
objectives.

There is a need for a coherent approach to achieving Net Zero and to ensuringthat all Government policies are compatible with the transition to Net Zero.
Decisions on road building, fossil fuel production, planning and expansion of waste
incineration are not only potentially incompatible with the overall need to reduce
emissions but also send mixed messages and could undermine public buy-in to the
Net Zero transition. We recommend implementation of a ‘Net Zero Test’ to ensurethat all Government policy decisions are compatible with the legislated emissions
targets.
Several cross-cutting issues must be addressed to enable sector-specific strategies
and plans to be rolled out effectively. These are essential in calibrating the public’s
expectations for what lies ahead and building broad public support for thechanges:Priorities include a Net Zero
Strategy, a plan for a justtransition and public
engagement, a framework for
local delivery and integrationof adaptation in climate plans.

157•

A comprehensive Net Zero Strategy is needed this year to fill gaps inambition and pull together a coherent story of how sectoral efforts fit
together to achieve the Net Zero target and interim budgets. The inclusionof international aviation and shipping in targets from the Sixth Carbon
Budget and onwards allows for the first comprehensive look at a pathway
to Net Zero covering all sectors. It should also commit to a ‘Net Zero Test’ toensure that all Government decisions are compatible with the legislated
emissions targets.

•

A plan for achieving a just transition for people, workers, consumers andregions, which ensures that opportunities are taken to create jobs andimprove the skills base while maintaining international competitiveness.
Alongside this, a credible plan is needed for the fair funding of thetransition, building on HM Treasury’s Net Zero Review, as well as ensuringthat investment is supported by strong financing.

•

Public engagement around the need for climate action, the co-benefits tohealth of low-carbon choices, information about how individual actions
can contribute to reducing emissions and involvement in decisions on how
best to achieve a transition.

•

A framework for local delivery to deliver ambitious climate objectives atdifferent scales (i.e. devolved administrations, regions and local authorities),
through workable business models, removal of barriers to action, dedicatedresource and an approach that facilitates sub-national action tocomplement action at the national level.

Climate Change Committee•The economic recovery
following COVID-19 should
accelerate the transition to Net
Zero, avoiding harmful lock-ins
and an overshoot in emissions.

Plans must make climate adaptation an integrated part of the transition to
Net Zero. Across multiple areas, and in particular on buildings and land use,
there are benefits to thinking holistically about how policy can reduce
emissions, while ensuring it improves resilience to the UK's changing climate.
Like Net Zero, climate adaptation will also need to be integrated into core
Government policy.

The Government must also ensure that public funding and investments toencourage an economic recovery are consistent with its Net Zero commitments
and the need to adapt to climate change, and avoid harmful lock-ins in emissions
or stranded assets. An overshoot in emissions relative to the CCC pathway as the
economy recovers from the pandemic – as occurred following the financial crisisof 2008 – can be avoided with the right policies (Box 4.2).

b) Essential elements of the transition to Net Zero
While progress is needed across a wide range of areas in order to get on track to
Net Zero, there are several indispensable parts to the transition. We have identified
seven priority areas for the Government, within the approximately 200
recommendations for the next year developed for this report, on which it is crucial
that good progress is made. These are primarily focused on delivery:
Delivery priorities for the next
year include EV charging
infrastructure, a policy
package for buildings
decarbonisation, delivery
mechanisms for land usechange, comprehensive
manufacturing policy, further
auctions for low-carbon power,a hydrogen strategy and GGR
support mechanisms.

•

Develop and implement a comprehensive policy package to enable thedelivery of the 2030 transition to electric vehicles, to build on the phase-out
announcement and the positive response from automakers and motorists.
This should include a full strategy for widespread deployment of charging
infrastructure and a mandate requiring manufacturers to sell a rising
proportion of zero-emission vehicles.

•

Implement a comprehensive policy package for buildings decarbonisation,and enshrine the long-term standards framework in regulation and law, tofinalise the roadmap for decarbonising the UK building stock.

•

Implement comprehensive delivery mechanisms for landscape-scale land
use change for afforestation and peatland restoration and a high take-up
of low-carbon farming practices. This should cover mechanisms for private
and public financing and a strategy to address non-financial barriers.
Interim policies will be needed to avoid a hiatus in action while awaiting
the implementation of the new mechanisms.

•

Advance policy for manufacturing decarbonisation by establishing
incentive mechanisms to support fuel switching, implementing CCS
proposals, and initiating the development of product and construction
standards both to improve energy and resource efficiency and to develop
the option of managing carbon leakage by applying carbon policy toimports.

•

Continue auctions for low-carbon capacity, together with supporting
actions to enhance system flexibility, to deliver an emissions intensity of
50 gCO2/kWh or better in electricity generation by 2030.

•

Deliver a Hydrogen Strategy that sets out a vision of the role of hydrogen on
the path to Net Zero and the steps needed to realise it. The strategy should
focus on hydrogen use in sectors that cannot decarbonise without it andlow-carbon hydrogen production routes to 2035 with aims to start largescale hydrogen trials in the 2020s.

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•

Enable domestic engineered greenhouse gas removals (GGR) to
contribute to UK carbon budgets and Net Zero, and establish GGR support
mechanisms and monitoring, verification and reporting (MRV) structures in
the UK that ensure that GGR is timely, sustainable and verifiable.

c) Gaps that must be addressed
Key gaps that must be
addressed include phasing out
unabated gas power
generation, public
engagement and encouraging
behaviour change, addressing
emissions from EfW and a Net
Zero aviation strategy that
addresses airport capacity.

Our assessment of strategies and policies announced to date has identified
specific key gaps that need to be addressed by Government policy:•

Commit to phasing out unabated gas-fired electricity generation by 2035,
subject to ensuring security of supply. Publish a comprehensive long-term
strategy for unabated gas phase-out, including ensuring new gas plant areproperly CCS- and/or hydrogen-ready as soon as possible and by 2025 at
the latest, and thoroughly assessing the market challenges that will emerge.

•

Include contributions in the Net Zero Strategy from demand-side action –on aviation, a shift towards healthier diets and a switch away from cars
towards active travel and public transport. This should be accompanied bypublic engagement to explain how low-carbon choices can contribute to
Net Zero and wider co-benefits to health, and policy frameworks that seek
to encourage and incentivise these changes.

•

Address with urgency the rising emissions from, and use of, Energy from
Waste (EfW), including by ensuring that the capacity and utilisation of EfWplants is consistent with necessary improvements in recycling and resource
efficiency, providing support to enable existing EfW plants to begin to be
retrofitted with CCS from the late 2020s, and introducing policy to ensurethat any new EfW plant are built either with CCS or are ‘CCS ready’.

•

The overdue Net Zero Aviation Strategy must set out credible pathways andpolicies to encourage technological development in the sector but also
recognise the potential need to manage aviation demand in future, should
improvements in sustainable aviation fuels and low-carbon aircraft fall shortof Government and industry ambitions. An assessment of the UK’s airport
capacity strategy and a mechanism for aviation demand management
should be part of the aviation strategy.

Section 4 of this chapter provides further insights into our assessment of progress ineach sector, identifies policy priorities and gaps and provides context for thesectoral recommendations for the next year.

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Box 4.2
Policy for a ‘green recovery’
The pandemic and the public health response have had far-reaching consequences for
the UK and global economy. As economies locked down, the world has seen recessions,lost jobs and higher Government debt.
This has resulted in a shift in the underlying conditions for reducing emissions and adapting
to climate change. Although we are now seeing the start of an economic recovery in theUK, with the Bank of England predicting a 7.25% increase in GDP in 2021, this follows on
from a 9.9% decline in 2020. 11 Government support to businesses and individuals affectedby the pandemic has boosted the prospect of an economic recovery but also resulted inincreased fiscal pressures (Government borrowing reached £355 billion in 2020-21 and is
expected to be £234 billion in 2021-22). The pandemic has also highlighted existing wealthand health-inequality and opened up new dimensions of inequality that were previously
perceived as being less significant (for example the ability to work at home, quality of
housing, or access to gardens and green spaces).
The Committee previously set out six principles to help guide the recovery in thiseconomic context. These principles remain a useful framing for thinking about short andlonger-term recovery from the pandemic:•

Use climate investments to support the economic recovery and jobs. Government
can act to bring forward investment needed to reduce emissions and manage thesocial, environmental and economic impacts of climate change, often without
direct public funding or by co- financing to accelerate private investment.

•

Lead a shift towards positive long-term behaviours. There is an opportunity toencourage a ‘leap forward’ rather than a return to business as usual, on some of the
new social norms resulting from the pandemic that benefit wellbeing, improve
productivity, and reduce emissions, especially for travel. Government can lead theway through its own operations, public communications and infrastructure provision,and investing in measures to facilitate social distancing on public transport.

•

Tackle the wider ‘resilience deficit’ on climate change. Comprehensive plans to
reduce emissions and to prepare for climate change are not yet in place. Strong
policies from across Government are needed to reduce our vulnerability to thedestructive risks of climate change and to avoid a disorderly transition to Net Zero.
Business must also play its part, including through full disclosure of climate risks.

•

Embed fairness as a core principle. The crisis has exacerbated existing inequalities
and created new risks to employment in many sectors and regions, placing evengreater priority on the fair distribution of policy costs and benefits. The benefits ofacting on climate change must be shared widely, and the costs must not burden
those who are least able to pay or whose livelihoods are most at risk as the economy
changes.

•

Ensure the recovery does not ‘lock-in’ greenhouse gas emissions or increased
climate risk. It is right that actions are taken to protect jobs and industries in this
immediate crisis, but the Government must avoid ‘lock-in’ to higher emissions orincreased vulnerability and exposure to climate change impacts over the long term.
Support for carbon-intensive sectors should be contingent on them taking real andlasting action on climate change, and new investments should be resilient to climatechange.

•Strengthen incentives to reduce emissions when considering fiscal changes.
Changes in tax policy can aid the transition to Net Zero emissions. Many sectors of
the UK economy do not currently bear the full costs of emitting greenhouse gases.
Revenue could be raised by setting or raising carbon prices for these sectors, andlow global oil prices provide an opportunity to offset changes in relative prices
without hurting consumers.

The UK has taken initial steps towards a green recovery, in line with the principles we set
out:•

Doubling the capacity to be contracted in this year’s Contract-for-Difference (CfD)
auction for renewable electricity to up to 12 GW.

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•

An initial £250 million of funding out of a package of investment of £2 billion over five
years for new cycling and walking infrastructure and a £5 billion funding package
over five years to improve bus services and cycle links across the country.

•£40 million of funding for nature-based investments such as tree planting andpeatland restoration via the Green Recovery Challenge Fund, as well as a £10 million
Natural Environment Investment Readiness Fund to encourage private sector
investment in nature.

•£5 billion of investment over five years on flood protection.

•

The Green Homes Grant scheme, which provided grants to support investments ingreening residential and public buildings, was announced in September 2020 with abudget of £2 billion. However, it reached just 10% of the 600,000 homes it set out toimprove and was cancelled by the Government in March 2021. The Government
must learn from this experience to develop a replacement to the Green Homes
Grant that works (Box 4.3).

Other Government announcements could also contribute to fund a green recovery, if theright rules are developed and put in place:•

A capital investment super deduction was announced in the March Budget, whichaims to bring forward capital investment in plant and machinery. The transition to Net
Zero will be capital intensive, but the super deduction in its current formulation does
not rule out investment in high-carbon assets, which could lead to lock-in of higher
emissions from these assets.

•

The remits of the Bank of England’s Monetary Policy Committee (MPC) and Financial
Policy Committee (FPC) were updated to reflect the Government’s economic
strategy to achieve economic growth that is consistent with Net Zero. The MPC remit
update could tilt the preference of the central bank’s asset purchases towards lowcarbon assets, potentially lowering borrowing costs for these assets.

•

A National Infrastructure Bank (NIB) with £12 billion in capital and the aim of funding£40 billion worth of public and private projects was announced, with a remit toencourage Net Zero. The NIB is forecast to invest £1.5 billion a year 12, only a fractionof the investment previously provided by the European Investment Bank each year
(around £7 billion), which the UK lost access to after EU exit.

•

The Government is issuing green sovereign bonds for the first time, committing to
issuing £15 billion worth of green bonds in 2021. The rules on what will count as green
spend have not been announced. This guidance should ensure that revenue raised
through green bonds is used to fund policies that will genuinely contribute to Net
Zero.

While fiscal pressures remain, overall UK investment continues to be low. More can bedone to boost private investment and increase tax revenues while accelerating
decarbonisation. Government announcements, while encouraging, do not go far
enough to deliver the level of decarbonisation needed to achieve Net Zero.

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4. Sectoral progress and next steps for policy
This section revisits key sectoralpriorities and gaps identified in
the Sixth Carbon Budget policy
report and sets out progresssince.

The Committee’s December 2020 report, Policies for the Sixth Carbon Budget and
Net Zero, set out comprehensive proposals for policy development across all
sectors. This continues to be a relevant guide to policy development. This section
revisits key sectoral priorities and gaps identified in the Sixth Carbon Budget policy
report and sets out progress since, in sectors where significant developments haveoccurred. There are no specific sections for shipping and F-gases as material
progress has not occurred in these sectors since December 2020 – here the Sixth
Carbon Budget policy report continues to be our most up to date assessment ofprogress and priorities.
Based on this assessment we have put together approximately 200
recommendations for UK Government departments and the devolved
administrations. Key priorities within these recommendations were set out in section
3 of this chapter, and the full lists of recommendations are in the Annex to thisreport.

a) Surface Transport
We have set out the core requirements of a policy package in transport in the Sixth
Carbon Budget policy report. The past year has seen considerable progress in theambition and strategy for decarbonisation of the UK’s transport sector, althoughspecific policies and delivery plans are now needed to deliver on this increased
ambition. Key progress over the past year has included:
The commitment to a 2030
phase-out of new petrol anddiesel cars and vans iswelcome. The focus needs to
be on fully battery-electricvehicles, rather than hybrids.

•

The commitment to a 2030 phase-out date for new petrol and diesel carsand vans in the Government’s Ten Point Plan for a Green Industrial
Revolution. Provided the focus is on a transition to fully electric vehicles(EVs) and the role allowed for hybrids is limited, this should deliver atransition which meets our Sixth Carbon Budget trajectory and delivers costsavings to society. Detailed supporting policies and implementation plans
are now required, including:– A Zero-Emission Vehicle Mandate, requiring manufacturers to produce
a rising percentage of EVs each year, alongside more ambitious CO2
emissions regulations.
– Support continues to be offered for purchases of plug-in cars and has
been extended to 2022-23, although the maximum value of thesegrants was recently reduced by £500 to £2,500. Sustained financial
support for the cleanest vehicles and disincentives to drive higher
emitting cars will help shift the market.
– The Ten Point Plan also confirmed plans to support the development of
UK-based EV supply chains (including giga-factories for battery
production) and to accelerate charge point roll-out with increasing
focus on on-street charge points near homes and workplaces. A
coordinated national strategy for charging infrastructure is needed, toensure that provision is sufficient and appropriate across all regions of
the country and that deployment is meeting the needs of theconsumers who rely on public charging (in particular those without
private off-street parking).

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Now is an opportunity toreinforce the increase inwalking and cycling andpositive public responses tolower air pollution following the
pandemic.

•

The Gear Change strategy 13 set out Government’s vision for increasing
active travel and using modal shift as a cost-effective way of reducing
transport emissions.
– The focus on high-quality infrastructure that would provide an attractive
alternative to car use and on delivery through Local Authorities(including recognition that different solutions will be appropriate fordifferent areas) within this strategy are important.
– Government should reinforce the increase in walking and cycling, andpositive public responses to reduced air pollution, that occurred during
the COVID-19 pandemic to deliver lasting longer-term travel
behaviours.

Public transport will needsupport to rebuild publicconfidence and avoid a carled recovery.

•

The Bus Back Better strategy 14 aims to improve services across the country,
including through better connectivity, simplified fares and increased use ofprioritisation measures, to encourage more people to use the bus, rather
than the car, as we build back from the COVID-19 pandemic.
– This strategy included funding for UK production and purchase of zeroemission buses and was accompanied by a consultation15 on phasingout new sales of diesel buses.
– Further empowerment of, and support for, Local Authorities is likely to beneeded to deliver improvements to bus services and simultaneously
continue driving zero-emission bus take-up.
– The public transport sector will require particular support to rebuild
public confidence in its safety and avoid a car-led recovery. Bus andtrain operators may need further support as social distancing rules
reduce capacity and impact profitability.

Trials of zero-carbon HGVs will
generate data on the best
options for this sector. In the
short-term, efficiency andlogistics improvements are alsoneeded.

•The Scottish Government’s Climate Change Plan Update 16 included acommitment to reduce car-kilometres by 20% by 2030. A comprehensive
package of measures to support active travel, shared mobility and public
transport, as well as reducing the need for some types of journey, will beneeded to deliver this transformation.

•

The Welsh Government launched LLwybr Newydd: the Wales Transport
Strategy, 17 setting out its intention to improve the quality, reliability andaffordability of public transport and provide better active travel and EV
charging infrastructure to encourage people to switch to more sustainable
modes of transport.

•

The Ten Point Plan also committed £20 million in initial funding for trials ofzero-emission heavy-goods vehicles (HGVs) and promised an upcoming
consultation on a phase-out date for new sales of diesel HGVs.
– This funding is being made available through two innovationcompetitions – one 18 proposing to test battery-electric trucks in realworld operation, and a second19 to conduct pre-deployment planningfor separate trials of an electric road system and hydrogen fuel-cell
HGVs.

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– Separate development and demonstration projects have also received
funding this year, including Advanced Propulsion Centre grants 20 for
development of electric HGV propulsion systems with better range andimproved energy efficiency and a commitment 21 to establish ahydrogen transport hub in the Tees Valley.
The Transport Decarbonisation
Plan will be important in settingout how the Government plans
to deliver Net Zero across thewhole transport system.

The upcoming Transport Decarbonisation Plan is expected to provide further detailon how the Government plans to deliver Net Zero for the transport sector.
Alongside this, it will be important to embed the positive behavioural changes thathave been developed during the COVID-19 pandemic, but also to act decisively
to mitigate those more negative consequences which could jeopardise thesector’s decarbonisation pathways. Key priorities as the economy emerges fromthe pandemic should be:•

To restore confidence in and use of public transport. This is important not
only for transport emissions, but to ensure all people have access toaffordable and safe transport.

•

To prioritise funding away from car use. The costs of car travel have fallen
relative to both average wages and to bus and rail.22 This needs to berebalanced away from cars, the most carbon-intensive mode, and towards
public transport and walking and cycling.

•

To encourage behaviours that reduce travel demand such as working fromhome or using technology in place of business trips. Prioritisation of
investment in improved digital connectivity rather than road-building would
help achieve this, contributing towards a greener recovery.

•

To encourage behaviours which improve efficiency of travel such asincreased car sharing.

b) Buildings
We have set out the core requirements of a policy package in buildings in the Sixth
Carbon Budget policy report. UK Government’s Heat and Buildings strategy, which
was originally due by summer 2020, had not been published as this year’s Progress
Report was being finalised.
At its core, the strategy needs to set out the trajectory of standards on energy
efficiency and heating emissions with policy proposals to deliver on this ambition in
a way that works for households. It must signal a clear route to expanding heatpump and heat network supply chains now, while kicking off the process to clarify
the role for hydrogen in any locations where it may be a viable option, as well as
those where it is not. There are critical questions to resolve around who pays forbuildings decarbonisation, along with considerations around how to ensure
resilience measures are integrated and co-benefits (e.g. for health and fuelpoverty alleviation) maximised.

i) Key developments in the past year
Key developments over the
past year have included acommitment to phase out the
installation of natural gas
boilers by 2035 UK-wide, and torequire zero or near zerocarbon heating from as earlyas 2025 in Scotland.

Strategy and implementation
A number of important publications have been released over the past year
including the Ten Point Plan, the Energy White Paper, the Scottish Government
Draft Heat in Buildings Strategy, consultations on new build standards, the Northern
Irish Energy Strategy consultation and the Welsh plan on tackling fuel poverty –amongst others. Developments have included the following:
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BEIS and the Scottish
Government have developed
new proposals for energy
efficiency standards for owneroccupied homes, with further
proposals from BEIS for an inuse performance scheme forlarge commercial buildings.

*

165

•

Owner occupier energy efficiency. The Scottish Government committed toconsulting on detailed proposals for requiring owner-occupied private
housing to meet Energy Performance Certificate (EPC) C at trigger points
such as point of sale from 2023-25 onwards, with a backstop standard by2035. * UK Government consulted on a framework for lenders to disclose theenergy performance of their portfolios, and on an associated target for all
lenders to meet a portfolio average of EPC C by 2030. The Energy White
Paper also announced a commitment to consult on regulatory measures toimprove the energy performance of owner-occupied homes.

•

Private rented sector energy efficiency. UK Government consulted onrequiring all properties with new tenancies to meet EPC C from 2025, withproperties for all tenancies required to reach the standard by 2028. The
Scottish Government also committed to requiring private-rented sector
properties to meet EPC C by 2028. The 2020 Energy White Paper confirmedthat the future trajectory for the non-domestic minimum energy efficiency
standards will be EPC B by 2030 – BEIS are now consulting on proposals totighten enforcement and an interim target.

