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’. Creating a trusted, transparent certification scheme will help producers and consumers to demonstrate the environmental credentials of the hydrogen they create and use. It will also help to deliver carbon savings in end use sectors by boosting the growth of the low carbon hydrogen market and helping consumers choose low carbon hydrogen. Hydrogen production and certification alone will not generate carbon savings, but we expect it to enable carbon savings in several sectors including industry, power, transport and potentially buildings, by replacing high-carbon fuels used

No. Sector Policy name and description How the policy supports delivery/ 39 Fuel Supply Net Zero Hydrogen The £240m Net Zero Hydrogen Fund (NZHF) aims to support the commercial deployment of new low carbon hydrogen production projects during the 2020s. The NZHF will provide capital grant co-funding to give projects a financial boost for construction to begin. It will also provide development support to stimulate a diverse pipeline of This funding will kickstart the production of low carbon hydrogen during the 2020s, which is crucial in displacing fossil fuels and meeting our ambitions for hydrogen It will also help to deliver carbon savings in end use sectors by boosting the growth of the low carbon hydrogen market. Hydrogen production alone will not generate carbon savings, but we expect it to enable carbon savings in several sectors including industry, power, transport and potentially buildings, by replacing high-carbon fuels used today. 40 Fuel Supply Hydrogen Production Business A government subsidy which provides revenue support to hydrogen producers to overcome the operating cost gap between low carbon hydrogen and high The intervention will support the deployment of low carbon hydrogen projects that will support government's ambition of reaching up to 10GW of hydrogen production capacity by 2030, with at least half of this from electrolytic hydrogen. It will also help to deliver carbon savings in end use sectors by boosting the growth of the low carbon hydrogen market. Hydrogen production alone will not generate carbon savings, but we expect it to enable carbon savings in several sectors including industry, power, transport and potentially buildings, by replacing high-carbon fuels used today. No. Sector Policy name and description How the policy supports delivery/ 41 Fuel Supply Industrial Decarbonisation and Hydrogen Revenue Support (IDHRS) scheme and Hydrogen Production Business Model (HPBM) will initially be taxpayer funded via the Industrial Decarbonisation and Revenue Support (IDHRS) scheme. Through the Energy Bill, we have introduced hydrogen spending powers and provisions for a hydrogen levy which is intended to fund revenue support payments made through the HPBM. Government will provide funding for successful projects from the first electrolytic hydrogen allocation round until the hydrogen levy is in place. It is intended to give long term certainty to investors and projects and enable the first commercial scale deployment of low carbon hydrogen production. It will also help to deliver carbon savings in end use sectors by boosting the growth of the low carbon hydrogen market. Hydrogen production alone will not generate carbon savings, but we expect it to enable carbon savings in several sectors including industry, power, transport and potentially buildings, by replacing high-carbon fuels used today. 42 Fuel Supply Hydrogen Transport and Storage Business This is a proposal to design new business models for hydrogen transport and storage infrastructure by 2025. A consultation government response is expected in Q2 2023. Legislative measures will be crucial to delivering these new business models. The business models will support hydrogen transport and storage infrastructure which is needed to enable our 10GW production capacity ambition and lead to potential carbon It will also help to deliver carbon savings in end use sectors by boosting the growth of the low carbon hydrogen market. Hydrogen production alone will not generate carbon savings, but we expect it to enable carbon savings in several sectors including industry, power, transport and potentially buildings, by replacing high-carbon fuels used today. No. Sector Policy name and description How the policy supports delivery/ 43 Fuel Supply Reducing Methane Leakage through the Distribution Network (Ofgem) The Gas Distribution Networks have been given a financial incentive in the RIIO-2 price control to reduce leakage levels by means of lowering system pressures and improved gas conditioning levels. Reducing methane leakage means lower The Gas Distribution Networks have been given a financial incentive in the RIIO-2 price control to reduce leakage levels by means of lowering system pressures and improved gas conditioning levels. Reducing methane leakage means lower 44 Industry Climate Change Agreements (existing Agreements scheme exists to ensure that the businesses, for whom energy makes up a larger proportion of their operating costs, are supported to make changes to their processes to increase their energy efficiency. Support through Climate Change Agreements is available to 2,600 eligible businesses in over 50 industrial sectors who meet negotiated energy efficiency or carbon reduction targets. The current scheme began in 2013 and will run until the 31 March 2025. CB 4 Climate Change agreements support energy efficiency improvements and associated carbon savings for eligible

No. Sector Policy name and description How the policy supports delivery/ 45 Industry Climate Change Agreements (from 2025): The government is extending the Climate Change Agreements (CCA) scheme by two years to cover 2025-26 and 2026-27 as announced in the March 2023 Budget. This will allow continued support to energy-intensive businesses across the UK in return for them meeting energy efficiency targets. The terms of the extended scheme are set out in a consultation document published by the Department for Energy Security and Net Zero, published alongside the Budget.
The government is considering proposals for a potential future CCA scheme with potential targets from 2025 and the role it could play in supporting energy efficiency CB 4 Climate Change agreements support energy efficiency improvements and associated carbon savings for eligible 46 Industry IETF Phase 3 Phase 3 of the Industrial Energy Transformation Fund will launch in 2024, subject to business case approval. The additional £185m budget will support energy intensive industries across the UK to save energy and decarbonise whilst maintaining CB 4 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

No. Sector Policy name and description How the policy supports delivery/ 47* Industry International efforts to increase the transparency of embodied emissions and boost demand for low carbon The UK championed a number of key initiatives in this area at COP26 and beyond. This includes the Clean Energy Ministerial’s Industrial Deep Decarbonisation Initiative, which the UK co-leads with India. This focuses on procurement, to ensure there is a coordinated approach to market creation across borders. We are also supporting the Net Zero Industry Mission, under Mission Innovation, which aims to foster deeper collaboration on industry CB 4 Work to support demand for low carbon products and carbon leakage mitigation starts with an internationally agreed methodology to monitor and report on the embodied emissions of products. This information allows us to enact policies based on data, including private and public procurement, product labelling, product standards and CBAMs. More broadly, mitigating carbon leakage risk is essential to enable domestic businesses to make investments required for decarbonisation and to reach net 48 Industry Resource The approach in driving the transition to a more resource efficient economy is set out for England in the government’s 2018 Resources and Waste Strategy, to be supplemented by a new Waste Prevention Programme, which outlines how we will maximise the value of our resources and minimise waste to increase the circularity of our economy. We will formalise joint working arrangements across government departments to promote collaboration on resource efficiency approaches, ensuring we are using all the policy tools available in working towards shared emissions and CB 5 Delivering carbon savings through resource efficiency requires collaboration across multiple sectors and departments. This policy will help to unlock the savings attributed to quantified Industrial Resource Efficiency policies by enabling joint working across government. No. Sector Policy name and description How the policy supports delivery/ 49 Industry Resource Government has supported the Green Construction Board Avoidable Waste, published in July 2021. We will continue to promote the adoption of resource efficient practices across the sector through close collaboration with the Green Construction Board, and wider CB 5 This policy will help to unlock savings under the quantified Industrial Resource Efficiency package of policies, which includes carbon savings from resource efficiency in 50* Industry Demand-side measures/ Carbon Published a call for evidence on demand- side policy in Spring 2022, to investigate how we can define low carbon products and the emissions reporting that will be required to support those definitions. It also explored the design of demand-side policy levers, with a view to the potential introduction of voluntary standards and labelling as early as 2025, and regulatory standards being introduced in the late In March 2023 the government published a consultation exploring a range of potential policy measures to mitigate carbon leakage risk in the future and ensure UK industry has the optimal policy environment to decarbonise. The eventual policy package could include a Carbon Border Adjustment Mechanism (CBAM), mandatory product standards and other demand-side policies to grow the market for low carbon industrial CB 5 The aim of demand-side policies is to increase demand for low carbon products, supporting the business case for companies to decarbonise and helping to mitigate carbon leakage. This will enable industry to make the large investments required to decarbonise highly emitting industrial processes. The group of policies described would support significant carbon savings both domestically and

No. Sector Policy name and description How the policy supports delivery/ products, as well as emissions reporting that could support the implementation of 51 Industry Resource We are supporting inter-disciplinary approaches and strengthening the evidence base on resource efficiency initiatives by collaborating with the UKRI funded National Interdisciplinary Circular Economy Research (NICER) programme. The Department for Energy Security and Net Zero and Defra are also conducting a research project to investigate resource efficiency opportunities across 11 CB4 This policy will help to build the evidence base and enable effective decision making to unlock savings associated with the quantified Industrial Resource Efficiency package of

No. Sector Policy name and description How the policy supports delivery/ Track 1 of the Cluster Sequencing Programme The cluster sequencing process was established to identify and sequence carbon capture, usage and storage (CCUS) clusters, with Track-1 identifying clusters suitable for deployment in the mid-2020s. Following the announcement of HyNet and East Coast Cluster as Track-1 clusters, we invited applications for capture projects to connect to the clusters. We have Negotiations List alongside the Net Zero Growth Plan and Energy Security Plan and negotiations with those projects will now commence. We will also set out a process this year for the expanded deployment of projects in the T-1 clusters late CB4 The projects included on the Track-1 negotiating list could deliver emissions savings by capturing CO2 emissions and transporting that CO2 to permanent geological storage. The final realised emissions savings enabled by Track 1 of the Cluster Sequencing Programme will be subject to negotiations successfully concluding and projects demonstrating deliverability, affordability and value for money.
We have also confirmed we will launch a process to Track 2 of the Cluster Sequencing Programme - The cluster sequencing process was established to identify and sequence carbon capture, usage and storage (CCUS) clusters, with Track-2 seeking clusters suitable for deployment by 2030. We have launched further details alongside the Net Zero Growth Plan and Energy Security Plan. late CB4 We will be launching Track-2 of the CCUS Programme to select two new transport and storage systems, and associated capture projects to deliver government's ambition of deploying CCUS in four clusters by 2030, with Track-2 clusters to be operational by 2030. Any projects delivered throughTrack-2 will enable emissions savings by capturing CO2 emissions and transporting that CO2 to permanent response to the Independent Review of Net Zero, we have confirmed we will set out a vision on how the CCUS sector will support our net zero ambitions. late CB4 Policies to support the delivery of CO2 capture projects and the delivery of further CO2 transport and storage infrastructure are essential for enabling the sectoral capture policies, across power, industry, low-C hydrogen production,

No. Sector Policy name and description How the policy supports delivery/ Business Model for Transport and Storage (T&S) of CO2, including associated economic regulatory framework and legislation to support the development of T&S networks for the deployment of CCUS clusters using a regulated asset base model. The economic licence and supporting network code will be overseen by an economic late CB4 The delivery of the CO2 transport and storage infrastructure is essential for enabling the sectoral capture policies, across power, industry, low-C hydrogen production, waste, and Delivery of £100 million innovation funding (a subset of the £1bn innovation funding set out in the innovation policy CB4 The Innovation funding supports the development of GGR technologies to help them achieve commercialisation. This includes the Direct Air Capture and GGR Innovation Competition. Phase 2 of the competition was announced in July 2022, with over £54m of government funding awarded across 15 of the most promising demonstration projects. This will support our ambition of at least 5MtCO2/yr of engineered removals by 2030 (see quantified list). Respond to, and take action following, the call for evidence exploring the role of the UK ETS as a potential long-term CB5 The call for evidence explored whether GGRs could be incentivised further if they were integrated into the UK Emissions Trading Scheme. Inclusion of engineered GGRs in the ETS could further support the growth and deployment of GGRs, which will be important in achieving our ambition to deploy at least 5MtCO2/yr of engineered removals by 2030. No. Sector Policy name and description How the policy supports delivery/ Explore options for regulatory monitoring, reporting and verification recommendations of the BEIS-led MRV Task & Finish Group involving experts CB4 This policy supports carbon budget delivery by designing policy to address critical barriers to the deployment of engineered GGRs through the establishment of reliable MRV standards to underpin business model support and a future negative emissions markets. It plays a critical role in balancing residual emissions from the hardest to decarbonise sectors by setting out accounting and sustainability frameworks to ensure that GGR projects deliver verifiable, permanent and sustainable removals of 59 Buildings Phasing out of new and replacement gas boilers. The government stated an ambition in the Heat & Buildings Strategy to phase out new and replacement gas boilers by 2035 at the latest. CB6 The emission savings for the 2035 ambition are embedded within the quantified pathways. 60 Buildings Additional measures to support the Network enabling measures aim to ensure that future heat network policies are delivered at the pace and scale needed to meet our net zero targets. The programme ensures that policies are delivered in a programmatic and systematic way and encompasses a range of supporting activity which de- CB4 Supports savings associated with the Heat Networks

