Presented to Parliament pursuant to details of the Climate Change Act (2008) Ordered by the House of Commons to be printed 30 March 2023

1. This Carbon Budget Delivery Plan - which also serves as our “section 14” report under the Climate Change Act 2008 - is being published to inform Parliament and the public on the government's proposals and policies to enable carbon 2. The approach set out in our October 2021 plan to deliver net zero, the Net Zero Strategy, remains the right one. The independent Net Zero Review led by Chris Skidmore MP supported this position. The Net Zero Growth Plan and the Energy Security Plan, published alongside this report, provide an update to the 2021 Net Zero Strategy and sets out the government’s strategy to achieve net zero and to deliver energy security, while at the same time increasing the UK’s international 3. This Carbon Budget Delivery Plan provides the detail, setting out the current package of proposals and policies prepared by the Secretary of State (as of March 2023) to enable the delivery of Carbon Budgets 4, 5 and 6. The proposals and policies reach far into the future, setting out our plans to the end of Carbon Budget 6 in 2037. This means that, whilst maintaining focus on delivering the proposals and policies, we must acknowledge that the package represents one of many routes to full decarbonisation of the UK economy by 2050. We expect the world to change between now and the end of Carbon Budget 6, so we expect that the package of proposals and policies will evolve to adapt to changing circumstances, new evidence, to utilise technological developments and address emerging challenges. This will enable us to maximise opportunities to drive growth, jobs and investment across the UK whilst reducing emissions. 4. In light of this, and consistent with the duties imposed by the Climate Change Act 2008, we will continue to keep the proposals and policies under review and update and amend the package as appropriate. It is an extremely difficult process to precisely forecast those proposals and policies that will be in effect so far in the future, for example those intended to take effect in Carbon Budget 6, and there is considerable fluidity in the final delivery. We expect to provide 5. The carbon budgets apply to the whole of the UK economy and society. In preparing this package of proposals and policies, we have consulted with Devolved Administrations who we continue to work with to deliver our UK-wide

Climate Change Act and carbon budgets 6. Parliament passed the Climate Change Act 2008 (‘the Act’), legislating the UK’s framework for setting carbon budgets. Under the Act, the UK is legally required to reduce greenhouse gas emissions by at least 100 per cent by 2050 on 1990 levels. In 2019, on advice of the Climate Change Committee (‘CCC’), the UK committed to reaching net zero emissions by 2050 and consequently the target reduction in the Act was amended (prior to this the target was at least 80 per cent reduction on 1990 levels). To keep the UK on a pathway to achieving the 2050 target, the government is required to set legally binding, five-year caps on emissions – carbon budgets – twelve years in advance and then to publish a report setting out proposals and policies for meeting that budget and those 7. The Act also established the Committee on Climate Change, now the Climate Change Committee (CCC), an independent statutory body, to advise the government and the Devolved Administrations on setting and meeting carbon goals. The CCC advises the government on the level of each budget, the respective contributions that different sectors could make and the extent to which carbon budgets could be met through the use of permitted “flexibilities” (such as surpluses from previous carbon budgets or the purchase of good quality international carbon credits). 8. Six carbon budgets have been set to date, covering 2008 to 2037. Carbon Budget 6, the first to be set under the UK’s new net zero target, was legislated for in June 2021. The UK has already met, and overachieved, its first (2008- 2012) and second (2013-2017) carbon budgets and is on track to meet the third (2018-2022). Between 1990 and 2021, UK emissions fell by 48% while our economy grew by 65%, decarbonising faster than any other G7 country. 9. This Carbon Budget Delivery Plan is the means by which we satisfy section 14 of the Act to publish a package of proposals and policies for enabling Carbon 10. To demonstrate how we will enable our legislated carbon budgets up to and including Carbon Budget 6 to be met, this report sets out the package of proposals and policies and their anticipated emissions reductions (where quantified) to 2037. As required by the Act, it also sets out the timescales over which we expect those proposals and policies to take effect. 11. To determine the total additional emissions reductions required to enable carbon budgets to be met we take an adjusted version of the government Energy and Emissions Projections (EEP 2021-2040) as a “baseline” for future emissions and compare this to the legislated carbon budget levels.1 12. EEP 2021-2040 is based on assumptions of future economic growth, fossil fuel prices, electricity generation costs, UK population and other key variables. They also incorporate EEP policies that have already been implemented, adopted or planned as of January 2022 (July 2022 for power sectors).2 The Technical Annex includes further detail on the latest 2021-40 Energy and Emissions 13. The current package of proposals and policies to enable Carbon Budgets to be met comprises the policies already incorporated in EEP 2021-2040, as well as the yet to be implemented, adopted or planned proposals and policies that will out the full list of policies currently included in EEP 2021-2040 and Tables 5 and 6 in the same appendix set out the list of additional proposals and policies. 14.
The policies set out in EEP 2021-2040 show the excellent progress that the UK has already made towards meeting our carbon targets. From the Projected baseline, EEP policies alone are expected to deliver over 100% of the emissions savings needed for Carbon Budget 4, and over 40% of the savings required for Carbon Budget 6, compared to projections with no government policy included 15. The latest EEP 2021-2040 was published in 2022, with the next update expected in the autumn 2023. However, recent changes in the greenhouse gas inventory and underlying trends in some areas have affected baseline emissions. For the purposes of this report, we have made adjustments to the EEP 2021-2040 baseline to reflect these. When making the adjustments we have taken a conservative approach, resulting in a higher baseline than the EEP 2021-2040 baseline by 4Mt amount in CB6. More detail on baseline adjustments is set out in the Technical Annex to this report. 1 UK Government, Energy and emissions 2021 to 2040. Available at -and-emissions- 2 Note this equates to the UNFCCC international reporting scenario “With Additional Measures” (WAM), which includes Existing an d Planned policies. 16. The difference between the adjusted baseline and the carbon budget for that period represents the level of emissions savings required to meet the target - this is the reduction in emissions we are trying to achieve through the proposals and policies laid out later in this document (Appendix B). When the total quantified savings for a given carbon budget are discussed as a percentage, this percentage relates to the gap between the baseline and the carbon budget. 17. After the baseline adjustments have been made, we project that CB4 could already be met with 7Mt p.a of headroom. The amount of savings required from further proposals and policies to meet CB5 and CB6 are 9Mt p.a and 199Mt including EEP policies and Carbon Budget targets. Projected emissions against current and future carbon budgets targets. For each carbon budget, the savings from new and early-stage residual emissions. This is then compared to the ‘budget limit’ to establish beyond the level required by the budget; and where this is negative, it indicates

that further emissions savings will be required to meet the budget. Unquantified proposals and policies that will contribute to achieving carbon budgets are set Years covered 2023 - 2027 2028 - Budget limit 1950 (390) 1752 (350) 965 (193) 1917 (383) 1799 (360) 1958 (392) 88 (18) 446 (89) 961 (192) 1829 (366) 1353 (271) 997 (199) 121 (24) 399 (80) -32 (-6)

budgets. These figures represent the projected residual emissions, after proposals and policies set out in this report have taken effect. The figures shown for each carbon budget are total emissions over the five-year period. Alongside this, we have shown the actual emissions over the single year of 2021 to show current performance. These are only projections and should not be interpreted as hard sectoral policy targets. Within our overall carbon budgets it is vital to retain a degree of flexibility to adjust our plans as circumstances change given the complexity of the net zero system and the inherent uncertainty in any projections. Modelling cannot always take into account systemic feedback effects, which are hard to quantify. Other factors such as consumer behaviour, technological innovation and the speed and structure of future economic growth further contribute to intrinsic uncertainties of long-term sectoral emissions

49 231 (46) 207 (41) 183 (37) Buildings 88 350 (70) 320 (64) 217 (43) transport 109 546 (109) 422 (84) 254 (51) Fuel supply 20 93 (19) 69 (14) 48 (10) Industry 76 340 (68) 207 (41) 111 (22) Power 54 143 (29) 63 (13) 42 (8) F-gases 30 125 (25) 96 (19) 75 (15) 20 217 (43) 210 (42) 184 (37) 426 1829 (366) 1353 (271) 813 (163) 446 2046 (409) 1563 (313) 997 (199) Background to our package of proposals and policies to meet the 20. Our Carbon Budget Delivery Plan is a dynamic long-term plan for a transition that will take place over the next 15 years, setting us on course to reach net zero by 2050. Many of the proposals and policies in the package will be phased in over the next decade or longer. Given our success in decarbonisation to date we are confident in our approach, but this plan does not intend to predict the exact shape of the British economy in 2037 or later, and nor should it. 21. We are taking a market-led approach to developing and deploying the technological shifts required to meet net zero. This means that it is very likely that some proposals or policies will out-perform expectations, with costs falling faster than we expect - for example, as scale increased, the per unit price of UK offshore wind fell by almost 70% between the first Contracts for Difference allocation round in 2015 and the fourth in 2022. Meanwhile, some other proposals or policies will under deliver compared to expectations. The complexity of the net zero system means there is inherent uncertainty in any forecasts. Modelling cannot always take into account systemic feedback effects, which are hard to quantify, such as co-benefits from technology roll-out. These have the potential to improve our position to enable the carbon budgets to be 22. Similarly, consumer behaviour, future trends and the future economic context, all of which will play a huge role in meeting carbon budgets and the exact mix of proposals and policies we need to get there is variable. For example, in recent years the uptake of electric vehicles has consistently exceeded expectations. 23. It is important to emphasise two points. Firstly, the list of proposals and policies that we set out is, necessarily, a snapshot of our current plan for meeting carbon budgets. As future circumstances change, we will review and adapt the proposals and policies in this report.
Secondly, some of the measures relied upon are proposals at an early stage of development that may not be required at all if we are overachieving in meeting carbon budgets or that could be subject to significant change as part of the full policy development process. The mechanisms for implementing these proposals will depend upon technological developments, societal changes, stakeholder views, future spending arrangements and broader policy developments. The inclusion of proposals and policies at an early stage of development that require further design and development ensures we do not risk curtailing scientific and technological development through over-prescription, whilst still setting out a carefully- planned, long-term package that will enable carbon budgets to be met. The methodology adopted in this report 24. In order to assess the package of proposals and policies against carbon budgets, we first calculated the expected emissions savings for all proposals of analytical models, designed to represent the sectors described in this report, and analytical techniques were used to derive the estimates, using consistent assumptions on shared inputs (such as GDP and fuel prices), and set against an appropriate baseline for each sector. 25. Further detail on the methodological approach underpinning these estimates can be found in the Technical Annex. 26. The calculated savings assume the package of proposals and policies are delivered in full. We consider it is reasonable to expect this level of ambition -

having regard to delivery risks and the wider context, which give rise to both downside and upside risks (see further information on delivery risks below). 27. We then combined these savings with the baseline as described above, to calculate the position compared to the carbon budgets. We then considered the potential of unquantified policies, where we cannot currently quantify associated emissions savings, for example in relation to some early-stage proposals, where we are still assessing the available evidence. Consideration of the 2030 Nationally Determined Contribution 28. The government is committed to delivering its international commitments, including the 2030 Nationally Determined Contribution (NDC) under the Paris Agreement. The UK will report to the United National Framework Convention on Climate Change on progress towards meeting the 2030 NDC from 2024 and will report on progress every 2 years. 29. We have quantified emissions savings to deliver 88 Mt or 92% of the NDC. We are confident the delivery of emissions savings by unquantified policies detailed in this package will largely close this gap and the government will bring forward further measures to ensure that the UK will meet its international commitments if Conclusion on enabling carbon budgets to be met 30. As outlined, our quantified proposals and policies give us over 100% of savings required to meet Carbon Budget 4 and 5 and 97% of the savings required to 31. Whilst the savings deliverable from the proposals and policies are likely to exceed Carbon Budgets 4 and will substantially overdeliver against Carbon Budget 5, there is a judgement to be made whether the policies identified at this stage are sufficient to enable Carbon Budget 6 to be met. We are confident that Carbon Budget 6 can be met through a combination of the quantified and unquantified policies identified. Proposals and policies we expect to deliver additional carbon savings, beyond those currently quantified, is identified in the 32. Examples of areas where we expect some further savings are areas of future research in the Agriculture and Land Use, Land-use Change and Forestry (LULUCF) sectors, as well as policies to further improve the energy efficiency of buildings and place-based transport interventions that will reduce emissions 33. In addition, the package is further strengthened through the inclusion of a range of cross-cutting proposals and policies which will enable and support our other proposals and policies – whether through leveraging the investment needed for technological growth or delivering the green jobs needed for the transition. This

supports with de-risking delivery across the package. We also expect that some of these areas could lead to additional emissions savings beyond those we have currently for example our package of policies to drive innovation is likely to lead to new low-carbon technologies which will lower costs and accelerate the transition to net zero. 34. We have also considered wider factors, which will affect our ability meet carbon budgets. These include additional emissions reductions not related to central government policy, such as the action we know is being taken by local authorities and devolved administrations, and areas of wider uncertainty in our projections of emissions. Taken together, they could positively impact our ability 35. The full list of proposals and policies to enable carbon budgets to be met are presented in Appendix B. Figures are included at a UK level except in relation to land use policies which are England only. In setting out the total emission reductions, above, an assumption of overall emissions savings at UK level are Delivery risks to our package of proposals and policies 36. The context within which we are delivering this transition is inherently uncertain. There are a wide range of fluctuating external factors which drive changes in greenhouse gas emissions and therefore the amount of savings we subsequently need to deliver to achieve carbon budgets. Our EEP baseline is sensitive to macro-economic changes, changes to fossil fuel prices, behavioural shifts and much more. This creates uncertainty and both upside and downside risks, which we manage through regular monitoring and updating of our baseline and, if necessary, taking action to address. 37. Policies included in the EEP baseline have high delivery confidence as they are at an advanced stage of development and have either been implemented already or are planned policies where the funding has been agreed and the design of the policy is near final. 38. Non-EEP proposals and policies vary in their degree of delivery confidence.
This is because a significant proportion of these proposals and policies have uncertainties inherent in long-term policy making and linked to our spending review cycles (as explained in the background to our package of proposals and policies above). Again, there are both upside and downside risks. Naturally, as we move towards Carbon Budget 6, a greater number of proposals and policies that are currently at an earlier stage of development will move into implementation and form part of the EEP baseline, giving higher delivery confidence. Currently, 40% of all savings needed to achieve our Carbon Budget

6 are projected to come from government policies that are part of the EEP baseline, providing further confidence in the plan. 39. Furthermore, taking a market-led approach to the transition means that technological changes and behavioural shifts will significantly shape the delivery of government policies providing opportunities to out-perform expectations and 40. Appendix D includes summaries at a sectoral level of the delivery risk picture, which includes commentary on the significance of the risks faced and the mitigating action being taken. 41. We have robust mechanisms in place to monitor, manage and mitigate our delivery risks. The Secretary of State for the Department for Energy Security and Net Zero is deputy chair of the Domestic Economic Affairs (Energy, Climate and Net Zero (DEA (ECNZ)) Cabinet Committee, which oversees overall progress across the UK’s climate portfolio, considering matters related to the delivery of net zero. This forum sits at the apex of our climate governance. Like its predecessor (The Climate Action Implementation Committee), DEA (ECNZ) will receive regular updates on the UK’s progress against carbon budgets and the UK 2030 NDC, which are informed by regular reporting and to ensure timely action is taken to keep programmes and policies on track. This is supported by well-established official-level governance structures supporting DEA (ECNZ), which regularly scrutinises and approves analysis and reports on the proposals and policies being developed to keep us on track for our carbon budgets. 42. Taking account of the level of policies already in delivery and in the EEP projections; the progress already made for Carbon Budget 4; the timelines for further policy development and implementation for Carbon Budgets 5 and 6; and the risks and mitigations around those policies, we have assessed the risks as being manageable and consider that the package of proposals and policies will enable carbon budgets to be met. 43. The timescales over which the proposals and policies take effect represent modelled estimates of when emissions savings are expected to begin and end. This is informed by an evidence-based understanding of how soon after policy implementation we would expect emissions savings to materialise; and for how long we anticipate the policy to continue to deliver emissions reductions. Whilst the government has committed to implementation dates for some proposals and policies, for others the implementation date remains subject to change as the policy develops. Further, some proposals and policies depend on funding decisions at future Spending Reviews. When emissions savings start to take effect is therefore dependent on the evidence underpinning the modelling as well

as when the policy is implemented – this means that the timescales presented in Appendix B will change over time. All proposals and policies are expected to deliver emissions savings until at least 2037, the end of Carbon Budget 6. Appendix sector definitions Power Emissions from power stations (Major Power Producers only), including those generating energy from waste. Fuel Supply Emissions from the extraction, processing, and production of fuels (chiefly oil, coal, gas and hydrogen). Industry Emissions from industrial processes, manufacturing, and production, including fuel combustion and product use in industrial buildings, as well as emissions from refineries and construction machinery. Includes emissions from non-Major Power Producers auto-generation and Combined Heat and Power. Emissions from public, commercial, and residential buildings, including domestic product use such as garden machinery and Emissions from all forms of road and rail transport, domestic aviation and domestic shipping (including fishing vessels). Emissions from fuel used in international aviation and international shipping, as measured by UK bunker fuel. Agriculture Covers emissions from livestock, crop soils and agricultural Emissions and removals from land use change, forestry, Emissions from the treatment and disposal of solid and liquid waste and landfill, including emissions from incineration not used to generate energy (e.g. incineration of chemical waste). Fluorinated gas emissions, primarily from refrigeration, air- conditioning, heat pumps, aerosols, and high voltage switchgear. Negative emissions from engineered removal technologies, including direct air and bio-energy carbon capture and storage. 3 Nature-based solutions, such as afforestation, are included in the Agriculture and LULUCF sub-sector. Appendix Tables of proposals and policies and projected emissions Within this appendix, we list the individual proposals and policies which will enable the Carbon Budgets to be met. These are set out over three Explanation of UK-wide approach to emissions. 1. The carbon budgets apply to the whole of the UK economy and society. In preparing this package of proposals and policies, we have consulted with Devolved Administrations who we continue to work with to deliver our UK-wide carbon budgets. Emission reduction figures are included at a UK- wide level, with the exception of the agriculture, forestry and other land use (AFOLU) and waste sectors, where we have provided savings at an England-only level, as the vast majority of these policy areas are devolved. F-gases are presented at a GB- wide level. We have provided separate, assumed UK figures, representing estimated projections for ongoing carbon savings for CB4, CB5 and CB6, for these sectors. Simple assumptions have been used to generate an initial estimate for emissions savings in these sectors, in Scotland, Wales and Northern Ireland. Further detail on the methodology is included in the Technical Explanation of approach to presenting timescales of policy effects 2. To fulfil the statutory requirement to set out the period over which the proposals year in which our modelling anticipates emissions reductions would start.
For some proposals and policies, it is highly uncertain when the policy may be implemented – in these cases we have indicated the carbon budget period or period from which we expect proposals and policies to take effect. 3. In all cases, the timescales over which we expect policies to take effect are not commitments – these may change according to developments in the evidence underpinning the modelling, the timing of policy implementation (unless the implementation date is an existing public commitment) and decisions on future spending (where applicable). All proposals and policies are expected to deliver emissions reductions until at least 2037, the end of Carbon Budget 6. Explanation of “scenarios" in modelled emission savings. 4. In some areas the technology pathway is more uncertain than others. For example, the government continues to support the potential deployment of hydrogen in heat (through commercialising hydrogen deployment through funding via the Net Zero Innovation Fund, for instance) and also the electrification of heat (for instance through increased deployment of heat 5. For most of the proposals and policies in the package, we show savings under a high electrification scenario because their savings do not vary across the different scenarios. However, we have modelled different decarbonisation options for some proposals in the buildings and fuel supply sectors. The emissions savings attached to these policies varies depending on the level of deployment of hydrogen across the economy. This applies to three policy areas covering heat pump deployment, buildings “on the gas grid”, and the emissions associated with hydrogen production unquantified policies 58, 59 and 60. The modelled scenarios show how differing uptake rates of hydrogen may displace some technologies that rely on electrification (and the policies that support them) 6. These scenarios are mutually exclusive. This means that emissions savings from policies in the high electrification scenario cannot be summed together with those from a "medium" or "high" hydrogen scenarios, as only one or the other policy would be implemented. Likewise, savings from "high" and "medium" hydrogen scenarios cannot be summed together. Although our list includes proposals and policies in different scenarios, we do not double count these emission savings in analysis presented elsewhere in this report. Across all sectors, the three scenarios achieve the same emissions reductions as each other – we do not expect emission reductions across the whole economy to vary materially depending on which of the three scenarios is taken forward through to 7. DESNZ simulates the power sector using the Dynamic Dispatch Model4, with emissions savings determined by comparing indicative net zero consistent scenarios against a scenario where no further government action is taken to decarbonise the power sector (which does not need to be net zero compliant). For all scenarios, the model builds sufficient capacity to ensure security of supply, with the capacity mix balanced to keep system costs low. Although specific capacity mixes are required by these scenarios, DDM modelling has shown that there are a range of capacity mixes that can achieve net zero and the government has adopted a market driven approach to delivering net zero.5 4 UK Government, Dynamic Dispatch Model (DDM) – May 2012. Available 5 UK Government, Modelling 2050 – electricity system analysis. Available