•

Energy efficiency in social homes. The UK Government Social Housing White
Paper commits to reviewing whether the Decent Homes Standard should
be updated and how it can better support decarbonisation and energy
efficiency. In Scotland, plans were announced to bring forward the review
on strengthening the EPC B target. The Welsh Government launched the
optimised retrofit programme to pilot approaches to retrofit.

•

Other commercial energy efficiency. BEIS have published proposals for a
new in-use performance rating for commercial and industrial buildings over
1,000 square metres, with a view to introducing standards on in-use
performance based on the successful Australian NABERS scheme and inline with our advice. Success relies on absorbing lessons from the originalscheme, including the role of public procurement in establishing thestandard.

•

Metrics. UK Government published the EPC action plan examining the steps
needed to improve the reliability, impact, and data infrastructure of EPCs.
The Scottish Government also committed to consult on proposed reforms to
EPCs in 2021.

•

New buildings. UK Government has announced an interim standards uplift
for new homes to apply from 2021, and proposed to legislate in 2024 for the
Future Homes Standard to be introduced in 2025. This standard will require
carbon savings of 75% relative to today and the Government plans to
consult on whether to end gas grid connections to new homes built from2025. UK Government have also consulted on the Future Buildings Standard,with implementation proposed as starting in 2025. Consultations have also
been undertaken in the devolved administrations, with the Scottish
Government targeting new buildings consented from 2024 for zero
emissions heating (and cooling).

A range of commitments here and elsewhere have been made around requiring homes to meet an EPC C
standard, which is broadly consistent with the level of home insulation in our pathways, provided EPCs are made fit
for purpose. This means that they must be designed to drive deployment of the necessary energy efficiency
measures - all practicable lofts and cavities insulated alongside other low-regret measures, with solid wall insulation
deployed where this supports low-carbon heat and wider benefits; to do so on a holistic basis (i.e. to address issues
such as overheating and ventilation simultaneously); whilst not disincentivising low-carbon heat or treating onsite
generation as a replacement for energy efficiency or low-carbon heat. See below for further discussion.

Climate Change Committee•

Low-carbon heat. The Scottish Government have proposed regulations torequire installation of zero or near zero emissions heating in existing buildings
at trigger points (such as heating system replacement) from 2025, with abackstop requirement for all buildings to meet this standard no later than
2045. UK Government have set an ambition for all newly installed heating
systems from the mid-2030s to be low carbon, or appliances which can beconverted to a clean fuel supply. UK Government have also announced an
ambition to deliver 600,000 heat pump installations per year by 2028,
alongside plans for hydrogen trials from 2023 and a plan to consult on therole of hydrogen-ready appliances. The details of the Green Gas Support
scheme, supporting biomethane, have also been announced.

•

Heat networks. BEIS is finalising proposals for the £270 million Green Heat
Network Fund, which will shift the focus away from gas Combined Heat andPower to lower-carbon networks. The Heat Networks Bill is going through the
Scottish Parliament, including ambitious proposals for zoning.

•

Skills. The Green Jobs Taskforce was launched, with a commitment topublishing an action plan this spring.

•Wood in construction. The England Trees Action Plan commits Government
to developing a policy roadmap on use of timber in construction, toincrease public demand for sustainably sourced timber throughprocurement policies and to conduct further research.

A full table of progress to date against the CCC’s previous recommendations canbe found in supplementary material published alongside this report. It should be
noted that the ratings are assigned on the basis of UK progress, reflecting the
majority position. For this reason they often do not, in isolation, reflect the pace ofprogress in the devolved administrations. Nevertheless, following publication of the
Draft Heat in Buildings Strategy, it remains the case that Scotland demonstrates astrong example of action to develop an effective policy framework. We willcomment on progress in Scotland in more detail in our Scottish Progress Report inlate 2021.
While important progress on ambition has been made or is imminent, effective
policy has yet to be designed or implemented in many areas.
HM Treasury committed over £3billion of public funding in the2020-21 financial year tobuildings decarbonisation aspart of the Green Recovery.
This included over £1 billion for
public sector decarbonisation,
alongside home efficiency
schemes.

Delivery and the Green Recovery
The case for investing in buildings retrofit as part of economic recovery remains
strong – there are major benefits in terms of emissions reduction, cost savings andwider benefits; it is labour-intensive and spread across the country. Fundamentally
this is something that needs to happen on the path to Net Zero and supply chainsare well below the levels they need to be at in order to deliver Government
commitments on fuel poverty, energy efficiency and heat over the next decade.

Significant time pressure andissues with the private sector
contractor led to the £1.5 billion
Green Homes Voucher scheme
being scrapped prematurely
with only £264 million allocatedto date.

In recognition of these points, Treasury committed over £3 billion of public funding
in the 2020-21 financial year, including over £2 billion grant funding for home retrofitand £1 billion funding for public sector decarbonisation.
The very significant time constraints for spending the funding have led to mixed
results, with severe consequences for the Green Homes Grant voucher schemedue to the requirement to undertake the work before payment is issued:•

Where the decision was taken to commit spending by the end of thefinancial year but actually undertake the work in 2021/22, funds weresuccessfully committed. This includes the £1 billion Public Sector

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Decarbonisation Fund, the £500 million Local Authority Delivery programme
for the Green Homes Grant, focussed on fuel poor, and the £50 million
Social Housing Decarbonisation Fund Demonstrator.
•

It is essential that lessons arelearnt. Government must now
come forward with plans for a
successor scheme in the next
fiscal event, committing tolong-term funding and taking
sufficient time to develop andtest a scheme so that we get
one which works.

The £1.5 billion Green Homes voucher scheme was conceived as the only
direct-to-household offer, with a requirement to undertake the work within
the 2020/21 financial year. Major delivery issues with the private sector
administrator led to the scheme cancellation in March 2021 with only £264
million allocated to date (of which £211 million to low income
households). 23 The Government has agreed to honour existing vouchers
meaning a portion of the spend will fall under the 2021/22 financial year.

To avoid further harm to supply chains at this stage, it is essential that Government
comes forward with plans for a successor to the Green Homes Grant voucher
scheme in the next fiscal event– ensuring this time that it is thoroughly tested,
provides a long-term funding commitment, and builds on lessons learnt (Box 4.3).
The initial success of the public sector scheme means that there is a template tobuild on now. Our scenarios imply funding levels of £1 billion a year through thenext decade, with a growing role for low-carbon heat alongside energy efficiency.
The next stages must now pivot to longer-term planning cycles, with clear roles for
local authorities backed by funding, and strong integration with wider heat policy
including the heat networks roll-out. The funding streams must also be designed so
as to be accessible to smaller public bodies, who anecdotally have not had theresources to bid into the Public Sector Decarbonisation Scheme and who havebeen affected by the merging of Salix funding with this pot.*

For the public sector, the key ismoving now to longer termplanning cycles, with clear roles
for Local Authorities backed byfunding, and strong integration
with wider heat policy including
the heat networks roll-out.

Box 4.3
Lessons from the Green Homes Grant
The £1.5 billion Green Homes Grant voucher scheme opened for applications in
September 2020, a few months after it was announced by the Treasury. It is the firstpublicly funded direct-to-household offer on home energy efficiency since the demise of
the Green Deal scheme in 2015.
The scheme aimed to improve the energy efficiency of over 600,000 homes, with grants
focussed on fabric efficiency measures and low-carbon heating primarily. Grants of up to£5,000 were issued, covering two-thirds of the cost. Households in receipt of certain
benefits were eligible for grants of up to £10,000, covering 100% of the cost of
improvements.
Lessons for the successor scheme
There are a number of important lessons to take into account in the design of a successor
scheme, along with an important positive story on demand:

*

167

•

Demand for the scheme. The scheme generated a significant amount of interest
from the public, with close to 2 million views of the Simple Energy Advice GHG
eligibility checker in a 4-month period and 170,000 measures applied for over sevenmonths. By comparison, only 20,000 measures were funded through Green Dealloans between 2013 and 2015. Media reports covered people unable to apply due
to the lack of local approved suppliers. The fact that it was announced by theTreasury may have helped raise the profile, along with the relative simplicity of thebasic offer to consumers.

•

Timelines and the need for a policy package approach. From the outset there werecalls for the Treasury to extend the funding window beyond March 2021 to allow
supply chains time to scale up and provide more certainty to businesses to invest,
develop and retain skills in the sector. These calls were backed by significant

Salix funding provides Government funding to the public sector to improve energy efficiency, reduce carbon
emissions and lower energy bills. Salix is funded by the Department for Business, Energy and Industrial Strategy, theDepartment for Education, the Welsh Government and the Scottish Government.

Climate Change Committee

evidence of the negative impacts on home insulation markets from short-term
subsidy schemes in England and Wales, including job losses of 30,000 following theend of the Green Deal. There is also evidence of poor-quality installations linked tothe surge in funding in the final year of the Supplier Obligation schemes, which shows
the impact of scaling up too quickly without the skills in place to deliver. Government
can move forward by announcing a successor scheme in the next fiscal event
alongside proposals for a timetable of standards, with funding designed to support
market stability and long-term investment planning.
•

The need for testing with installers. The timelines for getting the scheme up andrunning also put pressure on scheme development. In the £50 million Social Housing
Decarbonisation Fund Demonstrator fund launched in parallel, market testing had
already taken place through the Whole House Retrofit competition meaning there
was evidence to draw on. A key learning from the Green Homes Grant voucher
scheme is the need to workshop the consumer journey and practicalities with agroup of installers/practitioners covering the core trades. This could have flagged anumber of issues with the IT system including (but not limited to) the importance ofbeing able to track existing applications, the difficulties with delivery around
Christmas, and ways to streamline evidencing so as not to rely on consumers acting
following installation.

•

Procurement and use of existing systems. The issues with the scheme contractor are
currently subject to review by the National Audit Office (NAO). There remain
important questions over the procurement and contracting, as well as the decision
not to make use of existing IT systems such as the one used on the ECO scheme, or to
make more use of existing commercial relationships and expertise, including throughlocal authorities.

•

Accreditation. Households need to be confident that when they upgrade theirproperty they will see genuine improvements and technology that works.
Government has undertaken a considerable programme of work following therecommendations of the 2014 Each Home Counts review to improve standards andaccreditation, notably through its support of the PAS2030 and PAS2035 standards
overseen by Trustmark. The Microgeneration Certification Scheme (MCS) similarly has
accredited installers of low-carbon heat under the Renewable Heat Incentive.
However, there were a number of issues with the accreditation process for Trustmark,particularly for low-carbon heating measures already covered by MCS which
created bottlenecks in the supply chain and meant that consumer demandremained unmet, with strong geographical variation.

It is essential that these lessons are taken into account in a successor scheme to create along-term stable market which can deliver the major upgrade of the housing stock to
EPC C over the next decade.
Source: BEIS (2020) Press release: Greener homes, jobs and cheaper bills on the way as Government launches
biggest upgrade of nation's buildings in a generation; BEIS (2021) Official Statistics - Green Homes Grant voucher
release, May 2021

ii) Next steps for buildings decarbonisation
Major gaps include a clear
trajectory of standards on
efficiency and heat; funding
proposals and interventions tomake low-carbon choices
attractive; green buildings
passports and a governanceframework to drive decisions onheat infrastructure and zoning
from the mid-2020s. including arole for area-based energyplans.

As part of our Sixth Carbon Budget advice we set out our view of the fournecessary components of a policy package for the decarbonisation of heat inbuildings: setting a clear direction, making low-carbon financially attractive,
implementing enabling measures, and getting on with it.
As summarised above, a number of important commitments have been madeover the past year, but important gaps also remain at a UK level in every area:•

A clear direction. We do not yet have a long-term trajectory of standards inplace to deliver the efficiency upgrades and fossil fuel phase-out that isneeded. There is not yet a sufficiently strong commitment to the role ofelectrification – in particular, the current Government ambition of 600,000
heat pumps a year by 2028 will almost certainly fall short of the 2030 NDC

Progress in reducing emissions: 2021 Report to Parliament

168

target (given the lack of any stated ambition on heat networks) as well as
falling short of the Committee’s pathway to meeting the Sixth Carbon
Budget.
There is no support in place
now for commercial heatpumps over 45kW – a key
supply chain.

•

Making low-carbon financially attractive. There is currently no plan for how
price signals will be reformed to drive low-carbon choices (i.e. to correct
the current distortions that work against electrification), and a number ofexisting funding routes are set to fall away. A multi-year programmatic
funding regime is needed to replace them. In particular, there are majorrisks given the lack of support mechanism for commercial heat pumps over
45 kW after the Renewable Heat Incentive closed to new applications.
Grants of up to £4000 are unlikely to be sufficient for medium-sized
installations up to 45 kW given capital costs of £750-1550 per kW.* Equity
and consideration of the fair distribution of costs will be critical to designing
the price signal reforms and funding programmes necessary.

•

Enabling measures. While progress has been made, more is needed toensure householders have access to high quality information and can haveconfidence that work will be delivered to high standards. The forward
roadmap should include plans for incorporating in-use performance andtransitioning to green building passports.

EPCs are not fit for purpose –EPCs
are not
fitessential.
for purpose –furtherreformsarefurther reforms are essential.

– Government plan to increase the reliance on EPCs as a key policy
lever. As such it is critical they are made fit for purpose, robust andenforceable and make use of energy consumption data. The EPC
action plan is a positive step forward but further action is needed toensure EPCs and Standard Assessment Procedure (SAP) deliver theenergy efficiency measures needed and do so in a holistic way which
supports (rather than disincentivises) low-carbon heat deployment
and actively drives measures to simultaneously address ventilation,
damp and overheating (rather than simply communicating risks).
Onsite generation, such as solar PV, should not be treated as a
substitute for energy efficiency or low-carbon heat, and needs to bevalued proportionately to its benefits (factoring in seasonality and any
on-site storage). Biomass boilers must not be encouraged in areas
where they will impact public air quality and biofuels in buildings
should be minimised (for example, through efficient use in hybrid heatpumps rather than ‘drop-in’ biofuel boilers) given our assessment of
economy-wide best use being elsewhere.

Other barriers need to beaddressed, including poor
compliance and enforcement
and the risk of high connection
charges.

– The reforms in the Buildings Safety Bill create a framework to improvethe efficacy of building regulations, including those relating to climatechange mitigation and adaptation. 24 This should be strengthened
through an explicit responsibility for sustainability alongside buildings
safety and performance. It will be important to ensure the buildings
safety regulator is sufficiently equipped to monitor and enforce
compliance across all building regulations and to ensure that local
authorities are properly funded for enforcement activities.
– Barriers to deployment of key measures, such as the risk posed by thecurrent connection charging regime to the uptake of low-carbon
technology such as heat pumps, need to be addressed.

*

169

Range based on an air-to-air heat pump at the lower bound, and a low-temperature air-to-water heat pump at theupper bound, Sixth Carbon Budget published dataset, available online.

Climate Change CommitteeIt will be difficult if not
impossible to develop the fullmix of heat options (i.e. lowcarbon heat networks andhydrogen alongside buildingscale technology) without any
planning or clear roles for local
authorities, networks and otheractors.

•Getting on with it. Recognition is needed of the importance of ageographically planned approach to heat decarbonisation, with plans
introduced to deliver it. Commitments are lagging in areas with potential
for early progress.
– There is an urgent need to formalise a governance framework to drive
decisions on heat infrastructure and zoning from the mid-2020s,
including a role for area-based energy plans. This should beunderpinned by a programme of research initiated in 2021 to identify
areas unlikely to be suitable for hydrogen (a key enabler to efficiently
targeting early electrification and network development) alongsidepriority candidate areas for hydrogen.
– Levers such as the 2021 buildings standards uplift have potential to drive
early growth in heat pumps, but it remains unclear to what extent they
will do so.

The priority now must be on implementing a comprehensive policy package, andenshrining the long-term standards framework in regulation and law, to finalise theroadmap for decarbonising the UK building stock.
Climate adaptation andresilience is an essential part ofthis, including good ventilation
to manage overheating risks,
green sustainable urban
drainage systems and water
efficiency measures.

Progress in decarbonising buildings must go hand in hand with adapting them tothe changing climate. An integrated approach to housing and thermal comfort isrequired to manage overheating risk and ensure good ventilation.* Programmes toimprove energy efficiency of the housing stock provide an opportunity also toundertake work to adapt properties to possible heat and flood risks and improvewater efficiency.

c) Manufacturing and construction
This year has seen a substantial increase in the Government’s stated ambition on
decarbonisation of manufacturing. However, progress on developing anddelivering policy has been slower than required with large gaps in policy
remaining.

i) Progress in the past year
The Government’s Industrial
Decarbonisation Strategy set
out ambition to reduce
emissions from manufacturing
and refining by around two
thirds by 2035 from 2018 levels.

In March, the Government’s Industrial Decarbonisation Strategy (IDS) set out
ambition to reduce emissions from manufacturing and refining by around two
thirds by 2035 from 2018 levels. This represents a substantial step forward in the
Government’s ambition, but it is still below the CCC pathway, in which theequivalent emissions are reduced by 73% by 2035.
Underlying this ambition, the Government has made several commitments in thepast year to deliver fuel switching, CCS and energy and resource efficiency,
through the IDS, Waste Prevention Programme and business model updates.
•*

Fuel switching. The IDS set an ambition that at least 20 TWh of fuel use willswitch to low-carbon energy by 2030, which is close to, but below, the 24.5
TWh in the CCC pathway.

High levels of energy efficiency measures installed in new and existing homes can increase the retention of heat
and airtightness of the building. This can increase the risk of overheating and exposure to indoor air pollutants if
appropriate adaptation and ventilation measures are not implemented at the same time.

Progress in reducing emissions: 2021 Report to Parliament

170

– Hydrogen. Government has committed to consult on a hydrogen
supply business model that would incentivise hydrogen use bysubsidising the cost of hydrogen production.
– Electrification. Government has made a smaller commitment to ‘set out
initial steps to support uptake of electrification’. It also committed to
publish a call for evidence on energy affordability and fairness, by April
2021, which may consider the distribution of energy levies and taxes.

Government has set out a‘minded to’ business model forindustrial carbon capture, but
only and small commitment to‘set out initial steps to support
uptake of electrification’.

– Mandatory requirements. Government has committed to explore theoption of making it a mandatory requirement for upgraded equipment
to be low-carbon ready in the 2020s, which is also likely relevant to CCS.

The Waste Prevention
Programme consultation
proposed policies to improve
resource efficiency.

•

CCS. The IDS set an ambition for around 3 MtCO2e of industrial CCS by 2030,
which is broadly in line with the CCC pathway* The Government also set
out a ‘minded to’ position for an industrial carbon capture business model,
although some aspects of the model are yet to be detailed.

•

Resource and Energy Efficiency. The Waste Prevention Programme
consultation proposed policies to improve resource efficiency, although thesectoral scope of these proposals is often limited, the pace of proposals
modest and the emissions impact is not estimated. Further details are set
out in sub section (f) on waste. Government also agreed an updated set of
Climate Change Agreements with industry to encourage energy efficiency.

•

Material Substitution. The England Trees Action Plan commits Government
to developing a policy roadmap on use of timber in construction and toincrease public demand for sustainably sourced timber throughprocurement policies.

Government has also set out several plans that could provide cross-cutting support
for different decarbonisation measures and maintaining industrial competitiveness:

Government has committed toconsult on a target-consistentcap for the UK ETS and a callfor evidence on productstandards.

•

Carbon and energy pricing. The UK Emissions Trading System (UK ETS)
launched at the start of the year. Government has committed to consulting
by September 2021 on a cap for the UK ETS consistent with the Sixth Carbon
Budget.

•Product standards. Government has committed to a call for evidence on
low-carbon industrial product standards within a year, highlighting thepotential for mandatory standards to be introduced in the mid-to-late
2020s.

Government has made mixed progress with awarding existing capital funding.
£170 million was awarded from the Industrial Decarbonisation Challenge, but
progress awarding funding from the £315 million Industrial Energy Transformation
Fund has continued to be too slow since its announcement in October 2018 andthe £250 million Clean Steel Fund appears to have made no progress.
Overall, while progress has
been made, development anddelivery of policy todecarbonise manufacturing
and construction will need tobroaden and accelerate.

Overall, while progress has been made, development and delivery of policy todecarbonise manufacturing and construction will need to broaden to fill several
policy gaps, and accelerate if it is to deliver abatement levels consistent with the
CCC pathway.

*

171

Note that this 3MtCO2e of CCS includes CCS on refineries which falls within our Fuel Supply sector. We havecompared to our pathway on an equivalent basis.

Climate Change Committeeii) Next steps on manufacturing and construction policy
Our Sixth Carbon Budget policy report set out the core requirements of a policy
package for decarbonising manufacturing and construction. In this subsection, we
set out key near-term policy actions required to deliver the longer-term actions
recommended in our Sixth Carbon Budget advice. Full details are set out in thetables of departmental policy recommendations at the end of this report. These
policy actions should address the shortfalls of existing decarbonisation policy for
manufacturing and construction, and ensure longer-term policy has the rightambition, delivers key measures, strengthens incentive mechanisms, maintains
industrial competitiveness, and develops infrastructure and skills.
Ambition
Government has stated that it will revisit its ambition for decarbonisation of
manufacturing and refining in its Net Zero Strategy. It should take this opportunity toalign its ambition with the CCC pathway for manufacturing or identify other areasof the economy to make up for this shortfall. The strategy must also set out theGovernment’s ambitions and plans to decarbonise off-road mobile machinery.
It should also set out which policies will enable this ambition and quantify how
much abatement Government expects to be enabled by each policy, particularly
for resource and energy efficiency abatement through the 2020s.
Government should establish
incentive mechanisms to
support fuel switching,implementing CCS proposals
and initiating the developmentof standards to improve energy
and resource efficiency.