No. Sector Policy name and description How the policy supports delivery/ risks delivery. This includes the development of procurement models to leverage private sector investment, technical standards, developing skills and 61 Buildings Boiler Upgrade Scheme - The current Boiler Upgrade Scheme can be extended. This would be a part of a number of measures to reach the ambition for 600,000 heat pump CB4 Heat Pump uptake could be accelerated to deliver up to ~15Mt/year of emission savings2 (on average over CB6 period). This depends on wider commercial factors such as the cost of heat pumps (both their upfront costs and running costs). Any future government support would be dependent on future Spending Review outcomes. 62 Buildings Green Gas The Green Gas Levy will raise the capital required to fund the Green Gas Support Scheme by placing a levy on all licensed fossil fuel gas CB4 The Green Gas Levy (GGL) applies to licensed fossil fuel gas suppliers in Great Britain from 30 November 2021, and funds the Green Gas Support Scheme (GGSS) (supporting 63 Buildings Energy Technology List - Annual A government list of energy efficient products that meet the robust energy saving criteria. HMG annually reviews the technologies and products that qualify for inclusion. This can be CB4 The list functions as an easy-to-use procurement tool for energy managers, procurement professionals, facilities managers and a wide variety of other professions and organisations. The ETL gives the added reassurance to purchasers of measured and verified energy performance

No. Sector Policy name and description How the policy supports delivery/ 64 Buildings EPC Action The EPC Action Plan, published in Summer 2020, is intended to improve the accuracy and reliability of EPCs, their usefulness to users, and to The EPC Register was launched in redesigned to provide a more user- friendly experience to help people improve the energy performance of their CB4 Better reflecting the benefits of heat pump installation in buildings assessments could incentivise greater deployment of low carbon technologies.
Making EPCs more robust could strengthen retrofitting of homes and the incentives for consumers to value low-carbon homes 65 Buildings Consumer Information & Advice (former Simple Energy Advice) - A 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 govermment- funded schemes such as the Home CB4 This service is an enabler and will support homeowners make information green choices. Actions to improve their home efficiency will lead to reductions in energy waste. 66 Buildings Trustmark & PAS 2035: The Each Home Counts review, published in 2016 recommended the development of an overarching standards framework for end to end delivery of retrofit and the establishment of a government endorsed quality mark to ensure consumer protection and redress. HMG sponsors the PAS standards and they, with TrustMark registration, are key requirement for installers working in government funded decarbonisation schemes. We are working with TrustMark to encourage more installers to sign up to CB4 TrustMark delivers consumer confidence through its expert network of Scheme Providers and their Registered Businesses when untertaking building retrofit work

No. Sector Policy name and description How the policy supports delivery/ the standards and/or TrustMark as 67 Buildings Home Retrofit Skills and Capacity Proposal supporting upskilling Decarbonisation Skills Fund, which builds on £6m spent in 2020 and 2021, and will continue to work with the industry to remove barriers to growth, including the uptake of training. We are currently developing plans for a further £15m package of skills support that will launch CB4 This proposal supports skills training and capacity building in the home retrofit supply chain, which needs to grow and upskill to meet our fuel poverty and net zero commitments 68* Buildings Future Buildings The Future Buildings Standard will produce extremely efficient non-domestic buildings which use low-carbon heat complemented by high fabric standards. Buildings built to the Future Buildings Standard will be zero carbon ready, meaning that no retrofit work will be necessary to ensure they have zero carbon emissions as the electricity grid continues to decarbonise. These changes will be delivered through amendments to the Building Regulations and publication of a new Approved CB4 The Future Buildings Standard will produce extremely efficient non-domestic buildings which use low-carbon heat complemented by high fabric standards. Buildings built to the Future Buildings Standard will be zero carbon ready, meaning that no retrofit work will be necessary to ensure they have zero carbon emissions as the electricity grid

No. Sector Policy name and description How the policy supports delivery/ Document (statutory guidance) subject to 69 Buildings New We will consult on whether to end all new gas grid connections, or whether to remove the duty to connect from the Gas Distribution CB4 Regulating on new connections to the Gas Grid would act as a backstop to the Future Homes Standards and the Future Buildings Standard to ensure our expected timetable for new builds to be built using low carbon heat from 2025 is 70 Buildings Public We have initiated the Public Sector Low Carbon Skills Fund which provides complementary funding Decarbonisation Scheme to enable public sector organisations to acquire expert skills in order to unlock decarbonisation CB4 As an enabler, the Low Carbon Skills Fund provides public sector organisations with the resources to draw together their heat decarbonisation plans. To realise the carbon savings identified in the heat decarbonisation plans, grant recipients are then required to identify funding for and sources of investment in the recommended carbon reduction 71 Buildings We will enhance our gov.uk service to provide homeowners with personal, tailored advice for retrofitting their homes and links to local, accredited, trusted installers. We will launch regionally-led in-person pilots in 2023 and are expanding the telephone helpline This service is an enabler and will support homeowners make information green choices. Actions to improve their home efficiency will lead to reductions in energy waste. No. Sector Policy name and description How the policy supports delivery/ 72* Buildings Products Progress consultations on additional proposals to raise products standards between 2022 and 2023 ahead of implementing CB4 Current savings are based on proposals to raise minimum energy efficiency standards for a limited group of high priority products. Additional savings would be possible if we set stronger efficiency product standards than is currently planned and/or raised/introduced energy efficiency standards for additional products. Barriers to this would include cost and consumer/business impact of going 73* Buildings Additional owner occupier energy efficiency improvement. This is an early-stage proposal to explore how to upgrade homes in the owner-occupied sector to ensure as many homes as possible meet EPC Band C by 2035 where cost-effective, practical and affordable. We are planning to consult by the end of this year on how to improve the energy efficiency of owner-occupied Further improvements to the energy performance of owner occupied homes would deliver additional carbon savings 74 Buildings The Heat Pump Investment Accelerator Competition (HPIAC). The Accelerator will provide non-refundable grant funding of up to £30m towards building and fitting out new, or re- purposing existing, factories to components. The accelerator expects to support up to £270m in private sector investment, supporting the UK supply chain for heat pumps and components by supporting up to 270,000 heat pumps and components being manufactured in the UK (which is half the 2028 installation target). The accelerator could support up The competition is intended to support the delivery of CB5 and 6 through improving supply chain security of heat pumps, by increasing domestic manufacturing rather than relying upon importing heat pumps, which as global demand continues to increase, demand is outstripping supply. No. Sector Policy name and description How the policy supports delivery/ to 3,000 low carbon jobs, either new or safeguarding those currently working in the UK fossil fuel boiler manufacturing 75 Buildings Incentivising low-carbon The government has committed to setting out a clear approach to gas vs electricity price ‘rebalancing’ by the end of 2023/24.
Rebalancing will generate the clear short- term price signal necessary to shift households and businesses to lower- technologies such as heat pumps. CB 4 This policy is intended to support delivery from CB4 onwards by ensuring consumers are not penalised for making green choices through reducing running costs of low carbon heating, relative to fossil fuel alternatives. reduction in pigs. Endemic production- limiting disease is a major at on efficient livestock production and will have an impact on the carbon footprint of livestock farming. Improving health status would be expected to lead to reductions in emissions intensity. The Animal Health and Welfare Pathway aims to improve farm animal health and welfare across our national herds and flocks, including an in-development Porcine Reproductive Improving the health status of pigs would be expected to lead to reductions in the emissions intensity of pork production. This is emerging work and the potential emissions reductions are contingent on research. Defra is currently undertaking research to quantify the emissions savings associated with improved pig health but this has not

No. Sector Policy name and description How the policy supports delivery/ and Respiratory Syndrome virus control Development of more sustainable protein sources for human diets. Alternative proteins could offer environmental benefits. However, the sector is diverse and at different stages of readiness and investment, and so further research is needed to overcome technological barriers, increase understand consumer acceptance preferences and accomplish an optimal regulatory alignment that meets the needs of the sector and consumer safety. Within a broad and varied market, some alternative proteins may offer environmental benefits through low emissions intensity associated with production. Emissions savings towards the carbon budgets could be delivered via a shift in the agricultural sector in response to market drivers. This is emerging work and the potential emissions reductions are contingent on research and market drivers. Developing the evidence base on controlled environment agriculture (CEA) systems/vertical agriculture. These systems make it possible to consistently and reliably control and/or manipulate the growing environment. This effectively controls crop nutrition and growth along with potential pathogens (pests and diseases) on the crop, and CEA/vertical farming could improve the energy efficiency of production (including reducing transport emissions). This could lead to reductions in the emissions intensity of the arable/horticulture sector. This is emerging work and the potential emissions reductions are contingent on research. These systems are likely to increase GHG emissions until renewable energy sources become more widely available. We continue to undertake research and monitor the

No. Sector Policy name and description How the policy supports delivery/ increases the potential to reduce transport/import emissions and improve Methanisation, methane capture and combustion. Additional mitigation intervention whereby the methane generated during storage of liquid manure is collected and burnt, converting it to carbon dioxide, a less potent GHG. There may also be potential to utilise heat or energy produced on combustion Methane, generated during storage of liquid manure, is collected and burnt. This converts the methane to carbon dioxide, a less potent greenhouse gas, which may deliver carbon savings. There may also be potential to utilise the heat and energy produced. This is emerging work and the potential emissions reductions are contingent on research. Although initial quantification has been attempted, significant uncertainty remains and further work is needed, and further Biorefinery as nutrient recovery. We continue to support research and development in this area such as through the Farming Innovation Programme. The Programme funds industry-led research and development to drive innovation that will enhance the productivity and profitability of England’s farming sectors, whilst enhancing the environment and reducing greenhouse gas emissions. It has already supported a range of projects, including ones which focus on biorefinery as nutrient recovery. For instance, the ‘Bringing H2OPE to Agriculture’ project looks at on-site Producing high-value products, such as livestock feed or fertilisers from waste could support a more circular economy in which emissions are avoided or reduced from feed or fertiliser production. This is emerging work and the potential emissions reductions are contingent on research. Although initial quantification has been attempted, significant uncertainty remains, and further work is needed. No. Sector Policy name and description How the policy supports delivery/ transformation of dairy cow slurry into valuable byproducts including fertiliser Using insect protein as animal feed. Feeding insect protein to animals has the potential to reduce overall global emissions from feed production (in comparison to conventional protein production e.g. soya grown overseas) and support a circular economy (e.g. if insects are raised on waste). There is ongoing research to determine the potential of these measures and the sector is at an early stage of development. This measure is unlikely to have significant UK GHG or land use impacts. It could, however, reduce supply chain emissions from feed supply occurring outside the scope of UK carbon Feeding insect protein to animals may reduce overall global emissions from feed production by displacing soya grown in deforested areas and support a more circular economy. Whilst this may be an important technology to reduce emissions across the livestock supply chain, it may have limited impacts on UK emissions. Further work is required to understand the impacts on UK territorial emissions within scope of the Climate Change Act versus wider international This is emerging work and the potential emissions reductions are contingent on research (including an assessment of any potential impacts on animal and public