power sector proposals and policies all contribute to a single interlinked dynamic system. Calculating individual emissions savings (where capacity for a single technology does or does not materialise because of the policy) will yield significantly different values depending on whether that policy is evaluated in isolation or in conjunction with one or more other policies. This non-additive nature also means that single policy emissions savings are sensitive to the exact configuration of the chosen scenario, so two net zero consistent scenarios may yield different emissions savings for the same policy. 9. In this context, generating emissions savings for individual policies is likely to be both misleading and inaccurate. Risks to power sector decarbonisation are therefore not defined by the level of emissions savings for a given policy but rather in how each policy facilitates and accelerates the delivery of low carbon capacity and whether the policy retains optionality; that is, provide avenues for a large number of technologies to participate in the power sector, diversifying the technology mix and, in doing so, de-risking the system as a whole. 10. Emissions savings attributed to greenhouse gas removal technologies such as power-BECCS are accounted for in the Greenhouse Gas Removal section; whereas the contribution of that technology to low-carbon power generation as part of the power system are represented as part of the single Power carbon 11. More information on how policies in the power sector are modelled can be found

Policy Characteristics Savings (MtCO2e) Policy Description Implementati Committed active travel spending from 2011/12 onwards including from ring- fenced and non-ringfenced funds including the Local Growth Fund, Other Government Infrastructure Funds (e.g. the Housing Infrastructure Fund), Highways Maintenance Fund, Transforming Cities Fund, Integrated Transport Block, Local Sustainable Transport Fund and Cycling Ambition Implemented 2011 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Agricultural Policies are a group of English, Scottish and Welch policies and the Agricultural Action Plan (England), the Climate Change Plan (Scotland), and the Climate Smart Agriculture (Wales). These policies aim to reduce emissions through a range of policies are quantified in the aggregate Implemented Various 1.3 1.3 1.4 1.5 1.5 1.6 1.7 1.7 1.8 1.9 1.9 1.9 1.9 1.9 1.9 The policy objectives are to deliver additional energy and carbon savings from the domestic heating sector in England by lowering overall gas demand from domestic properties. It aims to do this by increasing the deployment of devices which increase the efficiency of domestic heating measures to make gas boilers heat homes more efficiently. The policy instrument is a technical standard set through statutory guidance under the Building Regulations framework.
This requires existing households in England to install an additional energy saving measure from a choice list at Implemented 2018 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.7 0.7 0.6 0.6 0.5 0.5 6 UK Government, Energy and emissions 2021 to 2040. Available

Policy Characteristics Savings (MtCO2e) Policy Description Implementati the point of installing a new or replacement combi gas boiler in an The Boiler Upgrade Scheme (BUS) is a £450m, 3year scheme offering upfront capital grants (£5000 for ASHP property owners to install heat pumps and in some limited circumstances, biomass boilers, to replace fossil fuel heating systems. The scheme will open in spring 2022 until 31 March Implemented 2022 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 Building Regulations set minimum energy performance standards for new buildings and when people carry out controlled ‘building work’ to existing properties including extensions, conversions and certain categories of renovation and replacement windows Implemented 2002 8.7 8.2 7.6 7.1 6.6 6.0 5.5 5.1 4.6 4.1 3.7 3.2 2.7 2.3 1.8 Building Regulations set minimum energy performance standards for new buildings and when people carry out controlled ‘building work’ to existing properties including extensions, conversions and certain categories of renovation and replacement windows Implemented 2010 6.0 6.1 6.4 6.5 6.1 5.6 5.2 4.8 4.6 4.5 4.3 4.1 3.9 3.8 3.6 Building Regulations set minimum energy performance standards for new buildings and when people carry out controlled ‘building work’ to existing properties including extensions, conversions and certain categories of renovation and replacement windows Implemented 2013 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1

Policy Characteristics Savings (MtCO2e) Policy Description Implementati EC Regulation 443/2009 sets fuel efficiency targets for new cars to be achieved by 2015 and 2020. The average CO2 tailpipe emissions target for new vehicles sold into the EU market into specific targets for individual manufacturers according to the mass of their fleet. Heavy compliance. The 2021 target is for across the single market, with a transition period where 95% of a manufacturer’s fleet must meet the targets (EU Regulation 2019/631) have been introduced for 2025 and 2030 based on the 2021 Worldwide Procedure (WLTP) measurements. As a result, the new passenger cars and light duty vehicles CO2 January 2020. The Road Vehicle Emission Performance Standards (Amendment) Regulations 2019 in existing ambition and targets out to 2024 still apply even in the event of the UK leaving the EU without a collection of technologies that could improve 'real world' fuel efficiency of cars which would not be fully captured in new car CO2 target and could improve fuel efficiency within the existing fleet. These include gear shift indicators, tyre pressure monitoring systems more efficient mobile air-conditioning and low rolling resistance tyres. EC Regulation 661/2009 sets minimum labelling for the rolling resistance, wet grip and external rolling noise Measures to support the uptake of Implemented 2012 6.2 8.5 10.8 13.3 16.0 19.1 22.0 25.1 27.6 30.0 32.3 34.5 36.8 38.7 40.3

Policy Characteristics Savings (MtCO2e) Policy Description Implementati ultra-low emission vehicles include the Plug-in Grant funding for ultra- low emission vehicle (ULEV) cars, vans, motorcycles and taxis as well as various tax incentives including lower rates for Vehicle Excise Duty vehicle (EV) infrastructure is directly supported through the grants for EV chargepoints for employees and fleets, the Electric Residential Chargepoint Scheme and the public-private £400 million Charging Infrastructure Investment committed £15 million to ensure that 95% of the Strategic Road Network will be within 20 miles The Carbon Trust provides a range of measures from general advice to in- depth consultancy and accreditation, to reduce emissions and save energy and money to businesses and public sector organisations of all sizes. Expired 2002 0.1 0.1 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 CERT extension - increased the targets originally set under CERT by 20% and required domestic energy suppliers with a customer base in excess of 50,000 (later increased to 250,000) to make savings in the householders. The extension also refocused subsidy towards insulation measures and away from electricity saving measures such as low energy lighting - and introduced a super priority group (households in receipt of certain means-tested benefits) to make energy reductions in low income and Expired 2010 1.5 1.4 1.4 1.4 1.4 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3

Policy Characteristics Savings (MtCO2e) Policy Description Implementati Community Energy Saving Programme (CESP) - area based regulation that targeted households across Great Britain, in areas of low income, to improve energy efficiency standards, and reduce fuel bills. CESP was funded by an obligation on larger energy suppliers and also the larger, Expired 2009 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 mandatory UK-wide emissions trading encourages the uptake of energy efficiency measures in large non- energy intensive private and public sector organisations that use energy not covered by the EU ETS or Climate Change Agreements. It covers around 5000 medium and large users of energy across the business and public sector. The scheme is split into phases. Phase 1 ran from 1 April 2010 until 31 March 2014. Phase 2 runs from 1 April 2014 until 31 March 2019. In the 2016 Spring Budget, the Chancellor announced there would be no further sales of CRC allowances after Phase 2 (i.e. following the legislation was laid in July 2018 to close the scheme after Phase 2. From April 2019, the CCL will be increased to recover the revenue forgone from reporting framework for quoted companies of all sizes and large unquoted companies and large Limited Liability Partnerships will come into Implemented 2010 0.9 0.9 0.9 0.6 0.3 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The reformed scheme (ECO 3) will run from autumn 2018 to March 2022. The scheme focuses completely on low income and vulnerable households.
Supplier thresholds were lowered to 200,000 domestic customers from ‘Innovation’ element was introduced to incentivise new better performing measures and cost-effective delivery techniques (up to 10% of scheme), and up to a further 10% of scheme for understand measure performance. The LA Flexible Eligibility mechanism was Implemented 2018 0.3 0.3 0.3 0.3 0.2 0.2 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3 n/a Implemented n/a 0.2 0.3 0.4 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 announced that ECO will be replaced with a new, lower cost scheme that will run for 5 years (to March 2022) and will tackle the root causes of fuel poverty. The 5-year extension will take place in the two phases, with the ECO Extension (April 2017 - Sept 2018) acting as a bridge between the expired ECO scheme and the new fuel poverty focused scheme, ECO 3, which will run from December 2018 to March 2022. The Local Authority Flexible Eligible mechanism was introduced under ECO2 Extension, enabling LAs to determine eligibility and refer households to obligated suppliers. Up to 10% of Affordable Warmth could be Implemented 2017 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 (ECO) is a statutory obligation on energy suppliers with over 250,000 domestic customers and delivering over a certain amount of electricity or gas to make reductions in carbon emissions or achieve heating cost savings in domestic households. ECO focuses on insulation measures, and also heating improvements to low Expired 2013 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6

Policy Characteristics Savings (MtCO2e) Policy Description Implementati income and vulnerable households. It ran until March 2017. ECO initially ran to March 2015 (also known as ‘ECO1’) and was extended in April 2014 to EEC GB wide regulation that required all electricity and gas domestic customers to achieve a combined energy saving of 62 TWh by 2005 by incentivising their customers to install energy-efficiency measures in EEC II - energy suppliers with more than 50,000 domestic customers required to deliver a total of 130 TWh lifetime energy use reductions in GB households, primarily through the promotion of energy efficiency Carbon Emission Reduction Target (CERT) – GB regulation that required all domestic energy suppliers with a customer base in excess of 50,000 domestic customers to make savings in the amount of CO2 emitted by Expired 2002 2.6 2.5 2.5 2.4 2.4 2.3 2.3 2.3 2.3 2.3 2.3 2.3 2.3 2.3 2.3 Energy Performance Certificates (EPCs) are required when any building is sold, rented out or constructed, and sometimes after refurbishment work. EPCs give information on a building's energy efficiency in a sliding scale from 'A' (very efficient) to 'G' (least Implemented 2007 0.5 0.5 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4

Policy Characteristics Savings (MtCO2e) Policy Description Implementati scheme for all large undertakings (non- SMEs) in response to requirements contained Article 8 of the EU Energy Efficiency Directive (2012/27/EU). Organisations which employ 250 or more people, or employ fewer than 250 people but have both an annual turnover exceeding £38.9m and an annual balance sheet total exceeding £33.4m, must measure their total energy consumption and carry out audits of the energy used by their buildings, industrial processes and transport to identify cost-effective December 2015 and every four years thereafter. It is estimated that around 10,000 organisations will participate in Implemented 2014 0.7 0.7 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.5 0.5 0.5 0.5 0.5 0.5 The F-gas regulations introduced a 79% phase down in the quantities of hydrofluorocarbons that can be placed on the EU market and was delivered via a gradually reducing quota system; a number of bans on the use of certain F gases in some new equipment; a ban on the use of very high GWP HFCs for the servicing of certain types of refrigeration equipment; and some strengthening of obligations in the 2007 regulation relating to leak checking, repairs, F gas recovery and technician training. These regulations were introduced by the EU in 2014 and Implemented 2014 3.8 4.3 4.6 4.9 5.2 5.5 5.7 6.0 6.2 6.5 6.8 7.1 7.4 7.6 7.9 Forestry policies are a range of post- 2009 policies aimed at driving afforestation and reforestation. Relevant policies are quantified in the aggregate 'Forestry policies'. Implemented Various -0.3 -0.3 -0.3 -0.2 -0.1 0.0 0.0 0.1 0.2 0.3 0.5 0.6 0.7 0.9 1.0 (GGSS) is a tariff subsidy to support the generation of biomethane by anaerobic digestion, for injection into the gas grid. It launched in November 2021 and will be open for applications until 2025, operating in England, Scotland and Wales. It is funded Implemented 2021 0.3 0.4 0.5 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6

Policy Characteristics Savings (MtCO2e) Policy Description Implementati GHNF is £328m fund that provides capital support to develop low carbon heat network infrastructure. Its objective is to accelerate the low carbon transition of new and existing heat networks and increase waste heat recovery from heat sources not currently exploited. GHNF supports greater deployment of large heat pumps (air-source, ground-source and water-source), waste-heat recovery (including heat exchangers and heat industrial/commercial processes and energy-from-waste plants), solar thermal with storage, and biomass (where this is sustainably sourced and complies with air-quality legislation). Implemented 2021 0.1 0.1 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 The GHG Local Authority Delivery Scheme (LAD) is a scheme of up to £500m for energy efficiency low- carbon heating improvements for low- Implemented 2020 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 scheme was announced in 2020 as an economic stimulus scheme. It opened on 30th September 2020, but early closure was announced resulting in applications ending on 31st March 2021. Up to £320m budget is allocated for FY21/22, but current applications will come out of this budget.
Policy savings represent an estimate of savings as a result of estimated installations later on in the year as a result of applications to the scheme, estimated energy savings could Expired 2020 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The Heat Networks Investment Project (HNIP) is a capital funding scheme encourage the development of heat networks. The HNIP is expected to support up to 200 projects by 2021 through grants and loans and other mechanisms and to lever in up to wider investment, reducing bills, cutting carbon and forming a key part of wider urban regeneration in many locations. applications from heat networks for up commercialisation and construction funding through a competitive process. The key objective of the project is to build a sustainable market for heat decarbonisation of heat in buildings, helping the UK reach the carbon Implemented 2017 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.1 0.1 The Heat Network (Metering and Billing) Regulations 2014 aim to introduce fairer billing and incentivise energy savings, by requiring heat suppliers to install heat metering devices where cost-effective and to bill based on consumption. The approach to assessing cost-effectiveness was methodological issues. Since then, this aspect of the Regulation has not been Regulation are required to support the installation of customer-level metering devices, reduce administrative burden, support wider UK climate goals, and enable consistency across heat network customers and compliance with the requirements of the Energy Implemented 2020 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.1 0.1 0.0 0.0 0.0 0.0 0.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati EC Regulation 661/2009 sets minimum requirements and introduces labelling for the rolling resistance, wet grip and external rolling noise of tyres. Industry and government are taking a range of actions to reduce freight emissions, including the Freight Transport Association's Logistics Carbon Reduction Scheme, which encourages members to record, report and reduce emissions from freight. The Mode Shift Revenue Support scheme encourages modal shift from road to rail or inland waterway where the costs are higher than road, and where there are environmental benefits to be gained. It currently helps to remove around 800,000 lorry journeys a year from Britain's roads. A similar scheme, Waterborne Freight Grant, can provide assistance with the operating costs associated with coastal or short sea A voluntary, industry-supported greenhouse gas emissions by 15% by The Regulation (EU) 2019/1242 setting CO2 emission standards for heavy- duty vehicles entered into force on 14 August 2019.The Regulation also includes a mechanism to incentivise the uptake of zero- and low-emission vehicles, in a technology-neutral way. From 2025 on, manufacturers will have to meet the targets set for the fleet- wide average CO2 emissions of their new lorries registered in a given calendar year. Stricter targets will start The targets are expressed as a percentage reduction of emissions reference period (1 July 2019-30 June 2020): from 2025 onwards a 15% reduction, from 2030 onwards a 30% The 2025 target can be achieved using technologies that are already available on the market. The 2030 target will be Implemented 2012 0.9 1.1 1.4 1.7 2.0 2.2 2.5 3.0 3.5 3.9 4.3 4.6 4.9 5.2 5.4

Policy Characteristics Savings (MtCO2e) Policy Description Implementati assessed in 2022 as part of the review The Industrial Energy Transformation Fund (IETF) was announced in the autumn Budget in 2018. The Fund will support businesses with high energy industries, to transition to a low carbon future. It will help companies cut their energy bills and carbon emissions through investing in energy efficiency and low-carbon technologies. The IETF has a UK-wide budget of £315m Implemented 2019 0.2 0.5 0.8 0.9 0.9 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The policy aims to increase industry confidence to invest in the technology potential to recover heat from industrial deployment of such technologies across manufacturing and data centres in England and Wales. It establishes a fund for feasibility studies that examine the potential for industrial businesses to adopt heat recovery technologies Implemented 2018 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati EC Regulation 510/2011 sets fuel efficiency targets for new Light Commercial Vehicles (LCV) to be Regulation 661/2009 sets minimum requirements and introduces labelling for the rolling resistance, wet grip and external rolling noise of tyres. The regulation translates a fleet average CO2 tailpipe emissions target for new vehicles sold in the EU market into specific targets for individual manufacturers according to the mass of their fleet. Heavy fines are imposed for non-compliance. The 2020 target is for a fleet average of 147g CO2 /km and represents a reduction of 19% from the 2012 average. EC Regulation 510/2011 sets fuel efficiency targets for new Light Commercial Vehicles (LCV) to be achieved by 2017 and 2020. EC Regulation 661/2009 sets minimum requirements and introduces labelling for the rolling resistance, wet grip and external rolling noise of tyres. The regulation translates a fleet average CO2 tailpipe emissions target for new vehicles sold into the EU market into specific targets for individual manufacturers according to the mass of their fleet. Heavy fines are imposed for non-compliance. The 2020 target is for a fleet average of 147g CO2 /km and represents a reduction of New stretching CO2 reduction targets (EU Regulation 2019/631) have been introduced for 2025 and 2030 based on the 2021 Worldwide Harmonised Light Vehicle Test Procedure (WLTP) measurements. As a result, the new passenger cars and light duty vehicles CO2 regulation came into force in January 2020.
The Road Vehicle Emission Performance Standards (Amendment) Regulations 2019 in March 2019 ensure the UK’s existing ambition and targets out to 2024 still apply even in the event of the UK leaving the EU without a deal in Implemented 2012 1.2 1.3 1.6 1.9 2.1 2.4 2.6 3.1 3.6 4.1 4.7 5.2 5.7 6.3 6.8