Government should also work
towards strengthening its crossmeasure incentive mechanisms
and start to develop the crucial
framework for maintaining
long-term competitiveness,
which will require developmentof measurement standards.

Delivering specific measures
Government should establish incentive mechanisms to support fuel switching,implementing CCS proposals and initiating the development of standards toimprove energy and resource efficiency. The Government should:•

Establish funding mechanism(s) to support operational and capital costs ofboth electrification and hydrogen use in manufacturing, as soon as
possible, with the aim of awarding funding in 2022. It should also deliverindustrial carbon capture contracts to enable final investment decisions on
the first industrial carbon capture projects in the first half of 2022.

•

Consult on detailed proposals for product standards and extended
producer responsibility to improve the resource efficiency of consumer
goods’ lifecycles by spring 2022. It should also implement policies to drive
more resource-efficient construction and use of existing low-carbon
construction materials, including a substantial increase in the use of timberin construction, on the same timetable. This should include finalising thereporting methodology for whole-life carbon standards for buildings, roads
and infrastructure.

Cross-cutting incentives and maintaining competitivenessGovernment should also work towards strengthening its cross-measure incentive
mechanisms and start to develop the crucial framework for maintaining long-termcompetitiveness, which will require development of measurement standards.
The Government should:•

Set a cap for the UK ETS consistent with the path through the Sixth Carbon
Budget to Net Zero. It should also reform energy and carbon pricing for
manufacturers not covered by the UK ETS, to provide a clear andstrong incentive for decarbonisation.

Progress in reducing emissions: 2021 Report to Parliament

172

Implementation of
manufacturing
decarbonisation will requiredevelopment of supporting
policies on infrastructure andskills and a focus on jobs.

•

Consult on reforms to electricity pricing to remove disincentives toelectrification, based on consideration of the strategic and fair allocationof legacy policy costs associated with past deployment of less-mature lowcarbon electricity generation. It should also consider the balance ofexisting taxes, such as the Climate Change Levy, on different energy
sources.

•Start to develop the options of applying either border carbon tariffs orminimum standards to imports of selected emissions-intensive products. Thisshould include developing carbon-intensity measurement standards,
encouraging the international development of these (e.g. through the G7
and COP26 presidencies) and fostering international consensus aroundtrade policies.

Infrastructure, skills and jobs
Implementation of manufacturing decarbonisation will require development of
supporting policies on infrastructure and skills, and a focus on jobs. The
recommendations tables in the annex of this report detail our recommendations in
full, capturing their cross-sectoral and cross-departmental nature:•

On infrastructure, Government should deliver the CCS Transport andStorage Regulatory Investment Model; develop plans for CO2 transport fromdispersed sites; deliver plans to ensure electricity networks canaccommodate large localised increases in demand; and formalise theprocess for decisions on the conversion to hydrogen of (zones of) the gas
networks.

•

On skills and jobs, Government should develop a strategy for thedevelopment and roll-out of manufacturing training and skills and designindustrial decarbonisation policies to support and create jobs, especially inregions with reliance on industrial jobs.

d) Agriculture and land use
While the UK Government and the devolved administrations have set out elementsof their ambition to reduce emissions from land, there has been limited
implementation of policy in these sectors over the past year. Key announcementson peat and trees in England were published in their respective Action Plans in
May 2021. 25i) Progress in the past year
UK Government’s afforestation
targets are in line with the CCC
pathway for 2025.

173

Trees
The UK Government has committed 26 to the planting of 30,000 hectares ofwoodland per year by 2025 across the UK, in line with the CCC pathway:•

England’s share is around 7,000 hectares per year based on Defra’scommitment to treble tree planting rates from the 2,340 hectares achievedin 2019/20.

•

The Scottish Government intends to deliver 18,000 hectares per year by2024/25. 27 The Welsh Government’s current ambition remains at 2,000
hectares a year, with a commitment to increase that to 4,000 hectares by

Climate Change Committee

an unspecified time. Northern Ireland’s target of 18 million trees during thisdecade averages 900 hectares per year.28£500 million of funding has
been committed through the
Nature for Climate Fund tomeet England’s woodland
creation target. Scottish
Forestry will receive £100 million
to reach its afforestation target
and Northern Ireland launcheda £4 million Small Woodland
Grant Scheme.

£500 million from the Nature for Climate Fund will be the main source of publicfunding to meet England’s woodland creation target to 2025. This will provide
grants for conventional planting in urban and rural areas (including trees on farms),
as well as natural colonisation. Focus will be given to the planting of native
broadleaves, and extra funding will be provided for planting that can deliver wider
benefits such as riparian shading (trees planted along water courses can reduce
the risks to freshwater species from higher water temperatures), biodiversity, water
filtration and flood risk alleviation.
To meet the 2024/25 afforestation target in Scotland, Scottish Forestry will receive£100 million, £30 million will go to Forestry and Land Scotland and £20 million to
boost tree nursery capacity. Northern Ireland launched the £4 million Small
Woodland Grant Scheme at the end of 2020 to encourage the integration of trees
on farmland.
Peat
Defra’s new £50 million Nature for Climate Peatland Grant Scheme funded by the
Nature for Climate Fund will support the Government’s target for restoring 35,000
hectares of peatland in England by 2025. Of this area, around 5,000 hectares is
expected to come from the restoration of lowland agricultural land to peat
habitat.

The Government’s peat
restoration commitments forEngland falls short of the CCC
pathway.

The Government’s partial ban
on rotational burning of peat isless ambitious than the CCC’s
recommendation that allburning in England and thedevolved administrations
should cease immediately.

This falls short of the Committee’s pathway for the restoration of 56,000 hectares ofpeatland in England by 2025, which includes 8,000 hectares of lowland rewetted
to peat habitat. Defra is expected to publish details on the options to manage
sustainably the area of lowland peat that remains in agriculture in 2022.
Legislation introduced in May 2021 prevents the rotational burning of certain
blanket bog sites in England with immediate effect. * The partial ban covering an
area of around 142,000 hectares accounts for around 40% of all blanket bog in
England. 29 Of the area covered by the ban, around 52,000 hectares hold a live
consent to burn, with the remainder either being subject to a consent that is not
exercised or has no current relevant consent. This partial ban is less ambitious thanour recommendation that all rotational burning in England and the devolved
administrations should cease immediately. Data on the area of land that is burned
each year is poor as the requirement to notify the authorities only covers newer
consents.
The sale of peat in compost is to end in England by 2024 subject to a consultation
later this year on a range of measures to achieve this. The consultation will also
consider extending the sales ban to the professional market, by an as yet
unspecified date. These proposals are less ambitious than our recommendationthat all peat extraction, along with its sale in both the amateur and professionalhorticultural market should end by 2023. This should also apply to imported peat,which makes up two-thirds of peat sold in the UK.
In Wales, between 600-800 hectares of peat will be restored annually between
2020 and 2025 under the Government’s National Peatland Action Programme(NPAP). Launched in November 2020, around 680 hectares was directly delivered
through the NPAP in 2020/21.

* Sites of Special Scientific Interest that are also a Special Area of Conservation or a Special Protection Area.

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174

Pilots focused on delivering
eight land-based
management standards arebeing funded through the
Sustainable Farming Incentive
ahead of national roll-out in
2022.

Agriculture
Defra is funding pilots under the Sustainable Farming Incentive (SFI) this year aheadof a national roll-out in 2022. The SFI, which is part of the new Environmental Land
Management Scheme (ELMS) will see farmers pilot actions focused on delivering
eight land-based management standards covering arable land, grasslands,horticultural soils, hedgerows, agroforestry and water buffers. In addition todelivering emissions reduction and carbon sequestration, many of the actions will
deliver other benefits such as improved wildlife habitat, reduced diffuse waterpollution and improvements to air quality.
The Welsh Government introduced legislation to extend coverage of Nitrate
Vulnerable Zones to all of Wales in line with our recommendation. In force sinceApril this year, mandatory measures covering manure management and fertiliser
use to reduce nitrate run-off into water courses will also deliver reductions in N2Oemissions.
NatureDefra recently announced it will be amending the Environment Bill to require alegally-binding target for species abundance, aiming to halt the decline of natureby 2030. 30 This will apply to species within protected sites, the wider countryside
and urban areas. The exact target level and broader details will be set insecondary legislation following consultation and further evidence gathering.

ii) Next steps for decarbonising agriculture and land use
Ambition in England and thedevolved administration falls
short of what is needed toachieve the Sixth Carbon
Budget and Net Zero. Gaps
must be addressed quickly
given the time profile of carbon
sequestration.

175

Existing ambition in England and the devolved administrations falls short of the
trajectory needed to meet the Sixth Carbon Budget on the path to Net Zero.
Ambition needs to be raised and gaps addressed quickly as delayed action now
puts future targets at risk given the time profile of carbon sequestration. Policy
voids should be addressed quickly (e.g. what will replace the Common Agricultural
Policy in Scotland and Northern Ireland):•Defra and the devolved administrations should set out targets for woodland
creation and peat restoration beyond 2025. These bodies should work
together to ensure that the combined levels are in line with the UK ambition
set out in our Sixth Carbon Budget Advice (e.g. 30,000 hectares of new
woodland each year from 2025, increasing to 50,000 hectares in 2035).

•

Authorities should develop and implement further mechanisms to leverage
private sector finance to help support woodland creation and peat
restoration targets in England and the devolved administrations. This
includes increasing participation in the Woodland Carbon Guarantee, andassessing the scope for and merits of including trees and peat in the UK
Emissions Trading Scheme. Further development of the Peatland Code isneeded to widen eligibility to a range of peatlands and enableaccreditation by the UK Accreditation Service.

•

The Sustainable Farming Incentive pilots are currently focused on land
management actions. The pilots should be extended to include the fullrange of available low-carbon farming measures set out in our Sixth Carbon
Budget advice, aimed at reducing other sources of emissions (e.g. entericemissions from cattle and sheep). Future piloting of the Local Nature
Recovery and Landscape Recovery schemes, which make up the othertwo ELM schemes should incentivise landscape-scale change such asafforestation and peat restoration.

Climate Change Committee

Gaps in ambition and policy
include targets for woodland
creation and peat restoration
beyond 2025; extending the
Sustainable Farming Incentive
pilots to additional low-carbon
farming measures; expediting
legislation to ban rotationalburning of all upland peat andending the sale of peat for all
horticultural use by 2023.

•

Legislation to ban rotational burning of all upland peat sites in England (andelsewhere in the UK) should be expediated to come into force before thestart of the burn season in October 2021. The ban on horticultural peat sales(including imports) should cover both the amateur and professional
markets and be brought forward to start in 2023 – a year earlier thanplanned. Damaging peat extraction practices should stop for all uses by2023. These recommendations apply to all of the UK.

•

The ongoing Industrial Strategy Fund for agriculture (i.e. Transforming Food
Production Challenge), and the roll-out of future productivity schemes suchas Defra’s Farming Investment Fund and the Innovation Research andDevelopment Scheme must cover funding of measures to improve
agricultural productivity while reducing the GHG impact of farming.

•

Measures to address non-financial barriers to increase the take-up of lowcarbon farming practices and land-use change need to be addressed. For
example, both England and Scotland’s respective Plans identified a rangeof barriers that could impede the planting of more trees, and work must
now proceed to find solutions to address these.

•

The Scottish Government should develop a new rural support scheme thatbuilds towards its climate goals. The Northern Ireland Executive should set
out the future direction of its post-CAP policy and how this will be used todeliver emissions reduction and carbon sequestration in the sector.

e) Electricity Supply
The Sixth Carbon Budget report set out the key elements of a policy package tofully decarbonise electricity generation. That includes the need to follow the coalphase-out with phase-out of unabated gas generation while keeping pace withgrowing demand from electrification, by deploying variable renewable generation
at scale, developing markets for dispatchable low-carbon capacity, and ensuringthat the enabling infrastructure and market arrangements are in place toaccommodate this.

i) Progress in the past year
The main policy developments in the past year have been the publication of theGovernment’s Ten Point Plan and Energy White Paper, which committed toincreasing the capacity of offshore wind significantly over the coming decade.
Progress was also made around the processes for delivering this, and on thelonger-term future of electricity markets.
The Government has
committed to increasing
offshore wind capacity from 10
GW today to 40 GW by 2030,
and to support power CCUS
and additional nuclear
investment.

•

Ten Point Plan and Energy White Paper. These included headline
commitments to increase the level of offshore wind capacity four-fold by2030, to make onshore wind and solar eligible for low-carbon contracts
once more, and to take forward carbon capture utilisation and storage(CCUS), nuclear, and demand-side flexibility.
– Offshore wind. The Government committed to increasing capacity ofoffshore wind from 10 GW today to 40 GW by 2030. That includes 1 GW
of floating offshore wind, which is likely to be increasingly important
over the period to 2050.
– Low-carbon auctions. The Government confirmed that the fourthround of auctions for low-carbon electricity will take in place in late
2021. These will now include onshore wind and solar, and the capacity

Progress in reducing emissions: 2021 Report to Parliament176limit has been doubled to 12 GW compared to the last auction roundin 2019.
– Power CCUS, nuclear, and demand-side flexibility all featured
additional commitments to:• Support at least one power CCUS project by 2030. Currently, only
new power plants above 300 MW are required to be CCS-ready. The
White Paper commits to removing this distorting threshold.
• Bring at least one large-scale nuclear plant to point of Final
Investment Decision this Parliament, and to provide up to £385
million of funding to develop a Small Modular Reactor (SMR) design
and to build an Advanced Modular Reactor (AMR) demonstrator.
• Publish a new Smart Systems Plan and a new Energy Data Strategy
in 2021, to unlock more of the potential for demand-side flexibility.
The Government has
commissioned a review of theregime for connecting offshore
projects to the onshore
network.

•

Offshore Transmission Network Review. Following our recommendation in
the 2020 Progress Report, the Government has commissioned a review of
the regime for connecting offshore projects to the onshore electricity
network. This will explore whether a more coordinated approach forconnections would be cost-effective in the context of increased ambition
for offshore wind.

•

Call for evidence on market design. A future electricity system with highshares of variable renewable generation is likely to require a different
market design compared to the current arrangements. This call forevidence aimed to understand more about how to continue to maintaindeployment of renewable generation at scale while minimising costs andsupporting innovation in a high-renewable system.

ii) Next steps for decarbonising electricity generation
The Ten Point Plan and Energy White Paper made a significant step towards a lowcarbon electricity system with the commitment to 40 GW of offshore wind by 2030.
However, gaps remain and further policies are needed to meet the Sixth Carbon
Budget. Priorities include:
The Government shouldcommit to phasing-out the useof unabated gas for electricity
generation by 2035, subject toensuring security of supply.

•

Unabated gas phase-out. The Government should commit to phasing-out
the use of unabated gas for electricity generation by 2035, subject toensuring security of supply. It should publish a comprehensive long-term
strategy in 2021 for achieving this. That should include through developing
and deploying CCUS and hydrogen in electricity generation, and by
ensuring new gas plant are properly CCUS- and/or hydrogen-ready as soon
as possible and by 2025 at the latest.

Barriers to delivery will need tobe addressed, and investment
will be needed to ensure
networks can accommodate
higher demand.

•

Renewables delivery. While the Government has committed to regularauctions for low-carbon electricity, it should set out a schedule and clear
pathway of volumes to be procured in order to provide visibility to the
supply chain. It will need to address potential barriers to deploying andusing low-carbon generation at scale (e.g. the planning and consenting
regime for renewables and networks).

•

Networks. The CCC Pathway has a 50% increase in electricity demand by2035 and a two-to-three-fold increase by 2050 as the economy increasingly
electrifies. The Government will need to work with Ofgem to deliver the177

Climate Change Committee

strategic investment required to ensure that electricity networks canaccommodate this.
The Government should startplanning for the market
arrangements needed for a
fully decarbonised electricity
system in the 2030s.

•

Market design. Given lead times for potential changes to market
arrangements, the Government will need to go beyond their recent call forevidence and develop a strategy as soon as possible on market design forthe medium- to long-term for a fully decarbonised, resilient electricity
system in the 2030s and onwards.

f) Fossil fuel supply
We previously set out the core requirements of a policy package for fuel supply in
the Sixth Carbon Budget Policy report.

i) Progress in the past year
The key development in the past year has been the North Sea Transition Deal
(NSTD), which commits to reducing the greenhouse gas footprint of North Sea oil
and gas production and processing by 50% by 2030 relative to 2018 levels. Thistarget is less ambitious than our Sixth Carbon Budget recommendation of reducing
emissions by 68% for the same period (Figure 4.4). We strongly advise that ambition
on reducing emissions from North Sea fossil fuel production and processing bestrengthened to be consistent with the CCC Pathway and the Sixth Carbon
Budget:
The targets of the North Sea
Transition Deal should be
strengthened.

•

The commitment for a reduction in emissions occurs in the context ofdeclining oil and gas production in the North Sea. While it is difficult toforecast precise levels of production out to 2030, our baseline scenario –before actions to reduce the footprint of production – implies a 37%
reduction in emissions by 2030 on 2018 levels.

•

Electrification offers opportunities to reduce emissions from fossil combustion
emissions associated with oil and gas production, by a further 17% of 2018
emissions. However, the degree of electrification assumed in the NSTD
targets falls short of our estimate for cost-effective action. Stronger action isneeded to reduce the emissions footprint of fossil fuels consumed in the UK.

•

The CCC Pathway sets out a further 8% of emissions reductions from 2018
levels through measures to reduce flaring and venting. The NSTD also falls
short of this level of ambition – by aiming to only permit flaring and venting
for safety reasons by 2030. We have recommended this should be done by2025, which would contribute to accelerating the pace of emissions
reductions in the sector.

•

The announcement of ‘climate compatibility checkpoint’ reviews prior tolicensing rounds can ensure new fossil fuel production is consistent with the
UK’s climate commitments, including zero direct emissions from energy use
by 2027. These reviews would need to present a transparent and coherent
case for there to be a potential justification for proceeding with newlicenses.

Progress in reducing emissions: 2021 Report to Parliament

178

Figure 4.4 Emissions reductions in oil and gas
production and processing in the CCC Pathway& the North Sea Transition Deal
25

Emissions Mt CO2e

20

15

10

Sources of abatement

North Sea
Transition Deal¹

CCC Pathway

Resource
efficiency

EnergyEfficiency

Reduced methaneleakage

Reduced methane
flare and ventHydrogenElectrification

Baseline emissions
reductions

0

2018 emissions

52030 emissions

Source: CCC analysis, BEIS (2021) North Sea Transition Deal.
Notes: Abatement in oil and gas production reflects emissions reduction from oil and gas platforms and processing
terminals but does not include LNG terminals or compression stations. 1. North Sea Transition Deal residual emissions
assume 50% emissions reductions from 2018 levels.

ii) Next steps for fossil fuel production
Meeting Net Zero will involve transitioning almost entirely away from the unabateduse of fossil fuels. Indeed, the CCC pathway set out in the Sixth Carbon Budget
entails unabated fossil fuel use falling from 1,750 TWh in 2019 to 110 TWh in 2050,
with use in 2050 limited predominantly to aviation.
Fossil fuel use should decreaseby 95% by 2050.

Specifically, petroleum use in the CCC pathway decreases by 85% in 2050, by
which time oil products are combusted exclusively used in aviation. In a similarvein, unabated gas is only 3 TWh by 2050, which represents less than 1% of current
gas use.

In the transition towards lowcarbon fuels, some fossil fueluse can be consistent with UK
targets.

As the energy system transitions towards low-carbon energy carriers such ashydrogen, low-carbon electricity and bioenergy, some fossil fuels can be used in a
way that is consistent with UK targets:•

179

Unabated gas use and oil should decline by 62% in 2035 to be consistent
with the Sixth Carbon Budget. However, some oil will still be needed,

Climate Change Committee

predominantly in surface transport (135 TWh), aviation (123 TWh) andshipping (42 TWh).
•

Reducing the footprint of fossil
fuel use is crucial to limit the
impact on global GHG
emissions.

In addition, there is uncertainty on the role of fossil gas in the UK, as some
sectors are likely to use gas with carbon capture and storage (CCS) as ameans to decarbonise. Our analysis found that 50 to 105 TWh could be
used across the economy in 2035, with that range widening further in 2050
from 60 to 445 TWh. 31 As use of fossil gas with CCS only reduces emissions by
up to around 85% compared to unabated fossil gas use, use of zero-carbon
energy is preferable where it can feasibly be deployed.

Remaining fossil fuel use in the UK will need to consider the emissions footprint
associated with oil and gas production in order to limit the impact on GHG
emissions:•

The Sixth Carbon Budget requires the emissions of UK oil and gas production
and processing to fall by 87% in 2035, relative to 2018 levels. For the same
year, active efforts to move towards electrification and reduced methane
flaring and venting should contribute to reducing emissions by 22% and 6%
respectively below 2018 levels, beyond the expected decline in oil and gas
production.

•

However, current projections of the North Sea oil and gas production
suggest it is unlikely to be sufficient to meet future UK needs. This suggeststhat there is likely to continue to be a need for some additional fossil fuelsupply and/or imports of Liquified Natural Gas (LNG).

