Net Zero Review recommendations could have 'significant impact' on trade if adopted

Mon 16 Jan 2023
Posted by: William Barns-Graham
Trade News

Net Zero logo surrounded by images of green energy symbols

The recommendations made in the Net Zero Review that was presented to government last week will have a ‘significant impact’ on UK trade if adopted, policy and trade experts have said.

The paper was published on 13 January by the government’s ‘Net Zero Tsar’, Chris Skidmore MP, following a public consultation launched towards the end of the last year.

It includes 129 recommendations for the government to ensure it meets its target of reducing carbon emissions to zero by 2050, including 25 that it says the government should adopt in the next two years.

Economic advantage

Skidmore says the move to net zero is an opportunity to put the UK at an “economic advantage globally”, as well as being fundamental to the UK playing its part in the global fight against climate change.

“We lead in areas including clean technologies, science, manufacturing and green finance – areas that, if managed right, can lead to new jobs and strong economic growth,” he said.

Trade impact

Hunter Matson, a trade policy and research specialist at the Institute of Export & International Trade (IOE&IT), told the IOE&IT Daily Update that the recommendations could change how British businesses trade internationally, should the government adopt them. He said:

“The review, which the IOE&IT supported in its consultation phase, lays out a series of recommendations that could have a significant impact on UK trade. The decarbonisation of freight, changes to regulation and the reduction of trade barriers for green sectors are among those that will change supply chains.

“As the main interlocutor between the UK’s traders and government, we look forward to supporting and challenging government in its implementation of the necessary steps in the country’s move to net zero.”

Vicky Payne, interim director of the IOE&IT Academy, added that the recommendations focussing on creating a stable environment for businesses to plan and invest are important.

“The review is right in saying that the move to net zero has economic advantages for the UK, as well as being key in the fight against climate change.

“It’s vital that the right business environment is created through policies, regulations and taxation regimes that incentivise investment in decarbonisation. The development and implementation of the UK’s Emission Trading Scheme will also be important for traders.”

Key recommendations

The report’s priority areas for the next two years included recommendations around:

  • Creating a stable environment for businesses to plan and invest in decarbonization, as well as long-term funding certainty
  • By the end of 2024, developing a pathway for the UK Emissions Trading Scheme to last until 2040
  • ‘Swift delivery’ of the zero emissions vehicle mandate from 2024
  • Launching a circular economy taskforce
  • Creating a new R&D roadmap for new technologies needed in net zero move
  • Conducting a strategic review of the UK's international climate leadership
  • Carbon capture, utilisation and storage
  • ‘Cleaner, greener homes’ and publishing a new Land Use framework by mid-2023
  • Fully backing at least one ‘Trailblazer Net Zero City, Local Authority and Community’ and immediately reforming the local planning framework
  • Non-domestic energy efficiency, accelerated use of renewables and hydrogen, and ‘doubling down’ on nuclear
  • Empowering consumers and publishing a new public engagement plan for 2023

Acceleration needed

The CBI’s decarbonisation director, Tom Thackrey, said the report “expertly shows that accelerating the UK transition gives us the best chance of capitalising on a global economic opportunity”.

Green MP Caroline Lucas said the report doesn’t go far enough, telling the BBC that it shied away from the "truly transformative measures to end our dependence on dirty, dangerous fossil fuels".

Labour’s shadow climate minister, Ed Miliband, accused the government of lacking “urgency and consistency” on net zero.

Business and energy secretary Grant Shapps said the government had a “track record to be proud of” on climate change.