Policy Characteristics Savings (MtCO2e) Policy Description Implementati To help address payload penalty issues and encourage uptake of cleaner vans, a derogation from the European Union third Driving Licence Directive (2006/126/EC) has been introduced to allow Category B (car) licence holders to operate alternatively fuelled vehicles up to a maximum authorised mass of 4.25 (rather than Complementary measures to support the uptake of ultra-low emission vans include the Plug-in Van Grant and various tax incentives; for instance zero emission vans only pay a small proportion of the van benefit charge and are not subject to the van fuel benefit charge. Electric vehicle (EV) infrastructure is directly supported through the Workplace Charging Scheme grants for EV chargepoints for employees and fleets, the Electric Vehicle Homecharge Scheme grants towards home EV chargepoints, the On-street Residential Chargepoint Scheme and the public-private £400 million Charging Infrastructure September 2019. Highways England have committed £15 million to ensure that 95% of the Strategic Road Network will be within 20 miles

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The EU Ecodesign Directive and the Regulation operate by setting minimum requirements (respectively) for energy- using products. They aim to take the least efficient products off the market and to give consumers clear energy use-related information to guide their implemented through product-specific EU regulations, replicated in UK law. Implemented 2009 2.8 2.7 2.9 2.8 2.7 2.3 2.3 2.0 2.2 2.2 2.3 2.2 2.0 2.0 2.0 The EU Ecodesign Directive and the Regulation operate by setting minimum requirements (respectively) for energy- using products. They aim to take the least efficient products off the market and to give consumers clear energy use-related information to guide their implemented through product-specific EU regulations, replicated in UK law. Implemented 2008 2.8 2.4 2.4 2.0 1.8 1.3 1.2 0.9 1.1 1.1 1.1 1.0 0.8 0.8 0.7 ‘There are two distinct parts to the Efficiency Regulations. The first part represents the ‘Tenants’ energy efficiency improvements’ provisions, which came into force in 2016. The second part represents the ‘Minimum level of energy efficiency’ provisions which were implemented in 2018. This properties rented out in the private rented sector to have a minimum energy performance rating of E on an Energy Performance Certificate (EPC), conditions for an exemption, and that exemption has been registered on the regulations came into force for new lets and renewals of tenancies in England and Wales with effect from 1 April 2018 and for all longer-term tenancies on 1 April 2020 (1 April 2023 for non-domestic properties). In April 2019 these regulations were further strengthened with respect to the domestic sector only, to require a 0.5 0.5 0.5 0.5 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3

Policy Characteristics Savings (MtCO2e) Policy Description Implementati contribution of up to £3,500 from landlords towards the cost of improving their property towards EPC Band E (previously landlords of domestic properties were only required to take action where third party funding was available to meet the improvement costs). It will be unlawful to rent a requirement for a minimum E rating, unless one of the limited number of There is no minimum requirement for private rented sector properties in The Green Bus Fund (GBF) allowed bus companies and local authorities in England to compete for funds to help them buy new low carbon emission buses. The four rounds of the fund, which ran from 2009- 2014, added around 1250 Low Carbon Emission Buses onto England's roads. The GBF has now been replaced by the Low Emission Bus Fund (LEBS) which offered £30m for bus operators and local authorities across England and Wales to bid for low emission buses and supporting infrastructure. This scheme funding is open from 2016- 2019 and the successful bidders were announced in July 2016, adding more than 300 extra low emission buses to fleets. In Autumn 2016, a further £100m was announced to increase the amount of low emission buses on the road. £11.1m was used to fund those who narrowly missed out on LEBS funding, and £48m formed the Ultra- Low Emission Bus Scheme which was launched in March 2018. Winners of Implemented 2006 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.8 0.9 0.9 0.9 0.9 1.0 1.0 1.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati February 2019. The remaining funding formed the Clean Bus Technology retrofitting solutions for existing bus fleets to a minimum Euro VI standard, and the winners of this fund was announced in February 2018. This was in addition to the previous £27m of Clean Bus Technology Fund rounds in 2013 and 2015. There was also a £5m Clean Vehicle Technology Fund in 2014. These funding schemes have contributed to an extra 5000 low The Public Sector Decarbonisation Scheme provides grants for public decarbonisation and energy efficiency measures. This return includes the £1bn of funding allocated in phase 1 of the scheme, £0.075bn of funding made available in phase 2, and £1.425bn of funding made available in phase 3. Implemented 2020 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 The Public Sector Energy Efficiency Loans Scheme, managed by Salix Finance Ltd, provides interest-free loans in England, Scotland and Wales to public sector organisations for energy efficiency schemes. These loans are intended to provide the capital cost of energy efficiency retrofit installed. These loans have a payback period of five years (eight for schools) during which the repayments are met with the energy bill savings from the energy efficiency measures. Thus, once the loan has been paid off, the organisations continue to benefit from energy savings for the lifetime of these measures.
This funding is then Implemented 2004 0.1 0.1 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati recycled once it has been returned to the Scheme and once again loaned out. BEIS provides the most amount of funding to the Scheme but there is also some funding from the Scottish Government, the Welsh Government and the Department for Education. The Public Sector Energy Efficiency Loans Scheme, managed by Salix Finance Ltd, provides interest-free loans in England, Scotland and Wales to public sector organisations for energy efficiency schemes. These loans are intended to provide the capital cost of energy efficiency retrofit installed. These loans have a payback period of five years (eight for schools) during which the repayments are met with the energy bill savings from the energy efficiency measures. Thus, once the loan has been paid off, the organisations continue to benefit from energy savings for the lifetime of these measures. This funding is then recycled once it has been returned to the Scheme and once again loaned out. BEIS provides the most amount of funding to the Scheme but there is also some funding from the Scottish Government, the Welsh Government and the Department for Education. Implemented n/a 0.3 0.3 0.4 0.4 0.4 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.2 0.2

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The Non-Domestic Renewable Heat Incentive (RHI) is a Great Britain (GB) wide scheme which provides financial incentives to increase the uptake of renewable heat by businesses, the organisations. Eligible installations receive quarterly payments for 20 years based on the amount of heat scheme which provides financial incentives to promote the use of renewable heat in domestic properties. Eligible installations receive quarterly payments for seven years based on either the estimated amount of renewable heat generated, or their Renewable Heat Incentive schemes operated before being suspended on 5.1 5.2 5.2 5.2 5.2 5.2 5.2 5.1 5.1 5.1 4.9 4.5 3.7 2.9 2.2 The smart metering programme will replace 53 million meters with smart electricity and gas meters in all domestic properties, and smart or advanced meters in smaller non- domestic sites in Great Britain by the end of 2025. Smart meters will deliver consumption to help them control energy use, so avoiding wasting energy and money. It will deliver information upon which to manage and plan current activities. Smart meters will also assist the move towards smart grids which support sustainable energy supply and will help reduce the total energy needed by the system. There are now 28.8 million smart and advanced meters operating across Great Britain. In January 2022, the targets-based framework to maintain Implemented 2012 1.8 2.0 2.0 2.0 2.0 2.0 2.0 1.9 2.0 2.0 2.0 2.0 2.0 2.0 2.0

Policy Characteristics Savings (MtCO2e) Policy Description Implementati The Carbon Trust provided interest free loans of £3,000 - £400,000 for small and medium sized businesses to invest in energy efficiency equipment and renewable technologies. These loans were designed so that in most cases the forecast reduction in energy costs would be similar to the total Expired 2004 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 The Social Housing Decarbonisation £60mn innovation project that looks at applying whole house retrofit to social Implemented 2021 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 SECR is a reporting framework which obligates all large (as defined by the Companies Act 2006) UK registered companies to report their energy use and associated emissions relating to electricity, gas and transport in their annual reports. Companies will also be required to provide an intensity metric and disclose any energy efficiency reporting period. Quoted companies will in addition be required to report their global energy use and GHG Adopted 2019 0.5 0.5 0.5 0.5 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 The RTFO set a 4.75% target for biofuel use by diesel and petrol suppliers to be achieved by 2014. Targets are by volume rather than by Renewables Directive (2009/28/EC). Implemented 2007 3.1 3.1 3.1 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 This policy sets enhanced overall targets of 9.75% (by volume) for biofuel use by diesel and petrol suppliers by 2020 and at least 12.4% Renewables Directive (2009/28/EC) as Implemented 2018 4.7 4.9 5.0 5.1 5.2 5.3 5.4 5.4 5.4 5.5 5.2 5.0 4.8 4.6 4.5

Policy Characteristics Savings (MtCO2e) Policy Description Implementati Warm Front installed heating and insulation measures to make homes warmer and more energy efficient for private sector households in England vulnerable to fuel poverty. The scheme offered a package of heating and insulation measures of up to £3,500 (or £6,000 where oil central heating or other alternative technologies are Expired 2000 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3 scheme provides an energy bill rebate recipients will spend a portion of the consumption for heating. Upper and lower scenarios are derived from the uncertainty range in the labelling effect (the proportion of the WHD rebate that recipients spend on energy). The central estimate is 41%, with an uncertainty range of 15%-66%. The larger labelling effect (66%) is used for the "lower" EEP scenario, as this leads to a larger increase in energy consumption. The smaller labelling effect (15%) is used for the "upper" scenario, as this leads to a smaller increase in energy consumption. The source of the range in labelling effect Evidence on labelling from the UK Implemented 2021 -0.4 -0.4 -0.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Electricity supply policies' are a bundle of decarbonisation policies in the electricity supply industries. Recent policies (post-LCTP) are quantified in the aggregate 'Decarbonisation policies in the electricity supply industries'.
Older policies are included in the baseline and mitigation impacts 32.2 31.1 37.3 42.5 47.1 49.2 45.4 47.6 48.3 48.5 49.8 52.2 54.3 57.0

# Sector Policy Name Policy Description Emissions savings associated with power sector decarbonisation. By nature of the power sector HMG cannot allocate savings to the power policies so the aggregate savings will be captured here. An explanation for our accounting approach this interrelated set of policies can be found in the main report, Appendix B, para 6 and Technical A CfD is a long term contractual agreement between a low carbon electricity generator and Low Carbon Contracts Company (LCCC), designed to provide the generator with price certainty over the lifetime of the contract. Contracts for Difference Allocation Rounds will run annually. The first annual auction will be the fifth CfD Allocation Round (AR5) scheduled to open in March 2023. This is the government’s main mechanism for supporting low-carbon electricity generating projects in Great Britain, including the goal to deliver up to 50GW offshore wind (including 5GW floating wind) by 2030 and up to 70GW solar by 3 Power Review of Contracts for The government will keep the Contracts for Difference (CfD) mechanism under review to ensure it remains investable and capable of addressing emerging barriers to renewable energy deployment. The government will respond to the consultation published in December 2022, which sought views and supporting evidence on specific changes proposed for the sixth Allocation Round of the CfD scheme (AR6), as well as early views on longer-term policy considerations for future rounds. Through ensuring an effective functioning of the CfD allocation rounds, this policy will support the delivery of low carbon electricity generating projects. On supporting repowered projects, Energy Security Plan states that government will consider how to ensure investment in repowered assets is appropriately valued in the market, to ensure locations with good energy resource continue to contribute to electricity security. This will include considering the potential of the CfD to support repowered projects, as part of a CfD consultation response by Spring. # Sector Policy Name Policy Description 4 Power Non Price Factors in The government is launching a Call for Evidence in April 2023 on the potential introduction of non-price factors into the CfD. If implemented, this would mean that, when considering CfD applications, HMG could take into account additional factors of value to the system and not only the statutory considerations of value for money and maximising deployment. Any changes made to the CfD scheme under these proposed changes would support the delivery of low-carbon, low-cost electricity generation capacity. This scheme supported investment in port infrastructure and manufacturing in the offshore wind supply chain. It was implemented to support development of offshore wind supply chain capacity. The scheme therefore indirectly supports emission reductions by de-risking the delivery of offshore wind capacity. OWAT’s work has helped put in place measures to accelerate the deployment of offshore wind and supported industry actions. The government has worked with the OWAT, Ofgem, the National Grid, the Crown Estates and the Devolved Administrations to speed up planning and consenting for offshore wind The Supply Chain and Infrastructure Working Group, established under OWAT, has also identified and addressed barriers to the development of the offshore wind supply chain. The Offshore Wind Environmental Improvement Package (OWEIP) will support the accelerated deployment of offshore wind, whilst maintaining environmental protections. The OWIEP will be implemented through regulations to adapt environmental assessments for offshore wind, enable strategic compensation and introduce industry funded Marine Recovery Funds. The government is seeking to introduce legislation through the Energy Bill to deliver the OWEIP, alongside non-legislative measures. This package will de-risk the delivery of offshore wind capacity including government's ambition to deploy up to 50GW offshore wind by 2030. 8 Power Floating Offshore Wind This scheme, which will launch in March 2023, will provide up to £160m to kick start investment in port infrastructure projects needed to deploy and service the scale of the floating offshore wind pipeline. This will indirectly support carbon emission reductions by de-risking the delivery of offshore wind capacity. 9 Power Floating Offshore Wind The government is working with the industry-led Floating Offshore Wind Taskforce to identify what investment in infrastructure is needed to support deployment of up to 5GW of floating offshore wind by 2030, and to support its further expansion into the 2030s and beyond. The taskforce will bring together companies from across the sector to coordinate their efforts, and speed up the further development. # Sector Policy Name Policy Description 10 Power Floating Offshore Wind The Floating Offshore Wind Demonstration Programme, using £31m government funding matched by £30m from industry, supports research and development to advance floating offshore wind technology. This work has the potential to enable the development and deployment of floating offshore wind capacity, and in doing so help the government achieve its ambition of up to 5GW floating offshore wind (part of the up to 50GW offshore wind ambition). DESNZ is working with industry, the Ministry of Defence, and The Crown Estate to find both interim and enduring solutions to mitigate air defence radar interference from offshore wind turbines. Similarly, government is working jointly with industry and the aviation sector to formulate a long-term strategy to address current and future civil radar interference issues. This policy is focussed on safety and security; and is not expected to lead to emissions savings. This package will de-risk the delivery of approximately 20GW of offshore wind capacity, and support ongoing The document 'Competition windfarm mitigation for UK Air Defence' on notes, 'The continued development of wind turbine sites has the potential to cause a number of negative effects on civil and military air traffic control and defence. Offshore windfarms, when in the line of sight of radar, have a detrimental effect on Ministry of Defence’s (MOD) primary surveillance radar capability used to deliver a recognised air picture for Air Defence.'
12 Power Local Partnerships for The government will consult on developing local partnerships for onshore wind in England so that those who wish to host new onshore wind infrastructure can benefit from doing so – a commitment made in the British Energy Security Strategy. The government is due to launch a new consultation to seek views on how to improve the system of engagement and benefits in England. The proposals in the consultation may help to indirectly reduce delays and improve the consenting of onshore wind planning applications by introducing policies to improve community support for onshore wind projects in England. However, the consultation does not include any policies that will directly drive the deployment of onshore wind. The cross-government, Defra-led Marine Spatial Prioritisation programme aims to support strategic planning of renewables and other sea uses by optimising use of the marine space, maximising coexistence between different sea users and balancing this with restoring and protecting the marine 14 Power Solar Taskforce and In line with the Skidmore Review recommendation, and to provide certainty to investors in the solar industry, the government will publish a solar roadmap setting out a clear step by step deployment trajectory to achieve a fivefold increase (up to 70GW) of solar by 2035. Government will also establish a government/industry taskforce, covering both ground mounted and rooftop solar to drive forward the actions needed by government and industry to make this ambition a reality. # Sector Policy Name Policy Description The government has supported the rollout of rooftop projects by removing VAT on solar panels installed on residential accommodations, and introducing capital allowances for rooftop solar panels until March 2027. This policy will incentivise residential solar deployment and therefore help to de-risk the delivery of solar capacity and support the government's ambition to deliver up to 70GW solar by 2035. 16 Power Permitted Development The government is currently consulting on changes to permitted development rights. The proposed changes seek to simplify planning processes for larger commercial rooftop installations and introduce a new permitted development right for non domestic solar canopies. The consultation was published on 28 17 Power Low-cost Finance for To meet the demand for rooftop solar, the government is looking at facilitating low-cost finance from retail lenders for homes and small business premises, aligning with recommendation in the Skidmore Net Zero The joint government/industry Green Jobs Delivery Group is developing an action plan which will address key emerging workforce challenges for solar and other renewables. The solar sector is also working with training partners, certification scheme providers and local bodies such as Mayor of London to provide grants, learning tools, and training and placement programmes. DESNZ expect that the new solar taskforce will consider further actions to build supply chain resilience and strengthen skills capability. This policy is key to ensuring the relevant skills and supply chain needed to build solar capacity are available, enabling the delivery of solar capacity. 19 Power Consultation on Future The government will explore how it can continue to drive onsite renewable electricity generation, such as solar panels, where appropriate in new homes and buildings. Bringing forward new renewables generation is a key component of decarbonising the power system. Recognising that onshore wind is an efficient, cheap and widely supported technology, government has consulted on changes to planning policy in England for onshore wind to deliver a localist approach that provides local authorities more flexibility to respond to the views of their local communities. We will respond to the NPPF consultation in due course. # Sector Policy Name Policy Description 21 Power Advice and Guidance The government will publish guidance to support the installation of solar technology on the Central government and wider public sector estate. This will incentivise and enable the deployment of solar 22 Power Biomass Strategy The government has committed to publishing a Biomass Strategy, which is due in 2023. The Strategy will set out how sustainable biomass could be best utilised across the economy to help achieve the government’s net zero and wider environmental commitments while also supporting energy security. The Strategy will also establish the role which BECCS can play in reducing carbon emissions across the economy and set out how the technology could be deployed. The government is exploring expanding the UK ETS to waste incineration and EfW by the mid-late This would incentivise the development and uptake of decarbonisation technologies and practices to reduce emissions from waste incineration and EfW, principally by strengthening long-term investment incentives. For example, the scheme could enhance the pre-treatment of waste before it is incinerated to reduce fossil plastic in the waste stream. This is otherwise a costly and intensive process. The expansion of the UK ETS would also incentivise investment into Carbon Capture and Storage (CCS) to reduce CO2 emissions from EfW, depending on wider availability of the technology and infrastructure, and cost-benefit to the plant. Due to biogenic content present in waste streams, in future operators may be able to generate ‘negative emissions’ by applying CCS equipment to EfW plants, depending on the level of biogenic CO2 captured. As per the consultation in March 2022 in Developing the UK ETS, we propose to explore expanding the UK ETS to waste incineration and EfW by the mid-late 2020s i.e. around the end of CB4. Government will respond to this consultation shortly and will set out more detail on the intended timing 24 Power Power Bioenergy with The government is developing a first of a kind (FOAK) business model for power Bioenergy with Carbon Capture and Storage (BECCS) to incentivise negative emissions and low carbon electricity generation. Power BECCS is expected to play an important role in helping the UK to achieve net zero and to contribute significantly to the ambition to deliver five million tonnes of GGRs by 2030, whilst also delivering low-carbon electricity to contribute toward security of supply within Great Britain.
The government consulted on the proposed business model framework last summer; consultation considered actions the government can take to enable the deployment of power BECCS at scale, through addressing prevailing market failures, deployment barriers and risks to investment. The consultation also proposed a number of high level business model design options, included a question on the most appropriate negative emissions market and posed questions on the proposal to include supply chain emission thresholds. The work on the business model will help to support our ambition to deploy power BECCS. A consultation response will be published imminently. # Sector Policy Name Policy Description Power BECCS provides two types of carbon savings. Within the Power sector, Power BECCS delivers carbon savings by displacing non-zero CO2 emissions electricity generation with low carbon electricity generation. Within the GGR sector, Power BECCS contributes carbon savings from generating negative emissions by capturing the CO2 emissions from biomass-to-power plants and storing those safely and 25 Power Power Carbon Capture, The government has announced the project negotiating list for Track 1 carbon capture, usage and storage (CCUS) clusters. The negotiating list contains one power CCUS project. The government will provide up to £20 billion funding for early deployment of CCUS across all sectors. Further projects will be able to enter a selection process for Track 1 expansion launching this year, and 2 additional clusters will be selected through a Track 2 process. The government has developed a Dispatchable Power Agreement (DPA) business model to bring forward a first of kind carbon capture, usage and storage (CCUS) power plant. The model will potentially supporting additional CCUS power plants in the future. When deployed, this first of a kind CCUS plant will provide low carbon electricity generation and reduce power sector emissions. 27 Power Hydrogen to Power In the Energy Security Plan, government announced our intention to consult in 2023 on the need and potential design options for hydrogen to power market intervention. To support the consultation development, government has commissioned external research on the need and case for market intervention to support hydrogen to power plants. This policy could enable the accelerated deployment of hydrogen to power capacity and the support the decarbonisation of the power sector. Emission reductions would be dependent on the pace and scale of deployment and so reductions are unquantified HMG published our Decarbonisation Readiness consultation in March 2023 on proposed updates to the 2009 Carbon Capture Readiness requirements. The proposals would require new build and substantially refurbishing combustion power plants to be built in such a way that they could easily decarbonise by converting to either 100% hydrogen generation or carbon capture technology. This policy does not have direct emission savings associated with it, but will enable emission savings