•

Given the demand for fossil fuels during the transition, it will be important toconsider the upstream emissions from oil and gas production in the UK
against those of imports in order to limit the impact on global GHG
emissions. Implementation of standards on the emissions footprint of fossil
fuels supplied for UK use could both drive reductions in fossil fuels supply
emissions in countries supplying fuels to the UK and provide a level playing
field for UK production that means more stringent standards thanembodied in the NSTD can be implemented without losing market share.

Reducing demand for fossil fuels and the emissions footprint of UK oil and gas
production and processing are key to limiting the impact on global GHG emissions,reinforcing the need for more ambitious targets that more closely align to a 68%
emissions reductions in 2030 against 2018 levels.

g) Waste
Our Sixth Carbon Budget advice set out the policies and measures required to get
the waste sector on track to deliver the UK’s pathway to Net Zero. The Government
has made progress in some of these areas but there are still key gaps which must
be addressed quickly.

i) Progress in the past year
Government has made some progress in developing policies to deliver on its 2018
Resources and Waste Strategy for England, which set out its ambition to double
resource efficiency and eliminate avoidable wastes by 2050, achieve 65%
municipal recycling by 2035 and eliminate food waste to landfill by 2030.

Progress in reducing emissions: 2021 Report to Parliament

180

Defra’s Waste Prevention
Programme, and BEIS’ Industrial
Decarbonisation Strategy set
out a number of important
initiatives on waste andresource efficiency.

Defra’s Waste Prevention Programme, which was launched for consultation in
March 2021, is central to this. It includes several measures aimed at driving moreresource-efficient approaches to product design and consumer behaviour,
including:•

Extended Producer Responsibility (EPR) schemes for several key waste
streams so that producers bear the cost of waste disposal, incentivisingmore efficient and sustainable product design.

•

New product standards and product information to reflect how reusable,
recyclable and repairable a product is, with the aim of minimisingpremature obsolescence.

•

A plastics tax and new charges on certain single-use plastic items.

Also, as mentioned under the section on manufacturing and construction, BEIS
published their Industrial Decarbonisation Strategy which sets out a number ofmeasures to improve resource efficiency, including:

Delivery timelines for waste andresource efficiency policies are
too slow and important gaps
remain, in particular around thelandfilling of biodegradable
waste, recycling and emissions
from Energy from Waste plants.

•

Exploring low-carbon product standards and labelling which will consider
embodied carbon, as well as broader environmental impacts.

•

A £30 million UKRI Circular Economy Research Programme aimed atworking with industry to develop new approaches to resource efficiency.

However, despite this progress, delivery timelines are too slow, policy is weak insome areas and key gaps remain. For example:•

The Environment Bill, which contains key powers to deliver on the Resources
and Waste Strategy and Waste Prevention Programme, has been delayed
and is yet to be passed into law.

•

The Waste Prevention Programme itself is only now out for consultation –over two years after the Resources and Waste Strategy was published,
while specific consultations on key elements of the programme, such as
some Extended Producer Responsibility schemes, are not expected for anumber of years.

•

A number of aspects need to be strengthened, in particular raising the levelof recycling targets, increasing the plastics tax threshold and extending thecommitment to end landfilling of food waste to cover all major
biodegradable waste streams – and implementing this in 2025 rather than2030.

Of particular concern is a lack of policy or guidance governing the use of, andemissions from, Energy from Waste (EfW) plants. If EfW usage is left to growunchecked, EfW emissions will quickly exceed those of the CCC pathway while
undermining recycling and re-use efforts. A recent policy statement indicating EfWplants will be eligible for CCS support is encouraging, but further action is urgently
needed in this space.

181

Climate Change Committeeii) Next steps on waste policy
To deliver the CCC pathwayurgent action is needed to banbiodegradable waste fromlandfill from 2025 while
improving recycling, re-use andwaste prevention.

Full details of all the policies needed to get the waste sector on track to Net Zeroare set out in our Sixth Carbon Budget polices report and the Departmental
Recommendations tables at the end of this report. The following actions should beprioritised by Government in the next few years:•

The Environment Bill should be legislated this year and should be used tostrengthen commitments on waste and resource efficiency including:– Raising recycling targets for England from 65% by 2035 to at least 68%
by 2030. Experience in Wales has shown that this is feasible.
– Sending a policy signal to ban the main biodegradable waste streams(i.e. paper, card, textiles, wood, food and garden waste) from landfill
from 2025.

A systems approach to waste
management and prevention
is crucial to avoid merely
shifting emissions from one
source to another, for example
from landfill to Energy from
Waste or from the UK tooverseas.

•

Delivery of the Waste Prevention Programme must be accelerated so thatkey measures such as Extended Responsibility Schemes and productstandards are in place well before 2025.

•

In order to avoid unintended consequences, Government must take awhole system approach to improving waste prevention, re-use andrecycling, including by:– Encouraging investment in recycling and re-use services andinfrastructure to ensure that, as far as possible, waste is not diverted
from landfill to EfW plants.
– Ensuring a holistic policy approach to reduce waste arisings, forexample by expanding measures aimed at reducing single-use plastic
waste to cover other single-use items and materials.
– Phasing out exports of waste by 2030 at the latest while strengthening
tracking and enforcement, to ensure waste intended for recycling or
recovery are treated as such.

•

Government must urgently address rising emissions from, and use of, EfW,
including by:– Setting out capacity and utilisation requirements for EfW which areconsistent with plans to improve recycling and waste prevention, by
the end of 2021.
– Consulting on the introduction of a carbon price on EfW emissions(either as part of the UK ETS or a separate carbon tax), by the end of2022.
– Providing the necessary support to enable existing EfW plants to begin
to be retrofitted with carbon capture, utilisation and storage (CCUS)
from the late 2020s, and introducing policy to ensure that any new EfWplants are built either with CCUS or are ‘CCUS ready’.

Delivering these actions requires different Departments to work closely together so
Government should consider establishing new cross-Whitehall governance on
waste and resource efficiency.
Progress in reducing emissions: 2021 Report to Parliament

182h) Aviation
The formal inclusion ofinternational aviation in the
Sixth Carbon Budget is an
important step towards tacklingthese emissions alongside otherUK emissions

The Government announced that international aviation (and shipping) emissions
would be formally included in carbon budgets for the first time when accepting
the Committee’s recommendation on the level of the Sixth Carbon Budget. We
strongly welcome this significant step, which recognises that international aviation
emissions need to be tackled alongside other UK emissions, and look forward toseeing legislation on the formal inclusion of international aviation and shipping laid
before Parliament soon.

i) Progress in the past year
There have been a few minor policy developments since we published the Sixth
Carbon Budget, but the Net Zero Aviation Strategy is overdue:•

The new UK Emissions Trading Scheme (UK ETS, a replacement to the EU
ETS), which will cover emissions from domestic UK flights and flights between
the UK and the European Economic Area, was launched and ran its firstauctions in May 2021.

•

DfT published a consultation on implementing monitoring, reporting andverification requirements of the Carbon Offsetting and Reduction Scheme
for International Aviation (CORSIA) as its first voluntary phase commences,including options for interaction between CORSIA and the UK ETS for flightsthat are covered by both schemes. 32•

The Civil Aviation Authority published the Airspace Modernisation Strategy(AMS), a plan for the use of UK airspace up to 2040 which aims to deliver
quicker, quieter and cleaner journeys. DfT also announced a funding
support package for initiatives within the AMS that support the postpandemic recovery of the aviation sector and decarbonisation.33•

The Ministry of Defence announced a change in RAF aviation fuelstandards, allowing RAF aircraft to utilise up to 50% of sustainable aviation
fuels (SAF) in the future. 34•

An aviation Net Zero Consultation and Strategy were planned for 2020. At
the time of finalising this report the Government’s consultation on
decarbonising aviation had not yet been published. The Government
intends to publish a Net Zero Aviation Strategy following the consultation,ahead of COP26.

ii) Next steps for decarbonising aviation
We have set out the core requirements of a policy package in aviation in the Sixth
Carbon Budget policy report.
There remain significant gaps within the policy framework for aviation. Government
support at present is focused on innovation funding and demonstration activities,
but without clear long-term policy mechanisms driving SAF uptake or valuing
negative emissions in the UK. These policy gaps should be addressed in the
Aviation Strategy:•

183

The Road Transport Fuel Obligation development fuels sub-mandate isunlikely to drive significant development of jet fuels, as it can be met withcheaper fuels.

Climate Change Committee•

There is currently no price signal for GHG removals in the UK.

•

There is a lack of larger-scale deployment support and policy frameworks
specifically for sustainable aviation fuel and GHG removals.

While SAF and technological innovations in aircraft provide an opportunity to
reduce emissions in the aviation sector, our analysis for the Sixth Carbon Budget
suggests that these measures alone are unlikely to go far enough in reducing
emissions. The CCC pathway allows for some further growth in aviation demand,
but below growth in a ‘business as usual’ case. Government must recognise theneed for demand management as part of a wider strategy to decarbonise
aviation, which should include:•

An aviation decarbonisation pathway. Although the UK aviation industry
has committed to a Net Zero goal for 2050 (via the Sustainable Aviation
coalition), this is not yet a policy goal for Government. A sector emissions
trajectory is needed to inform demand management and airport capacity
policies.

•

An assessment of airport capacity. Several UK airports are in the process of
seeking planning permission to expand, or have already sought permission
to expand and are challenging planning permission rejections (see Box 4.4).
Government has not made commitments to review its airport capacity
strategy nor stated a clear position on this issue. Our advice from the Sixth
Carbon Budget remains unchanged – there should be no net expansion of
UK airport capacity unless the sector is on track to outperform its net
emissions trajectory. Government needs to assess its airport capacity
strategy and develop and put in place a demand management
framework to assess and, if required, control sector GHG emissions and nonCO2 effects.

•

Appropriate price incentives. Reforming aviation taxation, alongside wider
reform of carbon pricing, will be critical to achieving Net Zero. The
Government’s current proposals for air passenger duty (APD) reform35 arelargely going in the wrong direction:

Managing aviation demand isa critical part of achieving the
Net Zero target, future airport
capacity needs must be
considered alongside
appropriate price incentives.

– Proposals include halving domestic APD to improve domestic
connectivity. Current price signals mean that flights are often cheaper
than lower carbon alternatives (e.g. rail). Redressing this requires both
higher taxes for flights (where there is an alternative to flying) andsubsidies on trains. Rather than reducing APD to incentivise domestic
flights, policy to improve domestic connectivity should focus on
reducing the cost and improving the service for surface transport,
especially rail.
– Where surface transport is not an option, relaxed requirements in APD
could relate not to distance but to the time taken to travel byalternative routes. Favourable treatment may be justified for small
islands in Scotland which would take hours to reach by other means, orfor Northern Ireland, but not for example for travel from London to
Newcastle or London to Edinburgh which can be done by train easily
and relatively quickly.
– Government should seek to embed positive behaviours that haveemerged during COVID-19, such as a reduction in business travel,
through taxation.

Progress in reducing emissions: 2021 Report to Parliament

184

The Government is at present developing legislation on the implementation of
CORSIA. These regulations should be used to maximise opportunities to tackle
climate change impacts of aviation, including non-CO2 effects:

CORSIA credits should only be
used towards ETS obligations if
and when these meet
minimum eligibility criteria. NonCO2 effects of aviation must
start to be measured.

•

Government’s CORSIA consultation includes options for interaction
between CORSIA and the UK ETS. Any such interaction should ensure credits
used to offset aviation emissions meet minimum credibility criteria.

•

Non-CO2 effects of aviation can have significant warming impacts. While itis true that further research is needed to better understand these impacts,and estimates may change as the science evolves, the data needed toenable these estimates should start to be collected now. Government
should include a requirement within CORSIA regulations for monitoring andreporting of non-CO2 effects.

Box 4.4
Airport capacity expansion
Several UK airports are in the process of seeking planning permission to expand or havealready sought permission to expand and are challenging planning permission rejections:•

A Supreme Court ruling in December 2020 overturned a previous court decision that
had blocked the plan to build a third runway at Heathrow airport on environmental
grounds, although airport operators still need to apply for planning permission for the
expansion to go ahead.

•

Expansion plans for Leeds Bradford airport were given conditional approval by Leeds
city council. Government later issued a direction preventing councillors from granting
planning permission without special authorisation. In April 2021, Government
postponed deciding on this request, providing no timescales for its resolution.

•

London airports, as well as many other regional airports, are seeking to push ahead
with expansion proposals.

The UK already has more than enough capacity to accommodate the demand increases
in our Balanced Net Zero Pathway. Our advice in the Sixth Carbon Budget was therefore
that there should be no net expansion of UK airport capacity, unless the sector is on track
to sufficiently outperform its net emissions trajectory and can accommodate theadditional demand:•

Outperforming the net emissions trajectory means making significant progress on
nascent and untested technologies like hybrid electric planes, and developing andscaling up markets for sustainable aviation fuels (SAF) and greenhouse gas removals.

•

It is not possible to have certainty today over the pace of development of thesetechnologies in future. It is therefore difficult at present to justify capacity expansion
on the basis of outperforming the emissions trajectory, particularly given theuncertainty around the permanence of impacts on aviation demand from COVID-19.

The fact that we have enough capacity in aggregate to achieve our emissions targets
does not mean that capacity is always in the right place:•

Airport capacity around London far exceeds capacity elsewhere in the country, as
does planned capacity expansion in London compared to regional airports’ plans.

•

While demand is greater in and around London, other areas see economic potential
in increasing their local airport capacity and improving their connectivity. There
could be some emissions savings from better allocation of capacity across thecountry (e.g. some emissions reduction from flying from a local airport rather driving
or flying to London).

•Conversely, arguments for increasing capacity in hub airports, such as Heathrow,include reducing emissions from less holding and better air traffic management.

Further work is needed to understand how capacity can best be utilised and managed
across the UK to increase efficiency and minimise emissions. A mechanism for managing

185

Climate Change Committee

demand should be developed and put in place alongside an assessment of theGovernment’s airport capacity strategy. This could act to control sector GHG emissions
and non-CO 2 effects if required and could also allow Government to address issues
around UK connectivity.

Figure B4.4 Airport capacity expansion plans

Million terminal passengers per year

120
100
80
60
40
20
0

London airports
Heathrow
Stansted
Leeds Bradford

Gatwick
Bristol

Other airports
Luton
Doncaster Sheffield

Source: CCC analysis based on AEF UK Airport Expansion Guide (https://www.aef.org.uk/uk-airport-expansions/),
Heathrow Airport Expansion Consultation (https://www.heathrow.com/company/aboutheathrow/expansion/documents), Gatwick Long Term Plans (https://www.gatwickairport.com/businesscommunity/future-plans/long-term-plans/), Doncaster Sheffield Masterplan (https://flydsa.co.uk/dsaadmin/wpcontent/uploads/2020/07/DSA_Masterplan.pdf). Includes airports with planning application submissions, that arechallenging planning permission refusals as well as airports that have recently publicly stated that they intend to
pursue expansion plans, where impacts of expansion plans on passenger numbers were available.

i) Removals
We have set out the core requirements for ensuring the timely delivery ofGreenhouse Gas Removals (GGR) in the Sixth Carbon Budget policy report.
Key developments in the past year are new funding to GGR research anddevelopment through the UK Research and Innovation’s GGR demonstrators
programme, 36 selection of phase one of the BEIS Direct Air Capture and GGR
competition,37 and inclusion of GGR within the Scottish Government’s Emerging
Energy Technologies Fund. 38
Alongside, during 2020-21 BEIS carried out a call for evidence on GGR.39 This invitedsubmissions on the contribution of GGR to reaching Net Zero, on GGR governance,and on possible approaches to GGR support mechanisms.

i) Next steps towards GGR delivery
Innovation support forengineered Greenhouse Gas
Removals needs to becomplimented by policy
development to set out andsupport deployment.

The Net Zero Strategy should set out expected amounts and timings of land-basedand engineered removals (i.e. bioenergy with CCS (BECCS) and direct air carbon
capture and storage (DACCS)) in contributing to meeting the Sixth Carbon Budget
and the Net Zero target. These should avoid over-reliance on these solutions.
Progress in reducing emissions: 2021 Report to Parliament

186

Building on the results of the BEIS GGR consultation, policy on governance andsupport mechanisms should be developed over the next year in order to enable
GGR scale-up during the mid-late 2020s. This should include enabling domestic
engineered removals to contribute to UK carbon budgets and Net Zero,establishing GGR monitoring, verification and reporting structures that ensure that
GGR is sustainable and verifiable, and setting out support mechanisms that alignwith the expectations for the role and timing of GGR contribution to UK emissions
reductions.
More generally, as GGR by BECCS and DACCS is reliant on CCS infrastructures forthe storage of the removed CO2, it is critical that CCS is established in a consistent
timeframe and in a manner that allows for the usage of CO2 pipeline and storage
for removals.

187

Climate Change Committee

Endnotes
1

Scottish Government (2020) Protecting Scotland, Renewing Scotland: The Government’s
Programme for Scotland 2020-2021.

2

Scottish Government (2021) Scottish Budget: 2021-2022.

3

Scottish Government (2020) Securing a green recovery on a path to net zero: climate change
plan 2018 – 2032 – update.

4

Just Transition Commission (2021) A National Mission for a fairer, greener Scotland.

5

Senedd Cymru | Welsh Parliament (2021) The Climate Change (Interim Emissions Targets) (Wales)(Amendments) Regulations 2021.

6

Welsh Government (2021) Llwybr Newydd: the Wales Transport Strategy 2021.

7

Welsh Government (2021) Beyond recycling.

8

CCC (2020) Letter: Lord Deben, Climate Change Committee to Edwin Poots MLA.

9

Northern Ireland Executive (2021) Energy Strategy for Northern Ireland: consultation on policy
options.

10

Northern Ireland Executive (2021) Future Energy Decarbonisation Scenarios.

11

OBR (2021) Economic and Fiscal Outlook.

12

OBR (2021) UK Infrastructure Bank.

13

Department for Transport (2020) Gear change: a bold vision for cycling and walking.

14

Department for Transport (2021) Bus back better: a national bus strategy for England.

15

Department for Transport and Office for Zero-Emission Vehicles (2021) Ending the sale of newdiesel buses.

16

Scottish Government (2020) Securing a green recovery on a path to Net Zero: climate change
plan 2018-2032 – update.

17

Welsh Government (2021) Llwybr newydd: the Wales transport strategy.

18

Department for Transport and Innovate UK (2021) SBRI zero-emission road freight, supporting
uptake of battery-electric trucks.

19

Department for Transport and Innovate UK (2021) Zero-emission road freight strands 1-3.

20

Department for Business, Energy and Industrial Strategy (2021) Emissions-cutting trucks and nextgen hydrogen buses closer to hitting the road with £54 million government-led funding.

21

Department for Transport (2021) UK’s first ever hydrogen transport hub kick-started by £3 million
government investment.

22

RAC Foundation (2021) Transport price index.

23

BEIS (2021) Green Homes Grant voucher release, May 2021.

24

HM Government (2020) The Government Response to the Committee on Climate Change’s
2020 Progress Report to Parliament.

25

Defra (2021) England Peat Action Plan; Defra (2021) The England Trees Action Plan 2021-2024.

26

Defra (2020) England Tree Strategy Consultation.

27

Scottish Government (2020) Update to the Climate Change Plan, 2018-2032.

Progress in reducing emissions: 2021 Report to Parliament

188

189

28

Northern Ireland Department of Agriculture, Environment and Rural Affairs (2020) Forest for our
Future Programme.

29

Defra (2021) England Peat Action Plan.

30

Defra (2021) Nature for people, wildlife and climate – policy paper.

31

CCC (2020) Sixth Carbon Budget – The UK’s path to Net Zero.

32

Department for Transport (2021) Implementing the carbon offsetting and reduction scheme forinternational aviation (CORSIA).

33

Department for Transport, Civil Aviation Authority (2021) Airspace Modernisation Plan.

34

Ministry of Defence (2021) Sustainable fuels to power RAF jets .

35

HM Treasury (2021) Consultation on aviation tax reform.

36

UK Research and Innovation (2021) Greenhouse Gas Removal Demonstrators Programme.

37

Department for Business, Energy & Industrial Strategy (2021), Projects selected for Phase 1 of the
Direct air capture and greenhouse gas removal programme.

38

Scottish Government (2020) Update to the Climate Change Plan 2018 – 2032.

39

Department for Business, Energy & Industrial Strategy (2020) Greenhouse gas removals: call forevidence.

Climate Change Committee

Annex

Joint Departmental
Recommendations

Progress in reducing emissions: 2021 Report to Parliament

190

Recommendations by Department
Central Government departments:•

Table A1: Cabinet Office and Number 10•

Table A2: COP Unit, the Foreign, Commonwealth and Development Office(FCDO) and the Department for International Trade (DIT)•

Table A3: HM Treasury (HMT)•

Table A4: Department for Business, Energy and Industrial Strategy (BEIS)•

Table A5: Department for Environment, Food and Rural Affairs (Defra)•

Table A6: Department for Transport (DfT)•

Table A7: Ministry of Housing, Communities and Local Government(MHCLG)•

Table A8: Department for Digital, Culture, Media and Sport (DCMS)•

Table A9: Department for Education (DfE)•

Table A10: Department for Work and Pensions (DWP)•

Table A11: Department of Health and Social Care (DHSC)•

Table A12: Home Office and the Ministry of Justice (MoJ)•

Table A13: Ministry of Defence (MoD)

Regulators and the Office for National Statistics:•

Table A14: Office of Gas and Electricity Markets (Ofgem)•

Table A15: Water Services Regulation Authority (Ofwat)•

Table A16: Office for National Statistics (ONS)

Devolved administrations:

191•

Table A17: The Scottish Government•

Table A18: The Welsh Government•

Table A19: The Northern Ireland Executive

Climate Change Committee

Table A1
Recommendations for Number 10 and Cabinet Office
Crosscutting

TimingUse the Cabinet Committees on Climate Strategy and Climate Action to drive home theneed for more pace in policy development across Departments. Consider whether additional
governance mechanisms such as independent delivery bodies are required in particular areas,such as heat decarbonisation.

