Energy professionals in my experience are a pretty hard-headed bunch. They’re engineers, technicians, scientists and economists, driven by the practicalities of what it takes to keep the electrons and molecules flowing to our homes, businesses and vehicles. I value their methodical, fact-based view of the world because it delivers for us all day-in-day-out, even in these exceptional times.
So when we survey the Energy Institute’s members in the UK every year in our Energy Barometer, about their sector and the world around them, I listen. And this year’s survey, focused on net zero and the impact of COVID-19 could not be better timed.
There’s no doubt the UK has a strong track record as a climate leader. The Climate Change Act was in its day the first of its kind and upgrading the target to net zero last year in line with the science put us back in the vanguard.
I was privileged to have been at the helm of National Grid during what I now see as the first decade of that net zero journey. And progress by this industry getting renewables onto, and coal off, Britain’s electricity grid has been astonishing.
But our survey published this week shows energy professionals are worried. Nine in ten of them believe the UK is currently off track for net zero by 2050; more than half of them say we’re even off track for the target for 2030 without urgent policy action.
More ambitious policies are needed and fast
In this endeavour, numbers matter. Zero is the goal, but emissions are still only down around 40 per cent and the hardest work is yet to be done. Dates matter too. 2050 might sound like a long time away, but the lead times for technology development and deployment are lengthy. If we’re to have a chance of net zero by the middle of the century, the 2020s really have to be the decade of delivery.
Fortunately, the Energy Barometer contains help for ministers looking for solutions. Before anything else, our members prescribe the unfinished business of bringing our nation’s buildings up to scratch. Energy efficiency is singled out as both the biggest missed opportunity of the past decade and the foremost option for plugging the emissions reduction gap for the 2030 target at least cost. Furthermore, in the context of Covid-19, more of our members urge retrofitting existing housing stock than any other action for a resilient recovery. It has nation-wide, job-creating potential, with long term environmental and social benefits.
In fact, our members overwhelmingly support calls for ministers to turn the discontinuity caused by the pandemic into the moment we get real about the climate threat and the shape of our future economy. Four in five agree with the Committee on Climate Change (CCC) that stimulus should be channelled into green industries and jobs, and support for emissions-intensive sectors should be contingent on action on climate change.
Bold decisions urgently need taking in heat and transport, to set us on that path to net zero by 2050. Top of the list are funding and incentives to bring on low-carbon aviation fuels, hydrogen HGVs, heat pumps and hydrogen-ready boilers, and demonstration of CCUS in power generation and industrial clusters.
Incumbents beware
The Energy Barometer also delivers a warning shot to our energy industry which is not doing enough either, according to two thirds of our members.
Although a third of our members’ own organisations have already publicly committed to a net zero target – impressive given it only became law a year ago – there’s a hint of trouble ahead for those who still have their head in the sand.
Boardrooms and management teams will all have to manage change over the coming decades – in terms of profitability, the supply of skilled workers and the supply chain. But it’s in the cast list of industry players where our members see things changing most dramatically. Almost half of our members expect gradual change, but a further third expect that change to be disruptive.
Incumbents are already facing challenge from dynamic new entrants, from innovative start-ups to big name brands from the ICT and automotive sector, and we can only expect that to intensify,
Moral authority
All of this matters for our economic recovery and for delivering on the UK’s legally binding targets, but it also matters for Glasgow and COP26. Without immediate domestic policy steps from ministers, to quote the CCC’s Lord Deben, “the UK’s international credibility is on the line”.
Orchestrating the international ‘Race to Zero’ and the diplomacy required by it over the next year will call for every bit of credibility we can muster. Hence why leading by example at home is singled out by our members more than any other measure as the number one priority for maintaining the UK’s status as a climate leader.
It was clear in Paris five years ago that COP21 president Laurent Fabius and the formidable French diplomatic machine commanded respect and were listened to.
But it’s no surprise that, as he travelled the world’s capitals building support for an ambitious deal, back at home an Energy Transition for Clean Growth Act was introduced. It put in place binding energy targets on housing, renewable energy and transport – with the aim of halving French energy consumption by 2050.
It signified France’s strong political commitment to mitigating climate change, to walking the walk at home. How else could Fabius have looked India in the eye?
The same goes for the UK over the coming year. The delay to COP26 bought breathing space but the test is fast approaching when the UK will need to prove its moral authority.
The world has entrusted the UK with COP26. Only with ambitious clean energy action at home can we inspire reciprocal action from countries around the world.
Steve Holliday, president, Energy Institute