No. Sector Policy name and description How the policy supports delivery/ Policy roadmap for the safe use of timber in construction. Increasing the safe use of timber in construction was a commitment in the England Trees Action Plan and the Net Zero Strategy, as it can support storing carbon safely, for example through using timber to build houses. This work will be taken forward in particular through the cross-government and industry timber in construction working group, which will design a policy roadmap identifying key actions for government and industry to safely increase timber use in construction.
Harvesting timber to be stored in buildings and replanting the woodland creates a ‘conveyor belt of carbon’ from woodlands into storage in buildings. Increased demand for timber means higher timber prices and therefore more investment in woodland creation, which means we’re more likely to meet our tree planting target. Higher timber prices drive increased management of existing woodlands. This makes woodlands more resilient to risks such as wildfire and disease and reduces the risk of reversals which cause emissions. More wood products going into structural use means that the carbon is stored over a longer time horizon than when used for e.g. MDF or pallets. Substitution of carbon-intensive materials such as cement, steel and brick Increase ambition for planting perennial energy crops and short rotation forestry. This may be achieved either increasing land planted, or relaxing expected standards about stocking density or use of exotic species. Increasing land planted with perennial energy crops and short rotation forestry, would ensure above- and below- ground carbon sequestered by fast-growing species. No. Sector Policy name and description How the policy supports delivery/ Paradigm shift in water management on lowland peatlands. Major investment in water storage and water level management infrastructure is required to transform the management of water to rewet lowland peatlands. This would enable us to raise water levels safely in a controlled way to an appropriate depth that would lead to lower GHG emissions. Rewetting by raising and maintaining higher water levels in peat soil reduces emissions and offers opportunities for continued productive agriculture and growing new crops suited to wetter soils, as well as supporting lowland peat restoration activities. This is because peat restoration is meeting our peatland targets. Further R&D needs to be completed before we can accurately quantify the carbon Regulatory approaches to activities on lowland peat soils.Following the management infrastructure, explore how we can go beyond our farming scheme incentives to achieve rewetting of lowland Peatland is privately owned and incentive schemes are demand led, therefore, rewetting peat soils will be the prerogative of landowners once the water infrastructure is in place. This measure would achieve greater rates of rewetting, reducing the GHG emissions. Paludiculture. Implementation of a roadmap towards commercially viable paludiculture. This includes building on the work of the Lowland Agricultural Task Force and delivery of the Paludiculture Exploration Fund (2022-2025), which comprises a community engagement project and a competitive grant scheme. Raising and maintaining water levels just below the surface of peat soil, as required for paludiculture, reduces emissions and offers opportunities for continued productive agriculture and growing new crops suited to wetter soils. R&D: Improving peat emissions data. Ongoing Research & Development will improve the quantification of peat Improving the available evidence base on our peatlands will enable the baseline estimate of emissions from peat to be revised. Areas of improvement have been identified. It would also support government and industry to implement more effective policy and guidance, supporting reducing our

No. Sector Policy name and description How the policy supports delivery/ Saltmarsh restoration and creation. Explore the potential for carbon sequestration through the restoration and creation of saltmarsh habitats around the Saltmarshes may contribute to climate change mitigation. While we are already working to protect and restore these habitats, we are not yet in a position to accurately quantify the extent of that contribution. There are significant data gaps surrounding emissions from coastal wetlands, activity data regarding extraction activities, and habitat extent. This information must be collected before a decision on inclusion Seagrass restoration and creation. Explore the potential for carbon sequestration through the restoration and creation of seagrass habitats around the Seagrass may contribute to climate change mitigation. While we are already working to protect and restore these habitats, there are significant uncertainties over the extent of that contribution. Work continues to improve the evidence base. Explore the potential for carbon application of ground silicate rocks to This is emerging work and contingent on research, but could provide additional support to meeting carbon budgets through providing a further mechanism for carbon dioxide Explore the potential to deploy biochar for carbon sequestration through This is emerging work and contingent on research, but could support carbon budgets through providing an additional mechanism for carbon dioxide removals from the

No. Sector Policy name and description How the policy supports delivery/ Explore the potential to cultivate microalgae to fix carbon dioxide into This is emerging work and is contingent on research, but could support carbon budgets through providing an additional mechanism for carbon dioxide removal. Explore the potential to cultivate macroalgae (such as seaweed or kelp) to fix carbon dioxide into biomass. This is emerging work and contingent on research, but could support carbon budgets through providing an additional mechanism for carbon dioxide removals from the Agriculture, Forestry and Other Land Use (AFOLU): Nature for Climate Fund. We will boost the existing £640 million Nature for Climate Fund with a further £124 million of new money, ensuring total spend of more than £750 million by 2025 By the end of 2025 NCF supports delivery for both forestry and peat restoration. No. Sector Policy name and description How the policy supports delivery/ on peat restoration, woodland creation Rewetting lowland peat. Rewetting lowland peat necessitates investment in (I) water storage capacity (e.g., reservoirs), and (ii) water level management capabilities (e.g., telemetry, mechanised pumps, Archimedes screws). This infrastructure would facilitate rewetting and address drought and flood risks. Design and cost of interventions will be context-specific, and will require close working with the EA, NE and water management authorities, e.g. around regulatory challenges. We are developing projects to facilitate a better understanding of the costs, barriers, and emissions impact of this work. Rewetting by raising and maintaining higher water levels in peat soil reduces emissions and offers opportunities for continued productive agriculture and growing new crops suited to wetter soil, as well as supporting lowland peat restoration activities. This is because peat restoration is reporting.
Explore the use of product labelling to show the durability, repairability and recyclability of products, as well as their environmental footprint, with a view to stimulating demand for better quality items. We have committed to developing a mandatory methodology for the voluntary eco-labelling of food and drink products. This will be for participating companies to consistently follow, providing a common standard where eco-information is voluntarily used Environmental labelling and eco-labelling can be used to indicate products and services with lower embodied carbon emissions, enabling more informed choices. Company reporting will incentivise companies to improve the environmental performance of their products and drive increased traceability in supply chains. No. Sector Policy name and description How the policy supports delivery/ should they choose to include such information on their products. Through the Food Data Transparency Partnership, Defra will also develop defined and consistent methodologies for the food and drink sector to consistently measure and report scope 3 GHG emissions. professional body for the farming industry. Between 2021 and 2027, Defra will gradually reduce and then stop untargeted Direct Payments. Farmers will instead receive public money for improving the environment, improving animal health and welfare and reducing carbon emissions. To achieve this, farmers will need new skillsets. The government is contributing towards the establishment of a new professional body for the farming industry; The Institute for Agriculture and Horticulture (TIAH). TIAH is aimed at removing the fragmentation that exists within current learning and skills landscape for farming businesses. TIAH will drive improvements in industry capability – which will cover the skillsets required to deliver future Environmental Land Management objectives; including water and air quality, soil husbandry, This is in an industry initiative that won’t directly deliver any additional carbon savings but will enable the delivery of agricultural transition policies that aim to deliver net zero. No. Sector Policy name and description How the policy supports delivery/ woodland restoration and management, agroforestry and biodiversity. Alongside TIAH’s work, we are also looking at the new skills and knowledge advisers may need to support farmers and land managers towards these goals. Action is already being taken by the sector. For example, the Chartered Institute for Ecology and Environmental Management (CIEEM) has developed a competency framework and BASIS has recently launched an environmental adviser Green Jobs and Forestry Training Fund. To meet afforestation targets, the Forestry Training Fund launched in. February 2023 to provide practical training courses for new entrants and upskilling the existing workforce. With Forestry England, we are increasing the number of available apprenticeships including the launch of the Level 6 Started and ongoing. The initiatives won’t directly deliver any additional carbon savings but will enable the delivery of forestry policies that aim to deliver net zero, such as the afforestation targets

No. Sector Policy name and description How the policy supports delivery/ Consider the role of decarbonisation. Assess the role and efficacy of introducing agriculture specific emissions targets, such as targets split between individual greenhouse gases to drive decarbonisation across the agriculture and land use sectors. Emissions targets, or targets split between individual greenhouse gases, could help us reduce emissions in the agricultural sector. This is an early-stage proposal and next steps have not yet been determined. The potential emissions reductions are contingent on further research. agroecological farming systems and the potential of regenerative systems. We are seeing farmers undertake such practices and are monitoring efficacy across farming. Defra’s evidence programme encompasses R&D on the productivity, sustainability and wider trade-offs of agroecological farming systems including extensive livestock systems, which will inform future development. Many of the pathway measures delivered through the schemes align with agroecological practices, for example introducing cover This is an early-stage proposal, with next steps yet to be determined. Agroecological farming systems may promote farming practices that reduce Greenhouse Gas (GHG) emissions, such as reducing Nitrogen application and introducing clover into pasture, supporting delivery of the pathway. Although regenerative measures are considered within the pathway and delivered through the Environmental Land Management Schemes, there is scope for additional emissions reductions from farming practices promoted under agroecological farming systems once they are better

No. Sector Policy name and description How the policy supports delivery/ Increase the use of robust Monitoring, Reporting and Verification of GHG emissions (MRV). We will explore policies to increase the use of MRV across farm businesses as a mechanism to support improved understanding and behaviour change for decarbonisation. This will build on the recent UK ETS consultation call for evidence chapter which explored the use and application of MRV for the agriculture sector and ongoing research projects to examine opportunities to better harmonise and improve the robustness of emission reporting across farm, food, and drink businesses. We will develop a harmonised approach for measuring carbon emissions from farms and by 2024 will set out how farmers will be supported to understand their emission sources through carbon audits and take further actions to decarbonise their This is an enabling policy that could support the delivery of carbon savings within existing net zero agriculture measures by improving sector level understanding of the source and scale of emissions on farms, and empowering farmers to deliver existing measures in order to decarbonise. This is an early-stage proposal and next steps have not yet been determined. The potential emissions reductions are contingent on further research. Further incentives to encourage nutrient use efficiency. Continue to monitor the effectiveness of current nutrient efficiency measures and market forces and consider development of policy levers to further enhance or strengthen delivery if needed e.g., This is an enabling policy which could support emissions reductions by encouraging a more efficient use of nutrients. This is an early-stage proposal and next steps have not yet been determined. The potential emissions reductions are contingent on further research. No. Sector Policy name and description How the policy supports delivery/ Explore the role of carbon pricing strategies and trading markets as a mechanism to drive decarbonisation.
We will continue to review potential carbon pricing strategies for the agriculture and land use and waste sectors, including the potential role for voluntary or compliance carbon markets to support cost effective decarbonisation This is an enabling policy that could support emissions reductions by encouraging uptake of net zero measures and practices. This is an early-stage proposal and next steps have not yet been determined. The potential emissions reductions are contingent on further research. No. Sector Policy name and description How the policy supports delivery/ R&D to refine emissions estimates and explore further methane gas capture from landfill. Landfill gas is collected and is used to generate electricity, oxidised through flaring or natural processes. Whilst current practices capture some landfill gas, there is room for improvement. Previous research has indicated that most methane is lost at operational sites through uncapped waste and around infrastructure, such as gas wells. Industry practise could reduce this leakage. There are also other smaller opportunities for improvements at closed This is emerging work and contingent on research but could support the more accurate measurement of landfill gas and enable exploration of opportunities to improve methane gas Investment. Water company research and investment into reducing process emissions from wastewater treatment plants, e.g. anaerobic treatment, membrane activated biofilm reactors, alternative ammonia removal processes Improving the available evidence base on process emissions will enable government and industry to implement more effective policy and guidance, supporting reducing our