2021-22
Priority
recommendation

Commit to a ‘Net Zero Test’ to ensure that all Government decisions are compatible with thelegislated emissions targets.

2021
Priority
recommendation

Develop (with BEIS) a public engagement strategy for Net Zero which builds on the findings of
the UK Climate Assembly by involving people in decision-making, providing trusted information
on decarbonisation choices and the need to reduce emissions and adapt to climate change.
The strategy should also identify preferred policy options to empower people to contribute
fully towards the path to Net Zero.

2021-22
Priority
recommendation

Support local government (with MHCLG) to play a full role in the Net Zero transition, including 2021-23
through increased resourcing, guidance, involvement in local area energy plans, statutory
reporting on the emissions from their estate and reforming the planning framework to enable
delivery of low-carbon and climate-resilient measures.
(funding for local
authorities at
This is likely to require additional funding for staffing and resources for local delivery plans,
next Budget)alongside a ‘duty to collaborate’ to encourage authorities to work with local, regional andPriority
national partners to deliver their climate ambitions.
recommendation
Cabinet Office should ensure that adaptation is integrated into major upcoming policies in
the next two years related to the priority CCRA3 risk for which it has lead responsibility,
coordinating work with other relevant departments as necessary:•

By 2023

Multiple risks to the UK from climate change impacts overseas

In addition, for the coming five-year period (2023-2028), Cabinet Office should outline
appropriate actions in the next National Adaptation Programme to address the adaptation
gap identified for the other risks and opportunities in the CCRA3 for which it is the leaddepartment (see Adaptation Report Annex).

Priority
recommendation

2022
Review guidance documents used in policy and business case development (e.g. the GreenBook) and ensure these are consistent with the requirements of Net Zero and account for the
impacts of climate change.
Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Cabinet Office should build a strong climate resilience capability for the UK, including making
use of storyline or ‘what-if’ scenarios to assess risks, in addition to or instead of using‘reasonable worst-case’ approaches. It should develop an early warning system for global
climate shocks. It should consider how more allowance and flexibility can be built into policy
making and policy implementation. This could include enhancing the ability of the Government
to make fast decisions by bringing in technical advice and expertise quickly when needed,and both protecting, and enhancing, monitoring and surveillance systems to enable faster
reactions as events unfold.

By 2023Develop and implement fully-funded plans towards making all public buildings and vehicle fleets 2021-22
zero-carbon in the long term. This must include a move to multi-year programmatic funding todeliver the stated ambitions of switching to ultra-low emission vehicles by 2030 and to halve
emissions from public buildings by 2032, supported by cross-government strategy (including
an ambitious new set of Greening the Government commitments) and capital funding levels in
the order of £1 billion/year for buildings.

International(With BEIS
and the
COP Unit)

As the public sector, lead the shift to other positive behaviours that reduce travel demand,for example encouraging home-working.

2021

Work towards securing more climate finance commitments from developed countries to getback on track for mobilising $100 billion a year in climate finance as soon as possible.

2021

Work to bring forward additional emissions reduction ambition from countries that haven’t
yet strengthened commitments ahead of COP26.

H2 2021

Place aligning global COVID-19 recovery plans with the goals of the Paris Agreement as a core
goal of the UK’s G7 and COP26 presidencies.

2021-22

Ensure that any outcome on international carbon markets at COP26 has high integrity andgenuinely supports global ambition to tackle climate change.

H2 2021Develop the option of applying either border carbon tariffs or minimum standards to imports 2021
Priorityof selected embedded-emission-intense industrial and agricultural products and fuels.
recommendation
This should include initiating development of carbon intensity measurement standards andfostering international consensus around trade policies through the G7 and COP presidencies.

192

Table A2
Recommendations for the COP Unit, the Foreign, Commonwealth and Development Office (FCDO) andthe Department for International Trade (DIT)

Timing

Crosscutting

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Action in the
run-up to
COP26

Work towards securing more climate finance commitments from developed countries to getback on track for mobilising $100 billion a year in climate finance as soon as possible.

2021 (COP26)Work to bring forward additional emissions reduction ambition from countries that haven’t
yet strengthened commitments ahead of COP26.

H2 2021

Provide a clear commitment prior to COP26 regarding the timescale by which the UK’s
official development assistance (ODA) contribution will return to 0.7% of GNI given the UK’scommitment to align its ODA spend with Paris Agreement requirements and the need forincreased finance to achieve the Paris Agreement.

H2 2021

Place aligning global COVID-19 recovery plans with the goals of the Paris Agreement as a core
goal of the UK’s G7 and COP26 presidencies.

2021-22

Ensure that any outcome on international carbon markets at COP26 has high integrity andgenuinely supports global ambition to tackle climate change.

H2 2021Develop the option of applying either border carbon tariffs or minimum standards to imports 2021
Priorityof selected embedded-emission-intense industrial and agricultural products and fuels.
recommendation
This should include initiating development of carbon intensity measurement standards andfostering international consensus around trade policies through the G7 and COP presidencies.
Ongoing
climateaction193

For the coming five-year period (2023-2028), FCDO should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the risks in
the CCRA for which it is the lead department (see Adaptation Report Annex).

2023
Priority
recommendation

Publish a new strategy for the UK’s international climate policy for after COP26 - ensuringthat the initiatives for the COP26 presidency have long-term benefits for global emissions
over the coming decade and supports the implementation of policies to deliver onstrengthened national targets.

H1 2022

For the coming five-year period (2023-2028), DIT should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the risks
and opportunities in the CCRA3 for which it is the lead department (see Adaptation Report
Annex).

2023

DIT should use trade policy to encourage increased ambition on both climate change
mitigation and adaptation in other countries, including considering the role for border carbon
adjustments and standards to prevent carbon leakage.

Spring 2022

Table A3
Recommendations for the HM Treasury (HMT)
Complete the overdue Net Zero Review, which should:

Funding

Taxation,carbon andenergypricing•

Develop a plan for funding decarbonisation fairly, reviewing the distribution of costs forbusinesses, households and the Exchequer.

•Set approach to near-term and long-term decarbonisation funding needs.

•

Consider policy implications for a just transition.

Timing2021
Priority
recommendation

The spending review(s) should ensure departments are fully equipped to deliver the necessary
actions across climate change mitigation and adaptation, during the rest of this Parliamentand beyond.

2021
Priority
recommendation

For the coming five-year period (2023-2028), outline appropriate actions in the next National
Adaptation Programme to address the adaptation gap identified for the risks in the CCRA
for which it is the lead department (see Adaptation Report Annex).

2023
Priority
recommendation

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Increase resources for local government to play a full role in the Net Zero transition.

2021-23 (fundingfor LAs at next
budget)Priority
recommendation

Fund plans towards making all public buildings and vehicle fleets zero-carbon in the long term.
This must include a move to multi-year programmatic funding to deliver the stated ambitionsof switching to ultra-low emission vehicles by 2030 and halving emissions from public buildings
by 2032, supported by cross-government strategy (including an updated set of Greening
the Government commitments) and capital funding levels in the order of £1 billion/year forbuildings.

2021-22

Provide a clear commitment prior to COP26 regarding the timescale by which the UK’s
official development assistance (ODA) contribution will return to 0.7% of GNI given the UK’scommitment to align its ODA spend with Paris Agreement requirements and the need forincreased finance to achieve the Paris Agreement.

H2 2021

Establish mechanisms (with BEIS) to close the substantial funding gap for heat networks, witha multi-year funding programme needed of sufficient scale to deliver the growth in network
deployment, and transition to low-carbon heat sources.

2022

Work with BEIS on the Heat and Buildings Strategy: to ensure that relative prices favour
a shift to low-carbon technologies, consulting widely including with the Committee on
Fuel Poverty; to ensure that sufficient funding is available; and to consider the role of tax
incentives (e.g. Stamp Duty differentials). Work with MHCLG and the new buildings safety
regulator to ensure that local authorities are properly funded to enforce buildings standards.

2021
Priority
recommendation

Consult on reforms to electricity pricing to remove disincentives to electrification, based on
consideration of the strategic and fair allocation of legacy policy costs associated with thepast deployment of less-mature low-carbon electricity generation. Also consider the balanceof existing taxes, such as the Climate Change Levy, on different energy sources. These
reforms in combination with wider sectoral incentives, standards and carbon pricing should
remove price barriers to electrification.

H1 2022

Consult (with BEIS) on the introduction of a carbon tax (either as part of the UK ETS or aseparate instrument) aimed at curbing rising emissions from Energy from Waste.

2022

Reform Vehicle Excise Duty, with larger differentials across all vehicle types, to provide
stronger incentives to purchase zero-emission vehicles and reverse the shift towards carsthat have higher lifecycle emissions. The reforms should consider the impact and design ofsecond and subsequent year rates, to ensure they encourage the purchase of zero-emission
vehicles in the second-hand market.

H1 2022

Aviation tax reform should seek to address price imbalances between aviation and surface
transport, encouraging the low-carbon alternative (e.g. rail) for journeys where one exists.
Taxation should also be used, alongside improvements in broadband, to embed positive
behaviours that have arisen during the pandemic (e.g. replacing business travel withvideoconferencing and online collaboration).

2021-22

Create a clear incentive for manufacturing facilities not currently covered by the UK ETS toswitch to low-carbon energy sources by reforming the suite of energy and carbon policies,
which could include rebalancing the Climate Change Levy rates for electricity and gas.

2023

2021
Set out a clear plan for ensuring that carbon prices and taxes on manufacturers, energy
producers and aviation encourage emissions reductions in line with the CCC Pathway, planningfor revised (and likely higher) carbon prices from 2023. This should include setting out a cap
for the UK ETS consistent with a credible path to the Sixth Carbon Budget for consultation
by Q3 2021.
Develop (with DIT) the option of applying either border carbon tariffs or minimum standards
to imports of selected embedded-emission-intense industrial and agricultural products andfuels. This should include initiating development of carbon intensity measurement standards
and fostering international consensus around trade policies through the G7 and COP
presidencies.

2021
Priority
recommendation

Table A3
Recommendations for the HM Treasury (HMT)Green
finance

195

TimingDevelop further ways to embed Net Zero and climate risk in financial decisions by UK firms,
building on the UK’s Green Finance Strategy. This should include implementing mandatory
climate disclosure, adoption of a robust green taxonomy with clear guidance on how it should
be used. It should also consider the recommendations of the Committee’s Finance Advisory
Group, such as making Net Zero and adaptation plans mandatory for financial institutions andmonitoring financial flows into climate action.

2021-25

In the green gilt framework, setting out the rules on what spending green sovereign
bonds can be used for, ensure that revenue is used to fund expenditure that will genuinely
contribute to Net Zero and improved climate resilience.

2021

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Crosscutting

Publish the overall Net Zero Strategy. It should:•

Provide a comprehensive plan for achieving Net Zero, the 2030 NDC and the carbon
budgets, setting out ambition for sectors and key technologies and behaviours thattogether will meet the challenge.

•

Set out the approach to the key cross-cutting challenges of fair funding, just transition,
skills, public engagement, local delivery, governance.

•

Set timelines for how policies will start to deliver decarbonisation with the required
urgency, and ensure that wider policy development is consistent with the UK’s climate
goals.

•

Ensure adaptation is properly integrated in the plan, maximising synergies and minimisingtrade-offs, while recognising the risks and impacts from climate change (see Adaptation
Progress Report for more details).

•

Introduce processes for monitoring progress and mechanisms to course-correct overtime.

Ensure that adaptation is integrated into major upcoming policies in the next two years
related to the eight priority risks identified in the Committee’s advice on the third UK Climate
Change Risk Assessment (CCRA3) for which BEIS has lead responsibility, coordinating workwith other relevant departments as necessary:•

Risks to the supply of food, goods and vital services due to climate-related collapse of
supply chains and distribution networks (with Defra and DIT).

•

Risks to people and the economy from climate-related failure of the power system.

Timing2021
Priority
recommendation

By 2023
Priority
recommendation

In addition, for the coming five-year period (2023-2028), BEIS should outline appropriate
actions in the next National Adaptation Programme to address the adaptation gap identified
for the other risks and opportunities in the CCRA for which it is the lead department (seeAdaptation Report Annex).

International

Jobs andskillsDevelop a public engagement strategy for Net Zero which builds on the findings of the
UK Climate Assembly by involving people in decision-making, providing trusted information
on decarbonisation choices and the need to reduce emissions. The strategy should link toengagement on adaptation and identify preferred policy options to empower people tocontribute fully towards the path to Net Zero.

2021-22
Priority
recommendation

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Update the UK’s long-term low greenhouse gas emission development strategy with the
UNFCCC to reflect a formulated economy-wide plan to achieve Net Zero by 2050 (expected
to be the Net Zero Strategy).

H2 2021

Place aligning global COVID-19 recovery plans with the goals of the Paris Agreement as a core
goal of the UK’s G7 and COP26 presidencies.

H2 2022

Publish a new strategy for the UK’s international climate policy for after COP26 ensuring that the initiatives for the COP26 presidency have long-term benefits for global
emissions over the coming decade and support the implementation of policies to deliver onstrengthened national targets.

H1 2022

Working with DWP, DfE, the Home Office and MHCLG, develop a strategy for a Net Zeroworkforce that ensures a just transition for workers transitioning from high-carbon to lowcarbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework
and actively monitors the risks and opportunities arising from the transition. This strategy
should include the development and roll-out of plans for training and skills, with buildings andmanufacturing being priority areas.

2021
Priority
recommendation

Design industrial decarbonisation policies to support and create jobs, especially in regions with Now and ongoingreliance on industrial jobs.

196

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Supporting
businessactionResearchand data

Timing2021-22
Support businesses to play their full role in the Net Zero transition and in adapting toclimate risks and opportunities, for example by extending and expanding the role of the Net
Zero Business Champion beyond COP26, building on the Race to Zero and Race to Resiliencecampaigns and providing sufficient resources to fully support businesses of all sizes to engage
in the transition, to input to policy development and to set their own robust Net Zero andadaptation action plans.
Develop further ways to embed Net Zero and climate risk in financial decisions by UK firms,
building on the UK’s Green Finance Strategy. This should include implementing mandatory
climate disclosure, adoption of a robust green taxonomy with clear guidance on how it should
be used. It should also consider the recommendations of the Committee’s Finance Advisory
Group, such as making Net Zero and adaptation plans mandatory for financial institutions andmonitoring financial flows into climate action.

2021-25

Determine appropriate regulatory arrangements, rules and guidance for the use of carbon
offsetting by UK corporates within their Net Zero strategies, recognising the growing
demand for offsetting markets, the interactions with the UK ETS and currently accredited
schemes (i.e. the Woodland Carbon Code and the Peatland Code), and the need to avoid
double-counting or negative outcomes for non-carbon objectives.

2021-22

Drawing on the Energy Innovation Needs Assessments ensure innovation funding (e.g. through
UKRI, Catapults, the Industrial Strategy Challenge Funding, BEIS Innovation Programme
and the Net Zero Innovation Portfolio) drives forward an extensive research and innovation
package for delivering a Net Zero, climate-resilient future.

Now and ongoing

2022
Make monitoring and data analysis of climate risks more accessible, alongside better
digitisation of past records. Further efforts should be taken to make the evidence on climate
risks more usable for decision makers through co-design of research programmes with end
users, where the user drives the research question from the beginning of the process. A major
gap is the lack of projections of impacts in 2ºC and 4ºC scenarios; this needs addressing as anurgent priority ahead of CCRA4.

Energy/ carbonpricing andemissionstrading

197

Review plan for improving data collection and statistical reporting for the purposes ofmonitoring and informing the low-carbon transition, as part of the broader work the ONS are
already undertaking to improve the collection of climate-related data.

2022

Work with ONS to put in place plans to collect and report data annually on low-carbon heat
networks, specifically the amount of heat delivered (split by DUKES consumption sector,
i.e. Residential/Public/Commercial/Industry, and where possible, by source of heat supply).
This should be part of a plan for improving data collection and statistical reporting for the
purposes of monitoring and informing the low-carbon transition.

2022

Improve the collection and reporting of industrial decarbonisation data to allow for progress
to be monitored more effectively, particularly on energy and resource efficiency.

2022

Set out a clear plan (with HMT) for ensuring that carbon prices and taxes on manufacturers,
energy producers and aviation encourage emissions reductions in line with the CCC Pathway,
planning for revised (and likely higher) carbon prices from 2023. This should include settingout a cap for the UK ETS consistent with a credible path to the Sixth Carbon Budget for
consultation by Q3 2021.

2021

Consult (with HMT) on reforms to electricity pricing to remove disincentives toelectrification, based on consideration of the strategic and fair allocation of legacy policy
costs associated with the past deployment of less-mature low-carbon electricity generation.
It should also consider the balance of existing taxes, such as the Climate Change Levy, on
different energy sources. These reforms in combination with wider sectoral incentives,
standards and carbon pricing should remove price barriers to electrification.

H1 2022

Consult (with HMT) on the introduction of a carbon tax (either as part of the UK ETS or aseparate instrument) aimed at curbing rising emissions from Energy from Waste.

2022

Commit (with DfT) not to use credits from the Carbon Offsetting and Reduction Scheme forInternational Aviation (CORSIA) for flights covered by the UK ETS unless and until they cansatisfy strict eligibility criteria (equivalence, additionality, permanence, sustainability).

2021-22Develop (with DIT) the option of applying either border carbon tariffs or minimum standards
to imports of selected embedded-emission-intense industrial and agricultural products andfuels. This should include initiating development of carbon intensity measurement standards
and fostering international consensus around trade policies through the G7 and COP
presidencies.

2021
Priority
recommendation

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Buildings

Produce a robust, equitable and ambitious heat strategy to eliminate emissions from buildings
through a clear direction for the next 30 years. This must include:•

Standards covering all segments of the building stock, with support for consumers
through the transition.

•

Plans to rebalance policy costs - in consultation with the Committee on Fuel Poverty andwider stakeholders - while making low-carbon solutions more financially attractive.

•

Plans to introduce Green Building Passports.

•

Formalisation of a governance framework to drive decisions on heat infrastructure
including a role for area-based energy plans and zoning of heat networks.

Timing2021
Priority
recommendation

Provide a stable long-term policy framework to support sustained energy efficiency andheat pump growth at sufficient scale (i.e. 600,000 heat pumps per year in existing homes by2028). This must include a replacement for the Green Homes Grant voucher scheme whichworks, backed by standards and support for non-residential heat pump installations. Create alevel-playing field for hybrid heat pumps off the gas grid and ensure hybrid heat pumps are an
integral part of PAS2035 retrofit coordinator advice.

2021
Priority
recommendation

Establish mechanisms to close the substantial funding gap for heat networks, with a multiyear funding programme of sufficient scale to deliver the growth in network deployment, andtransition to low-carbon heat sources, needed. Finalise policy on the future market frameworkfor heat networks, including requiring new district heat schemes to utilise low-carbon sourcesfrom 2025 at the latest and setting regulations for the conversion of legacy fossil fuelschemes to low-carbon sources.

2022

Publish proposals for standards to phase out the installation of new liquid and solid fossil
fuel heating by 2028 at the latest. Send clear signals on the phase-out of gas heating,including the roles for area-based planning and standards in phasing out gas installations (as in
Scotland).

2021

Move to multi-year programmatic funding to deliver the stated ambition of halving emissions
from public buildings by 2032. This must be supported with cross-government strategy(either independent or integrated with the Net Zero or Buildings Strategies) and funding
levels in the order of £1 billion/year. Support mechanisms must be designed so that smaller
public bodies can access them.

2022

Set requirements for all new gas boilers to be hydrogen-ready by 2025 at the latest, while
ensuring that all new boilers outperform current and expected future air quality standards.

2021

Implement improvements to the Energy Performance Certificate (EPC) and Standard
Assessment Procedure (SAP) framework, including:

2022

•

Ensuring EPCs drive deployment of the necessary energy efficiency measures and do soon a holistic basis to address overheating, ventilation, and moisture-risk.

•

Supporting delivery objectives across both energy efficiency and low-carbon heat, andvaluing properly the benefits of low-carbon and flexible technologies.

•

Formally integrating a forward trajectory for declining grid carbon-intensity, in line with
Government projections.

•

Addressing wider issues of quality/robustness, with a commitment to integrate in-use
performance metrics from 2023.

•

Plans for the future role of Green Building Passports.

Improve understanding of and support action on overheating in existing residential buildings
and encourage retrofit of passive cooling measures. The Heat and Building Strategy must
consider overheating risks. The following steps are needed:•

Further research to understand when overheating occurs in existing homes, including
ongoing monitoring of temperatures in the housing stock, monitoring of overheating
exceedances in homes, and the number of homes currently adapted.