# Sector Policy Name Policy Description 29 Power Great British Nuclear The government is committing to a programme of new nuclear projects beyond Sizewell C, giving industry and investors the confidence, they need to deliver projects at speed, reducing costs through learning and replication. To deliver this, we have launched Great British Nuclear (GBN) which will be an arms-length body with the responsibility to drive delivery of new nuclear projects, backed with funding it The first priority for GBN is to launch a competitive process to select the best SMR technologies. This will commence in April with market engagement as the first phase. The second phase will follow in the summer, with an ambition to assess and decide on the leading technologies by autumn. We are working towards bringing forward legislation setting out Great British Nuclear’s statutory role when parliamentary time allows. In the meantime, work will continue at pace to achieve our ambition within the existing legal framework to support delivery of HMG’s ambitions. 30 Power Sizewell C Government Following the government's investment decision to take a £700m stake in Sizewell C, the government will work with EDF as a co-shareholder in the project to continue its development. This includes plans to prepare for a capital raise later this year, using the newly established RAB model for nuclear. The government’s investment was an historic step, as our first direct investment in a nuclear project for 35 years. New nuclear projects like Sizewell C will work alongside renewables to help to ensure secure and stable, low-cost and low-carbon electricity system for the long-term. 31 Power Regulated Asset Base Following consultation and the passing of the Nuclear Energy (Financing) Act 2022, the government is implementing a Regulated Asset Base (RAB) model as an option for funding new nuclear projects. In November 2022, the Sizewell C project became the first to be designated to benefit from the RAB model, following a statutory consultation. In sharing risk between projects and consumers (overseen by an economic regulator) RAB has the potential to reduce the cost of project capital, the biggest driver of nuclear project costs. The appropriate funding model for each new nuclear project will be determined through negotiations between government and the project’s developer. Providing this option to developers will support the development of new projects, helping the government achieve its ambition to have up to 24 GW of nuclear capacity by 2050. The government has committed to spend up to £385 million to invest in the next generation of nuclear technologies. This includes up to £210 million for Small Modular Reactors (SMRs) to develop a domestic smaller-scale power plant technology design, and funding for a research and development programme to deliver an Advanced Modular Reactor (AMR) demonstration by the early 2030s. While this policy will not deliver emissions savings itself, it will play an important role in enabling the

# Sector Policy Name Policy Description nuclear sector to evolve, potentially delivering additional low-carbon, low-cost power and heat, and helping the government achieve its ambition of up to 24 GW of nuclear capacity by 2050 The Future Nuclear Enabling Fund (FNEF) is a £120m fund announced in the government’s Net Zero Build Back Greener in 2021.
The fund is the first in a series of government interventions designed to achieve the government’s ambition of deploying up to 24GW of nuclear capacity by 2050, as announced in the British Energy Security Strategy (BESS). The FNEF will help industry reduce project risks, so they are better positioned for anticipated future investment decisions. The FNEF is be targeted at applicants that could be in a position to take a Final Investment Decision (FID) within the next parliament, subject to Value for Money and all relevant approvals. The government is making amendments to the Levelling-up and Regeneration Bill to give powers to the Secretary of State to improve the National Significant Infrastructure Projects (NSIP) system. Our aim is to bring forward and, where necessary, incentivise firm, flexible and variable low carbon technologies to meet anticipated demand and reduce reliance on unabated fossil fuel generation. This policy will enable the deployment of these low carbon technologies, which would be expected lead to carbon emissions 35 Power Interconnectors Ofgem's decision on Third Cap and Floor Window for Electricity Interconnectors and Ofgem’s Multi- Purpose Interconnector Pilot Scheme (publicly available, confirms Ofgem decisions on project eligibility) will incentivise and encourage investment in electricity and multi-purpose interconnectors. The cap and floor regime will deliver a new generation of interconnectors and the multi-purpose interconnector pilot will enable investment in low carbon infrastructure and more effective coordination in the delivery of low- The government will support the National Grid ESO on The Pathway to 2030 Holistic Network Design and Follow Up Exercise. This is a network design, delivered by the ESO, to connect the offshore wind projects covered by the Pathway to 2030 workstream of the Offshore Transmission Network Review in a coordinated manner. The Holistic Network Design will incentivise investment in network infrastructure which is needed to connect new generation offshore wind assets and demand to the grid, and to avoid congestion and permit the most efficient electricity system. The government will update the National Policy Statements for energy to ensure they provide a suitable framework to support decision making for nationally significant energy infrastructure. This is the first time they have been updated since 2011. The policy need for energy has been strengthened and the language of the NPSs has been simplified and made more accessible. An initial consultation was issued in early 2022, and documents have been further updated to reflect the increased ambition set out in the NZS and BESS. Stronger National Policy Statements will ensure that HMG has a planning policy framework which can support the infrastructure required to transition to net zero. # Sector Policy Name Policy Description 38 Power Offshore Transmission The review looks into the way that the offshore transmission network is designed and delivered, consistent with the ambition to deliver net zero emissions by 2050. It brings together the key stakeholders involved in the timing, siting, design and delivery of offshore wind to consider all aspects of the existing regime and how this influences the design and delivery of transmission infrastructure. The review is determining whether changes need to be made to offshore transmission networks to enable new generation to operate effectively, connect both new generation assets and demand to the grid, and accelerate transmission and distribution infrastructure build to avoid congestion and permit the most efficient system. The outcomes of the OTNR will support the delivery of offshore wind generation assets by accelerating the delivery of the transmission required to move power to the centres of demand. It will also reduce the local and environmental impacts of transmission through an increase in coordinated 39 Power Offshore Coordination The Offshore Coordination Support Scheme provides grants to offshore energy projects to develop coordinated options for offshore transmission infrastructure. The secondary objective of the scheme is to learn lessons from funding activities to support coordination in late-stage projects that can be applied to later workstreams of the Offshore Transmission Network Review (OTNR). The Scheme will complement those other arrangements to facilitate coordination being made as part of the OTNR. The Scheme is a competitive process under which one or more Applications may receive Grant funding. The scheme will enable the development of offshore low carbon infrastructure. This will support and enable the delivery of offshore wind capacity and help in delivering the ambition of up to 50GW offshore wind by 2030. Through primary legislation in the Energy Bill and forthcoming secondary legislation, the government will introduce competitive tendering in onshore electricity networks and an Energy Networks Special Merger Regime. Introducing competition will provide new opportunities to invest in networks where it is efficient to do so. The creation of a new competitive market should improve efficiency in investment, foster innovative solutions to network needs, including increasing the opportunities for smart and flexible solutions, and reduce costs to consumers. 41 Power Electricity Networks Early stage policy development - this joint DESNZ and Ofgem publication sets out a strategic framework, and actions the government and Ofgem are taking, to ensure the electricity network can act as an enabler of a secure, resilient, net zero energy system - for example (per the publication) 'speeding up the connections process by reviewing minimum standards for connections (in particular, the time it takes a customer to connect to the distribution grid); introducing a penalty-only incentive for distribution network operators to deliver on major network connections )'. The focus of this work is to enable the necessary transformation of the network at the scale and pace required to accommodate decarbonisation and demand growth. It is therefore a key enabler of decarbonisation and of other decarbonisation targets such as the government’s ambitions on offshore wind and solar generation and the 2035 phase out of new petrol and diesel cars and vans. # Sector Policy Name Policy Description 42 Power Electricity Networks The government appointed Nick Winser as Electricity Networks Commissioner to advise the government, Ofgem and industry on actions to accelerate the delivery of electricity transmission network infrastructure.
The Electricity Networks Commissioner is expected to make recommendations to government in June. This will enable decarbonisation through the potential to accelerate network infrastructure build, therefore allowing new generation and demand to connect to the grid more quickly. The government has published a consultation on community benefit options for network infrastructure ('Community Benefits for Electricity Transmission Network Infrastructure' March 2023) and, pending responses, intends to produce guidance on community benefits. The consultation considers different types of community benefits and how this can be implemented (e.g. voluntary or mandatory). The consultation proposes to introduce voluntary guidance on the appropriate levels and forms of benefits to give communities the knowledge, power and flexibility to decide what benefits they want in consultation with the project developer, with the option to move to a mandatory approach if necessary. The consultation proposes introducing a recommended level of funding for community benefits, which we believe will increase the level of funding from that seen in existing examples of community benefits for electricity transmission network infrastructure. The proposed guidance will focus on providing direct benefit payments to eligible individuals and wider community- focused benefits. Following consultation feedback, we intend to work with community and industry representatives to develop the guidance, which we intend to publish in 2023. The proposals enable decarbonisation by supporting the timely deployment of network infrastructure to connect low carbon generation and technologies, by improving community support and avoiding delays. To understand whether the current land rights and consenting processes for electricity network infrastructure are fit for purpose, government sought views on what improvements could be made in a call for evidence and will respond this year. This policy is likely to enable or incentivise timely deployment of electricity network infrastructure that will be necessary for connecting low carbon generation and Ofgem’s Accelerating Strategic Transmission Investment work seeks to accelerate regulatory approval for delivery of key strategic transmission network projects to 2030. This work will act as an enabler for investment into electricity transmission networks, enabling decarbonisation by allowing timely connection of low carbon generation and demand to the grid. 46 Power Fast-track System for DLUHC are designing a fast-track system for Nationally Significant Infrastructure Projects (NSIPs) that meet certain quality standards. The clauses are in the Levelling Up Regeneration Bill, which is going through Parliament, and pilots are expected to include offshore wind developments, de-risking the delivery of offshore wind capacity. # Sector Policy Name Policy Description Ofgem Final Determinations for Distribution Network Operators (DNOs) on expenditure for the next electricity distribution price control (RIIO-ED2) from 2023-2028. This policy will enable carbon savings as it will directly determine investment into electricity distribution networks that will be necessary for enabling the timely connection of low carbon electricity generation and demand. 48 Power Strategy and Policy The Strategy and Policy Statement (SPS) set out the government’s strategic priorities and other main considerations of its energy policy, the policy outcomes to be achieved as a result of the implementation of that policy, and the roles and responsibilities of those who are involved in implementation of that policy. The SPS will enable emissions savings because the Energy Act 2013 and imposed new duties on Ofgem to have regard to the strategic priorities when carrying out its regulatory functions and to carry out those functions in the way it considers is best calculated to further the delivery of the specified policy The government will be taking powers to establish the Future System Operator (FSO) through the Energy Bill. The FSO will build on the existing capabilities and functions of the Electricity System Operator, managing the electricity system in real time, as well as supporting its future development. It will also be responsible for gas strategic network planning, long-term forecasting and market strategy functions. No emissions savings have been quantified; it has no direct emission impacts but the body it enables (FSO) could be a significant driver of emission reductions. Through the legislation in the Energy Bill the government will be creating a new governance framework for the energy codes. This will empower Ofgem to set a strategic direction for how the detailed rules of the energy system should evolve each year and create licensed code managers to ensure that direction is delivered. The reforms will allow Ofgem to drive strategic change across the codes, for example for the coordinated delivery of Net Zero priorities, alongside benefits for consumers and competition. The new code governance framework will also aim to remove potential barriers to innovation arising from the current arrangement, ensuring the codes governance process is better equipped to facilitate the widespread changes required to deliver Net Zero. # Sector Policy Name Policy Description 51 Power Capacity Market 2023 The government has launched a consultation on "Capacity Market 2023: strengthening security of supply and alignment with net zero", which closed on 3rd March 2023. This policy aims to ensure that the capacity market remains fit for purpose while also looking at options for aligning the capacity market with the government's Net Zero ambitions. On Retail Markets, government are considering retail market reforms aimed at making sure the market supports the wider transformation of our energy system, whilst also working better for consumers and being more resilient and investable. We aim to publish a Call for Evidence in summer 2023 on how the retail regulatory framework needs to evolve to support new ways of offering energy supply. On the Review of Electricity Market Arrangements, the programme ('REMA') is exploring the reforms needed to (non-retail) electricity market arrangements to support delivery of a decarbonised power system by 2035, helping to deliver a cost-effective transition to a future net zero power sector, whilst maintaining a secure electricity supply. The government first consulted on REMA in 2022, and published the summary of responses in March 2023. We aim to publish a second REMA consultation in Autumn 53 Power Energy Digitalisation Delivering the actions set out in the Energy Digitalisation Strategy.
Continuing to work with Ofgem and Innovate UK, building on the joint response to the recommendations of the Energy Digitalisation Taskforce. The actions in the strategy will deliver greater digitalisation of the energy system and implementation of smart technologies needed to integrate low carbon technologies. The government will deliver the actions set out in the Smart Systems and Flexibility Plan. This will remove barriers to flexibility on the electricity grid and reform markets to reward flexibility. This includes legislating for enabling powers in the Energy Security Bill and consulting on proposals for a Secure and Smart Electricity System, alongside learning from innovative approaches such as the National Grid Electricity System Operator’s Demand Flexibility Service. These measures form part of our approach to bring forward and incentivise firm, flexible and low carbon technologies that are needed to meet demand and ensure security of supply and de-risking the delivery of emission reductions in the power sector. # Sector Policy Name Policy Description Large scale, long duration storage (LLES) is a key enabler to a secure, cost-effective and low carbon energy system. It has an important role to play in achieving net zero, helping to integrate renewables, maximising their use, contributing to security of supply, and helping manage constraints in certain areas. LLES technologies provide low carbon flexibility, replacing some unabated gas generation. DESNZ will ensure the deployment of sufficient LLES to balance the overall system by developing appropriate policy Energy storage has the ability to significantly reduce carbon emissions by shifting low-carbon energy supply to meet demand. To support development of new energy storage technologies the government has been running the Longer Duration Energy Storage (LODES) innovation competition. The first phase of the £68m LODES program, the feasibility phase, has successfully concluded. In November 2022 we announced £32.9 million of LODES funding awarded to successful Phase 2 projects (build and demonstration phase). DESNZ expect to announce further recipients of Phase 2 funding in early 2023 as part of the £1 billion Net Zero Innovation Portfolio. While it is expected that these projects will deliver demonstration schemes. They are intended to be proofs of concept and so carbon emissions savings have not been determined for this competition. 57 Power Flexibility Innovation To support widespread electricity system flexibility, the government has been running the Flexibility Innovation Programme (FIP), part of the £1 billion Net Zero Innovation Portfolio. This Programme, worth up to £65 million, is supporting over 40 innovation projects, and includes innovation action on Interoperable Demand Side Response, Alternative Energy Markets, Vehicle-to-Everything and Automatic Asset Registration. These projects are intended to support innovation, deliver proof of concepts, and deliver insights to policy development which will enable decarbonisation of the energy system; and so carbon emissions savings have not been determined for this policy. HMG continues to support the potential deployment of hydrogen in heat (through commercialising hydrogen deployment through funding via the Net Zero Innovation Fund, for instance) and also support for electrification of heat, for instance through increased use of heat pumps. Because of this, we have modelled different decarbonisation pathways for parts of the buildings and fuel supply sectors that vary depending on the level of deployment of hydrogen across the economy. This applies to three policy areas covering heat pump deployment, buildings “on the gas grid”, and the emissions associated with hydrogen production. Modelled scenarios show how differing uptake rates of hydrogen may displace some electrification across the economy. These scenarios are mutually exclusive of one another. Emissions savings from the high electrification scenario cannot be summed together with those from a "medium" or "high" hydrogen scenarios. Likewise, savings from "high" and "medium" hydrogen scenarios cannot be summed together. Although our list therefore includes proposals and policies in different scenarios, we do not double count these emission savings in analysis presented elsewhere in this report. 58 Fuel Supply 10GW Low Carbon Delivery of the 2030 ambition for 10GW low carbon hydrogen production capacity, with at least half from electrolytic hydrogen, will be supported through a range of measures. # Sector Policy Name Policy Description a) £240m Net Zero Hydrogen Fund (capital b) Hydrogen Production Business Model (funded via the Industrial Decarbonisation and Hydrogen c) Industrial Decarbonisation and Hydrogen Revenue Support scheme (IDHRS), which will support both electrolytic (‘green’) and CCUS enabled methane reformation (‘blue’) low carbon d) New business models for hydrogen transport and storage infrastructure by 2025, which will grow the hydrogen economy and provide security e) Working with industry and other stakeholders to develop a hydrogen production roadmap on the scaling up of hydrogen production and supply chain growth across the decade We have announced today the shortlist of projects to take through to due diligence for the first electrolytic allocation round, which will offer support from our Net Zero Hydrogen Fund and from the Hydrogen Production Business Model. Please refer to the note on hydrogen modelling above and the Technical Annex for an explanation of our modelling in this sector. 59 Fuel Supply 10GW Low Carbon This is a modelled scenario covering hydrogen production capacity deployment to 2037 in a scenario where heating is electrified. It only includes production capacity which is additional to our 10GW ambition, so it is additive to the '10GW low carbon hydrogen production by 2030 and beyond' ((HYbase – line 58) line. This scenario assumes hydrogen production capacity reaches a