No. Sector Policy name and description How the policy supports delivery/ Raising ambition through additional actions identified by the review of F- gas legislation. We are undertaking a review of F-gas policy in 2023 and will identify action to deliver additional emissions savings which we will then Subject to passing suitable primary legislation, measures identified through the review of F-gas policy are likely to allow us to deliver greater emissions savings, although the extent of these savings cannot at present be determined. Committee on Critical Minerals to published an updated list of these decisions. A Critical Minerals Intelligence Centre has also been launched that will provide robust, dynamic analysis on stocks and flows to guide our decision-making. The government has published a Critical Minerals Strategy on 22nd July 2022 setting out our approach to securing the technology-critical minerals and metals. Increasing the resilience of global critical mineral supply chains supports the manufacturing of clean technologies globally. Securing the supplies of critical minerals can support the UK to play its part in manufacturing the technologies required for the NZ transition. No. Sector Policy name and description How the policy supports delivery/ (GJDG) - A cross-cutting delivery group to include representatives from industry, the skills sector and other key stakeholders to oversee the development and delivery of the government’s plans for green jobs and skills. This group will drive action across the green skills agenda. We will set out further details on the membership and mandate of the cross-cutting delivery group later this We will continue to encourage industry to ensure there is equal opportunity for all to work in the green economy, building on our existing support for industry initiatives. Through the cross-cutting delivery group we will explore what actions can be taken across industry to improve diversity in the green economy, including improving data collection and Policy in effect The Green Jobs Delivery Group is supporting the delivery of policies which help to deliver net zero and reduces risks to delivering our Carbon Budgets. For example, it can accelerate or extend the savings achieved across its work

No. Sector Policy name and description How the policy supports delivery/ The Skills for Life campaigns - raises awareness of education, training and skills options, including those that can lead to green careers, inspiring young people (14-19) and adults (primary audience is adults aged 25 to 44 years old, C2DE, secondary audience is working age population, C2DE, in England) to work in the green economy. This campaign supports Net Zero by promoting green careers in its images, content and case studies - along with other shortage and priority sectors. 2023 The user journey for people exploring, applying for and taking up skills offers is not linear and delivered across Government cannot track a customer journey from initial interaction with the campaign to take up of skills offers, completion and employment. We are exploring whether it is possible to track awareness and consideration of qualifications and jobs that would contribute to net zero although this is challenging due to the complexity of the 'green' sector and the numbers of jobs that could contribute We are exploring how to gather demand-led data which could be fed into an assessment of campaign effectiveness. While this data will shed light on what is happening on the ground, we would not be able to directly link the campaign to any of this data due to the incomplete customer journey and the fact it is impossible to demonstrate the additionality of Delivery of Sustainability Strategy by Department of Education (published 2021 (to 2030) The strategy will support meeting of carbon budgets in the 1. Enabling cross government net zero policy by providing a pipeline of learners prepared for the net zero economy. 2. Stimulating behaviour change in learners and thus the local communities via initiatives such as the Climate Action Award, Climate Action Plans and the National Education 3. Reducing the carbon emissions from the operations of the education system (36% of total public sector emissions). No. Sector Policy name and description How the policy supports delivery/ Introduce a national education nature Enables children and young people to develop skills needed for their future studies and careers and to ensure that they factor in climate change and sustainability in their work going forward. By studying for the Climate Action Award, children and young people will be developing new skills needed in Improvement Plans (LSIPs) are bringing together employers and providers (e.g., further education colleges) to identify skills priorities.
The Skills and Post-16 Education Act 2022 places LSIPs on a statutory footing and the Secretary of State for Education may only approve a LSIP if satisfied that the skills, capabilities, or expertise required in relation to jobs that contribute to or support Net Zero targets, adaptation to climate change and other environmental goals, have been considered in the development of the plans. We have now designated employer representative development of LSIPs in all 38 areas of The Strategic Development Fund (SDF) provides capital and programme funding to enable FE providers in an area to support changes in local facilities and provision so as to better meet the needs of employers, as set out in LSIPs. This will support more people to retrain, develop skills, grow an interest in and gain qualifications in jobs that are directly or indirectly linked to the NZ transition (e.g. Wind Turbine Maintenance, Electrical Install, bio science). This will help limit supply chain constraints thereby de-risking delivery of

No. Sector Policy name and description How the policy supports delivery/ Careers - we will continue to build an integrated careers information, advice and guidance offer to raise awareness of different career pathways in low-carbon Awareness raising of opportunities in green jobs and skills through the provision of careers information, advice and guidance, supports uptake of new and growing opportunities within the green skills economy. By creating a more informed workforce in this area, it will help limit supply chain constraints thereby de-risking delivery of existing policies. Further education teaching - we have worked with employers to develop a refreshed occupational standard for Further Education teaching (included in the Level 5 Learning and Skills Teacher Apprenticeship), which came into effect in This occupational standard will form the basis of future FE teaching qualifications, confirming that from 2024 all FE trainee teachers, not just apprentices, will embed and promote these issues across their teaching, in all subject areas. This means that future learners in FE will receive training relevant to new developing growth sectors. This will support future skills supply by ensuring that all new FE teachers have a good level of skill and understanding in relation to teaching on sustainability. Future skills supply will be supported as all new FE teachers will have a good level of understanding of sustainability in relation to their technical and vocational subject. Future FE teachers will be able to ensure that sustainable knowledge and practices underpin their teaching and they will be well positioned to support emerging skills. No. Sector Policy name and description How the policy supports delivery/ Green Apprenticeships and Technical Education Advisory Panel - The Institute for Apprenticeships and Technical Education (IfATE) has convened a Green Apprenticeships and Technical Education Advisory Panel (GATE-AP) to work with employers to align occupational standards to net zero and wider sustainability objectives. By updating occupational standards to include environment and climate change , people undertaking apprenticeships and other technical education qualifications will be able to apply their learning to work in sectors which contribute to delivery of the carbon budget and help to make sectors which are les directly linked to carbon budgets function more Continue to roll out T levels which support green careers - there are three Construction, and three Engineering, Manufacturing T Levels now in live delivery and Agriculture is in development This policy will contribute to meeting the latest environmental and climate change skills needs. Increasing quantity and quality of green careers will help limit supply chain constraints thereby de-risking delivery of existing policies. No. Sector Policy name and description How the policy supports delivery/ Higher Technical Qualifications (HTQs) - started rollout from September 2022. These are existing and new level 4/5 qualifications approved and quality marked by IfATE as aligning to the skills employers, including for green occupations. Digital HTQs are available for teaching this academic year with additional occupational routes coming on HTQs are important to meeting carbon budgets as roll-out up to 2025/26 will continue to broadly align with government priorities, supporting the development of level 4/5 skills aligned with the transition to net zero. No. Sector Policy name and description How the policy supports delivery/ Institutes of Technology - the Network of 21 Institutes of Technology (IoTs) across England are working alongside industry leading employers to deliver higher level technical provision in key STEM subjects such as manufacturing and engineering, construction and digital. The extent to which each IoT delivers green skills provision as part of their curriculum is determined by the IoT itself and is dependent on the skills needs of employers in the area they serve. The provision delivered by IoTs links to employment in green jobs across a wide range of sectors, supporting the transition to net zero and the wider net zero system. Skills Bootcamps - providing free, flexible courses of up to 16 weeks for people to retrain and upskill at Levels 2-5 in skills supporting the green economy, including building retrofit, solar and wind, heat pump installation, forestry and arboriculture, electric vehicle maintenance and repair, and charge Skills Bootcamps support Carbon Budget delivery through the provision of training, and employment, in green sectors and roles that support the reduction of emissions and the transition to net zero. Examples include upskilling workers into job roles that support greater energy efficiency in domestic and commercial buildings, and to work with green technologies that contribute to the lowering of carbon Through the NSF we are funding an electrification and battery technology, which commenced in June 2021. We are exploring options to develop the Emerging Skills Programme further, to stimulate the provision and demand for cutting-edge skills in key technologies and sectors such as green construction. The policy supports green jobs across a wide range of sectors, supporting the transition to net zero and the wider

No.
Sector Policy name and description How the policy supports delivery/ Free Courses for Jobs - provides adults without an existing full level 3 the opportunity to gain one by studying one of over 400 high value qualifications. In addition, adults who meet the definition of being unemployed or the low wage criteria can also access these qualifications for free, regardless of their Some qualifications are available to study online or part-time and those eligible may be able to get support to pay for childcare, travel, and other costs. Free Courses for Jobs includes various qualifications supportive of the green economy; a list was published in 2021 alongside the Green Jobs Taskforce Whilst FCFJs is not primarily a net zero focused delivery policy, it will support more people to retrain, develop skills and gain qualifications in jobs that are directly or indirectly linked to the NZ transition (e.g. Wind Turbine Maintenance, STEM subjects - we are encouraging more students into STEM subjects throughout primary and secondary education. To do this, we are funding several initiatives to support STEM teaching and uptake, such as support for teaching about climate change as part of the curriculum. We are encouraging a diverse range of students to take up STEM subjects through programmes such as Tomorrow’s Engineers Code which showcase the diversity of roles and people that make up the STEM sector. Increasing the uptake of STEM skills throughout primary and secondary education will impact the supply of skills relevant to green jobs in STEM sectors, indirectly supporting the transition to net zero and the wider net zero system. No. Sector Policy name and description How the policy supports delivery/ The Department for Work & Pensions are considering how government can work more closely with sectors in the future transition, and we are identifying where we can adapt and enhance our support for people at risk of redundancy to support a transition to green jobs. 2018-2022 Improvements in DWP's ability to support people into green jobs will help to ensure recruitment demand in green industries is met as these sectors grow to help deliver the net zero transition. Providing support for workers in at-risk jobs to move into new roles will also mitigate against the risks of Carbon Budget delivery, as high emission sectors commissioning an R&D project to restoration sector and the level of growth it needs to undergo in order to meet our restoration targets. This will include looking at green skills routes into CB4 The jobs and skills initiatives will enable the delivery of peat restoration targets as part of the delivery of net zero. No. Sector Policy name and description How the policy supports delivery/ 125* Local NZ Local Net Zero Hubs supports all areas of England to reach net zero by promoting best practice and supporting local authorities to develop net zero projects and attract commercial Local authorities play an essential role in driving and accelerating action to tackle climate change with significant influence in energy, housing, and transport. Local authorities are directly responsible for only 2-5% of local emissions through their own estates and operations, but they have potential to influence up to around 80% of all UK emissions. Local authorities can also attract private sector net zero investment that wouldn’t otherwise be obtained, supporting local supply chains with new and upskilled local jobs. Local authorities can therefore play a key role in supporting the delivery of our national net zero targets across a number of The Local Net Zero Hubs Programme supports all areas of England with their capacity and capability to reach net zero by supporting local authorities to develop net zero projects and attract commercial investment to accelerate net zero 126 International The UK has responded to the Glasgow Climate Pact by revisiting its 2030 Nationally Determined Contribution (NDC) and strengthening it with information on delivery of our target to reduce all greenhouse gas emissions by at least 68% by 2030 on 1990 levels. Present - 2030 The 2030 NDC is more ambitious than Carbon Budget 5 and in response to the Glasgow Climate Pact, was strengthened by making the following • clarified how the target aligns with the Paris Agreement • explained more fully how the UK will deliver the NDC by • updated on the progress made in expanding the territorial scope of the NDC to include the UK’s Crown Dependencies • included more detail on the UK’s approach to levelling up, gender, green skills, public engagement, Just Transition and how the UK is supporting other countries with delivery of