•

Guidance and information for homeowners with the steps that can be taken if theirhomes overheat. This should include an outline of behavioural options and the measuresthat can be installed to reduce internal temperatures. Green Building Passports and homeretrofit plans could provide holistic guidance and help to unlock green finance.

•

Overheating risk considered and mitigated against if necessary when doing energy
efficiency retrofit programmes.

•

Making finance available to install adaptation measures. This could be via grant schemes
or green finance for private owners, with public funding targeted at low-income orvulnerable households alongside energy efficiency retrofit.

Bring forward the date to reach EPC C in social homes to 2028, in line with the Private
Rented Sector (PRS) proposals and finalise the delivery mechanism. Implement ambitious PRS
standards for homes which drive fabric efficiency, while valuing deployment of cost-effective
low-carbon heat alongside this. Implement the EPC B target for PRS non-domestic buildingsin line with new proposals. Consult on options to cover the regulatory policy gap for owneroccupied homes.

2022

2021

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Power

Waste

199

TimingPublish a plan for reaching an emissions intensity of 50 gCO2/kWh by 2030, with a totalof around 350 TWh of low-carbon generation. Set out a schedule for regular auctions
to procure low-carbon generation, with a clear pathway of volumes to be procured androbust contingency for uncertainties in demand and delivery. Address potential barriers to
deploying and using low-carbon generation at scale (e.g. the planning and consenting regime
for renewables and networks, exposure to climate risks) and, with Ofgem, develop a framework
under which sufficient supply resilience can be ensured.

2022
Priority
recommendation

Commit to phasing out unabated gas generation by 2035, subject to ensuring security ofsupply.

2021
Priority
recommendation

Publish a comprehensive long-term strategy for unabated gas phase-out, including ensuring
new gas plant are properly CCS- and/or hydrogen-ready as soon as possible and by 2025 at
the latest.

By Spring 2022
Priority
recommendation

Develop a strategy as soon as possible on market design for the medium to long term for a
fully decarbonised, resilient electricity system in the 2030s and onwards.

2023

Develop mechanisms for strategic investment in coordination with Ofgem to ensure thatelectricity networks can accommodate increased future demand levels, including large
localised demand increases associated with electrification in manufacturing, transport andbuildings, and that lack of network capacity does not cause delays in emissions reduction.

2023

Develop a strategy to coordinate the development of interconnectors, connections foroffshore wind farms and the enhancement of inter-area transfer capacity for the onshore
network, ensuring cost-effective, timely delivery, bringing forward any legislation necessary
to enable it.

H1 2022Work in partnership with Ofgem to publish and implement a new Smart System Plan andEnergy Data and Digitalisation Strategy, including working with DCMS on cyber-security,
in order to continue to unlock the full benefits of electricity system flexibility. Ensure
that, alongside smart standards for heating, all electricity users have access to half-hourly
metering and the option of tariffs that encourage flexibility in use of electric heat andelectric vehicle charging.

2021

Improve information sharing on climate risks to infrastructure interdependencies at a
local level, especially for electricity, digital and ICT networks. As reported in our previous
assessment in 2019, NAP actions to enhance arrangements for information sharing between
local infrastructure operators and improve understanding of critical risks arising frominterdependencies have not been completed. Defra’s link with Local Resilience Forums iskey, and BEIS and DCMS should engage with utility companies to encourage standardisedbenchmarking and data sharing on climate risks to electricity networks, digital & ICT.

Now and ongoingSet out capacity and usage requirements for Energy from Waste consistent with plans
to improve recycling and waste prevention. Issue guidance to align local authority waste
contracts and planning policy to these targets.

2021
Priority
recommendation

Introduce the necessary planning guidance and policy to ensure any new Energy from Waste
plants (including incineration, gasification & pyrolysis facilities) are built with carbon capture
usage and storage (CCUS) or are ‘CCUS-ready’.

Spring 2022
Priority
recommendation

Set out how existing Energy from Waste plants will be supported to be retrofitted with
CCUS from late 2020s onwards, with 2050 a backstop date for full CCUS coverage.

2022

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Manufacturing
and construction

TimingEstablish funding mechanism(s) to support operational and capital costs of bothelectrification and hydrogen-use in manufacturing, as soon as possible, with the aim ofawarding funding in 2022. There must be mechanisms for both options, not only hydrogen, andthe mechanism(s) should be designed to ensure that, in the medium term, hydrogen-use andelectrification compete on a level playing field, to ensure the best value for consumers andtaxpayers. Support for electrification may be combined with reforms to electricity pricing.

2022
Priority
recommendation

Continue to support innovation and demonstration of fuel switching and CCS technologies
for decarbonising manufacturing and construction. Ensure that a full range of options isdeveloped, filling previous gaps in support, such as encouraging electrification projects tocome forward.

Spring 2022

Set out which policies will deliver the pathway to 4 MtCO2e of industrial energy efficiency
abatement set out in the Industrial Decarbonisation Strategy and quantify how muchabatement will come from each policy:

Spring 2022•

Set out the future role of Climate Change Agreements (CCAs) and any required CCA
reforms.

•

Consult on mandating the use of Energy Management Systems and on Government
support and incentives for implementing energy management standards.

•

Set out the role of energy efficiency standards and audit programmes.

•

Develop resources such as direct advice and training to address capacity and expertise
gaps, and highlight available energy efficiency solutions, particularly for SMEs.

Ensure the policy package for decarbonising manufacturing addresses manufacturers’ low
appetite for investments with long payback times, either using grants or favourable loans,particularly for energy efficiency.

2022

Work with the minerals industries to develop a detailed joint plan for CO2 transport fromdispersed sites.

Spring 2022

Commit to targets for ore-based steelmaking and cement production in the UK to reach near- 2021
zero emissions by 2035 and 2040, respectively.
Deliver industrial carbon capture contracts (ICC) to enable final investment decisions on thefirst ICC projects by mid-2022.

H1 2022

Deliver the proposed CCS transport and storage regulatory investment model to enable final
investment decisions by mid-2022 that are consistent with establishing at least two CCS
transport and storage clusters in the mid-2020s.

H1 2022

Create a clear incentive for manufacturing facilities not currently covered by the UK ETS toswitch to low-carbon energy sources by reforming the suite of energy and carbon policies,
which could include rebalancing the Climate Change Levy rates for electricity and gas.

2023

2021
Set out a strategy for decarbonisation of off-road mobile machinery and work with industry
to identify potential policies to increase uptake of low-carbon off-road mobile machinery. This
will require work across BEIS, MHCLG, DfT and Defra.

200

Table A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)
Resource
efficiency inmanufacturing
and construction

Step up efforts (with Defra) to deliver the waste prevention and resource efficiency
improvements required as part of the pathway to Net Zero, including by:•

Accelerating delivery of the Waste Prevention Programme so that key policies, such as
Extended Producer Responsibility and new product standards, are on track to be in place
well before 2025.

•

Setting out how levels of resource efficiency improvements identified within the
Industrial Decarbonisation Strategy will be delivered.

•

Beginning to develop and implement any additional policies needed to deliver theseresource efficiency improvements, by the end of 2022.

•

Ensure cross-departmental working, potentially through new cross-Whitehall governancefocused on resource efficiency.

Develop policies (with MHCLG, Defra and DfT) to drive more resource-efficient construction
and use of existing low-carbon materials, including a substantial increase in the use of wood inconstruction. Policies should include:•

Reviewing and clarifying the position of structural timber in the ban on combustible
materials, underpinned by further research and testing where necessary, and ensuring
there are no barriers to the safe use of timber in buildings. The buildings safety regulator
to play a role in overseeing this on an ongoing basis.

•

The development of a fully-funded policy roadmap on the use of timber, including policies
to support the development of UK wood supply chains.

•

Finalising the reporting methodology for whole-life carbon standards.

•

Setting out a plan for phasing in mandatory whole-life reporting followed byminimum whole-life standards for all buildings, roads and infrastructure by 2025, withdifferentiated targets by function, scale, and public/private construction.

TimingSpring 2022
Priority
recommendation(end 2022 foradditional policies)

Spring 2022

Spring 2022
Consult on detailed proposals (with Defra) for product standards and extended producer
responsibility to improve the resource efficiency of consumer goods’ lifecycles. The proposals
should include all consumer goods with high environmental impact and cover how products are
made, through indicators such as the level of recycled content and critical material content,
and the repairability, durability and upgradability of a product.

Transport

201

Work with business to encourage and enable consumers to share, lease and use products forlonger while discouraging ‘disposable’ business models.

Spring 2022

Continue to support (with DfT and Ofgem) widespread deployment of EV charging
infrastructure:

Now and ongoing
Priority
recommendation•

This should ensure it can support high EV uptake levels. Project Rapid has the rightambition for the strategic road network and should be developed into a full strategy forthe 2020s and beyond.

•

Further investment is needed to support on-street and other urban charging solutions
for those without off-street parking and destination charging.

•

Government should aim for there to be around 150,000 public charge points operating by
2025. These should be widely available across all regions of the UK.

•

Implement the recommendations of the EV Energy Taskforce, in particular improving theconsumer charging experience and making smart-charging accessible, appealing and costeffective for as many EV users as possible.

Produce a clear assessment (with DfT) of how best to re-use and recycle EV batteries andfund development of competitive, large-scale battery recycling facilities in the UK.

2021-22

Continue innovation and demonstration support (with DfT) for zero-carbon fuel technologies
and their use in shipping, and ship efficiency measures. Develop incentives for zero-carbon
ammonia and hydrogen supply chains.

Early 2020sTable A4
Recommendations for the Department for Business, Energy and Industrial Strategy (BEIS)

Timing

Greenhousegas removals(GGRs)The overall Net Zero Strategy should place GGRs in context of a wider strategic approach toreaching Net Zero, setting out a plan for development and deployment of removals, but also
for actions elsewhere to limit the need for them.

2021
Priority
recommendation

Building on the Greenhouse Gas Removals (GGR) call for evidence, launch consultation on
Government’s preferred GGR strategy and long-term expected requirement for GHG
removals, including a proposed market design, a set of governance principles and proposals
that recognise the need for a long-term price signal.

H1 2022
Priority
recommendation

Support the demonstration of engineered GGR at scale in the 2020s, either throughamending existing policies or introducing new support mechanisms.

2022
Priority
recommendation

Build on the recently commenced innovation programmes, the Direct Air Capture and otherGreenhouse Gas Removals Competition and UK Greenhouse Gas Removal Demonstration
Programme, to support both the demonstration and commercialisation of more advanced
greenhouse gas removal technologies (taking these from technology readiness level 5 to 8),
and alongside undertake research and development into less advanced removal approaches
including through pilots and field experiments.

Now and ongoing

2021-22
Ensure that a public engagement strategy for Net Zero includes national, regional, and local
communities to improve the public’s understanding of GGR approaches and both the local andsystem-wide implications of different options - awareness is currently very low, and support ismixed or uncertain.

Fuel supply

Align with adaptation policies to ensure long-term resilience and effectiveness of GGRs in
the face of climate impacts and exploit potential for co-benefits (e.g. choice of tree species,
protecting new infrastructure from flood risks).

Before 2025

Develop a Hydrogen Strategy out to 2035 that determines plans and sets out pathways
to appropriate hydrogen use across power, industry, transport, and buildings; low-carbonhydrogen production options; and the associated infrastructure. Ensure that large-scalehydrogen trials begin in the early 2020s.

2021
Priority
recommendation

Deliver a Biomass Strategy that is aligned to the UK’s path to Net Zero, and which reflects
recommendations on governance, monitoring and best-use from the Committee’s 2018
Biomass report and 2020 Land Use report. The UK should also continue to take a global
lead on further developing and improving UK and international biomass governance andsustainability criteria.

2022
Priority
recommendation

Set new requirements for CCS-readiness at biofuel conversion facilities of all scales. Thisshould include dates beyond which new facilities should be built with CCS, and dates for when
CCS will need to be retrofitted to biofuel facilities already in operation.

2022

Set out policies to reduce upstream emissions from oil and gas production by 68% by 2030,
relative to 2018 levels:

2021

•

Develop policies to reduce emissions from existing oil and gas platforms, including
developing carbon-intensity measurement standards for gas and oil.

•

Set a requirement for new plans for offshore oil and gas platforms and associatedinstallations to use low-carbon energy for their operations, aligning to zero directemissions from operational energy use by 2027.

•

Make plans to ensure flaring and venting is only permitted for safety reasons from 2025.

Work with Ofgem to make explicit how current and future policies will reduce emissions
associated with methane leakage from the gas networks in a way that is consistent with the
Sixth Carbon Budget.

2021

Formalise the process, governance framework and timeline for decisions on the conversion
to hydrogen of appropriate parts of the gas pipeline networks. This should include startinga programme of research with Ofgem to identify areas which are unlikely to be suitable (suchthat electrification and alternatives can be prioritised), alongside priority candidate areas forhydrogen.

2021

202

Table A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Crosscutting

The next National Adaptation Programme, due in 2023, should ramp up adaptation ambition,
implementation and evaluation. It should:•

Set out the Government’s vision for a well-adapted UK, alongside the measurable
outcomes that the Government is aiming to achieve by the end of the next NAP period(2023 – 2028).

•

Include a detailed monitoring and evaluation framework, including which indicators will be
used to monitor progress in reducing risk and showing the effectiveness of different
adaptation responses for each risk in CCRA3.

•

Report how departments have addressed the top eight priority risks set out in the
CCRA3 Advice Report for urgent action between 2021 and 2023.

•

Set out how adaptation is being integrated into policy, and the measurable actions bydepartment for adaptation across each of the 61 risks and opportunities set out in the
CCRA3 Technical for the period 2023-2028.

•

Ensure the adaptation actions and the programme as a whole are framed around theprinciples for good adaptation outlined in the CCRA3 Advice Report:

Timing2023 onwards

Priority
recommendation– Adapt to 2ºC warming, assess the risks for 4ºC– Prepare for unpredictable extremes– Assess interdependencies– Understand threshold effects– Integrate adaptation into relevant policies– Ensure adaptation is sufficiently financed– Avoid lock-in– Address inequalities– Consider opportunities from climate change•

Specific actions to manage international climate risks should be included, setting out thedirect response to the risks identified in CCRA3.

Ensure that adaptation is integrated into major upcoming policies in the next two years
related to the priority CCRA3 risks for which Defra has lead responsibility, coordinating workwith other relevant departments as necessary:•

Risks to the viability and diversity of terrestrial and freshwater habitats and species
from multiple hazards.

•

Risks to soil health from increased flooding and drought.

•

Risks to natural carbon stores and sequestration (trees, soils and wetlands) from multiple
hazards.

•

Risks to crops, livestock, and commercial trees from multiple hazards.

By 2023
Priority
recommendation

In addition, for the coming five-year period (2023-2028), Defra should outline appropriate
actions in the next National Adaptation Programme to address the adaptation gap identified
for the other risks and opportunities in the CCRA for which it is the lead department (seeAdaptation Report Annex).
Implement a public engagement programme about national adaptation objectives, acceptablelevels of risk, desired resilience standards, how to address inequalities, and responsibilities
across society. The findings from the programme should feed into the vision and desired
outcomes of the next National Adaptation Programme.

2021
Priority
recommendation

2021-25
Implement measures to address non-financial barriers to tackling emissions from land use
and agriculture, including awareness and improving skills in sustainable forestry and peatland
Priority
management; scaling up supply chains; streamlining application processes and addressing
recommendation
contractual and tax issues where they are acting as barriers. Delivery plans should also set out
measures to:203•

Improve knowledge exchange of low-carbon farming practices to provide confidence tofarmers to take up measures to reduce on-farm GHGs.

•

Improve the science and evidence base for woodlands and peatlands, to deliver GHG
reductions and multiple other benefits, ensure the right tree is planted in the right place
and that they are resilient to future climate impacts.

Table A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Crosscutting

Legislate the Environment Bill this year, using it to strengthen commitments on waste,resource efficiency, agriculture and land-use.
Develop (with DIT) the option of applying either border carbon tariffs or minimum standards
to imports of selected embedded-emission-intense industrial and agricultural products andfuels. This should include initiating development of carbon intensity measurement standards
and fostering international consensus around trade policies through the G7 and COP
presidencies.

Researchand data

Nature andland use

Timing2021
2021

Priority
recommendation

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Fund a programme of work to design and populate the appropriate new priority adaptation
indicators for England. These should complement other environmental and social indicators
collated by Government. The CCC could be tasked to coordinate this activity in partnershipwith other relevant organisations such as the Office for Environmental Protection andEnvironment Agency.

2021

Continue to monitor consumption emissions. These are important to ensure that action to
decarbonise UK-based activities does not result in emissions moving offshore, and to trackprogress in decarbonisation of imports to the UK, which in turn can inform future policy (e.g.
border carbon adjustments).

Now and ongoing

Improve the collection and reporting of industrial decarbonisation data to allow for progress
to be monitored more effectively, particularly on energy and resource efficiency.

2022

Extend current ambition set out by the UK government and the devolved administrations to
implement a comprehensive delivery mechanism to address degraded peatland:•

17% of upland peat is restored, equivalent to 200,000 hectares (and where this is notpossible, stabilise the peat) by 2025; 58% by 2035 (700,000 hectares) and the remaining
area by 2045.

•

Rewet and sustainably manage 12% of lowland peat used for crops by 2025 (24,000
hectares), rising to 38% by 2035 (72,000 hectares).

•

Rewet 8% of lowland grassland area by 2025 (18,000 hectares), rising to 25% by 2035
(54,000 hectares).

•

Remove all low-productive trees (i.e. less than YC8) from peatland (equivalent to 16,000
hectares by 2025), and restore all peat extraction sites by 2035 (equivalent to 50,000
hectares by 2025).

Extend current ambition set out by the UK government and the devolved administrations to
implement a comprehensive delivery mechanism for new woodland to create at least 30,000
hectares per year across the UK by 2025 (in line with the Government’s commitment) and an
average of 40,000 hectares per year in the 2030s.
Introduce legislation to:•

Extend the ban on rotational burning of peat from certain protected upland bog sites toall peatland before the start of the burn season in 2021•

End peat extraction, and ban its sale for all horticultural uses including in the professional
sectors and apply this to imports by 2023.

•

Mandate water companies to restore peatland under their ownership.

•

Ensure lowland peat soils are not left bare.

2021-25

Priority
recommendation

2021-25

Priority
recommendation

2021-23

Priority
recommendation

Publish an overarching strategy that clearly outlines the relationships and interactions
between the multiple action plans in development for the natural environment, including thosefor peat, trees, nature and plant biosecurity. This must clearly outline how the different
strategies will combine to support the Government’s climate change goals on both Net Zeroand adaptation, along with the wider environment and other goals.

2021

Make long-term targets for biodiversity, set out under the Environment Bill, and associatedtimeframes outcome-based and linked directly to the goals set out in the Government’s 25Year Environment Plan.

H1 2022Make interim targets for biodiversity statutory and link them clearly to the long-termtargets set out in the Environment Bill.

H1 2022

The commitment in the 25 Year Environment Plan to achieve 75% restoration for terrestrial
and freshwater protected sites should be extended to include all priority habitat sites.

2021

Set out a clear mechanism to account for the consequences of higher water temperaturesand low flows (including drying up) in water bodies for freshwater habitats and species, andfor meeting the Water Framework Directive (WFD) targets. This is lacking in current plans torevise the River Basin Management Plans (RBMPs).

H1 2022

Extend the statutory requirements of marine plan policies to the decisions of public andprivate organisations. At present only public authorities are duty bound under law to apply
the plan policies to their decisions meaning there is a significant gap in the protections they
are designed to provide.

NowTable A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Agriculture
and food

Provide incentives and address non-financial barriers across all of the UK to:•

Plant trees on 2% of farmland by 2025 while maintaining their primary use, rising to 5% by
2035.

•

Extend hedgerows by 20% by 2035 and better manage existing hedgerows.

•

Increase the area growing energy crops across the UK to 6,000 hectares per year by2025, and 30,000 hectares per year by 2035.

Timing2021-25

Priority
recommendation

Implement measures to encourage consumers to shift diets and reduce food waste across the
supply chain, including:••Start now andreview mid2020s for dietLow-cost, low-regret actions to encourage a 20% shift away from all meat by 2030, rising change
to 35% by 2050, and a 20% shift from dairy products by 2030. Develop an evidencePriority
based strategy to establish options for successful behaviour shifts and demonstrate
recommendation
public sector leadership.

Policy to reduce food waste by 50% by 2030 and 60% by 2050, with the public sector
taking a lead through measures such as target setting and effective product labelling.

Introduce a strong post-CAP regulatory baseline, and adopt and retain existing EU rulesthat benefit GHG mitigation into UK legislation. These include low-cost, low-regret on-farmmeasures to reduce emissions; extending coverage of Nitrate Vulnerable Zones across all of
the UK; including measures that reduce enteric methane emissions in the Clean Air Strategy,
specifically under the proposal to extend environmental permitting to the dairy and intensive
beef sectors; and mandating UK feed producers to incorporate methane inhibiting additives incompound feed and mineral supplements.

2021-23

Set out measures to ensure the resilience of the food supply chain, including to the risks ofextreme weather in England and internationally, as part of its white paper responding to the
independent review of the National Food Strategy for England.