# Sector Policy Name Policy Description total of 18GW by 2037, which is sufficient to meet demand for hydrogen in a scenario where heat is electrified. This scenario would require further policy development beyond 2030. Our production policies are grouped together to model our planned hydrogen production deployment. It is not possible to quantitatively split out the impact of the separate policies, as they each contribute to hydrogen production and are interlinked.
Hydrogen production alone will not generate carbon savings, but we expect it to enable potential carbon savings in several sectors including industry, power, transport and potentially buildings by replacing high-carbon a) £240m Net Zero Hydrogen Fund (capital b) Hydrogen Production Business Model (funded via the Industrial Decarbonisation and Hydrogen c) Industrial Decarbonisation and Hydrogen Revenue Support scheme (IDHRS), which will support both electrolytic (‘green’) and CCUS enabled methane reformation (‘blue’) low carbon d) New business models for hydrogen transport and storage infrastructure by 2025, which will grow the hydrogen economy and provide security e) Working with industry and other stakeholders to develop a hydrogen production roadmap on the scaling up of hydrogen production and supply chain growth across the decade We have announced on 30 March the shortlist of projects to take through to due diligence for the

# Sector Policy Name Policy Description first electrolytic allocation round, which will offer support from our Net Zero Hydrogen Fund and from the Hydrogen Production Business Model. We are aiming to run annual allocation rounds for electrolytic hydrogen, moving to price competitive allocation by 2025 as soon as legislation and market conditions allow. This means that we aim to have up to 1GW of electrolytic hydrogen in construction or operational by 2025, with up to 2GW of production capacity overall (including CCUS-enabled hydrogen) in operation or Please refer to the note on hydrogen modelling above and the Technical Annex for an explanation of our modelling in this sector. 60 Fuel Supply 10GW Low Carbon This is a modelled scenario covering hydrogen production capacity deployment to 2037 in a scenario where hydrogen is used for heating. It only includes production capacity which is additional to our 10GW ambition, so it is additive to the '10 GW low carbon hydrogen production by 2030 and beyond' line. This scenario assumes hydrogen production capacity reaches a total of 34GW by 2037, sufficient to meet demand for hydrogen in a scenario where hydrogen is used for heat. This scenario would require further policy Our production policies are grouped together to model our planned hydrogen production deployment. It is not possible to quantitatively split out the impact of the separate policies, as they each contribute to hydrogen production and are interlinked. Hydrogen production alone will not generate carbon savings, but we expect it to enable potential carbon savings in several sectors

# Sector Policy Name Policy Description including industry, power, transport and potentially buildings, as a replacement to high- a) £240m Net Zero Hydrogen Fund (capital b) Hydrogen Production Business Model (funded via the Industrial Decarbonisation and Hydrogen c) Industrial Decarbonisation and Hydrogen Revenue Support scheme (IDHRS), which will support both electrolytic (‘green’) and CCUS enabled methane reformation (‘blue’) low carbon d) New business models for hydrogen transport and storage infrastructure by 2025, which will grow the hydrogen economy and provide security e) Working with industry and other stakeholders to develop a hydrogen production roadmap on the scaling up of hydrogen production and supply chain growth across the decade We have announced on 30 March the shortlist of projects to take through to due diligence for the first electrolytic allocation round, which will offer support from our Net Zero Hydrogen Fund and from the Hydrogen Production Business Model. We are aiming to run annual allocation rounds for electrolytic hydrogen, moving to price competitive allocation by 2025 as soon as legislation and market conditions allow. This means that we aim to have up to 1GW of electrolytic hydrogen in construction or operational by 2025, with up to 2GW of production capacity overall (including CCUS-enabled hydrogen) in operation or

# Sector Policy Name Policy Description Please refer to the note on hydrogen modelling above and the Technical Annex for an explanation of our modelling in this sector. 61 Fuel Supply Bio-Generation This line represents emissions created as a by- product of our policy framework to deliver increased production of biomethane and associated carbon savings. Biomethane will play an important role in decarbonising the gas grid and supporting various pathways to Net Zero. This framework, which would be subject to public consultation, would build on the Green Gas Support Scheme (GGSS), which will increase the amount of biomethane injected into the gas grid and closes to new applicants in 2025/6 62 Fuel Supply Flaring and Venting Reduce emissions from the practice of gas flaring and venting in the oil and gas industry. This policy is in line with government’s commitment to the World Bank’s ‘Zero Routine Flaring by 2030’ initiative, the North Sea Transition Deal and the sector’s target for 50% reduction of emissions by The North Sea Transition Authority’s Strategy includes the expectation that flaring, venting, and associated emissions will be at the lowest possible levels and requires new developments to be planned based on zero routine flaring and 63 Fuel Supply Electrification of This is a policy to promote electrification of existing and new offshore oil and gas production assets in the North Sea via integration with the onshore grid and offshore renewables infrastructure, with the aim of reducing emissions by 50% by 2030, and 100% by 2050. The policy is

# Sector Policy Name Policy Description North Sea Transition Deal and will be delivered by government, key regulators including the North Sea Transition Authority and industry. 64 Fuel Supply Reducing Methane This is an Ofgem and Health and Safety Executive (HSE) policy to reduce methane leakage from the Gas Distribution Networks through the replacement of old iron mains pipes with new plastic pipes, through the Ofgem/HSE Iron Mains Risk Reduction Programme (IMRRP). Ofgem funds this work through the RIIO-2 price control (as set out in the price control framework). Leakage rates for plastic pipes are around 99% lower than for metallic pipes. 65 Industry Industrial Carbon Business model for Industrial Carbon Capture (ICC), comprising upfront capital support (via the CCS Infrastructure Fund) and ongoing revenue support (via the Industrial Decarbonisation and Hydrogen Revenue Support (IDHRS) scheme) as part of the Track 1 CCUS Cluster Sequencing process programme.
DESNZ will work to evolve the business model and allocation process to enable us to contribute and deliver these long- term ambitions. Updated business model contracts with further technical contractual drafting are planned to be published in 2023. Preparations to lay relevant secondary legislation in 2023 (following the Energy Security Bill) are also being made. The start date for this row contains a degree of uncertainty. The actual start dates are subject to successful project negotiations with multiple projects and clusters, 0.084 0.9 0.9 Late CB4 - Early

# Sector Policy Name Policy Description 66 Industry Industrial Carbon Building on the Industrial Carbon Capture (ICC) business models as part of the Track 1 CCUS Cluster Sequencing process develop further support for Industrial Carbon Capture (ICC) for the additional carbon capture of industrial emissions to achieve 6 MtCO2 p.a. in total by 2030. Note that this scenario is the additional capture needed (after the Track-1 Cluster Sequencing scenario) and will not achieve the NZS ambitions without the scenario above. As such, it relies upon the delivery mechanisms set out under the Track 1 ICC sequencing process This is planned to be delivered via Track 2 of CCUS Cluster Sequencing process and expansion of Track-1 clusters. We plan to set out a vision for the UK CCUS sectors in 2023 to raise confidence and improve visibility for investors. 67 Industry Industrial Carbon Business model for Industrial Carbon Capture (ICC) support needed to achieve 10 MtCO2 p.a. in total by 2035. This includes the ambition to capture and store 9MtCO2pa of industrial emissions by 2035, as set out in the Net Zero Strategy. It is anticipated that an additional 1MtCO2pa could, if required, be delivered by industrial carbon capture, but the best mechanism for doing so remains under review. We will work to evolve the business model and allocation process to enable us to contribute and deliver these long-term ambitions. Note that this scenario is the additional capture needed (after the 6 Mt ambition) and will not achieve the NZS ambitions without the scenario above. As such, it relies upon the delivery mechanisms set out under the Track 1 ICC sequencing process and Track 2/Track 1 expansion rows. Updated business model contracts with further technical contractual drafting are planned to be published in 2023. # Sector Policy Name Policy Description 68 Industry Industrial Energy The Industrial Energy Transformation Fund (IETF) supports industrial sites with high energy use to transition to a low carbon future. The fund targets existing industrial processes, helping industry to cut energy bills by investing in more efficient technologies and reduce emissions by bringing down the costs and risks associated with investing in deep decarbonisation technologies. Grant funding is allocated through a competitive process aimed at supporting the highest quality and most transformational bids. The fund is open to a broad range of industrial sectors of all sizes and will support applicants based in England, Wales, and Northern Ireland, both within and outside of industrial clusters. Phase 2 of the Fund closed to new applications in February 2023. The average annualised carbon the EEP and are therefore in addition to those newly committed funding to extend the IETF for a Phase 3 round of applications are not included. Proposal for steelmaking to be carried out through electrification by 2035 with recycled steelmaking supplemented with ore-based iron imports. Limited near-term savings are achieved through existing policies. The proposal could potentially be developed further to replace ore-based iron imports with domestic near-zero hydrogen iron- making as the next step process. 70 Industry Industrial Non-Road Publish an industrial non-road mobile machinery (NRMM) strategy to ensure that emissions savings are delivered. The strategy will set out how the sector can decarbonise while maintaining competitiveness, attracting investment and supporting growth. To deliver the strategy, government is developing its evidence base on NRMM decarbonisation options through ongoing

# Sector Policy Name Policy Description external research and a call for evidence planned for late 2023. Government has made support available for NRMM decarbonisation through schemes such as the £40m Red Diesel Replacement competition, the Industrial Energy Transformation Fund (IETF), and the Renewable Transport Fuel Obligation (RTFO). We expect our ambition to achieve 50TWh of industrial fuel switching to low carbon fuels by 2035 primarily to be reached via switching from fossil fuels to electricity and hydrogen. Bioenergy is an additional fuel source that could enable carbon savings where other low carbon alternatives aren't available or through BECCS to generate negative emissions. The split will depend on the availability, cost and technical feasibility of the various fuel switching options We will explore measures to address barriers inhibiting the switch away from fossil fuels to electricity, including capital and operational costs such as the fuel cost barrier, through publishing a call for evidence in 2023. The call for evidence will seek industry’s, and other stakeholders’, views on overcoming barriers to electrification. This is part of a broader policy package to reach industrial fuel switching target of 50TWh low The savings represented in rows 71/72/73 are the collective result of the policies on those rows, so sets of individual fuel switching policies, and should not be summed together. # Sector Policy Name Policy Description We expect our ambition to achieve 50TWh of industrial fuel switching to low carbon fuels by 2035 primarily to be reached via switching from fossil fuels to electricity and hydrogen. Bioenergy is an additional fuel source that could enable carbon savings where other low carbon alternatives aren't available or through BECCS to generate negative emissions. The split will depend on the availability, cost and technical feasibility of the various fuel switching options. Having published our response to the call for evidence on 'Enabling or requiring hydrogen- ready industrial boiler equipment’, we will sponsor the BSI to ensure that hydrogen-ready industrial- sized boiler equipment is covered by a Publicly Available Specification (PAS). This will help establish best practice for the production and installation of hydrogen ready equipment, designed to facilitate a switch to low carbon hydrogen.
We will explore further measures to incentivise fuel switching through regulating out the use of unabated fossil fuels in industry. Measures under consideration include product regulation, environmental permitting, or a combination of the two. Any potential measures taken forward will be designed through consultation with relevant industries and The savings represented in rows 71/72/73 are the collective result of the policies on those rows, so sets of individual fuel switching policies, and should not be summed together. # Sector Policy Name Policy Description We expect our ambition to achieve 50TWh of industrial fuel switching to low carbon fuels by 2035 primarily to be reached via switching from fossil fuels to electricity and hydrogen. However, bioenergy is an additional fuel source that could enable carbon savings where other low carbon alternatives are not available or through BECCS to generate negative emissions. The split will depend on the availability, cost and technical feasibility of the various fuel switching options. We will explore measures to direct the use of biomass, a limited resource, within the industrial sector to achieve industrial decarbonisation. The upcoming Biomass Strategy, due for publication in 2023 Q2, will review the amount of sustainable biomass available to the UK and how this resource could be best utilised across the economy. The outcomes of the strategy will guide the next stage where we will develop a policy package that strives to make best use of biomass as a transitional fuel, and generate negative emissions in combination with bioenergy with carbon capture and storage (BECCS). The savings represented in rows 71/72/73 are the collective result of the policies on those rows, so sets of individual fuel switching policies, and should not be summed together. 74 Industry Industrial Resource This is a proposal in an early stage of development, but government has recognised the importance of Industrial Resource Efficiency (RE) as a decarbonisation lever in HMG's Industrial Decarbonisation and Net Zero Strategies (2021). Research is underway to identify the full range of Industrial Resource Efficiency measures that, if

# Sector Policy Name Policy Description implemented, could deliver against the modelled RE emissions savings in the Net Zero Pathway. We are supporting greater collaboration across government departments to accelerate and co- ordinate actions to encourage reuse, recycling, repair, remanufacture, and material substitution, supporting the development of new resource 75 Industry Industrial Energy This is a proposal in an early development stage that will look to tackle multiple barriers that businesses face to investing in energy efficiency measures with limited near term savings achieved through existing policies. This is in order to deliver wider HMG ambitions on Net Zero and energy security and the recently announced target to reduce total UK energy demand by 15% from 2021 levels by 2030. As part of this, we intend to launch a pilot which will offer advice, energy audits and grants to 4000 SMEs. The pilot will allow us to learn lessons and gather evidence to inform future policy making, and reduce energy 76 Industry Non Domestic Energy The government has consulted on proposals for the private rented sector and will publish the government response in due course. 0.044 0.1 0.1 Late CB4 subject 77 Industry Non Domestic Energy We will consider how we can further support greater energy efficiency in owner occupied 0.068 0.2 0.4 Late CB4 subject

# Sector Policy Name Policy Description 78 Industry Phasing Out Fossil The government consulted on proposals in late 2021 and will publish the government response in 0.006 0.080 0.2 Late CB4, subject A mandatory energy assessment scheme for large UK industrial businesses’ energy use opportunities at least every four years, intended to identify practicable and cost-effective energy saving opportunities. ESOS is to be strengthened through the Energy Security Bill. The key changes are to strengthen requirements for audits and make them more standardised, to improve the quality of ESOS audits e.g. through better oversight of assessors and to require additional public disclosures from the audits. We have also announced the introduction for the next ESOS phase a requirement for the audits to include a net zero element and are sponsoring new PAS standard. Through the consultation we also sought views on the potential expansion to a wider range of businesses and requiring mandatory implementation of recommendations, which we are considering as options for future 80 Industry Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic building on the gas grid. The policy is split across four lines to represent various options to electrify heat or deploy High electrification This is a modelled scenario for emission savings for policies to phase out fossil fuel heated systems in non- domestic buildings on the gas grid. There are a range of measures which would be subject to future consultation. For 2030 onwards, there are

# Sector Policy Name Policy Description three different scenarios with involving a different balance of deploying hydrogen and electrification. This is because if more hydrogen heating is rolled out, then less electrification (i.e. fewer heat pumps) are required to achieve the same carbon savings. To capture the full picture, this policy should be captured with one of the scenario - Assumes the deployment of little to no hydrogen, alongside heat pumps post 2030. - Assumes the deployment of a "High" level of hydrogen alongside heat pumps post 2030. - Assumes the deployment of a "Medium" level of hydrogen alongside heat pumps post 2030. The non-traded emissions are the same in each scenario but the traded emissions and hydrogen demand will change. Hydrogen scenario is dependent on the domestic hydrogen scenario. 81 Industry Phasing Out Fossil There will be a need to phase out fossil fuel systems in industrial buildings on the gas grid.
The policy is split across four lines to represent various options to electrify heat or deploy High electrification This represents early stage policies that to grow the heat pump market in industrial buildings on the gas grid to the extent that would be required in a high-electrification scenario (where hydrogen plays a limited or no role in heating). We will seek to grow the market and transition consumers, while continuing to follow natural replacement cycles to work with the grain of consumer behaviour. For industrial buildings, we could focus initially on key segments of the building stock, for example based on tenure or building use. # Sector Policy Name Policy Description 82 Industry Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic industrial buildings on the gas grid. The policy is split across four lines to represent various options to electrify heat or High hydrogen This represents early stage policies in a high hydrogen scenario would be taken in addition to base high electrification scenario measures to grow the heat pump market) in order to roll out hydrogen for heat to the extent required in a high hydrogen scenario. To note, a high hydrogen scenario would require chosen policy mechanisms to deliver a more extensive rollout of hydrogen for heat than in a 83 Industry Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic industrial buildings on the gas grid. The policy is split across four lines to represent various options to electrify heat or Medium hydrogen This represents early stage policies which in a medium hydrogen scenario would be taken in addition to the base electrification scenario above (measures to grow the heat pump market) in order to roll out hydrogen for heat to the extent required in a medium hydrogen scenario. To note, a medium hydrogen scenario would require chosen policy mechanisms to deliver a less extensive rollout of hydrogen for heat than in a high hydrogen The non-traded emissions are the same in each scenario but the traded emissions and hydrogen demand will change. Hydrogen scenario is dependent on the domestic hydrogen scenario. # Sector Policy Name Policy Description 84 Buildings Non Domestic Energy The government has consulted on proposals for the private rented sector and will publish the government response in due course. 0.2 0.4 0.4 Late CB4 subject 85 Buildings Non Domestic Energy We will consider how we can further support greater energy efficiency in owner occupied 0.083 0.3 0.5 Late CB4 subject 86 Buildings Building Regulations - An uplift to the energy efficiency standards for non-domestic buildings was implemented in December 2021 and came into force in June 2022, delivered through changes to the Building Regulations and publication of statutory 87 Buildings Phasing Out Fossil The government consulted on proposals in late 2021 and will publish the government response in 0.012 0.081 0.1 Late CB4, subject A mandatory energy assessment scheme for large UK commercial businesses’ energy use opportunities at least every four years, intended to identify practicable and cost-effective energy saving opportunities. ESOS is to be strengthened through the Energy Security Bill. The key changes are to strengthen requirements for audits and make them more standardised, to improve the quality of ESOS audits e.g. through better oversight of assessors and to require additional public disclosures from the audits. We have also announced the introduction for the next ESOS phase a requirement for the audits to include a net zero element and are sponsoring new PAS standard. Through the consultation we also