No. Sector Policy name and description How the policy supports delivery/ 127 International Build on our G7 and COP26 Presidencies and COP campaigns to strengthen collaboration in key sectors. Utilise bilateral relationships (and extensive climate attaché network) and multilateral fora to develop strategic partnerships on climate action, including through Promoting greater international ambition and coordination across climate and energy policy supports our Net Zero Strategy by addressing multiple issues and making decarbonisation faster and cheaper for all, offering opportunities for growth and trade. As the impacts of UK action on international decarbonisation are not possible to quantify, it is not possible to quantify the potential impact o

No.
Sector Policy name and description How the policy supports delivery/ 128 International Published a refreshed Export Strategy to outline how we are advocating for extended export support to green energy initiatives and more green innovation in the export market for the period 2021- In the first year of the strategic period, UK Export Finance (UKEF) introduced variants of its existing products which offer low carbon exporters access to increased lending capacity, with extended repayment terms; estimated its financed emissions across its full portfolio and set ambitious 2030 decarbonisation targets for the oil and gas, and power sectors, which will guide UKEF on it pathway to net zero by 2050; and continued to demonstrate international leadership on climate change, such as by supporting peers in their implementation of the COP26 statement to end public support for the fossil fuel energy sector overseas (the government's fossil fuel policy), and by becoming the first export credit agency in the world to offer Climate Resilient Debt Clauses (CRDCs) in its 2021 - 2024 UKEF support can unlock finance for green exports and investment. This supports HMG's net zero by 2050 ambitions, by growing industrial capacity in new technologies, and the Export Strategy ambition to increase exports to £1 trillion by 2030. No. Sector Policy name and description How the policy supports delivery/ 129 International Champion UK priorities for integrated international climate and nature action over the coming decade in a cross- governmental strategic framework Present - 2030 The Strategic Framework for International Climate and Nature Action sets out how government will continue to drive forward ambitious international climate and nature action to 2030. It brings together existing government international policy on climate and nature for the first time. As this is an internationally focused framework the main impacts are expected to be on emissions in other countries. However, supporting faster international action - for instance in innovation, research and deployment - could potentially have positive spill overs globally and in the UK e.g. helping to reduce costs and speed up low carbon deployment. 130 International The UK will seek to increase and facilitate trade in green goods and services through our trade policy, our pipeline of free trade agreements (FTAs) and our seat at the World Trade We will seek to reaffirm our commitment to the Paris Agreement in all UK trade agreements, and will ensure that they preserve our regulatory autonomy to We will use our multilateral fora to galvanise international partners to adopt climate-ambitious trade policy, and to promote global trade rules that are aligned to net zero and the Paris Trade can help support the growth of the global market for priority sectors identified in the Net Zero Strategy - zero emission vehicles and renewables are particularly trade- exposed sectors with global supply chains. While the UK enjoys regulatory sovereignty, agreeing clarificatory text under FTAs offers some additional protections for measures required to meet net zero targets, in the event of a trade dispute. Trade is an important enabler across priority net zero sectors. Changing trade patterns will also play an important role in reducing deforestation and preventing carbon

No. Sector Policy name and description How the policy supports delivery/ 131 International Publication of the UK International Climate Finance Strategy brings together the collective ambitions for ICF reaffirms our international commitment to double ICF spend on 2019 levels, to £11.6bn in the period from 2021/22 to 2025/26. The strategy also shows how we are delivering on the ICF sub-targets which we have announced publicly, on nature adaptation, and innovation. This investment will support low and lower-middle income countries to increase their level of ambition in their NDCs, including by investing more in the protection and restoration of critical ecosystems, such as forests, peatland and marine habitats which are major carbon sinks. A more ambitious global effort could reduce the cost of certain low carbon technologies more quickly, catalysing and de-risking our own 132 International Following the adoption of the Just Transition Declaration at COP26, the UK will focus on the implementation of this framework to support developing countries and emerging economies to accelerate climate ambition and enable a Just Energy transitions supports the greening of the economy in a way that is fair and inclusive. No. Sector Policy name and description How the policy supports delivery/ 133 International Commitment to monitoring the impacts of our climate and clean energy policies to assess the need for targeted support for disproportionately impacted groups. This will include working to advance gender equality and diversity in the clean energy sector, for example through our commitments under the 'Equal by 30' Campaign to work towards equal pay, equal leadership and equal opportunities for women in the By 2030 A gender diverse energy sector is vital for driving energy 134 International We will support increased climate finance flows to developing and emerging markets to finance the transition to net zero, this includes delivering on our commitment to provide £11.6 billion International Climate Finance. As part of this HMG is increasing investment to £3 billion in nature-based climate solutions which offer co-benefits for biodiversity and so support delivery of the Global Biodiversity This investment will support low and lower-middle income countries to increase their level of ambition in their NDCs, including by investing more in the protection and restoration of critical ecosystems, such as forests, peatland and marine habitats which are major carbon sinks. A more ambitious global effort could reduce the cost of certain low carbon technologies more quickly, catalysing and de-risking our own 135* International Following ICAO's adoption of Net Zero by 2050 as its long-term aspirational goal, continue to use UK influence through strengthening of existing measures such as CORSIA and agree further measures, such as a global target for 2022 This policy would support reductions to UK aviation emissions (both domestic and international), e.g., through increased use of SAF. It cannot be quantified at present as it is not known what can be achieved through international agreements, but further developments are likely. No.
Sector Policy name and description How the policy supports delivery/ 136 Embedding Lay legislation on 'Improving CB4 Support the transition to zero emission vehicles and roll-out 137 Embedding We have established the Domestic Economic Affairs (Energy, Climate and DEA(ECNZ) which places net zero and climate more broadly at the heart of CB4 The Cabinet Committee sits at the apex of internal government governance structures. As such it indirectly supports all quantified policies - it does this through progress monitoring, direction setting and decision-making. 138 Embedding Revision to HMT Green Book Guidance, including on transformational change and upcoming changes to carbon valuation in policy appraisal. CB4 This policy supports the delivery of Carbon Budgets by giving policy officials the tools to fully consider and appraise climate change and emissions when creating policy. Proper appraisal and evaluation of emissions will ensure ministers have high quality advice on costs and benefits when deciding between policy options, increasing the quality of decision making and - ultimately - policy outcomes for the 139 Embedding HMT set requirements at Spending Review 2021 for major bids to be assessed according to their climate and environmental impact, and has published data on the environmental impacts of SR21. HMT continues to improve this methodology and to work with departments to build capacity and capability. HMT also now requires all measures at budgets to have climate CB4 This policy supports the delivery of Carbon Budgets by ensuring that the climate impacts of spending bids are considered as part of the Spending Review process led by HMT. This ensures that net zero is embedded into fiscal

No. Sector Policy name and description How the policy supports delivery/ 140 Embedding Greening Government Commitments to reduce emissions from the estates and operations of central government and This policy provides government departments and their partner organisations with targets to reduce their emissions. This will help these organisations to decarbonise and ultimately helping to meet Carbon Budgets. 141 Embedding National Procurement Policy Statement sets out clear principles that contracting authorities should be following organisationally, with net zero being one of the key considerations. CB4 This policy encourages the consideration of net zero in public procurement, aiming to ensure that contracting authorities factor in net zero as they undertake procurement activities. This policy ensures net zero is embedded into the wider public procurement ecosystem, working in tandem with other policies to leverage public procurement spending in 142 Embedding Carbon Exclusion Measure Procurement Policy Note requires suppliers bidding for major government contracts (>£5m) to commit to net zero and publish a ‘Carbon Reduction Plan’. CB4 This policy ensures that suppliers bidding for major government contracts commit to net zero and publish a carbon reduction strategy. This helps to ensure that the government is procuring with suppliers committed to net 143 Embedding Environmental principles policy impact on net zero. The Environment Act 2021 makes sure that environmental considerations are at the heart of government policy making, by creating a legal duty on Ministers of the Crown to have due regard to the environmental principles policy statement internationally recognised principles integration, prevention, rectification at source, polluter pays, and the precautionary principle. The policy statement is designed to set out how the principles should be interpreted and proportionately applied. The final The Environment Act 2021 places a legal duty on Ministers of the Crown to have ‘due regard’ to the environmental principles policy statement (EPPS) when making policy. We published the final EPPS in Jan 2023. The EPPS explains how Ministers of the Crown should interpret and proportionately apply the five environmental principles when making new or revised policy. Its publication will help to further embed net zero (as it is a core component of the overall EPPS framework) into government policymaking. It will come into force on 1 November 2023. This will help support the transition to net zero and delivery of Carbon

No. Sector Policy name and description How the policy supports delivery/ environmental principles policy statement was published on 31 Jan 2023. Following an implementation period, the duty will come into force on 01 Nov 2023. Appendix Deployment assumptions underpinning quantified policies in this report. Ranges indicate where values differ between the electrification and hydrogen pathways set out for the heat and buildings sector. In some cases, these assumptions represent early-stage assessments based on maximum technical potential. Given ongoing uncertainties, the policy mix that will meet carbon budgets, and related deployment assumptions, are subject to change; these are illustrative and should not be interpreted as government targets.
Sector Deployment assumption Unit 2021 2025 2030 2035 Electricity generation TWh 307 315 percentage of total projected generation Low carbon fuels a consumption as a percentage of final energy consumption Resource and energy efficiency savings MtCO2e See policy savings tables for resource and energy efficiency Industry demand for Industrial CCUS

Low carbon hydrogen production TWh 0 10*** Electrical power demand from offshore oil and gas installations as a percentage of Cumulative heat pumps installed Cumulative homes converted to 100% Yearly homes treated by new domestic Low carbon fuels a consumption as a percentage of total fuel consumption in commercial buildings (excluding heat Yearly heat supplied via heat networks TWh 15 17 Yearly biomethane injected into the grid TWh 4 7 Yearly area of peatland under restoration Yearly area of afforestation in the UK Ha 13,300 7,500 Yearly additional area of perennial energy crop and short rotation forestry

Farmers engaging with low carbon farming practices as a percentage of total Level of HFC consumption relative to a 2015 baseline level (percentage of bulk Removals BECCS and DACCS MtCO2e 0 0 ZEVs as a percentage of total car fleet % 0.9% 7% ZEVs as a percentage of total van fleet % 0.5% 3% ZEVs as a percentage of total HGV fleet % 0.1% 0.4% ZEVs as a percentage of total bus and Low carbon fuels a used in road transport as a percentage of total fuel use (in litres) Proportion of short journeys (less than 5 miles) in towns and cities that are walked SAF use in domestic aviation as a percentage of total fuel use (in tonnes) Low carbon fuels a use in domestic shipping as a percentage of total fuel use IAS SAF use in international aviation as a percentage of total fuel use (in tonnes)

Low carbon fuels use a in international shipping as a percentage of total fuel use *Reflects demand in the high hydrogen pathway. **This metric has been changed from "Low carbon fuel switching" published in the Net Zero Strategy due to methodological issues. Figures for low carbon fuel switching, including BECCS, are 122TWh for 2021, 115TWh for 2025, 120TWh for 2030, and 160TWh for 2035. ****Energy crop and short rotation forestry area figures are indicative and may vary, for example, based on precise mix of crop varieties. the electricity, biofuels, solid biomass, hydrogen, ammonia and methanol. All of these deployment assumptions include electricity and hydrogen both in the numerator and denominator, with the exception of low-carbon fuels used in road transport (from which electricity and hydrogen are completely excluded). The metric ‘Single track kilometres electrified per year’ has been removed while we develop an appropriate metric to reflect the policy on rail