2022

Introduce a comprehensive plan and incentives to deliver emissions reduction across all UK
farms through:2021-25•

High take-up of low-carbon agricultural measures (60-75% by 2050) covering livestock(diets, breeding, and health), soils (cover crops and grass-legume mix) & waste management(anaerobic digestion and slurry covers).

•

Measures to incentivise the take-up of near-zero-emissions options for agricultural
machinery and vehicles from the mid-2020s, and develop options where they are notcurrently available.

The landscape-level and on-farm measures set out above should:•

Leverage private and public finance (e.g. a trading scheme or auctioned contracts). New
and existing funding streams should continue during the transition period to this system
to avoid a hiatus in deployment.

•

Be accompanied by a strong monitoring, reporting and verification system that uses thelatest monitoring tools and technologies to create a strong institutional framework toverify actions across the UK.

2021-25

2021
Set out a strategy for decarbonisation of off-road mobile machinery and work with industry
to identify potential policies to increase uptake of low-carbon off-road mobile machinery. This
will require work across BEIS, MHCLG, DfT and Defra.

205

Table A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Waste

Introduce the necessary planning guidance and policy to ensure any new Energy from Waste
plants (including incineration, gasification & pyrolysis facilities) are built with carbon capture
usage and storage (CCUS) or are ‘CCUS ready’.
Set out how existing Energy from Waste plants will be supported to be retrofitted with
CCUS from late 2020s onwards, with 2050 a backstop date for full CCUS coverage.
Set out capacity and usage requirements for Energy from Waste consistent with plans
to improve recycling and waste prevention. Issue guidance to align local authority waste
contracts and planning policy to these targets.

TimingSpring 2022

Priority
recommendation

2022

Priority
recommendation

2021

Priority
recommendation

Set out funding arrangements for local authorities to provide the recycling, composting andwaste management services and infrastructure required to deliver at least the commitmentsin the Environment Bill, Waste Prevention Programme and Resources and Waste Strategy, by
2022.

2022-25

Consult on the introduction of a carbon tax (either as part of the UK ETS or a separate
instrument) aimed at curbing rising emissions from Energy from Waste.

2022

Set a target for a 68% recycling rate by 2030 covering all wastes in England via theEnvironment Bill and announce new policies to meet this target. Northern Ireland to set a 70%
target for 2030. Scotland and Wales to set new targets for 2030 that go beyond their 70%
targets for 2025.

2021

Composting facilities should be incentivised to install forced aeration as a method of reducing
on-site emissions.

From 2022

Mandatory business food waste reporting to be introduced by 2022, building on WRAP’s
existing voluntary scheme.

2022

Legislate for (in England via the Environment Bill, and in Wales, Scotland, and Northern Ireland
via new legislation) and implement a ban on landfilling of the main biodegradable waste streams
from 2025 (both municipal and non-municipal). There must be sufficient recycling/composting/
AD treatment capacity made available before the ban comes into force, so that significant
increases in energy-from-waste are avoided.

2021

Long-term plans should be announced for eventual diversion of all wastes from landfill (except
for where no alternative treatment or disposal method exists) but with a date conditional on
sufficient action on reduction, re-use and recycling, and installation of CCS at energy-fromwaste plants, to avoid a surge in fossil emissions when the ban comes into force.

Mid-2020s

Introduce policies and funding for increased methane capture and oxidation at landfill sites, to 2022
decrease fugitive landfill methane emissions significantly.
Phase out exports of waste by 2030 at the latest, through improvements in waste prevention 2020sand domestic recycling and recovery, while strengthening tracking and enforcement to ensurethat any exports intended for recycling are being treated appropriately.
Greenhousegas removals
and offsets

Build on the recently commenced innovation programmes (with BEIS), the Direct Air Capture
and other Greenhouse Gas Removals Competition and UK Greenhouse Gas Removal
Demonstration Programme, to support both the demonstration and commercialisation of
more advanced greenhouse gas removal technologies (taking these from technology readinesslevel 5 to 8), and alongside undertake research and development into less advanced removal
approaches including through pilots and field experiments.

Now and ongoing

Align with adaptation policies to ensure long-term resilience and effectiveness of GGRs in
the face of climate impacts and exploit potential for co-benefits (e.g. choice of tree species,
protecting new infrastructure from flood risks).

Before 2025

Consider (with BEIS) the appropriate regulatory arrangements, rules and guidance for theuse of carbon offsetting by UK corporates within their Net Zero strategies, recognising
the growing demand for offsetting markets, the interactions with the UK ETS and currently
accredited schemes (i.e. the Woodland Carbon Code and the Peatland Code), and the need to
avoid double-counting or negative outcomes for non-carbon objectives.

2021-22

206

205
Table A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Resource
efficiency

Buildings andinfrastructure

207

Step up efforts to deliver the waste prevention and resource efficiency improvements
required as part of the pathway to Net Zero, including by:*•Accelerating delivery of the Waste Prevention Programme so that key policies, such as
Extended Producer Responsibility and new product standards, are on track to be in place
well before 2025.

•

Setting out how levels of resource efficiency improvements identified within the
Industrial Decarbonisation Strategy will be delivered.

•

Beginning to develop and implement any additional policies needed to deliver theseresource efficiency improvements, by the end of 2022.

•

Ensure cross-departmental working, potentially through new cross-Whitehall governancefocused on resource efficiency.

TimingSpring 2022

Priority
recommendation(end 2022
for additional
policies)

Consult on detailed proposals for product standards and extended producer responsibility
to improve the resource efficiency of consumer goods’ lifecycles. The proposals should
include all consumer goods with high environmental impact and cover how products are made,through indicators such as the level of recycled content and critical material content, and therepairability, durability and upgradability of a product.

Spring 2022

Develop policies (with BEIS, MHCLG and DfT) to drive more resource-efficient construction
and use of existing low-carbon materials, including a substantial increase in the use of wood inconstruction. Policies should include:

Spring 2022•

Reviewing and clarifying the position of structural timber in the ban on combustible
materials, underpinned by further research and testing where necessary, and ensuring
there are no barriers to the safe use of timber in buildings. Buildings safety regulator toplay a role in overseeing this on an ongoing basis.

•

The development of a fully funded policy roadmap on the use of timber, including policies
to support the development of UK wood supply chains.

•

Finalising the reporting methodology for whole-life carbon standards.

•

Setting out a plan for phasing in mandatory whole-life reporting followed byminimum whole-life standards for all buildings, roads and infrastructure by 2025, withdifferentiated targets by function, scale, and public/private construction.

Work with business to encourage and enable consumers to share, lease and use products forlonger whilst discouraging ‘disposable’ business models.

Spring 2022

Make changes ahead of the next round of reporting under the Adaptation Reporting Power(ARP). When used effectively, the ARP can present updated risks and adaptation actions
that allows for an assessment of preparedness of all infrastructure sectors and theirinterdependencies. In particular:

2023

•

The next round of reporting must be mandatory.

•

The deadline for reporting must allow sufficient time for consideration of all the reports
in the fourth UK Climate Change Risk Assessment, and the CCC’s statutory assessmentof progress on adaptation.

•

The list of organisations reporting should be expanded to ensure comprehensive
coverage of critical infrastructure and services, such as canals and food supply chains, as
recommended by the ARP3 consultation.

Work with the Environment Agency to set out the measures being taken to improve theuptake of property-level flood resilience (PFR) following stakeholder responses to its PFR
call for evidence and consultation. This should include improved data collection to monitor
progress. Plans for the new national flood risk assessment and 2025 long-term investment
scenarios must ensure that the evidence they provide can be used to identify the mosteffective locations for PFR, and smart targets for their installation with timescales.

2022

Work with Port Operators and the British Ports Association to ensure the format ofreporting under the Adaptation Reporting Power is appropriate for port operators and thatthe right operators are being asked to report, as well as to identify what further support
could be offered to enable more comprehensive reporting on adaptation by the ports sector.

2023

Improve information sharing on climate risks to infrastructure interdependencies at a
local level, especially for electricity, digital and ICT networks. As reported in our previous
assessment in 2019, NAP actions to enhance arrangements for information sharing between
local infrastructure operators and improve understanding of critical risks arising frominterdependencies have not been completed. Defra’s link with Local Resilience Forums iskey, and BEIS and DCMS should engage with utility companies to encourage standardisedbenchmarking and data sharing on climate risks to electricity networks, digital & ICT.

Now and ongoingTable A5
Recommendations for the Department for Environment, Food and Rural Affairs (Defra)
Waste andwasterwater

TimingWork with the Environment Agency, Ofwat and other stakeholders to set out targets andsupporting measures for reducing water use by business. This could be through ensuringthat any water reduction targets linked to the Environment Bill include business as well ashousehold water use, and responding to advice and recommendations from Defra’s new Senior
Water Demand Reduction Group.

2022

Commit innovation funding to development and demonstration of novel wastewater
treatment process that achieve a step change improvement in direct process emissions.

2022

Outside of the municipal wastewater sector, incentivise industrial wastewater plants to
reduce their process emissions.

From 2022

208

Table A6
Recommendations for the Department for Transport (DfT)
Crosscutting

Electric
vehicles

For the coming five-year period (2023-2028), DfT should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the risks
and opportunities in the CCRA for which it is the lead department (see Adaptation Report
Annex).

2023
Priority
recommendation

Decisions on investment in roads should be contingent on analysis justifying how they
contribute to the UK’s pathway to Net Zero. This analysis should demonstrate that the
proposals would not lead to increases in overall emissions. Wherever possible, investment inroads should be accompanied by proportionate investment in EV charging infrastructure andin active travel and public transport.

2021-22Develop policies (with BEIS, Defra and MHCLG) to drive more resource-efficient construction
and use of existing low-carbon materials. DfT’s focus should be on:

Spring 2022•

Finalising the reporting methodology for whole-life carbon standards•

Contributing to a plan for phasing in mandatory whole-life reporting followed by minimum
whole-life standards for all roads and infrastructure by 2025, with differentiated targets
by function, scale, and public/private construction.

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Develop a comprehensive policy package to support the supply and uptake of EVs to enable
delivery of the 2030 phase-out of new petrol and diesel cars and vans. This will require:

Policy package:
2021•

Strong consumer incentives to purchase zero-emission vehicles, whether in the formof purchase subsidies or preferential tax rates and duties. These should be fair acrossconsumer groups and scaled back as costs of EVs fall.

Support: Now
and ongoing•

Introducing a zero-emission vehicle mandate requiring car manufacturers to sell arising proportion of zero-emission vehicles (specifically, fully battery-electric vehicles),reaching nearly 50% by 2025 and 100% by 2030, with only a very small proportion of
hybrids allowed alongside until 2035. This will benefit air quality and consumers, as well as
greenhouse gas emissions.

Priority
recommendation•

Setting out ambitious UK regulations on new car and van CO2 intensities to 2030, withmore regular intervals than the EU’s five years, requiring around a 55% reduction by 2025
and 97% by 2030.

Continue to support widespread deployment of EV charging infrastructure:•

This should ensure it can support high EV uptake levels. Project Rapid has the rightambition for the strategic road network and should be developed into a full strategy forthe 2020s and beyond.

•

Further investment is needed to support on-street and other urban charging solutions
for those without off-street parking and destination charging.

•

Government should aim for there to be around 150,000 public charge points operating by
2025. These should be widely available across all regions of the UK.

•

Implement the recommendations of the EV Energy Taskforce, in particular improving theconsumer charging experience and making smart-charging accessible, appealing and costeffective for as many EV users as possible.

Produce a clear assessment of how best to re-use and recycle EV batteries and funddevelopment of competitive, large-scale battery recycling facilities in the UK.

209

TimingNow and ongoing
Priority
recommendation

2021-22

Table A6
Recommendations for the Department for Transport (DfT)
Publictransport
and active
travelStrengthen support for, and provision of, schemes to support walking, cycling and public
transport to reduce demand for higher-carbon travel:•

Provision of infrastructure for active travel and other support schemes, as well as
measures to make it less attractive to drive, are needed.

•

This should include maintaining positive behaviour shifts and addressing risks resulting
from the COVID-19 pandemic.

•

Working across delivery bodies (e.g. local authorities) is critical.

Government should support the public transport and shared mobility sectors to recoverfrom the COVID-19 pandemic:

Freight and
off-road
mobilemachinery•

Positive communications and messaging will be required to rebuild public confidence in thesafety of public transport.

•

Financial support for the sector should be maintained while confidence and demand arerebuilt, to avoid the risk of operators cutting service provision.

•

Government should seek to reverse the increasing relative price advantage of car travel
over public transport.

Timing2021-22
Priority
recommendation

2021-22

Set out a clear vision to deliver Net Zero in rail, and support Network Rail and other bodies
in delivering the target to remove all passenger diesel trains by 2040. This should cover a
mix of zero-emission technologies (e.g. track electrification, battery-electric, hydrogen andhybrid trains). The strategy should be published by 2021 as recommended by the National
Infrastructure Commission.

2021

Mandate a phase-out of new sales of all diesel buses and coaches by 2040 at the latest.

2021-22•

This should include a requirement for new sales of diesel vehicles operating on shorter,
urban routes to end considerably sooner.

•

Local authorities should be empowered to continue driving zero-emission bus take-up andto deliver improvements to bus services.

Implement large-scale trials of zero-emission HGVs in the early-2020s to demonstrate
the commercial feasibility of these technologies and establish the most suitable and costeffective technology mix.

Early 2020s

Set out and implement a strategy to transition to zero-carbon freight, including:

2021

•

Ending sales of new diesel HGVs by 2040 at the latest.

•

Stronger purchase and other incentives for zero-emission HGVs.

•

Infrastructure plans and support (e.g. ultra-rapid chargers for battery-electric HGVs andhydrogen refuelling stations for hydrogen HGVs).

•

Clean air zones.

Implement schemes to reduce HGV and van use in urban areas (e.g. e-cargo bikes and use ofurban consolidation centres), to reduce traffic and improve the safety of active travel.

2021

2021
Set out a strategy for decarbonisation of off-road mobile machinery and work with industry
to identify potential policies to increase uptake of low-carbon off-road mobile machinery. This
will require work across BEIS, MHCLG, DfT and Defra.
Shipping

Build on the Clean Maritime Plan and formal inclusion of international shipping in CB6 and
Net Zero to set a Net Zero 2050 goal for UK shipping (including international shipping) and apathway to get there.

2021

Take a leadership role in working with the International Maritime Organisation (IMO) andother willing partners on global shipping policies, research funding, tighter efficiency targets
and other initiatives to reduce shipping emissions. Work to strengthen the IMO 2050 global
target.

2021-22

Commit to the UK’s first clean maritime cluster(s) operating at commercial scale (supplying
at least 2 TWh/year of zero-carbon fuels) by 2030 at the latest, with zero-carbon fuels
expanding to 33% of UK shipping fuel use by 2035.

2021-22

Continue innovation and demonstration support for zero-carbon fuel technologies and theiruse in shipping, and ship efficiency measures. Develop incentives for zero-carbon ammonia andhydrogen supply chains.

Early 2020s

Provide support for ports’ investment in shore power and electric recharging infrastructure.

Early 2020s

Start monitoring non-CO2 effects of shipping and decide on how best to tackle themalongside UK climate targets.

2021

210

Table A6
Recommendations for the Department for Transport (DfT)
Aviation

Timing2021
Commit to a Net Zero goal and pathway for UK aviation as part of the forthcoming Aviation
Priority
Decarbonisation Strategy, with UK international aviation reaching Net Zero emissions byrecommendation
2050 at the latest, and domestic aviation potentially earlier. Plan for residual emissions (after
efficiency, low-carbon fuels, and demand-side measures) to be offset by verifiable greenhousegas removals, on a sector net emissions trajectory to Net Zero.
Assess the Government’s airport capacity strategy in the context of Net Zero and any
lasting impacts on demand from COVID-19, as part of the aviation strategy. There should
be no net expansion of UK airport capacity unless the sector is on track to sufficiently
outperform its net emissions trajectory and can accommodate the additional demand. A
demand management framework will need to be developed (by 2022) and be in place by themid-2020s to annually assess and, if required, control sector GHG emissions and non-CO2
effects.

2021-22
Priority
recommendation

2021-22
Take a leadership role within the International Civil Aviation Organisation (ICAO), and workwith other high-ambition nations, to set a long-term goal for aviation consistent with the Paris
Agreement, strengthen the CORSIA scheme and align CORSIA to this long-term goal.
Continue innovation and demonstration support for sustainable aviation fuel (SAF)
technologies, aircraft efficiency measures, hybrid, full electric and hydrogen aircraft
development and airspace modernisation. Set out a policy package for supporting the nearterm deployment of commercial SAF facilities in the UK (with carbon capture and storage
where applicable).

Now and ongoing
Policy package in
2021

Longer-term, support for SAF should transition to a more bespoke, enduring policy to drive
uptake.
2021-22
Use aviation tax reform to address price imbalances between aviation and surface transport,
encouraging the low-carbon alternative (e.g. rail) for journeys where one exists. Taxation should
also be used, alongside improvements in broadband, to embed positive behaviours that havearisen during the pandemic (e.g. replacing business travel with online networking).

211

Commit to not use credits from the Carbon Offsetting and Reduction Scheme forInternational Aviation (CORSIA) for flights covered by the UK ETS unless and until they cansatisfy strict eligibility criteria (equivalence, additionality, permanence, sustainability).

2021-22

Start monitoring non-CO2 effects of aviation (including through CORSIA for eligible
aeroplane operators), set a minimum goal of no further warming after 2050, research
mitigation options, and consider how best to tackle non-CO2 effects alongside UK climate
targets without increasing CO2 emissions.

2021-22

Table A7
Recommendations for the Ministry of Housing, Communities and Local Government (MHCLG)
Crosscutting

Support local government to play a full role in the Net Zero transition, including throughincreased resourcing, guidance, involvement in local area energy plans, statutory reporting on
the emissions from their estate and reforming the planning framework to enable delivery of
low-carbon and climate resilient measures.
This is likely to require additional funding for staffing and resources for local delivery plans,alongside a ‘duty to collaborate’ to encourage authorities to work with local, regional andnational partners to deliver their climate ambitions.
Ensure that adaptation is integrated into major upcoming policies in the next two years
related to the priority CCRA3 risks for which MHCLG has lead responsibility, coordinating
work with other relevant departments as necessary:

Flooding•

Risks to human health, wellbeing and productivity from increased exposure to heat inhomes and buildings (with DHSC).

•

In addition, for the coming five-year period (2023-2028), MHCLG should outline
appropriate actions in the next National Adaptation Programme to address theadaptation gap identified for the risks and opportunities in the CCRA for which it is thelead department (see Adaptation Report Annex).

Timing2021-23
Priority
recommendation(funding for local
areas at next
budget)By 2023
Priority
recommendation

Working with BEIS, DWP, DfE and the Home Office, develop a strategy for a Net Zeroworkforce that ensures a just transition for workers transitioning from high-carbon to lowcarbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework
and actively monitors the risks and opportunities arising from the transition. This strategy
should include the development and roll-out of plans for training and skills, with buildings andmanufacturing being priority areas.

2021
Priority
recommendation

Ensure that developments and infrastructure are compliant with Net Zero and appropriately
resilient to climate change through proposed amendments to the Planning Bill.

2021-22

Introduce an urban greenspace target to reverse the decline and ensure towns and cities are
adapted to more frequent heatwaves in the future and that the 25-Year Plan goals are met.

2022

Ensure all departmental policy decisions, planning decisions and procurement decisions, areconsistent with the Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Ensure that all types of current and future flood risk are included in policies to assess floodrisk to new developments. Housing targets for local authorities should take account of floodrisk, amongst other environmental issues. Assessments and management of flood risk in new
developments must as a minimum:

2022

•

Include evidence that the development will be safe over its full lifetime, with aconsideration of the downstream interactions and impacts of new developments (i.e. it
should not increase flooding in other areas).

•

Include an assessment of current and future flood risk under both 2°C and 4°C global
climate scenarios.

•

Assess and manage the risk of flooding to local infrastructure as well as housing.

•

Include a consideration of better preparedness as set out in the Government’s recent
FCERM Policy Statement.

•

Ensure there are properly funded and trained staff in local authorities.

To help improve the information on SuDS and surface water flood risk, urgently begin
collecting data on sewer capacity and SuDS location, type and capacity. This would bring thelevel of information in line with that for river and coastal flood risk defences.

2021

To address the issue of increased risk of surface water flooding in new developments, commit
to ensuring that new developments do not put more water into the public sewers than what
was there before, taking into account climate change. To incentivise this, end the automatic
right to connect to the public sewer; planning reforms should enact Schedule 3 of the Floodand Water Management Act (2010); and technical SuDS standards should be made mandatory
and be updated to deliver SuDS that provide multiple economic, social and environmental
benefits.

2022

The consultation process for surface water flood risk must be improved. This should be doneby adding statutory consultees for all development type and sizes. Consultees must havethe appropriate skills to provide advice on surface water flood mitigation. Ensure that Local
Authorities fully justify planning decisions where applications can proceed either without orgoing against formal flood risk mitigation advice.

2022

212

Table A7
Recommendations for the Ministry of Housing, Communities and Local Government (MHCLG)
Buildings

Construction

Implement a strong set of standards – with robust enforcement – that ensure both newand existing buildings are designed for a changing climate and deliver high levels of energy
efficiency and low-carbon heat. Including:•Publish robust definitions of the Future Homes Standard and Future Buildings Standard
which are legislated in advance of 2023 and ensure no fossil fuels are burnt in newbuildings. This must include coordination with DfE, MoJ, DHSC as well as BEIS and HMT.