# Sector Policy Name Policy Description sought views on the potential expansion to a wider range of businesses and requiring mandatory implementation of recommendations, which we are considering as options for future 89 Buildings Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic building on the gas grid. The policy is split across four lines to represent various options to electrify heat or deploy High electrification This is a modelled scenario for emission savings for policies to phase out fossil fuel heated systems in non- domestic buildings on the gas grid. There are a range of measures which would be subject to future consultation. For 2030 onwards, there are three different scenarios with involving a different balance of deploying hydrogen and electrification. This is because if more hydrogen heating is rolled out, then less electrification (i.e. fewer heat pumps) are required to achieve the same carbon savings. To capture the full picture, this policy should be captured with one of the scenario - Assumes the deployment of little to no hydrogen, alongside heat pumps post 2030. - Assumes the deployment of a "High" level of hydrogen alongside heat pumps post 2030. - Assumes the deployment of a "Medium" level of hydrogen alongside heat pumps post 2030. The non-traded emissions are the same in each scenario but the traded emissions and hydrogen demand will change. Hydrogen scenario is dependent on the domestic hydrogen scenario. # Sector Policy Name Policy Description 90 Buildings Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic building on the gas grid. The policy is split across four lines to represent various options to electrify heat or deploy High electrification This represents early stage policies that to grow the heat pump market in non-domestic buildings on the gas grid to the extent that would be required in a high- electrification scenario (where hydrogen plays a limited or no role in heating). We will seek to grow the market and transition consumers, while continuing to follow natural replacement cycles to work with the grain of consumer behaviour. For non-domestic buildings, we could focus initially on key segments of the building stock, for example based on tenure or building use. 91 Buildings Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic building on the gas grid.
The policy is split across four lines to represent various options to electrify heat or deploy High hydrogen This represents early stage policies in a high hydrogen scenario would be taken in addition to base high electrification scenario measures to grow the heat pump market) in order to roll out hydrogen for heat to the extent required in a high hydrogen scenario. To note, a high hydrogen scenario would require chosen policy mechanisms to deliver a more extensive rollout of hydrogen for heat than in a

# Sector Policy Name Policy Description 92 Buildings Phasing Out Fossil There will be a need to phase out fossil fuel systems in non-domestic building on the gas grid. The policy is split across four lines to represent various options to electrify heat or deploy Medium hydrogen This represents early stage policies which in a medium hydrogen scenario would be taken in addition to the base electrification scenario above (measures to grow the heat pump market) in order to roll out hydrogen for heat to the extent required in a medium hydrogen scenario. To note, a medium hydrogen scenario would require chosen policy mechanisms to deliver a less extensive rollout of hydrogen for heat than in a high hydrogen The non-traded emissions are the same in each scenario but the traded emissions and hydrogen demand will change. Hydrogen scenario is dependent on the domestic hydrogen scenario. 93 Buildings Private Rented Sector Proposals to strengthen the Minimum Energy Efficiency Standard Regulations for the domestic Private Rented Sector in England and Wales to EPC Band C by 2025 for new tenancies and 2028 for all tenancies. We will publish a summary of responses to the consultation on improving the energy performance of privately rented homes. these savings reflect the consultation stage IA published in September 2020; the estimated carbon savings will be updated once final policy Early stage proposal to develop regulations to introduce Social Rented Sector (SRS) Minimum Energy Efficiency Standards (MEES), subject to consultation. Following the 2020 Social Housing White Paper, the 2021 Heat and Buildings Strategy committed government to consider

# Sector Policy Name Policy Description setting a new regulatory standard of EPC Band C for the social rented sector. We have committed to begin the consultation process on a minimum energy efficiency standard for the social rental sector, within six months of the Social Housing Regulation Bill receiving Royal Assent. Take action following a government consultation on proposals for mortgage lenders to support homeowners to improve the energy performance of their properties. A government response will be published by the end of 2023. these savings reflect the consultation stage IA published in November 2020; the estimated carbon savings will be updated once final policy decisions have 96 Buildings Phasing Out Fossil The government consulted on proposals in late 2021 and will publish the government response in 0.052 1.4 3.4 Late CB4, subject Regulations from 2025 through the Future Homes Standard to ensure all new homes are ready for net zero by having a high standard of energy efficiency and low carbon heating installed as standard. The technical detail is subject to 98 Buildings Building Regulations - Uplift to the energy efficiency standards for new domestic buildings, delivered through changes to the Building Regulations and publication of new statutory guidance. The standard applies when certain building works take place. 99 Buildings Building Regulations - Uplift to the energy efficiency standards for existing domestic buildings, delivered through changes to the Building Regulations and publication of new statutory guidance. # Sector Policy Name Policy Description 100 Buildings Local Authority Delivery LAD 3 to raise the energy efficiency of low income and low energy performance homes with a focus on energy performance certificate (EPC) ratings of E, F or G. LAD 3 allocated £286.8m to Local 101 Buildings Home Upgrade Grant - Up to £218m of grant funding for local authorities to improve the energy performance and heating systems of low income households living off the gas grid in England (2022-2023). Will achieve carbon saving through energy demand reduction in homes and transition from fossil fuel to low carbon heating. Scheme in delivery. 102 Buildings Home Upgrade Grant - Up to £630m in grant funding for local authorities to improve the energy performance and heating systems of low income households living off the gas grid in England (2023-2025). Will achieve carbon saving through energy demand reduction in homes and transition from fossil fuel to low 103 Buildings Home Upgrade Grant - Up to £100m of funding for eligible consumers to improve the energy performance and heating systems of off gas grid homes in England. Importantly, it would use an assessment of household income in order to approve eligibility. Scheme is at the policy development stage and is anticipated to be launched in financial year 24/25. 104 Buildings Great British Insulation The £1 billion Great British Insulation scheme (formerly ECO+) will see hundreds of thousands of homes across the country receive new home insulation, saving consumers around £310 a year. The Great British Insulation scheme will extend support to those in the least energy efficient homes in the lower Council Tax bands, as well as

# Sector Policy Name Policy Description 105 Buildings Social Housing The government launched Wave 1 of the SHDF in August 2021. It has awarded around £179m of grant funding for delivery from 2022 into 2023, and will see energy performance improvements to up to 20,000 social housing properties. 106 Buildings Social Housing £800m has been committed for the SHDF as part of the 2021 Spending Review settlement. The Wave 2.1 competition, which closed on 18 November 2022, will look to allocate up to £800m of grant funding to support the installation of energy performance measures in social homes in England. Successful projects are likely to be notified in March 2023.
Delivery will continue until 107 Buildings Social Housing The funding will upgrade a significant amount of the social housing stock currently below EPC C up to that standard, delivering warmer and more energy-efficient homes, reducing carbon emissions and bills, and tackling fuel poverty as well as supporting green jobs. 108 Buildings Clean Heat Market A new market-based incentive for heating appliance manufacturers, similar to obligations in sectors such as low-emissions vehicles and renewable electricity generation, to support investment in increasing the proportion of low- carbon heating appliances installed relative to fossil fuel boilers over the years 2024 to 2028. 109 Buildings Heat Network Market The Heat Networks Regulation will use new primary legislation to appoint Ofgem as the heat network regulator in GB and the CCNI in NI. Under this system of regulation consumers will be given equivalent levels of protection to those on electricity and gas with new regulatory powers to ensure all consumers are treated fairly and networks are run to high standards. We will also help operators run their heat networks as cost- efficiently as possible, delivering further savings

# Sector Policy Name Policy Description for consumers and government will have powers to regulate the carbon emissions of heat networks so that they meet their 2050 net-zero target. Finally, it will make it easier for investors to enter the sector and level the playing field with other 110 Buildings Green Heat Networks The Green Heat Network Fund (GHNF) is an existing capital grant support programme available for the development of new and existing low and zero-carbon heat networks within the current SR. This is a proposal to extend capital support to continue to grow the heat networks market. Carbon savings are achieved by displacing existing fossil fuel heating systems with heat networks supplied by low carbon sources which is achieved through competitive funding 111 Buildings Consumer information A “minimum viable product” one-stop shop where you can connect your EPC to your home and get bespoke advice on energy efficiency. The next stage will be to connect that advice to the government-funded schemes such as the Home 112 Buildings Heat Network Zoning Through new powers in the Energy Bill, Heat Network Zoning will be introduced by no later than 2025. Zoning will involve the identification and designation of areas where heat networks are expected to be the lowest cost solution for decarbonising heat. Carbon savings are achieved by displacing existing fossil fuel heating systems with heat networks supplied by low carbon The Heat Network Efficiency Scheme (HNES) will provide grant funding to existing heat network projects in England and Wales, in order to address customer detriment and deliver network efficiency improvements. The scheme grant

# Sector Policy Name Policy Description budget is £32m, with eight funding windows planned across 23/24 and 24/25. The Heat Network Efficiency Scheme (HNES) is an existing capital support programme that supports performance improvements to existing heat networks or communal heating projects within the current Spending Review period. This is a proposal to extend capital support to continue to support performance improvements in future years, subject to future Spending Reviews. 115 Buildings Energy-related Product Ecodesign regulation to raise minimum energy performance standards for domestic cooking appliances (ovens and hobs) in order to phase out the worst performing appliances as the market towards more efficient and low carbon products, 116 Buildings Energy-related Product Improved information about energy consumption of energy using products provided on energy labels in order to allow consumers to make informed purchases and buy the most energy 117 Buildings Energy-Related Ecodesign regulation to introduce minimum energy performance standards for non domestic cooking appliances, subject to consultation. 0.038 0.2 0.3 Second half of 118 Buildings Energy-Related Update to energy efficiency requirements and introduction of resource efficiency requirements for a range of products (starting with lighting and space heating appliances) following the work of the Energy-related Product Policy Framework,

# Sector Policy Name Policy Description which identified a range of products with high potential for additional energy efficiency gains as well as other mitigation of other environmental 119 Buildings Boiler Efficiency A package of measures to improve domestic gas boiler heating system efficiency. The policy is aimed at ensuring gas boilers are operating at their best after they have been fitted into homes, through a combination of energy saving technologies, better boiler product standards and supporting improved design and maintenance of heating distribution systems, following consultation in December 2022. This builds on the previous standards for domestic gas boilers, the Boiler Plus Standards, that were introduced in Drive forward commercial-scale gasification given its potential for biomethane production. The proposal is at an early stage of policy development and would be subject to 121 Buildings Biomethane - Future Create a policy framework to deliver increased production of biomethane and associated carbon savings, subject to consultation. This will follow the current Green Gas Support Scheme (GGSS) and increase the amount of biomethane injected Future phases of the PSDS scheme, with the aim of reducing direct emissions from public sector buildings by 75% by 2037. Mechanism for delivery is a 2021-2032 grant scheme for Public Sector Organisations to decarbonise their heat and install energy efficiency measures. # Sector Policy Name Policy Description 123 Buildings Additional Retrofit Heat Part of the ‘high electrification’ pathway, requiring an increase in heat pump installations. Drive forward mechanisms to increase the retrofitting of existing properties. Delivery mechanisms under consideration include capital schemes to support consumers, regulation to better incentivise industry and other methods of building the supply chain for heat pump manufacturing and installation. 124 Buildings Hydrogen Heating Part of the "high hydrogen" scenario in which hydrogen makes up a large proportion of the mix The gas grid could be converted to handle hydrogen for heat (domestic & non-domestic) required in high hydrogen scenario, in order for hydrogen heating to contribute to the replacement of the incumbent technology of natural gas for heating to deliver carbon savings.
125 Buildings Additional On Gas Grid Part of the "high hydrogen" scenario in which hydrogen makes up a large proportion of the mix For all hydrogen scenario The deployment of heat pumps beyond 2028 will depend on wider commercial factors such as the cost of heat pumps (both their upfront costs and running costs) and the successful commercialisation of hydrogen to heat buildings - as well as continued government action through a range of measures. Heat pump deployment is lower in a scenario of greater hydrogen uptake. Government is planning to take a strategic decision on the role of hydrogen heating in 2026. # Sector Policy Name Policy Description 126 Buildings Hydrogen heating Part of the "medium hydrogen" scenario in which hydrogen makes up a medium proportion of the Convert the gas grid to handle hydrogen for heat (domestic & non-domestic) required in medium hydrogen scenario, in order for hydrogen heating to contribute to the replacement of the incumbent technology of natural gas for heating to deliver 127 Buildings Additional On Gas Grid Part of the "medium hydrogen" scenario in which hydrogen makes up a medium proportion of the The zero emissions vehicle (ZEV) mandate will set targets for a percentage of manufacturers’ new car sales to be zero emission each year from 2024; alongside regulations that will require non- The ZEV mandate will set targets for a percentage of manufacturers’ new van sales to be zero emission each year from 2024; alongside regulations that will require non-ZEV emissions to The policy comprises a range of measures to support UK road freight’s transition to net zero, including removing barriers to the uptake of zero emission medium and heavy goods vehicles, the Zero Emission Road Freight Demonstrator programme, financial incentives, and updating and introducing MHGV regulation aimed at delivering the 2035 phase out date for the sale of new, non-zero emission MHGVs 26 tonnes and under, and increased support for uptake in the

# Sector Policy Name Policy Description The policy comprises a range of funding measures to support the ZEB markets, and policy/regulation to ensure in-scope zero emission vehicles are deployed at pace. Funding includes that delivered through the ZEB Regional Area Scheme and the All-Electric Bus City initiative. Following a consultation in Spring 2022, government will announce an end date for the sale of new non ZEBs in due course. Take further action following recent calls for evidence on the decarbonisation of coaches and minibuses. End the sale of new non-zero emission light- powered two, three and four wheeled (L-category) vehicles following government consultation held in This proposal requires further development. There are a number of potential national and local policy levers that could encourage vehicle owners to move towards cleaner vehicles faster than currently anticipated should this be required to stay on track to meet carbon budget obligations. This proposal requires further development. PHEV performance could be improved through targeted technological improvements and changes in real-world use. We will consider different levers that could bring about such improvements, should this be required to stay on track to meet carbon budget obligations. Current projections assume limited improvements in the CO2 performance of internal combustion engine vehicles in the period of the ZEV mandate. Policy measures could be developed to incentivise consumers to opt for more fuel efficient (and lower CO2) petrol and diesel vehicles during this

# Sector Policy Name Policy Description This proposal requires further development. We will consider measures that could reverse recent trends in declining average road vehicle occupancy, bringing the UK more in line with comparable countries and reducing overall vehicle miles travelled, should this be required to stay on track to meet carbon budget obligations. HGV and van logistics This proposal requires further development. We will consider ensuring more support is available for HGV and van drivers to reduce total fuel used by HGV fleets, should this be required to stay on track to meet carbon budget obligations. This proposal requires further development. We will consider decarbonisation of the rail network beyond currently funded electrification schemes through additional electrification and deployment of alternative traction trains, should this be required to stay on track to meet carbon budget obligations and subject to future Spending This policy is not additional - these emissions savings result from other measures indirectly reducing the use of urea and liquid petroleum gas Domestic aviation policy aligned with policy for international aviation, including rapid scale up of the use of Sustainable Aviation Fuels, introduction of zero emission aircraft from 2035, continued improvements in efficiencies of our airspace, aircraft and airports and carbon pricing. (See International Aviation section for more detail.) # Sector Policy Name Policy Description The second statutory Cycling and Walking Investment Strategy (CWIS2) and the government's Gear Change Plan include delivery of a range of capital and revenue funded projects to enable more cycling and walking in line with the July 2021 Transport Decarbonisation Plan commitment to 'deliver a world-class cycling and walking network in England by 2040’. The ‘Course to Zero’ consultation will inform development of indicative decarbonisation targets and policy interventions. We have consulted on expanding the UK ETS to domestic shipping and will publish a government response in due course. R&D funding is being delivered through the £206m UK Shipping Office for Reducing Emissions (UK SHORE) programme, including the Clean Maritime Demonstration Competition and the Zero Emission Vessels and Infrastructure This policy includes electrification of the Transpennine Route Upgrade (due for completion 2036-41), the Midland Mainline to Sheffield and Derby (completion date TBC), and the Wigan- Bolton line (due for completion 2024). 143 IAS International Maritime Pursue the ambitious emission reduction strategy and targets agreed at the International Maritime Organization (IMO) in 2018. The government is playing a leading role in calling for even greater ambition during negotiations at the IMO.
This policy is not additional but is linked to delivery of the government's target for airport operations in England to be zero emission by

# Sector Policy Name Policy Description 145 IAS Increasing the Take Up Promote the rapid scaling up of Sustainable Aviation Fuels (SAFs) in the aviation sector, in line with the high ambition scenario detailed in the Jet Zero Strategy, through the introduction of a SAF mandate. This policy will be supported by measures such as the £165m Advanced Fuels Fund and ongoing discussions with industry on action to tackle barriers to the production and use 146 IAS Zero Emission Flight Introduction of zero emission aircraft from 2035 in line with the high ambition scenario detailed in the Jet Zero Strategy. Government is promoting development of ultra-low and zero emission technologies through its funding to the Aerospace Technology Institute Programme. 147 IAS High Fuel Efficiency Promote continued improvements in efficiencies of airspace, aircraft and airports as set out in the Jet Zero Strategy. Government is providing funding to support airspace modernisation and is promoting development of ultra-efficient aircraft technologies through its funding to the Aerospace Technology Institute Programme. Introduce carbon pricing through the UK Emissions Trading Scheme and Carbon Offsetting Reduction Scheme for International Aviation (CORSIA) to incentivise in-sector reduction of emissions (e.g. through fuel efficiency, uptake of sustainable aviation fuels and zero emission flight). Carbon pricing assumptions in line with the high ambition scenario in the Jet Zero Strategy. Precision feeding involves the assessment of animal feed to ensure the composition and volume of feed meets, but does not exceed, animal requirements. This can reduce emissions and emissions intensity by maximising feed utilisation, stabilising fermentation in the stomach, improving animal health, and minimising nutrient 0.00186 0.01020 0.02815 2022