Appendix Sectoral summaries of 1. Delivery confidence for all proposals and policies- but particularly those delivering in later carbon budget periods- will be impacted by technological developments, societal changes and future spending arrangements. Below we set out further detail for each sector. 2. Delivering deep decarbonisation of power is key both to delivering sector carbon savings and unlocking the path to net zero across transport, industry, and heating buildings. Meeting growing demand while achieving the goal of decarbonising the power system by 2035 subject to security of supply needs substantial expansion of renewable low carbon generation. This will require appropriate planning arrangements, expansion of electricity networks and grid connections, strong supply chains, deploying sufficient flexible capacity capable of replicating the role of unabated gas on the electricity system and the delivery of new nuclear capacity. We must catalyse private investment in low carbon infrastructure to deliver the level, pace and scale of ambitions. Given the scale and pace at which the power sector will need to deliver generating infrastructure, to meet demand, and the risks to delivery and deployment, power must retain optionality on which generating technologies deploy to deliver lower cost 3. The Energy White Paper, Net Zero Strategy, British Energy Security Strategy, and the Energy Security Plan set out our strategy for decarbonising the power sector, including how we are developing and delivering a portfolio approach to mitigate the delivery risk of any individual project or technology. 4. An efficient planning system for nationally significant infrastructure is essential for the deployment of large scale low carbon electricity generation technologies like offshore wind, nuclear power and power-CCUS at the pace and scale we need to meet Carbon Budget 6. The government is undertaking several actions to review planning and consents, such as the Action Plan for reform published in February, making the system faster, fairer and more effective, as well as changes to Permitted Development Rights to simplify obtaining planning consent

for solar installations. The government has also issued a Call for Evidence on Land Rights and Consenting for electricity networks. The government is also updating the National Policy Statements to ensure that we have a planning policy framework to support infrastructure required for net zero and has set up taskforces to support the development and deployment of infrastructure. 5. The electricity network will need to be expanded so that the new generating capacity can connect to the grid. The electricity network will need to be able to manage an additional capacity required on the electricity system for Carbon Budget 6. We are developing proposals and policies to meet this onshore and offshore, including delivering the Electricity Networks Strategic Framework, focused on how government and Ofgem would enable the transformation of the network at the scale and pace required; and delivering the Centralised Strategic Network Plan with Ofgem and National Grid ESO; and Holistic Network Design 6. Nuclear capacity is a key technology in the decarbonisation of the power sector, and faces legislative, planning, policy and financing challenges.
We manage this by planning on taking one project to FID this Parliament and two projects in the next Parliament, legislating in 2022 for the Regulated Asset Base, setting up Great British Nuclear and taking forward Sizewell C. Further action to mitigate risk includes work on a nuclear siting consultation as a first step towards a new National Policy Statement for nuclear; implementing the Action Plan published last month for reforming the planning process for all nationally significant infrastructure; and exploring the potential for streamlining the planning process further. In addition, the government has launched Great British Nuclear (GBN) which will be funded to lead delivery of our programme of new nuclear projects. The first priority for GBN is to launch a competitive process to select the best small modular reactors (SMR) technologies. We will also be exploring the research and development of advanced modular reactors (AMRs) and fusion. 7. Currently the UK relies heavily on unabated gas to provide flexibility in the electricity system. Reducing emissions in the power sector will also depend on bringing forward flexible technologies that are capable of replicating the role of unabated gas in the electricity system. These include technologies such as power CCUS, hydrogen to power, and energy storage. To boost confidence and funding clarity for CCUS we are taking forward Track 1 negotiations including one power CCUS project; setting out plans for Track 2 and expansion of Track 1 clusters; and setting out a longer-term vision to give investors, industry and regulators clarity on our 2030s approach. For hydrogen to power we intend to consult on the need and potential design options for market intervention and we will develop appropriate policy to enable investment in large scale long duration storage by 2024. We are also taking forward actions set out in the Smart Systems and Flexibility Plan. This includes legislating for enabling powers in the Energy Security Bill and consulting on proposals for a Secure and Smart 8. Power BECCS is a technology that can deliver both low carbon generation to support the decarbonisation of the power sector, as well as negative emissions. To support the deployment of power BECCS the government is developing

Power BECCS business models to incentivise negative emissions and power 9. Industry is a major source of CO2 emissions. Industrial sectors in 2021 produced 18% (76 Mt CO2e) of UK emissions, with just over half of these emissions concentrated in specific ‘clusters’ – geographical areas with large concentrations of industry. We set out a plan to decarbonise industry in the Industrial Decarbonisation Strategy (2021) and in the Net Zero Strategy. 10. Our ambitions are stretching to achieve. To de-risk delivery we are looking at what could be delivered with further government action on resource and energy efficiency, fuel switching and CCUS. We increased our ambition in the Net Zero Strategy to capture and store industrial emissions (from 3 MtCO2 per year to 6 MtCO2 by 2030, and to 9 MtCO2 per year by 2035); are now committed to delivering more fuel switching to low carbon alternatives, with our initial ambition to replace around 20 TWh of fossil fuels per year by 2030 – potentially increasing to 50 TWh per year by 2035; and decarbonising the iron and steel sector in the 2020s and early 2030s. We are also developing proposals for industry through the Energy Efficiency Taskforce, as part of the 15% reduction in energy use target, which will increase delivery confidence for industrial energy efficiency and resource efficiency. 11. A lot of our efforts are focused on major industrial clusters, which account for just over half of total industry emissions, and less on support for remaining emissions in more ‘dispersed’ industrial sites. To address this, we have launched the Local Industrial Decarbonisation Plan (LIDP) to allow industries outside industrial clusters to develop strategic plans to decarbonise. Plans will be reviewed to ensure they continue to present value for money and are delivering on the carbon savings expected. 12. Many industries continue to highlight carbon leakage as a risk preventing investment. We are addressing this by ensuring there is a clear plan for carbon leakage mitigation that gives industry confidence to invest ahead of upcoming 13. The delivery of the industrial decarbonisation pathway is heavily reliant on new and emerging technologies, alongside significant investment. This is a long-term package that will be adapted as our understanding of the technical and economic potential for industrial decarbonisation continues to develop. 14. We have an ambition to have up to 10GW low carbon hydrogen production capacity by 2030, subject to affordability and value for money, with at least half of that coming from electrolysis. Growing the sector from an extremely low starting point naturally entails challenges in either high hydrogen or high 15. Hydrogen production alone will not generate emissions savings, but we expect it to enable emissions savings in several sectors including industry, power, transport and potentially buildings by replacing high-carbon fuels used today. 16. Policies intended to meet this stretching 2030 ambition and contribute towards CB6 carry delivery risks, some of which are inevitable given pace and scale of deployment. We have higher certainty in the delivery and funding of some policies in the near term, having launched the Net Zero Hydrogen Fund, Hydrogen Production Business Model, and the Low Carbon Hydrogen Standard. Confidence should grow as government and industry action provides clarity on long term funding, production, and legislating for Transport and Storage 17. Up to 50% of the 2030 hydrogen production ambition depends on Carbon Capture Use and Storage (CCUS), which carries delivery risks which could materially affect the successful delivery of the associated carbon savings for 2030. Progress on Track 1, Track 1 Expansion and Track 2 plans provide significant mitigation for these risks. 18. The oil and gas sector continues to make good progress in decarbonising in line with North Sea Transition Deal (NSTD) for upstream; and steady progress on the midstream gas approach.
NSTD projects are primarily focused on offshore infrastructure electrification, and cessation of routine flaring and venting, which require industry action and new approaches so entail delivery risks. 19. Factors driving the delivery risks include the high cost of infrastructure change, regulatory complexity, bottlenecks in network capacity and scheduling and a challenging investment climate. These could affect the speed at which we electrify and decarbonise. We do not assume that all platforms will electrify. 20. Government continues to work with the industry and regulators to help mitigate these risks, including by responding to questions regarding the regulatory environment and encouraging investment in infrastructure. 21. The oil and gas sector’s expertise and supply chain is key to supporting technologies that will help us enable carbon budgets to be met, including

offshore wind, CO2 storage, and hydrogen; while ensuring UK energy security as we transition to net zero by 2050. 22. The Buildings sector accounted for around 17% of UK GHG emissions in 2019 and therefore has a significant contribution to make to enable carbon budgets to be met. Action is needed on finance, regulation and driving consumer behaviour 23. Delivery is dependent on government taking decisions in relation to future Carbon Budget periods to provide additional funding and to regulate for changes. This will be subject to technological developments, societal changes, stakeholder views, future spending arrangements and broader policy 24. Over a third of the policies require consumers to make choices to achieve the carbon savings. There are risks that these choices may not occur due to several factors including concerns around costs and lack of clear information for the consumer to make informed choices, which could mean there would be no widespread adoption of policy measures. In July 2022 government launched a home retrofit tool on GOV.UK, ‘Find ways to save energy in your home’, and a phoneline service that will help provide consumers in England with tailored and impartial information about how to improve the energy performance of their homes. Consumer awareness of the benefits of heat pumps and the Boiler Upgrade Scheme is also being raised through a targeted marketing campaign. 25. There is also a risk that retrofit and low carbon heat supply chains do not grow or upskill sufficiently to enable meeting our energy efficiency and clean heat deployment targets. This sector can face capacity issues as the majority of businesses are small to medium enterprises that may require support to upskill or retrain staff. Also, within the labour market there are challenges for attracting workers with the right skillset for insulation measures, which we are addressing with skills funding across heat decarbonisation and buildings retrofit. The £15m Home Decarbonisation Skills Fund commits to future support for training for people who want to work in the energy efficiency sector and has already funded 18 projects. We have also recently announced the £5m Heat Training Grant for heat pump and heat network skills. 26. Product supply may not meet demand at an affordable price which makes the achievement of targets more expensive. This is driven by current costs of technologies or measures and the potential to reduce these, as well as by inflation, transport costs and competing demand from other markets. Product supplies are not directly within government control but are influenced by demand generated by government schemes or policies. For clean heat measures, we are growing the heat pump market and supply chain through the Boiler Upgrade Scheme, Clean Heat Market Mechanism, Heat Pump Investment Accelerator and through off-gas grid regulations. An insulation products strategy is in development with key industry partners to enable management of peaks in 27. Distortions between electricity and gas prices may continue to disincentivise technologies such as heat pumps. We are committed to support low carbon technology development and deployment. 28. The external risks outlined above present delivery challenges to the buildings sectors carbon savings targets, however we are confident that the agreed and funded schemes will deliver on their targets with appropriate mitigation. Schemes without allocated funding or in an early stage of development carry inherently higher risk and are subject to future decision-making. Natural Resources, Waste and F-Gases 29. The Natural Resources, Waste and F-Gases (NRWF) sectors accounted for 18% of UK GHG emissions in 2021, meaning that delivery of emissions savings in this sector are important to enabling cross-economy carbon budgets to be met. Action on these areas can also support economic growth, a circular economy, and co-benefits for nature. 30. Many of the delivery risks faced in these sectors are due to a need for further research and innovation, dependencies on other stakeholders to deliver, supply chain and sector capacity issues and the need to manage potential trade-offs with other priorities, such as food production. There is increased risk to delivery as many of our proposals and policies are in early stages of development. It is crucial we maintain flexibility to adapt our pathway to ensure we maximise co- benefits with priority outcomes. Some of the most significant delivery risks are detailed below. There are links and interdependencies between the different 31. Given the UK’s land use profile and that these sectors are largely devolved, a significant proportion of UK-wide emissions reductions savings will be delivered