•

Regulate the overheating requirement as set out in the Future Buildings Standard
consultation. Expand the requirement to cover refurbishments of existing buildings andconversions of non-residential buildings to residential.

•

Work with BEIS on the Heat and Buildings Strategy and use standards to set a clear
direction for retrofit across the buildings stock.

•

Ensure that the remit of the new buildings safety regulator covers climate change
mitigation and adaptation, strengthened through an explicit responsibility forsustainability; and is fully equipped to monitor and enforce compliance with buildings
standards.

•

Work with HM Treasury to ensure that local authorities are properly funded to enforce
buildings standards.

•

Close loopholes allowing homes to be built which do not meet the current minimum
standards for new dwellings. This includes provisions around the expiry of planningpermission and permitted development rights relating to change of use. Make accurate
performance testing and reporting widespread, committing developers to the standards
they advertise.

Timing2021-22
Priority
recommendation

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

2021-22

Implement improvements to the Energy Performance Certificate (EPC) and Standard
Assessment Procedure (SAP) framework, including:

2022

•

Ensuring EPCs drive deployment of the necessary energy efficiency measures and do soon a holistic basis to address overheating, ventilation, and moisture-risk.

•

Supporting delivery objectives across both energy efficiency and low-carbon heat, andvaluing properly the benefits of low-carbon and flexible technologies.

•

Formally integrating a forward trajectory for declining grid carbon-intensity, in line with
Government projections.

•

Addressing wider issues of quality/robustness, with a commitment to integrate in-use
performance metrics from 2023.

•

Plans for the future role of Green Building Passports.

Step up efforts to deliver the waste prevention and resource efficiency improvements
required as part of the pathway to Net Zero, including by:•

Setting out how levels of resource efficiency improvements in construction identified
within the Industrial Decarbonisation Strategy will be delivered.

•

Beginning to develop and implement any additional policies needed to deliver theseresource efficiency improvements, by the end of 2022.

•

Ensure cross-departmental working, potentially through new cross-Whitehall governancefocused on resource efficiency.

Develop policies (with BEIS, Defra and DfT) to drive more resource-efficient construction
and use of existing low-carbon materials, including a substantial increase in the use of wood inconstruction. Policies should include:•

Reviewing and clarifying the position of structural timber in the ban on combustible
materials, underpinned by further research and testing where necessary, and ensuring
there are no barriers to the safe use of timber in buildings. Buildings safety regulator toplay a role in overseeing this on an ongoing basis.

•

The development of a fully funded policy roadmap on the use of timber, including policies
to support the development of UK wood supply chains.

•

Finalising the reporting methodology for whole-life carbon standards.

•

Setting out a plan for phasing in mandatory whole-life reporting followed byminimum whole-life standards for all buildings, roads and infrastructure by 2025, withdifferentiated targets by function, scale, and public/private construction.

Spring 2022
Priority
recommendation(end 2022
for additional
policies)
Spring 2022

2021
Set out a strategy for decarbonisation of off-road mobile machinery and work with industry
to identify potential policies to increase uptake of low-carbon off-road mobile machinery. This
will require work across BEIS, MHCLG, DfT and Defra.

Table A8
Recommendations for the Department for Digital, Culture, Media and Sport (DCMS)
Crosscutting

Support BEIS in developing a public engagement strategy for Net Zero which builds on thefindings of the UK Climate Assembly by involving people in decision-making, providing trusted
information on decarbonisation choices and the need to reduce emissions and adapt toclimate change. The strategy should also identify preferred policy options to empower people
to contribute fully towards the path to Net Zero.

Timing2021-22
Priority
recommendation

2023
For the coming five-year period (2023-2028), outline appropriate actions in the next
Priority
National Adaptation Programme to address the adaptation gap identified for the risks andopportunities in the CCRA for which it is the lead department (see Adaptation Report Annex). recommendation

Digitalinfrastructure

Work in partnership with Ofgem to publish and implement a new Smart System Plan andEnergy Data and Digitalisation Strategy, including on cyber-security, in order to continue
to unlock the full benefits of electricity system flexibility. Ensure that, alongside smart
standards for heating, all electricity users have access to half-hourly metering and the optionof tariffs that encourage flexibility in use of electric heat and electric vehicle charging.

2021

Ensure sport and culture strategies align to other departments’ plans for lower-carbon
buildings, more active travel and improved public health.

2021

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Ensure plans for a digital transition and fibre roll-out can complement changing work patterns 2021
and travel behaviours, leading to lower-carbon working. Co-ordinate with DfT to invest indigital infrastructure to lock in positive behaviours that reduce travel demand (e.g. homeworking).
Resilience standards for the digital sector must include requirements pertaining to climatechange risks. In addressing the National Infrastructure Commission recommendations fromthe Resilience Study, Government should incorporate consideration of climate changerisks and adaptation actions into any new standards being developed. Standards for digital
infrastructure operators should include requirements to:•Assess climate risks under both 2°C and 4°C global climate scenarios.

•

Consider interdependencies with other critical infrastructure, and•

Set out actions to reduce risk and monitor progress.

Improve information sharing on climate risks to infrastructure interdependencies at a
local level, especially for electricity, digital and ICT networks. As reported in our previous
assessment in 2019, NAP actions to enhance arrangements for information sharing between
local infrastructure operators and improve understanding of critical risks arising frominterdependencies have not been completed. Defra’s link with Local Resilience Forums iskey, and BEIS and DCMS should engage with utility companies to encourage standardisedbenchmarking and data sharing on climate risks to electricity networks, digital & ICT.

2022

Now and ongoing214

Table A9
Recommendations for the Department for Education (DfE)
Working with BEIS, DWP, MHCLG and the Home Office, develop a strategy for a Net Zeroworkforce that ensures a just transition for workers transitioning from high-carbon to lowcarbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework
and actively monitors the risks and opportunities arising from the transition. This strategy
should include the development and roll-out of plans for training and skills, with buildings andmanufacturing being priority areas.

2021
Priority
recommendation

Support BEIS in developing a public engagement strategy for Net Zero which builds on thefindings of the UK Climate Assembly by involving people in decision-making, providing trusted
information on decarbonisation choices and the need to reduce emissions and adapt toclimate change. The strategy should also identify preferred policy options to empower people
to contribute fully towards the path to Net Zero.

2021-22
Priority
recommendation

For the coming five-year period (2023-2028), DfE should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the one
risk in the CCRA for which it is the lead department (see Adaptation Report Annex).

2023
Priority
recommendation

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

2021-22

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Table A10
Recommendations for the Department for Work and Pensions (DWP)

215

TimingTimingEnsure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Working with BEIS, DfE, MHCLG and the Home Office, develop a strategy for a Net Zeroworkforce that ensures a just transition for workers transitioning from high-carbon to lowcarbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework
and actively monitors the risks and opportunities arising from the transition. This strategy
should include the development and roll-out of plans for training and skills, with buildings andmanufacturing being priority areas.

2021
Priority
recommendation

Design industrial decarbonisation policies to support and create jobs, especially in regionswith reliance on industrial jobs.

Now and ongoing

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

2021-22

Table A11
Recommendations for the Department of Health and Social Care (DHSC)

Timing

For the coming five-year period (2023-2028), DHSC should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the risks
and opportunities in the CCRA for which it is the lead department (see Adaptation Report
Annex).

2023
Priority
recommendation

Assess health sector vulnerability to existing and future climate risks, particularly for carehomes and home-based care. Following this, develop a cross-sector approach to address risks.
This cross-sector approach should include input from DHSC, CQC, PHE, NHS, MHCLG and
local level public health bodies.

2022

Fund the strengthening and widening of vector and pathogen surveillance and early-warning
mechanisms, due to the increasing risk of disease spread as a result of climate change andother factors.

Now and ongoing

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

Now and ongoing

Support the NHS in delivering on its Net Zero plan.

Now and ongoing

Take an active role in climate policy development that also has health benefits, such as active
travel, access to green space, air quality, better buildings and healthier diets.

Now and ongoing

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Table A12
Recommendations for the Home Office and the Ministry of Justice (MoJ)

Timing

For the coming five-year period (2023-2028), MoJ should outline appropriate actions in thenext National Adaptation Programme to address the adaptation gap identified for the risks in
the CCRA for which it is the lead department (see Adaptation Report Annex).

2023
Priority
recommendation

Home Office, BEIS, DWP, DfE and MHCLG, should develop a strategy for a Net Zeroworkforce that ensures a just transition for workers transitioning from high-carbon to lowcarbon and climate-resilient jobs, integrates relevant skills into the UK’s education framework
and actively monitors the risks and opportunities arising from the transition. This strategy
should include the development and roll-out of plans for training and skills, with buildings andmanufacturing being priority areas.

2021
Priority
recommendation

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

2021-22

Ensure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Table A13
Recommendations for the Ministry of Defence (MoD)

TimingEnsure all departmental policy decisions, and procurement decisions, are consistent with the
Net Zero goal and reflect the latest understanding of climate risks.

Now and ongoing

Develop and implement plans to make all public-sector buildings and vehicle fleets within
the department’s remit zero-carbon in the long term, switching to ultra-low emission
vehicles by 2030 and halving emissions from public buildings by 2032. This must be part of acoherent cross-government strategy including an updated set of Greening the Government
commitments, multi-year spending commitments and annual reporting.

2021-22

Assess the potential for alternative fuels (such as low-carbon electricity, hydrogen or
bioenergy) to be used for land vehicles, ships and aircraft, and consider opportunities tosupport wider use of low-carbon technologies in civil applications (e.g. through research ordemonstration).

Now and ongoing216

Recommendations for Regulators and the ONS

217

Table A14
Recommendations for the Office of Gas and Electricity Markets (Ofgem)
Continue to support widespread deployment of EV charging infrastructure:•

This should ensure it can support high EV uptake levels. Project Rapid has the rightambition for the strategic road network and should be developed into a full strategy forthe 2020s and beyond.

•

Further investment is needed to support on-street and other urban charging solutions
for those without off-street parking and destination charging.

•Around 150,000 public charge points will need to be operating by 2025. These should be
widely available across all regions of the UK.

•

Implement the recommendations of the EV Energy Taskforce, in particular improving theconsumer charging experience and making smart-charging accessible, appealing and costeffective for as many EV users as possible.

TimingNow and ongoing
Priority
recommendation

Ensure all regulatory decisions, and procurement decisions, are consistent with the Net Zerogoal and reflect the latest understanding of climate risks.

Now and ongoing

Develop mechanisms for strategic investment in coordination with BEIS to ensure thatelectricity networks can accommodate increased future demand levels, including large
localised demand increases associated with electrification in manufacturing, transport andbuildings, and that lack of network capacity does not cause delays in emissions reduction.

2023

Start a programme of research with BEIS to identify areas which are unlikely to be suitablefor hydrogen (such that electrification and alternatives can be prioritised), alongside priority
candidate areas for hydrogen. Distribution Network Operators should gather and sharedetailed information on network capacity (at least to substation level) to feed into this.

2021

2021
Set out reforms to encourage the utilisation of existing network capacity and ensure thatcosts of local network upgrades are shared fairly and do not disincentivise the roll-out of lowcarbon technologies.
2021
Work in partnership with BEIS to publish and implement a new Smart System Plan and Energy
Data and Digitalisation Strategy, including working with DCMS on cyber-security, in order
to continue to unlock the full benefits of electricity system flexibility. Ensure that, alongsidesmart standards for heating, all electricity users have access to half-hourly metering and theoption of tariffs that encourage flexibility in use of electric heat and electric vehicle charging.
H1 2022Develop (with BEIS) a strategy to coordinate the development of interconnectors,
connections for offshore wind farms and the enhancement of inter-area transfer capacity forthe onshore network, ensuring cost-effective, timely delivery, bringing forward any legislationnecessary to enable it.
Work with BEIS to make explicit how current and future policies will reduce emissions
associated with methane leakage from the gas networks in a way that is consistent with the
Sixth Carbon Budget.

Table A15
Recommendations for the Water Services Regulation Authority (Ofwat)

2021

TimingEnsure all regulatory decisions, and procurement decisions, are consistent with the Net Zerogoal and reflect the latest understanding of climate risks.

Now and ongoing

Include decarbonisation as one of Ofwat’s core principles, to assist the water industry’s goalof decarbonising by 2030, and the need to roll out advanced anaerobic digestion systems.

2021

Work with Defra, the Environment Agency and other stakeholders to set out targets andsupporting measures for reducing water use by business. This could be through ensuringthat any water reduction targets linked to the Environment Bill include business as well ashousehold water use as well as responding to advice and recommendations from Defra’s new
Senior Water Demand Reduction Group.

2022

Table A16
Recommendations for the Office for National Statistics (ONS)Timing

Review plan for improving data collection and statistical reporting for the purposes ofmonitoring and informing the low-carbon transition, as part of the broader work the ONS are
already undertaking to improve the collection of climate-related data.

2022

Work with BEIS to put in place plans to collect and report data annually on low-carbon heat
networks, specifically, the amount of heat delivered (split by DUKES consumption sector, i.e.
Residential/Public/Commercial/Industry, and where possible, by source of heat supply).

2022

Improve the collection and reporting of industrial decarbonisation data to allow for progress
to be monitored more effectively, particularly on energy and resource efficiency.

2022

Recommendations for Scotland, Wales & Northern Ireland219

Table A17
Recommendations for the Scottish Government

TimingScale up delivery across all sectors in line with the ambition set out in the recent Climate
Change Plan Update.

Now and ongoing

Publish the finalised Heat in Buildings strategy.

2021

•

This must include finalising the regulatory framework and role of different trigger points(including area-based plans), and setting in train the legislation needed to underpin these.

•

Consult on the trajectory of reform for metrics such as EPCs, to ensure they are robustand enforceable, fit for purpose to deliver the measures needed on a holistic basis, do
not disincentivise low-carbon heat, integrate in-use performance metrics from 2023, andinclude plans for the future role of Green Building Passports.

•

Provide further detail on the ambition for heat networks and heat pumps over the coming
decade, and determine how funding for energy efficiency and low-carbon heat will beallocated to meet strategic priorities.

Proposals in Scotland’s Updated Climate Change Plan 2018-32 to set out a route map for
agricultural transformation should be scaled up, with the development of environmental
conditionality that incentivises emission reduction and carbon sequestration measures in
the land sector that build towards Scotland’s climate goals. It is essential that appropriate
incentives are in place to drive early action, given the time (often decadal) needed for somemeasures to reduce and sequester carbon (e.g. afforestation and peat restoration).

2021

Renew efforts to improve recycling and resource efficiency, including by:

2021

Bringing forward the planned circular economy package for legislating within the forthcoming
Programme for Government.
Putting in place the policy and support to ensure the 2025 targets (including the 70%
recycling target) within the package are delivered, and setting new ambitious targets for
2030.
Legislating to ban key biodegradable waste streams going to landfill from 2025, and ensuring
this is delivered through increased resource efficiency and recycling.
Publish a strategy setting out how the Scottish Government will achieve a 20% reduction in
car-kilometres by 2030 and deliver 20-minute neighbourhoods. This should be supported by:

2021

Continuing to strengthen schemes to support walking, cycling, and public transport.
Investment in infrastructure connectivity to lock in positive behavioural changes that reduce
travel demand (e.g. home-working).
Supporting the public transport and shared mobility sectors to recover from the COVID-19
pandemic, including through recovery funding and positive communication and messaging.
Continue to support the expansion of Scotland’s public EV charge point network, to ensure
the EV transition works for all road users in Scotland.

Now and ongoing

Maintain the provision of interest-free loans for EVs (now including second-hand EVs) on topof existing UK government grants. Plan for a transition to fiscally-neutral incentives as EV
costs fall.

2021-22

Taxation should be used, alongside improvements in broadband, to embed positive behaviours
that have arisen during the pandemic, replacing business travel with videoconferencing andonline collaboration.

2021-222021-22
Seek to address price imbalances between aviation and surface transport, once aviation
taxation is devolved to Scotland, encouraging the low-carbon alternative (e.g. rail) for journeys
where one exists.
Play a leading role in decarbonising the shipping sector by exploring opportunities totransition ferries operated by Transport Scotland to low-carbon energy and establishingappropriate business models to encourage their adoption.

Now and ongoing220

Table A18
Recommendations for the Welsh Government

TimingPublish a new Net Zero Delivery Plan that sets out a long-term vision for meeting the Net
Zero goal in 2050, with a particular focus on the Third Carbon Budget and beyond.

2021

Publish a coherent, long-term strategy for heat and energy efficiency in Welsh homes andother buildings, setting a framework for progress in areas of devolved responsibility.

2021

As part of this, energy efficiency policy should be designed so as to ensure that funds go as
far as possible in reducing the fuel poverty gap and improving the energy efficiency of homes,
by focusing on the most cost-effective interventions (including upgrading homes to EPC B
and EPC C where applicable).
Deliver on the priorities set out in Llbwyr Newydd to reduce demand for higher-carbon travel. 2021-22
This includes:

221•

Delivering a better, more integrated, decarbonised bus system.

•

Developing a network of connected local routes for walking and cycling.

•

Investing in infrastructure connectivity to enable delivery of the ambition for 30% of theworkforce to work remotely on a regular basis.

•

Supporting the public transport and shared mobility sectors to recover from the
COVID-19 pandemic, including through recovery funding and positive communication andmessaging.

Support delivery of a charging network that meets the ambition set out in the Electric
Vehicle Charging Strategy, to ensure the EV transition works for all road users in Wales.

Now and ongoing

The Welsh Government’s second statutory decarbonisation plan (LCDP2), due out later thisyear, should set out policies to accelerate afforestation rates to deliver its share of the UK
target to plant 30,000 hectares in 2025.

2021

Build on strong progress made on recycling and resource efficiency, including by:

2021

•

Implementing the policies set out in the recent ‘Beyond Recycling’ strategy.

•

Legislating and progressing towards the existing 70% recycling target, and set new
ambitious targets for 2030.

•

Legislating to ban key biodegradable waste streams going to landfill from 2025, andensuring this is delivered through increased resource efficiency and recycling.

Table A19
Recommendations for the Northern Ireland Executive

TimingLegislate a credible long-term emissions reduction target that is backed up by evidence on
its deliverability and a clear plan for how it can be achieved in a way that is fair for Northern
Ireland’s citizens – the Committee previously advised that an 82% reduction on 1990 levels by
2050 is Northern Ireland’s appropriate contribution to the Paris Agreement and the UK Net
Zero goal.

2021-22

Publish a final energy strategy that sets out how Northern Ireland will achieve a net-zerocarbon energy system by 2050, in line with the pathways recommended in our December
2020 advice.

2021

Publish a coherent, long-term strategy for heat and energy efficiency in Northern Ireland’s
homes and other buildings; encompassing regulatory, policy and funding commitments tofacilitate delivery.

2022

•

The strategy should include a trajectory of regulatory standards for energy efficiency,
supported by reforms to relevant metrics (such as EPCs) to ensure they drive themeasures needed on a holistic basis and do not disincentivise low-carbon heat. Reforms
should ensure metrics are robust and enforceable such that standards targeted areachieved in practice.

•

Publish proposals on the phase-out of fossil fuel heating, including standards to phase out
the installation of new liquid and solid fossil fuel heating. Proposals should recognise thecritical role of heat pumps and hybrid heat pumps in these homes, minimising the use of
biofuels to reflect economy-wide needs.

Consult on an ambitious trajectory of new-build standards uplifts, including ensuring all new
homes are designed for a changing climate, are ultra-efficient and use low-carbon heatingfrom 2025.

2021

Set out provisions to integrate a post-CAP framework that helps the land sector contributeto Northern Ireland’s climate goals as soon as the climate legislation is introduced. Thisshould include providing incentives for landowners and tenants to deliver low-carbon farming
practices and change the use of land to reduce emissions and increase carbon sequestration.

2022

The Northern Ireland Executive should bring forward a resource efficiency package whichmatches the ambition of Wales and Scotland, including by:

2022

•

Setting a target for 70% recycling across all wastes by 2030.

•

Policies to deliver such a target, as well as improving waste prevention and re-use.

•

Legislating to ban key biodegradable waste streams going to landfill from 2025, andensuring this is delivered through increased resource efficiency and recycling.

Strengthen support for and provision of schemes to support walking, cycling and public
transport to reduce Northern Ireland’s high levels of car-dependence:•Strengthen schemes to ensure access to local amenities without dependency on cars.

•

Invest in infrastructure connectivity to lock in positive behavioural changes that reduce
travel demand, e.g. home-working.

•Support the public transport and shared mobility sectors to recover from the COVID-19
pandemic, including through recovery funding and positive communication and messaging.

2021-22

Support the deployment of public charge points across Northern Ireland, to address theissue that Northern Ireland currently has the fewest EV charge points per capita of any of
the UK nations.

Now and ongoing

Resume collecting and publishing data on vehicle-kilometres travelled by mode in Northern
Ireland. This will help identify which actions are effective in encouraging modal shift away fromcar travel.

2021-22Long-haul air passenger duty, which is devolved to Northern Ireland, should be increased atleast in line with UK-wide long-distance APD, to better reflect the climate change impact offlying.

2021-22

222

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June 2021
Progress in reducing emissions – 2021 Report to Parliament
Climate Change Committee

1 Victoria St, Westminster
London SW1H 0ET
www.theccc.org.uk@theCCCuk