# Sector Policy Name Policy Description excretion in manure. It is expected that industry adoption of precision feeding will increase as a market-led take up of precision feeding is already occurring. The AIC (Agricultural Industries Confederation) maintains a register of accredited feed nutritionists to facilitate this by providing technical advice on best feeding practice. In addition, precision mixing machinery is available for the preparation of mixed rations. The role of government is in supporting and accelerating the take up of precision feeding. The government will provide funding under the Farming Innovation Programme, which could support the development of technology related to precision Methane-suppressing feed products (for example 3NOP, nitrate additives) within feed rations to reduce the amount of methane produced by ruminant livestock (e.g. cattle). Food Standard Agency (FSA) and Food Standards Scotland (FSS) are responsible for the authorisation process of feed additives in Great Britain. We will continue to work with the FSA and FSS, industry and the sector to explore suitable policy options to encourage rapid and extensive uptake of methane suppressing feed products with proven safety and efficacy, including exploring mandating methane suppressing feed products in compound feed for cattle in England. We have already published research on these products and recently ran a call for evidence on methane suppressing feed products to better understand the opportunities and challenges associated with their use. This will inform our next steps to encourage the extensive update of methane

# Sector Policy Name Policy Description Using conventional production focussed breeding metrics such as Estimated Breeding Value (EBV – which do not require gene editing or genetic modification) reduces emissions intensity in cattle, without compromising welfare or fertility. This process allows the identification of desirable genetic effects in individuals and enables cattle to be bred with lower rates of methane production. Continuing market-led uptake from farmers is expected. Ongoing research and development to improve breeding metric and measures such as funded annual animal health and welfare visits (to support improved fertility and reproduction rates) are expected to support that Funding provided through Farming Investment Fund can help facilitate an increase in the rate of milk production, without the use of hormones, by moving from milking twice a day to three times a day, such as by supporting farmers to install robotic milking parlours and make changes to stock management (e.g., keeping cattle closer to 0.00726 0.02707 0.07093 2022 Monitor current market-led initiatives to increase integration of beef and dairy production chains (via dual purpose breeds or increasing use of diary/beef cross calves) explore government’s potential role and policy options to support delivery of this measure should the market-led response not meet the required uptake levels or This measure is part of Defra’s Animal Health and Welfare Pathway (launched in 2022 to support the gradual and continual improvement in farm animal health and welfare) and will be delivered through the in-development disease eradication programme focusing on Bovine Viral Diarrhoea

# Sector Policy Name Policy Description (BVD) in England. Testing for BVD is also part of the recently launched Sustainable Farming Incentive Annual Health and Welfare Review which is the first step on the Pathway to improving the health of cattle herds across England. This measure is part of Defra’s Animal Health and Welfare Pathway (launched in 2022 to support the gradual and continual improvement in farm animal health and welfare) and will be delivered through the in-development disease reduction programme focusing on a range of diseases and conditions in sheep in England. Improving health of sheep can reduce emissions intensity by improving the efficiency of livestock production, through improved fertility, reducing mortality and morbidity. The recently launched Sustainable Farming Incentive Annual Health and Welfare Review will also improve sheep health by providing funding to test the effectiveness of 0.00591 0.02260 0.06066 2022 The measure involves improving breeding, using genetic testing (genomic tools), to ensure that breeding goals involve some low carbon traits. The measure involves farmers collecting performance information on the individual animals and genetic testing and feeding back this information to help with breeding goal development (the goals include lower methane emissions). Competitions in Defra’s Farming Innovation Programme (FIP) are developing this measure ahead of further refinement of policy measures. NB.
This measure shows carbon savings starting before the start date. While government action or support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. 0.00019 0.00082 0.00339 2035

# Sector Policy Name Policy Description Additionally due to the significant lead in time for the projected savings to start, and the modelling system used, there may be minor emissions savings before the anticipated start year, e.g. due to proactive and engaged farmers and land managers taking steps themselves, ahead of Regulations to mandate retrofitting slurry tanks with a permeable cover will reduce both methane and ammonia emissions, subject to consultation. In the short term, focus is on improving compliance and supporting take up through e.g., Countryside Stewardship slurry grants. NB. This measure provides carbon savings starting before the start date. While government action or support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. Additionally due to the significant lead in time for the projected savings to start, and the modelling system used, there may be minor emissions savings before the anticipated start year, e.g., due to proactive and engaged farmers and land managers taking steps themselves, ahead of 0.00003 0.00015 0.00043 2027 Regulations to mandate retrofitting slurry tanks with an impermeable cover to reduce both methane and ammonia emissions. In the short term, focus is on improving compliance and supporting take up through e.g. grants provided through Farming Investment Fund Slurry Infrastructure Grant and Countryside Stewardship capital grants for slurry stores. NB. This measure provides carbon savings starting before the start date. While government action or support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. # Sector Policy Name Policy Description Additionally due to the significant lead in time for the projected savings to start, and the modelling system used, there may be minor emissions savings before the anticipated start year, e.g. due to proactive and engaged farmers and land managers taking steps themselves, ahead of Analysing the nitrogen content of slurry, prior to application on crops and grassland, can improve nutrient management, ensuring nitrogen applications do not exceed crop requirements to minimise emissions of nitrous oxide (N2O). Increasing industry adoption is expected as part of a market-led take up of precision farming that is already occurring. Government will work with industry to identify the most appropriate mechanisms for change. We expect the Sustainable Farming Incentive (nutrient management standard) to contribute indirectly to 0.00008 0.00032 0.00096 2022 Leys are temporary grasslands made up of legume, grass and herb species. Diversification of arable cropping systems with grass/herbal leys can increase the positive effects of rotation practices. This measure reduces greenhouse gas emissions and emissions intensity by improving soil organic matter leading to positive impacts on crop yield, soil structure, resistance to erosion losses and could reduce nitrogen fertilizer application. Grass leys are also likely to reduce nitrogen leaching from the soil. This is included in the Sustainable Farming Incentive SFI (soils standards for SFI 2022). Once land is entered into the standard, the government will pay for the integration of multi-species cover crops including a mix of legume, grass and herb species. NB. This measure provides carbon savings starting before the start date. While government action or 0.00306 0.01310 0.04779 2024

# Sector Policy Name Policy Description support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. Additionally due to the significant lead in time for the projected savings to start, and the modelling system used, there may be minor emissions savings before the anticipated start year, e.g. due to proactive and engaged farmers and land managers taking steps themselves, Support the use of nutrient management plans and manure management plans across the farming sector. To optimise the use of nitrogen and avoid excess application. Positive impacts include reduced Greenhouse Gas emissions from synthetic fertilisers and reduced energy use and leaching of nitrogen from the soil. This is included in the Sustainable Farming Incentive SFI (soils standards for SFI 2022, nutrients standard for 2023, and low/no input grassland standard for 2023) and is also partially covered by the Farming Rules for Water and Nitrate Vulnerable Zones 0.00144 0.00779 0.02102 2022 Support improved crop health to increase yield quality and reduce yield losses, through the Sustainable Farming Incentive Integrated Pest Management actions and the Farming Innovation Programme. This reduces emissions through a reduced need for control agents, such as pesticides, and activities such as fuel used during 0.00035 0.00140 0.00433 2022 Support reductions in farm non-traded carbon dioxide (CO2) emissions from motive power, pumps and drives. Actions include, amongst others, the use of minimum till, which can cultivate the land using mechanical measures other than ploughing to reduce soil disturbance, and the use of no till, which uses direct drilling methods

# Sector Policy Name Policy Description instead of cultivation machinery, thereby reducing Currently competitions in the Farming Innovation Programme (FIP) are developing this technology and equipment (for example electrified tractors and utility vehicles, the use of robots and low energy motors) and the Farming Investment Fund (FIF) is providing grants towards the purchase of Increasing the inclusion of clover into pasture areas and ensuring the proportion of clover in the mixed grassland to at least 20%. Clover captures atmospheric nitrogen which is made available to pasture, reducing mineral fertiliser requirements and associated nitrous oxide (N2O) emissions. We are already seeing farmer led movement to more biological and on farm solutions to nutrients. Government will accelerate wider adoption by funding these actions through the Sustainable Farming Incentive (soils standards for SFI 2022 nutrients standard for SFI 2023) and Countryside Stewardship (GS4 Legume and herb-rich swards).
We have conducted done co-design pilots, tests and trials with more than 5,000 farmers and other people, plus several stakeholder organisations since 2019. We plan to continue this in 2023. We’ve also created a single landing page on GOV.UK on Reseeding temporary pasture/forage crops with high sugar grass varieties. High sugar grasses have the potential to increase livestock’s nitrogen usage efficiency. This reduces nitrogen lost though livestock urine and subsequent emissions to the environment. Government is considering the role in, and options for encouraging the 0.00337 0.01856 0.05139 2022

# Sector Policy Name Policy Description reseeding of temporary pasture/ forage crops with Use of plant biostimulants to promote growth and reduce emissions. Plant biostimulants are plant or soil additives that contain substances (microbial and non-microbial) that stimulate natural plant processes and can reduce greenhouse gas emissions intensity by increasing yield. Biostimulants may offer these productivity and resilience gains by enhancing nutrient uptake, nutrient efficiency, tolerance to environmental stress and crop quality. Regulation is in development to set consistent products standards. The evidence on the efficacy of Biostimulants is mixed, and so further research is required to allow for it to be integrated into the Sustainable Farming Incentive. Defra’s Farming Innovation Programme (FIP) and agri-food evidence programme are developing evidence on novel fertilising products. NB. This measure shows carbon savings starting before the start date. While government action or support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. Additionally due to the significant lead in time for the projected savings to start, and the modelling system used, there may be minor emissions savings before the anticipated start year e.g. due to proactive and engaged farmers and land managers taking steps themselves, ahead of 0.00008 0.00037 0.00152 2030

# Sector Policy Name Policy Description Nitrification inhibitors are chemical additives that inhibit or delay biochemical processes that give rise to Greenhouse Gas emissions from fertiliser breakdown. Evidence is not yet robust enough on the case for direct government intervention. While nitrification inhibitors are currently available on the market, further research and evidence is needed for example on impacts and application rates. Defra’s Farming Innovation Programme (FIP) and agri-food evidence programme are developing evidence on novel fertilising products to inform future policy and regulation development. 0.00646 0.02564 0.07833 2022 Promote reducing and remediating surface and subsoil compaction through the Sustainable Farming Initiative SFI and soil health measures in the Environmental Improvement Plan, alongside regulatory impacts from initiatives such as Farming Rules for Water. Compaction compromises the movement of the movement of air, water and nutrients within soil which can reduce crop yields and increase emissions. Produce guidance on improving and renovating current land drainage (where drainage is poor) to improve crop yield and reduce Nitrous oxide 0.00108 0.00447 0.01473 2022 Support and accelerate the use of machine guidance (MG) and variable rate nitrogen application technologies (VRNT) in arable and temporary grassland field operations to help farmers reduce overlaps/avoids gaps and adjust the application rate of fertiliser to match need better in that precise location within the field in order to reduce Nitrous oxide (N2O) emissions. Funding is available for technology and equipment to facilitate this measure through the Farming Investment Fund and new 0.00559 0.02102 0.06084 2022

# Sector Policy Name Policy Description innovations are being supported through the Support and accelerate adoption of soil analysis for pH and carrying out soil liming (application of magnesium or calcium rich materials to soils) on arable grassland. The application of lime improves the soil pH on land which is below the optimal pH for crop or grass growth. This allows more carbon to be captured below ground through improved productivity and efficient use of nutrients from the soil. This is included in SFI soils standards for 2022, moorland standard for 2022, and nutrients standard for 2023. Support and accelerate the adoption of the cultivation of varieties of already common crops in the UK which use nitrogen more efficiently, emissions. Competitions in Farming Innovation Programme (FIP) are developing this technology and equipment. In addition, Defra’s Genetic Improvement Networks (GINs) aim to improve the main UK crops by identifying genetic traits to improve their productivity, sustainability and resilience. Ongoing work in the Wheat GIN, including annual nitrogen diversity trials, is exploring nitrogen use efficiencies in different wheat varieties. NB. This measure shows carbon savings starting before the start date. While government action or support to deliver implementation at pace may not yet be in place, there is existing, market led, uptake across sectors to deliver emission reductions. Additionally due to the significant lead in time for the projected savings to start, and the modelling 0.00001 0.00007 0.00039 2034

# Sector Policy Name Policy Description system used, there may be minor emissions savings before the anticipated start year, e.g. due to proactive and engaged farmers and land managers taking steps themselves, ahead of Support and accelerate adoption of such cover crops to ensure co-benefits (e.g. for nature and water quality, from the capture of carbon and the retention of nutrients) are realised. This is included in Sustainable Farming Incentive arable and horticultural soils standard for SFI 2022 and through Countryside Stewardship (SW6 Winter Hedgerows. Support farmers to create or restore at least 30,000 miles of managed hedgerows by 2037, increasing to a total of at least 45,000 miles of additional managed hedgerows by 2050 returning hedgerow lengths in England to 10% above the 1984 peak (360,000 miles). We will also support them to additionally restore degraded hedges across the country. These measures will increase carbon storage and sequestration. We have announced the inclusion of a hedgerow standard in the Sustainable Farming Incentive, expected to 0.01800 0.05000 0.09200 2022 Agroforestry will be delivered through environmental land management schemes. Indicative launch date for agroforestry standard in Sustainable Farming Incentive is 2024, although this will not be confirmed until nearer the date.
These measures will increase carbon storage and 0.00000 0.01400 0.08800 2029 Through the England Trees Action Plan, supported by the Nature for Climate Fund (NCF), we have launched new grants and initiatives to support increased tree planting in England. These include the England Woodland Creation Offer, the

# Sector Policy Name Policy Description Community Forests Trees for Climate Programme and the establishment of Woodland Creation Partnerships in Cornwall and Northumberland. Tree planting and woodland creation was increased in England to c.2,700 hectares in 2021/22. The new environmental land management (ELM) schemes will deliver a large proportion of tree planting funding from 2025, when the NCF is due to end. Future woodland creation grants in ELM will mirror the EWCO. Landscape Recovery will support major landscape-scale afforestation projects where these deliver a wide range of environmental outcomes. NB. This measure has small negative carbon savings over CB4. This is due to operational emissions created during the creation of woodlands, for example from the machinery used and soil disturbance. Our tree-planting goals have a large impact on the longer term goals, as they will sequester more carbon the more they Increase land planted with perennial energy crops and short rotation forestry, ensuring above- and below-ground carbon sequestered by fast- growing species through the Biomass Strategy. We will also be further exploring how this will be driven by market demand, what the appropriate sustainable business models might be and whether other support might be needed from government to enable this planting. Restore approximately 280,000 ha of peatland by 2050 (inclusive of the Nature for Climate Fund (NCF) funded restoration). The NCF is providing over £33 million to restore 20,000 hectares of peatlands, with a further bidding round in 2023. Beyond 2025, the main delivery vehicles will be incentives through the new environmental land

# Sector Policy Name Policy Description management (ELM) Countryside Stewardship will provide a key funding stream for wetter modes of farming; Landscape Recovery will provide long-term funding to support large- scale peatland restoration projects; and the Farming Innovation Programme supports applications for research and development in paludiculture. Private investment will be mobilised by developing the Peatland Code further, including by expanding the Code to cover lowland peat and exploring further carbon pricing opportunities for the sector. Informed by data from the England Peat Map and findings of the Lowland Agricultural Peat Task Force, a Peatland Restoration Roadmap will be developed to set out a detailed trajectory for restoration to 2050. Promote more responsible agricultural management of peatlands, through raising water tables and wetter modes of farming (e.g. End the sale of peat in horticultural growing media, in the amateur sector by 2024 and in the professional sector by 2026, with limited 0.00000 0.01000 0.04000 2031 Modelling for UK-wide consistency for the agriculture and LULUCF sectors The majority of emissions from the waste sector are attributable to methane produced by biodegradable waste breaking down in landfill. Collection and packaging reforms will support the reduction of biodegradable municipal waste going

# Sector Policy Name Policy Description to landfill. Collection and Packaging reforms are made up of the consistent collection of household and business recycling, the introduction of packaging Extended Producer Responsibility (pEPR) and a Deposit Return Scheme (DRS) for plastic and metal drinks containers. We have brought forward £295 million of capital funding which will allow local authorities in England to prepare to implement free separate food waste collections for all households from 2025. Consistent collection of recycling is the primary driver reducing biodegradable waste going to landfill. DRS and pEPR will reduce the total amount of waste and therefore create space for more biodegradable waste to be processed in waste processing facilities which are not This is an early-stage proposal which will consist of further measures to divert biodegradable municipal waste from landfill from 2028. We will launch a call for evidence to support development of a plan to achieve this shortly. Work with water companies to encourage the widespread deployment of new sensors for the detection of emissions from a full range of sites, treatment stages and environmental conditions to enable optimisation of current processes to reduce greenhouse gas leakage and

# Sector Policy Name Policy Description Promote further improvements in modelling and data collection to improve reporting and reduce uncertainty. Government will publish a rapid evidence assessment setting out options to improve estimates of greenhouse gas emissions from industrial wastewater treatment. 0.06720 0.06720 0.06720 2037 Work with water companies to upgrade existing treatments which use anaerobic digesters to Advanced Anaerobic Digestion, which emit less greenhouse gas and capture waste energy as 0.01344 0.05376 0.08400 2025 Work with the water industry to expand into more sustainable wastewater treatment techniques and encourage the development and adoption of new wastewater treatment processes which will improve the efficiency of wastewater treatment and reduce greenhouse gas production and contribute to the circular economy by allowing 0.00000 0.02520 0.08400 2030 Implementation of additional phasedown step(s) to meet the Kigali Amendment requirement to reduce HFC consumption by 85% by 2036. This will follow the same process laid out for the existing phasedown step(s) in the F-gas regulation. Timescales for this measure assume 0.00000 0.00000 0.05627 2035 Prescribing incentives introduced by the NHS to reduce the use of HFCs in inhalers and industry commitments to introduce lower GWP propellants