by Devolved Administrations (DAs). Many of the risks to delivery of emissions savings will likely be common across all four nations. Proposals and policies for these sectors may be subject to risks such as the need to manage competing demands on land, dependencies on stakeholders, the appropriate infrastructure being in place, evidence gaps and dependencies on early stage technologies. Close working will continue with DAs on net zero policy and analysis to support UK-wide delivery, addressing common challenges and sharing best practice to mitigate delivery risks, recognising devolved Data, Evidence and Research and Development 32. Various measures that form part of the package of proposals and policies are dependent on R&D and improved data.
We are addressing this risk through Defra’s commitment to spend £75 million on net zero R&D for the NRWF sectors during the current spending review period and through a £270 million Farming The role of external stakeholders 33. Many actions are dependent on external stakeholders. For example, waste policies are dependent upon successful implementation of the reforms by businesses and local authorities and response from households. We are working closely with businesses and local authorities to support detailed waste policy development. Also, in order to restore and manage lowland peatlands, government and industry need to work together to ensure the correct water infrastructure exists to facilitate water management. 34. Many of the agriculture and wider land use measures will be delivered through our environmental land management schemes, which are voluntary schemes and depend on sufficient uptake. For agriculture and land use measures, information on the schemes’ funding was published in January 2023, including the announcement of six new Sustainable Farming Incentive standards. The second round of Landscape Recovery focuses on net zero, protected sites and habitat creation, including creating and enhancing woodland and peatland. government will monitor uptake and implementation and will consider 35. There is a risk that competing priorities for land affects delivery of emissions savings. We have a finite amount of land and this needs to support the delivery of net zero as well as other objectives, like improving biodiversity and water quality, as well as maintaining food production. To address this, government will publish a Land Use Framework later this year, setting out how our land can play an important role in delivering multifunctional landscapes. Early-stage proposals and policies 36. Many proposals and policies, such as policy relating to domestic biomass planting and some aspects of waste decarbonisation, are at early stages of development. Key risks to delivery of the biomass pathway include establishment of the business model for sustainable biomass cultivation, linked with demand from end use sectors including bioenergy with carbon capture and

storage, and confidence in uptake of new models for land use. R&D and policy work is ongoing to increase delivery confidence. For delivery of waste emissions savings, we committed in the Environmental Improvement Plan to launch a call for evidence to support detailed policy development to achieve the near elimination of biodegradable municipal waste to landfill from 2028. 37. In 2020 transport remained the biggest emitting sector of the UK economy, responsible for 24% of UK greenhouse gas emissions. Reducing transport emissions is therefore a clear priority to successfully enable carbon budgets to be met. To tackle transport emissions, in July 2021 DfT published the Transport Decarbonisation Plan. This included 78 ambitious commitments – covering all types of transport – to decarbonise the sector and set it on the path to net zero. We have made good progress on delivering these commitments and must continue on this trajectory. Despite the intrinsic uncertainties of long-term sectoral emissions projections, we still have a reasonable to high level of confidence that the proposed policy package will deliver in line with what is needed to enable carbon budgets to be met. 38. Road transport accounts for around 90% of domestic transport emissions, with nearly three quarters coming from cars and vans. A principal risk is that the regulation and incentives we are putting in place are insufficient to drive the transition to zero emission vehicles at the speed required to enable carbon budgets to be met. However, we have confidence in the established mechanisms for transitioning the car and van fleet to zero emission alternatives, and there are already signs for optimism. Evidence shows that deployment of electric cars and vans in the time since publication of the 2021 Net Zero Strategy has outstripped expectations – both domestically and in international comparators – indicating that these technologies are attractive to consumers. The adoption of battery electric cars has also increased dramatically with nearly 17% of new cars sold in 2022 battery electric. Regulation will come into force, most notably the ZEV mandate from 2024 and phase out dates for the sale of all types of new non-zero emission vehicle by 2040 at the latest. There will also be continued investment in enabling measures – such as the Local EV Infrastructure Fund and Project Rapid – to support the rollout of essential charging infrastructure. We will continue to monitor progress in this space, and should our confidence change, we will consider additional measures to support 39. Another risk is that we see considerable, unanticipated growth in transport demand, going beyond our high-end projections. DfT analysis is based on the latest available demand projections for road transport and aviation. However, the

impacts of recent lower GDP projections on road traffic projections and the impact of COVID on aviation demand are not yet fully factored in, and these factors may mean growth in demand is lower than current projections. This helps to mitigate this risk, and critically, should future demand be lower than current projections, emissions will be lower than previously forecast. 40. Risks to delivery are highest where there is a reliance on nascent or immature technologies and associated markets, such as zero emission vehicle or flight technologies or utilisation of lower carbon fuels. To mitigate this risk, stakeholder groups and R&D funding are being used to explore how technologies can be expedited and supported through development. For example, zero emission maritime technologies are supported through the UK SHORE R&D programme whilst the Zero Emission Road Freight Demonstrator is supporting development of zero emission freight technologies. The Zero Emission Flight Delivery Group (part of the Jet Zero Council) has been established to explore the UK’s capabilities to deliver zero emission technologies. 41. As committed to in the Transport Decarbonisation Plan, DfT will review progress against our pathway at least every five years and consider as necessary additional options to support delivery of UK carbon budget targets. 42.
Engineered greenhouse gas removals (GGRs) are essential for meeting net zero and enabling our carbon budgets to be met.7 We have an ambition to deploy at least 5MtCO2/yr of engineered removals by 2030, with analysis suggesting 30 Mtpa removals are required by 2037 at the end of carbon budget 6. However, this is a nascent sector, with inherent associated uncertainty as new technologies and markets for engineered removals are in their infancy. We are addressing this uncertainty and enabling the sector through progress on policy and through innovation funding. This includes developments on GGR and power BECCS business models, monitoring, reporting and verification (MRV), access to carbon capture and storage (CCS) infrastructure and exploring integration 43. Key to managing the uncertainty and risk in this emerging sector is supporting development across a range of GGR technologies and projects. Through this portfolio approach and our ongoing policy development, we are confident that we are developing a world-leading approach to GGRs and enabling the delivery of engineered removals for carbon budgets. 7 Nature-based solutions, such as afforestation, are included in the Agriculture and LULUCF subsector

44. New technology scale-up carries inherent delivery risk and government’s innovation funding is crucial for de-risking this. The GGR sector needs to pull through a portfolio of First of a Kind (FOAK) technologies to commercialisation. We are addressing this through the DAC and Greenhouse Gas Removals Innovation Programme; last year we announced over £54m of government funding across 15 GGR pilot projects. 45. Business models are essential to address the risk of financial barriers to deployment and provide investors with certainty in early GGR projects. In 2022, we consulted on both a GGR and FOAK power BECCS business model. For the GGR consultation we intend to respond later this year and we will publish the power BECCS consultation response imminently. In December 2022, the Industrial Carbon Capture (ICC) Business Model and Waste ICC Business Model also updated policy positions on how potential GGR credits will be incorporated into the business models. 46. A well-functioning negative emissions market will be essential to reduce investment risk for the private sector. We are exploring options for different market options to support deployment. We will work within the UK ETS Authority to consider options for integrating GGRs in the UK ETS subject to the outcomes of last year’s UK ETS consultation, a robust monitoring, reporting and verification (MRV) regime being in place, and the management of wider impacts - including market stability and the permanence of the emissions stored by the GGRs. Further detail will be provided in the Government Response to the UK ETS consultation. We recognise the integrity offered by the UK ETS could unlock investment at scale in the UK's greenhouse gas removal sector by providing an integrated market where businesses can make economically efficient choices on how to decarbonise or remove their emissions. 47. Robust MRV will be critical to reduce market risks and increase public certainty through ensuring the credibility of GGRs. We are developing our MRV policy through consultation and we intend to review the existing landscape, to determine which of these standards, if any, might form the basis of ‘MRV eligibility criteria’ for business model support in the near-term. For biomass GGRs, the Biomass Strategy is due to be published in 2023 and will outline recommendations for enhancing the UK’s existing biomass sustainability 48. Access to CCS clusters is critical to achieve the volumes of removal needed. For technologies that rely on long-term geological storage, such as direct air capture with carbon capture and storage (DACCS) and bioenergy with carbon capture and storage (BECCS) access to CCS is important for large scale removals. Subject to criteria under development, the government is minded to enable engineered GGRs to apply to Track-1 expansion and Track-2 of the CCUS cluster sequencing process. We have also published a project submission process for power BECCS projects to enable project selection and announced the outcome of this assessment. The scientific case for strong action on climate Technology See Innovation chapter The latest evidence on relevant climate technologies has been used for all emissions Economic See Net Zero Workforce competitiveness impacts of the transition, with some potential significant economic benefits, particularly when compared against inaction on climate change. However, the economic impacts and interactions of reaching net zero are complex. We make no overall conclusion. The full fiscal impact of these proposals and policies is not yet known and will depend on varied policy decisions and economic DESNZ and other departmental spending was set at the 2021 Spending Review. We will continue to consider the impacts on the public finances of future climate policy. See Sector chapters There are both positive and negative natural capital impacts associated with these proposals and policies but the overall contribution to sustainable development is likely positive. Energy Policy See Power chapter and Delivering our carbon budgets has the potential to reduce demand for gas, coal, oil and transport fuels which could improve security of supply by diversifying away from primarily imported fossil fuels. Other measures will mean increases in electrification and the simultaneous deep decarbonisation of electricity supply, which carries

Price and bill impacts will depend on electricity market developments and consumption patterns. Government has mitigated some of the worst impacts of recent energy price increases, saving typical households £1,500 factoring in the extension of the Energy Price Guarantee to June. Policies that improve energy efficiency of homes will reduce bills and benefit fuel poor households. IAS emissions will be included in the sixth carbon budget and will use the bunker fuel sales method The UK has world leading ambition on climate change and is committed to advancing global climate action - in the run up to and at COP26 we narrowed the ambition gap, with net zero commitments covering 90% of the world’s economy, up from 30% two years ago, when the UK took on the COP26 Presidency.
The UK has left the EU and is no longer bound by EU climate policies, allowing the UK to tailor policies in the national interest and deliver better outcomes. For example, we are undertaking the most significant reform of agricultural policy and spending in England in decades as we move from the EU’s Common Agricultural Policy (CAP) to our Environmental Land Management schemes, designed for our countryside and environment. The proposals and policies in this report will directly reduce emissions across the nations of the UK, depending on their differing circumstances. There is potential for further reductions where the Devolved Administrations are taking action beyond what is reflected in our assumptions. Appendix Summary of impact of proposals and policies across sectors of 1. The Net Zero Growth Plan sets out the impact on jobs and investment at a Summary of the impacts of the Carbon Budget Delivery Plan proposals and 2. Proposals and policies (P&Ps) in this section refer to the list of P&Ps in Appendix B of the s14 report (tables 4-6). The descriptions of the P&Ps identify their proposed effects and anticipated impacts. This section seeks to summarise the anticipated impacts of these P&Ps on different sectors of the economy. For additional detail, please see the sector chapters in the Net Zero Growth Plan 3. There are risks inherent in the delivery of the defined suite of P&Ps. Please see Appendix D for sectoral summaries of delivery confidence, alongside risks and 4. P&Ps, as defined above, will have a significant impact on the power sector. The package creates markets for investment and sector growth, offers targeted funding support to reduce technology and infrastructure costs, and provides long-term clarity and certainty in terms of future revenue streams. 5. The package will result in the expansion of electricity networks, deployment of sufficient flexible capacity capable of replicating the role of unabated gas on the electricity system, expand renewables and remove planning barriers to support deployment of renewable and low carbon infrastructure to facilitate delivery of a more secure, cleaner and cheaper energy system. As a package the P&Ps will meet growing demand while achieving the goal of decarbonising the power system by 2035, subject to security of supply. a) Decarbonising the power sector whilst meeting a potential 60% increase in electricity demand has the potential to bring forward £275 – £375 billion of investment from both the private and public sectors. Investment in the electricity network will support the expected increase in peak demand, bringing forward £50-£150 billion of b) Reinforcing the onshore electricity network could support 20,000-80,000 jobs by 2037, in addition to providing further employment in the supply chain. In addition, measures to increase storage and demand side flexibility could support up to 7,000 jobs across the supply chain by 2030. We are also working to build UK training and certification capability for onshore wind and solar. c) Our proposals and policies for growing the offshore wind sector in line with our 50GW ambition could support up to 90,000 direct and indirect jobs. d) For nuclear, we aim to take one nuclear project to Final Investment Decision this parliament and two in the next parliament, including Small Modular Reactors (SMRs). Each large-scale nuclear power plant could support up to around 10,000 jobs at peak construction, in addition to providing further employment in the supply chain. e) In 2021, power emissions were around 54 MtCO2e making up around 12% of total UK net GHG emissions (including international aviation and shipping). Natural gas combustion currently makes up the largest share of emissions. f) Power emissions have decreased by 6% since 2019 and 73% since 1990. This decrease has resulted mainly from changes in the mix of fuels being used for electricity generation, including the decline of coal and growth of renewables; together with greater efficiency resulting from improvements in technology. g) In line with the sectoral breakdown of the indicative pathway set out in the Net Zero Strategy, compared to 2021 emissions levels, GHG emissions could need to fall by 42% to 48% on average over 2023-27, by 69% to 74% by 2030 and 79% to 84% on h) Support a range of technologies, including offshore wind, onshore wind, solar, tidal, geothermal and floating offshore wind through annual Contracts for Difference (CfD) i) Streamline the planning system to support offshore wind, solar, nuclear power and carbon capture, and enable local technology like EV charge points and heat pumps. 6. P&Ps are aimed at growing the emerging sector and putting it in a position to act as a key enabler to carbon savings across other sectors - including industry, power, transport and potentially buildings by replacing high-carbon fuels used today. The package provides clarity on long-term funding, the legal framework and production. Taken together P&Ps will support deployment of new low