# Sector Policy Name Policy Description Modelling for UK-wide consistency for the waste, Develop and implement business models to support the overarching policy ambition to deploy at least 5 MtCO2/year of engineered Greenhouse Gas Removals (GGRs) by 2030 and further future development. After 2030 we expect the volume of engineered removals to increase to 23 MtCO2/year by 2035 and 75-81Mt CO2/year by 2050. Our aim is to enable a diverse portfolio of The main business models are the GGR Business Model and the Power BECCS (Bio-energy Carbon Capture and Storage) Business Model. The Industrial Carbon Capture (ICC) and Hydrogen Business Models are additional policy instruments that could enable some GGR deployment.
The actual split of GGR technology will depend on the scope for business models and commercial negotiations, but likely include Power BECCS, H2 BECCS, Industry BECCS and Direct Air Capture and Storage (DACCS) technologies. Note - Proposals and policies that we expect will or could deliver further emissions savings, in addition to the savings identified in emissions savings, for example in relation to some early-stage proposals, where we are still assessing the available evidence. No. Sector Policy name and description How the policy supports delivery/ Emissions trading- UK ETS To incentivise cost effective abatement across traded sectors at the pace and scale required to deliver net zero, we have consulted (in partnership with the Devolved Administrations) on a net zero consistent UK ETS cap for 2024-2030. The range of options put forward in the consultation remains compatible with achieving carbon budgets. In due course, the Authority will communicate its decision on the UK ETS cap in its response to the consultation along with an assessment of any impacts on carbon CB4 The UK Emissions Trading Scheme (ETS) puts a price on the ‘carbon externality’ that greenhouse gas emissions represent. This is the most cost-efficient way to support the transition to net zero. It is a necessary condition for enabling the market to deliver that transition, and provides a long-term price signal that, when supported by complementary mechanisms and policies, can deliver a stable investment case for decarbonisation. The ETS emissions cap also provides a strong guarantee that the traded sector's emissions will not exceed its decarbonisation pathway. Setting out a long-term pathway for emissions We will work within the ETS Authority to publish a long term pathway for the ETS this year. Subject to agreement within the Authority, this pathway will set out our intention to legislate to continue the ETS beyond 2030 until at least 2050. It will remain aligned with our net zero target, so giving businesses the certainty they need to invest in decarbonisation. We will explore CB4 We will explore expanding the scheme to more sectors of the economy, including high emitting sectors. We consulted last year on expanding the scheme to cover energy from waste/waste incineration and domestic maritime emissions and on incorporating greenhouse gas removals. We will explore the potential role of emissions trading markets in gas/electricity price rebalancing as we consider options for rebalancing policy costs away from electricity and onto fossil energy use when the current high gas prices fall. We will work to develop a harmonised approach for measuring

No. Sector Policy name and description How the policy supports delivery/ expanding the scheme to more sectors of the economy, including high emitting The ETS emissions cap provides a strong guarantee that the traded sector's emissions will not exceed its decarbonisation pathway. Depending on future decisions regarding the ETS, including future levels of the cap and expansion to other sectors, this could therefore provide additional savings beyond those which are currently quantified. 3* Innovation Government portfolio of net zero research and innovation programmes for the Spending Review period 2022- 2025, amounts to approximately £4.2 billion of public investment. This includes £1.5 billion specifically allocated to net zero innovation announced in the Net Zero Strategy (including the £1 billion Net Zero Innovation Portfolio), as well as further research and innovation delivered through other departmental programmes This policy provides R&I funding to support the development of new technologies to decarbonise sectors such as power, buildings, industry, transport and agriculture. Continued investment in cutting-edge research, development and demonstration will be integral to achieving the transition. This cross-government portfolio of net zero research and innovation support will help develop technologies critical for decarbonising all relevant sectors of the economy. There is potential for this policy to generate carbon savings beyond those already quantified by increasing the effectiveness of new technologies, reducing costs so that technologies can be deployed at greater scale sooner or from technologies currently at early technology readiness levels which are not yet mature enough to have quantified deployment plans. Additional policies to deploy new technologies at scale will be needed to realise any additional 4 Innovation Implementing measures to make it easier for pension schemes to unlock investment in illiquid assets, including innovative companies, green projects, and infrastructure. The government's consultation, published on 30 January 2023, outlined the final regulatory This policy aims to open up more financing options for innovative companies, including those focused on net zero. No. Sector Policy name and description How the policy supports delivery/ 5 Innovation Driving innovation in key low-carbon sectors by taking leadership role in Mission Innovation 2.0. Through our leadership of Mission Innovation (MI) and the Secretariat, we have cemented Mission Innovation as the leading forum for international clean energy innovation and global collaboration. The UK co- leads the Green Powered Future Mission and the Clean Hydrogen Mission, as well as the Heating and Cooling Innovation Community. The UK also participates in four other Net-Zero Industries, Integrated Biorefineries, Carbon Dioxide Removal and Zero-Emission Shipping. This policy aims to drive enhanced international action and investment in research and innovation for clean energy 6 Innovation As one of the first major investments following the creation of the Department of Science, Innovation and Technology (DSIT), it dedicates £250m over three years to exploiting the UK’s global leadership in three of the five technologies that will be the focus of the Department’s Artificial Intelligence, Quantum Technologies and Engineering Biology. Developed with delivery partners, the new programme delivers against the Innovation Strategy commitments for new “innovation This policy aims to build on UK strengths and opportunities to catalyse industry, research and public sector actors in developing key transformational technologies which could support the net zero transition. No. Sector Policy name and description How the policy supports delivery/ missions” and to support the 7 technology families. The development of these technologies will help tackle major challenges faced by the UK and the world such as climate change and energy security.
The missions may include interventions directly supportive of Net Zero activity, or through spill over benefits in the realisation of technology outcomes. 7 Innovation The Net Zero Research and Innovation Framework, which set out the key research and innovation challenges for the next 5-10 years and a roadmap to Alongside the Net Zero Growth Plan, we've published a follow-up Delivery Plan which outlines the government’s investment of £4.2 billion towards net programmes for the current Spending Review 2022-25, aligned to the priorities This policy aims to set out the government's key priorities for net zero R&DI and clearly articulate government support 8 Innovation Provision of advice, networking opportunities, skills development and testing facilities, including an online innovation hub from Innovate UK Innovate UK, together with the British Business Bank, is developing an online Innovation Hub for businesses to easily access all funding and support opportunities that are relevant for them with three clicks. This is in response to an action in the Innovation Strategy to provide a dedicated platform for opportunities, making it easier and simpler for innovative businesses to access government backed funding and support. This also includes options specifically for net zero businesses to grow and scale as fast as possible. No. Sector Policy name and description How the policy supports delivery/ 9 Innovation UK participation in Horizon Europe either as an associated country or a third country, the world's largest collaborative research programme worth around €95 billion over the next decade, will help us reach our net zero goals. With a minimum of 35% of funding earmarked for climate change projects, this collaboration with other world leaders in net zero research will drive further progress. DSIT continues to develop its alternative to Horizon Europe in case it is needed which is designed to significantly increase the scale, pace and impact of our international leadership on Net Zero. This funding will support international research collaboration with the EU and others to In all circumstances, there will be funding that will support collaboration with EU partners in order to progress net 10 Innovation We will continue to invest in R&D through the Advanced Propulsion Centre (APC) CB4 Support the transition to zero emission vehicles by accelerating technology development. Since 2013, government and industry have jointly committed more than £1.3 billion in the design and development of new vehicle technologies, with 188 zero emission and low carbon projects supported across a range of R&D competitions. These projects are estimated to support over 56,000 jobs 11 Innovation We will coordinate transport’s investment in R&D, collaborating with Transport Research and Innovation 2025 TRIB could accelerate R&D to reduce transport emissions, including transport infrastructure. No. Sector Policy name and description How the policy supports delivery/ 12 Investment Introduce mandatory climate-related financial disclosure requirements requirements were aligned to the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD). To achieve economy-wide reporting, requirements were introduced by the Financial Conduct Authority via listings rules and the Department for Work and Pensions and the Department for Business, Energy and Industrial Strategy via regulation. Regulations came into force through 2021 and 2022, with the final BEIS (now DESNZ) policy coming into effect 6th April 2022. Significant flows of private finance will be needed to meet our carbon budgets. The right mix and quantum of public and private capital will be a pre-requisite for delivery of most deployment targets, and thus most associated carbon savings. For financial institutions to effectively allocate their capital, they must have access to the right information and data to price and manage risks, identify opportunities and get comfortable with building exposure to new sectors and technologies. The UK's climate-related financial disclosure requirements will help ensure the right capital is available at the right time, reducing the delivery risk of other carbon 13 Investment Transition planning Currently the Financial Conduct Authority (FCA) requires listed companies, as well as large asset owners and managers to disclose transition plans on a ‘comply or explain’ basis. The government commits to consulting on the introduction of requirements for the UK’s largest companies to disclose their transition plans if they have them. To ensure parity between listed and private companies, as well as to ensure requirements are consistent and comparable across the economy, we expect to consult on the basis that these requirements could align closely with those of the FCA, including the ‘comply or explain’ basis. The government will also work with the FCA Transition planning is a useful tool for companies to communicate to investors how they will be managing risks and securing opportunities associated with our transition to net zero. They allow investors to more effectively allocate

No. Sector Policy name and description How the policy supports delivery/ to ensure transition plan requirements are delivered across the financial services sector alongside requirements for listed and private companies. 14 Investment UK Green Taxonomy We will deliver a UK Green Taxonomy – a tool to provide investors with definitions of which economic activities should be labelled as green. This will support the quality of standards, labels and disclosures used in the industry for green finance activity. We expect to consult in Autumn 2023. The government proposes that nuclear - as a key technology within our pathways to reach net zero - will be included within the UK’s Green Taxonomy, subject to consultation. After the Taxonomy has been finalised, we will initially expect companies to report voluntarily against it for a period of at least two reporting years after which we will explore mandating disclosures. Government does not wish to place undue burdens onto companies whose size or scale makes the disclosure of Significant flows of private finance will be needed to meet our carbon budgets. The right mix and quantum of public and private capital will be a pre-requisite for delivery of most deployment targets, and thus most associated carbon savings.
For financial institutions to effectively allocate their capital, they must have access to the right information and data to price and manage risks, identify opportunities and get comfortable with building exposure to new sectors and technologies. As such, the UK's Green Taxonomy will help ensure the right capital is available at the right time, reducing the delivery risk of other carbon savings. No. Sector Policy name and description How the policy supports delivery/ unreasonable. Therefore, we will develop proposals with proportionality in mind. We are considering whether it is appropriate to pursue a ‘Transition Taxonomy’, which was a recommendation of the Net Zero Review, or include certain transitional activities within one Taxonomy. 15* Investment Use the new UK Infrastructure Bank to co-invest alongside private sector investors for infrastructure projects. The Bank will support projects in England, Scotland, Wales and Northern Ireland and is available to local and mayoral authorities for key infrastructure projects and will provide advice on developing and financing infrastructure. The Bank will ‘crowd-in’ in private investment to support economic growth, accelerate our progress to net zero, and help level up the UK. The Bank will invest in public and private projects, as well as providing world-class advisory services. Initially, the government will provide the Bank with £5bn of equity and allow it to borrow a further £7bn on top, with a review point in three years to assess whether that is sufficient funding. In addition to this £12bn of capital it will be able to deploy £10bn of government guarantees. We expect it to use this to crowd in private investment to support more than £40bn of infrastructure For many of the sectors and technologies we are reliant upon for meeting our carbon budgets, access to the right forms of public funding and co-investment will be critical. This is due to the sectors and technologies in question being too nascent to attract the deepest pools of private capital. Although the capital deployed by the UK Infrastructure Bank cannot be quantified into specific carbon savings, as the capital will be deployed across sectors and across time horizons, the scale and the reach of the capital available means the UKIB's interventions should provide additional

No. Sector Policy name and description How the policy supports delivery/ investment overall. £4bn of capital is set aside for local authority lending. On the £8bn for private projects, based on evidence from the UK and internationally, we would expect it to crowd in private investment at a ratio of 2.5:1, supporting 16* Investment Adopt a new Net Zero objective and integrate Net Zero into the operations of the British Business Bank (BBB). BBB is a government-owned economic development bank established by the UK government. BBB supports access to finance for smaller businesses to drive sustainable growth and prosperity across the UK, and also to enable the transition to a net zero economy. Between 2014 and end of August 2022, BBB supported £505 million of equity investment in clean For many of the sectors and technologies we are reliant upon for meeting our carbon budgets, access to the right forms of public funding and co-investment will be critical. This is due to the sectors and technologies in question being too nascent to attract the deepest pools of private capital. Although the capital deployed by the British Business Bank cannot be quantified into specific carbon savings, as the capital will be deployed across sectors and across time horizons, the scale and the reach of the capital available means we expect the BBB's interventions to provide 17* Investment The Clean Growth Fund (CGF): launched in 2020, with an ambition to use its £101 million in venture-stage funding to accelerate the deployment of innovative clean technologies that reduce greenhouse gas emissions, while catalysing the UK clean growth venture capital market and leveraging private sector funding into early stage clean tech For many of the sectors and technologies we are reliant upon for meeting our carbon budgets, access to the right forms of public funding and co-investment will be critical. This is due to the sectors and technologies in question being too nascent to attract the deepest pools of private capital. Although the capital deployed by the Clean Growth Fund cannot be quantified into specific carbon savings, as the capital will be deployed across sectors and across time horizons, the scale and the reach of the capital available means we would expect the CGF's interventions could provide additional carbon savings. No. Sector Policy name and description How the policy supports delivery/ 18 Investment Green Financing published in June 2021, sets out six categories of green expenditure that are eligible to be ( government-green-financing). A total of £16.3 billion has been raised by the sale of green gilts and retail green savings bonds for the financial year 2020-21. The Green Financing Programme will continue into the next financial year, with further issuances totalling £10 billion. Treasury’s general account, and the equivalent amount will be allocated to fund environmental and climate-related expenditures as classified in the The capital raised through the green gilt helps to fund multiple net zero programmes. As such, the associated carbon savings are already accounted for. The policy does however reduce the delivery risk of the programmes it helps 19 Investment Green finance education In 2019, we partnered with the Green Finance Institute and leading UK-based finance professional bodies to launch the first-ever Green Finance Education Charter which commits signatories to sustainability into their core curricula, new qualifications and the continued professional development of members. For our green finance policy framework to be effective, and as such for it to reduce overall delivery risk for our carbon budgets, we need the right skills and expertise to be available within our financial and professional services sector. This policy helps deliver that and therefore de-risks the delivery of carbon budgets.
Promote use of higher biocontent low carbon fuels in compatible heavy-duty vehicles (HDVs) as an interim measure to reduce emissions from internal combustion engine vehicles as the fleets transition to Zero Emission Vehicles CB4 In 2021 the Zemo Partnership published a report which modelled potential emission savings from deploying higher biocontent transport fuels blends. The modelling suggested the potential to contribute up to 44-47 MtCO2e cumulative emission savings from 2020 to 2030. Higher biocontent fuels would help achieve further GHG savings from existing

No. Sector Policy name and description How the policy supports delivery/ (ZEV). Fuels could include B20, B30 and B100, where figures represent the fraction of biodiesel blended (i.e., B20 = internal combustion engine (ICE) HDVs, as the fleet transitions to zero emission vehicles. Identify specific opportunities for transport decarbonisation in rural areas through transport innovation in the upcoming Future of Rural Strategy. CB4 The strategy will enable local areas to identify potential solutions for decarbonising rural areas, as well as the risks of not planning for these changes. Alongside decarbonisation, a key aim for the strategy is improving Drive decarbonisation and transport improvements at a local level by making quantifiable carbon reductions a fundamental part of local transport CB4 Updated Local Transport Plan (LTP) and Quantifiable Carbon Reductions (QCR) guidance will support local transport authorities to drive transport decarbonisation at the local level. This will enable a better understanding of the potential carbon impact of local transport interventions, which will support local authorities to deliver quantifiable carbon reductions and contribute to national Allocating further funding to support the electrification of UK vehicles and their supply chains through the Automotive CB4 Support the transition to zero emission vehicles and roll-out Build a globally competitive zero emission vehicle supply chain and ensure our automotive sector is at the forefront of the transition to net zero. CB4 Support the transition to zero emission vehicles and roll-out infrastructure network is reliable, accessible, and meets the demands of CB4 Support the transition to zero emission vehicles and roll-out of supporting infrastructure. The UK now has over 37,000 electric vehicle charging points. No. Sector Policy name and description How the policy supports delivery/ Infrastructure (LEVI) Fund to support Local Authorities to deliver charging infrastructure for drivers without off street CB4 Support the transition to zero emission vehicles and roll-out The Rapid Charging Fund will support the upgrade of electricity capacity on the strategic road network, enabling the roll- out of ultra-rapid electric vehicle CB4 Support the transition to zero emission vehicles and roll-out Deliver the first All-Electric Bus Town CB4 Supports bus, coach, and minibus decarbonisation. UK Shipping Office for Reducing CB4 Supports the decarbonisation of domestic maritime across vessels and ports. UK SHORE will deliver £206m of R&D funding to accelerate the development of zero emission technologies. Demonstration projects will directly reduce emissions in both the short and long term. Strategy and further develop policy on potential SAF support for scaling up a UK These policy mechanisms support the effective use and deployment of low carbon fuels. This will deliver emissions savings, particularly in the transition period to zero emission Embed transport decarbonisation principles in spatial planning and across transport policy making. Increased spatial consideration of transport schemes will lead to more potential for walking, wheeling, cycling and public transport uptake, leading to additional carbon savings. No. Sector Policy name and description How the policy supports delivery/ intervention. Investment of up to £20m until March 2025 to establish the UK’s first multi-modal hydrogen transport hub The Tees Valley Hydrogen Transport Hub is delivering hydrogen vehicles and refuelling infrastructure which will lead to a direct reduction in carbon emissions in the Tees Valley in Carbon Budget 4 although the full quantification can only be completed once bids have been properly assessed. DfT will sign grant offer letters with winning projects from the competition, which will ensure continuing commercial-scale Sustainable Aviation Fuels (SAF) plants in the UK through the Supports delivery of our commitment to SAF deployment, delivering significant emissions savings from aviation. Programme. Commute Zero will be a programme that works with leading companies and large employers to research, support and encourage long- term changes to employee travel habits and support the take-up of lower carbon CB4 Carbon reductions could be achieved through a combination of encouraging sustainable transport modes, increases in vehicle occupancy, and uptake of zero emission vehicles. Work with the Civil Aviation Authority environmental information at the time of searching for and booking flights. CB4 This policy is aimed at individual consumer choices and therefore it is not possible to quantify its impact on emissions reductions. However, once implemented, additional emissions savings are expected from individuals and businesses making greener choices. We are supporting motorists through Plug-In Vehicle Grants, which provide support towards the upfront purchase of new zero emission vans, motorcycles, wheelchair accessible vehicles and CB4 Support the transition to zero emission vehicles. No. Sector Policy name and description How the policy supports delivery/ 37 Fuel Supply Downstream oil & Downstream, UK refineries already underpin major CCUS and hydrogen projects in key industrial clusters. We have also published the draft Downstream Oil Resilience Bill which will give the government the powers it needs to ensure secure fuel supplies are maintained during the transition to net This policy is not designed to reduce carbon emissions itself, however it will support progress to reduce emissions by enabling CCUS and hydrogen projects which themselves will 38 Fuel Supply Low Carbon Hydrogen Standard and Certification Set up a hydrogen certification scheme by 2025. We envisage the certification scheme will use the methodology set out in the Low Carbon Hydrogen Standard, which sets a maximum threshold for the amount of greenhouse gas emissions allowed in the production process for hydrogen to be considered ‘low carbon hydrogen’. Certification scheme - this is a proposal to set up a hydrogen certification scheme by 2025, as committed to in the British Energy Security Strategy.