carbon hydrogen production, reduce upfront infrastructure costs, and provide greater clarity and certainty around future demand and revenue streams. 7. P&Ps will also support decarbonisation in the oil and gas sector between 2027 and 2040, primarily through electrification. Working alongside regulators the package will result in the elimination of the practice of ‘flaring’ as soon as a) Decarbonising our fuel supply and driving the new green industry of hydrogen has the potential to unlock £11 billion of private investment across production, transport, and storage, supporting 12,000 jobs by 2030. The UK has already built world leading capabilities - for example in electrolyser and fuel cell manufacture.
There are over 200 companies working on hydrogen and fuel cell technologies in the UK, and we consistently feature in the top ten countries globally for hydrogen technology patent b) Carbon Capture Usage and Storage (CCUS) forms part of the most cost-effective route to net zero, and represents a significant economic opportunity, with the potential to support up to 50,000 jobs by 2030 and deliver £4.3 billion in GVA by c) In 2021, fuel supply emissions were around 20 MtCO2e making up around 4% of total UK net GHG emissions (including international aviation and shipping). Upstream oil and gas currently make up the largest share of these emissions. Fuel supply emissions have decreased by 18% since 2019 and 66% since 1990. Since 1990, the largest reductions have been from coal mining and gas leakage. d) In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions could rise by 8% or fall by 2% on average over 2023-27, fall by 22% to 33% by 2030 and 43% to 52% on average e) Government and industry remain committed to the North Sea Transition Deal target to reduce GHG emissions from oil and gas production by 50% by 2030 from 2018. 8. P&Ps will result in an increased rate of adoption of low carbon technologies and processes in industrial sectors, particularly when these technologies are not yet fully cost- or price-competitive with established practices. In the process the package will support jobs and investment in areas with a rich heritage of manufacturing and engineering. 9. The package will support the delivery of a reduction of total UK energy demand by 15% from 2021 levels by 2030, across domestic and commercial buildings and industrial processes, with a particular focus on the role of the private sector and the stimulation of investment. a) Decarbonising our industrial sector has the potential to unlock £19 billion in public and private investment across the UK in line with our 2037 delivery pathway. b) This could support up to 4000 jobs directly in industry for the manufacture and installation of on-site energy efficiency measures and up to 50,000 jobs across industry, power and the transport and storage network for the deployment of CCS. This is supporting growth and levelling up across the country both in our industrial clusters and in dispersed industrial sites. c) In 2021, industry’s GHG emissions were 76MtCO2e, equivalent to 17% of whole economy GHG emissions. This represents a 3% decrease from 2019 levels, and a 52% drop from 1990 levels. The majority of these GHG emissions are from industrial d) In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions could fall by 15% to 25% on average over 2023-27, 41% to 52% by 2030 and 62% to 75% on average over 2033- 10. The package will result in more efficient, low-carbon buildings, reduced energy bills and healthier, more comfortable environments. At the same time, it will reduce our reliance on volatile fossil fuel prices, improving energy security and 11. Targeted regulation and new market-based mechanisms will result in reduced costs for consumers and businesses, attract greater private investment and strengthen supply chain resilience. New government funding will provide long- term funding certainty, supporting the growth of supply chains and skills. 12. The package will stimulate private investment and increase green finance options, galvanising supply chains, and increase public and business engagement with energy efficiency, including how to build public understanding of clean heat technologies and deliver greater take-up of support. a) Potential to unlock up to £10 billion in Gross Value Add (GVA) per year in the UK and supporting ~240,000 jobs in 2035. For example, research shows that heat networks could provide for c.20% of total UK heat demand by 2050, up from providing c.3% currently. This represents an investment opportunity of £60 – £80 billion, incentivised through policies such as heat network zoning and capital support schemes. b) Grow the UK heat pump market to 600,000 installations a year by 2028. c) In 2021, buildings emissions were around 88 MtCO2e making up around 20% of total UK net GHG emissions (including international aviation and shipping). Residential

combustion currently makes up the largest share of emissions (78%), the vast majority of which is from heating. Buildings emissions have increased by 5% since 2019 and decreased by 19% since 1990. Annual buildings emissions are particularly volatile as impacted by external temperatures. d) In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions could fall by 7% to 17% on average over 2023-27, 25% to 37% by 2030 and 47% to 61% on average over 2033- e) Support generation of biomethane for injection into the gas grid f) Raise consumer standards and improve the performance of heat networks through a new market framework, and identify areas where heat networks are the lowest cost solution for decarbonising heat. g) Support industry to deliver trials ahead of taking decisions on the role of hydrogen in 13. P&Ps will result in the widespread decarbonisation of road, maritime and aviation transport as well as the supporting infrastructure. The package will also provide benefits across the UK, bolstering energy security, unleashing economic growth, and supporting a healthier population and environment. The P&Ps will bring about an accelerated shift to public transport and active travel following investment in the development and building of new walking, wheeling, and a) We have provided strong market signals and incentives to drive supply chain development, and this is already unlocking significant private investment. For example, our commitment to zero emission vehicles has led to hundreds of millions of pounds of private investment in charging infrastructure.
b) We are a world leader in the production and use of low carbon fuels, with independent analysis conducted for Sustainable Aviation forecasting the potential for 65,000 jobs to be created by a UK SAF industry by 2050, and £1.9bn of direct GVA c) The sector will see accelerated growth in the number of zero-emission vehicles on the road following implementation of the ZEV mandate and investment in charging infrastructure across the country. d) In 2021, domestic transport emissions were around 109 MtCO2e making up around 25% of total UK net GHG emissions (including international aviation and shipping). Road transport makes up the vast majority of emissions. Domestic transport emissions have decreased by 11% since 2019 and 15% since 1990, though 2021 emissions were impacted by COVID-19 and resultant restrictions on movement. e) In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions for domestic transport could fall by 2% to 8% on average over 2023-27, 27% to 39% by 2030 and 61% to 73% on f) International aviation and shipping were significantly impacted by COVID-19 and resultant restrictions on movement. In 2021, international aviation and shipping emissions were around 20 MtCO2e making up around 4% of total UK net GHG emissions (including international aviation and shipping). In 2019, international aviation and shipping emissions were around 44 MtCO2e making up around 9% of total UK net GHG emissions (including international aviation and shipping). g) For IAS, in line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2019 emissions levels due to severely depressed demand in 2021, GHG emissions could fall by 11% or rise by 5% on average over 2033-37. Natural Resource, Waste & F-Gases 14. P&Ps will maximise co-benefits for climate and nature alongside other priority outcomes, including biodiversity, water quality, climate adaptation and economic growth. The package will ensure that from 2024, we will be paying farmers to provide a range of public goods, including actions to reduce emissions. The package will also lead to improved capture of data and evidence, with increased funding for R&D, increased engagement with external stakeholders to support waste policy and water management plans. P&Ps will also result in greater clarity on how we can deliver multifunctional landscapes that are resilient to our changing climate whilst meeting our needs for net zero, food production, environmental recovery, housing and infrastructure. a) Decarbonising agriculture and land use sectors and increasing carbon sequestration from land will provide opportunities for economic growth across rural communities. b) Unlocking private investment into nature-based solutions such as afforestation and peatland restoration will contribute to our goal to attract at least £1 billion of private finance into nature's recovery per year by 2030. c) In 2021, agriculture and other land use emissions were around 49 MtCO2e making up around 11% of total UK net GHG emissions (including international aviation and shipping). Livestock (particularly cattle) currently make up the largest share of these emissions. Agriculture and other land use emissions have decreased by 2% since 2019 and 25% since 1990. The largest factor in this long-term fall has been an increase in the sink provided by forest land, with an increasing CO2 uptake by trees as they reach maturity, in line with the historical planting pattern. In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions could fall by 1% to 12% on average over 2023-27, 11% to 24% by 2030 and 19% to 37% on average over 2033-37.

d) In 2021, waste and F-gas emissions were around 30 MtCO2e making up around 7% of total UK net GHG emissions (including international aviation and shipping). The largest emissions sources include landfill and air conditioning and refrigeration. Waste and F-gas emissions have decreased by 11% since 2019 and 66% since 1990. The reduction since 1990 is primarily due to reductions in emissions from landfill and halocarbon production. In line with the sectoral breakdown of the indicative pathway set out in the NZS, compared to 2021 emissions levels, GHG emissions could fall by 23% to 31% on average over 2023-27 43% to 51% by 2030 and 56% to 65% on average over 2033-37. e) The near elimination of biodegradable municipal waste being sent to landfill. f) Optimisation of current wastewater processes to reduce greenhouse gas emissions. 15. P&Ps will capitalise on the economic benefits from this emerging sector by scaling-up First of a Kind technologies to deliver new export opportunities and high-quality green jobs across the UK, supporting energy security and levelling- 16. The package will provide clarity on innovation funding, business models, monitoring, reporting and verification. Successful delivery will see the sector mature and grow significantly through the mid-to-late 2020s. This will be both in terms of a growth in the evidence base of the emerging technologies, and in terms of industry and public confidence in the long-term prospects of the deployment of GGRs at-scale in the UK. a) Funding a variety of innovative GGR technologies, including several first-generation Direct Air Capture (DAC) technologies through the DAC and Greenhouse Gas Innovation Programme. This programme will produce several operational pilot plants by 2025, and will also realise investment, jobs, skills and technology in this nascent b) £100m innovation investment in key technologies, will help to move nascent technologies from prototype stage through to demonstration and deployment. c) One example of a project being funded is a consortium led by Sizewell C, who are developing an innovative heat-powered Direct Air Capture (DAC) demonstrator plant designed to capture low carbon waste heat from a nuclear power plant. This technology could offer increased efficiency and less reliance on electricity, therefore reducing the cost of removing carbon dioxide from the atmosphere. A scaled-up DAC plant linked to Sizewell C could utilise around 400 MW of heat from the nuclear power plant to capture 1.5 million tonnes of CO2 per year.
d) As set out in the Net Zero Strategy, to meet our CB4, NDC and CB6 targets, we set an ambition to deploy at least 5 MtCO2e p.a. of engineered removals by 2030, potentially rising to 23 MtCO2e p.a.by 2035.