On Thursday 28th November, Onward publishes ‘Costing the Earth’ by Richard Howard and Ted Christie-Miller.
Our new report Costing the Earth presents a bold plan to decarbonise the UK economy without undermining competitiveness, hitting consumers or overburdening taxpayers.
While the Government’s 2050 target back in May was a positive step forward, the commitment alone is not enough. A practical plan is urgently needed that utilises the power of the market, spurs investment in innovation and most importantly safeguards those poorest in society.
This report recognises the significant progress to date, including the fact that UK Greenhouse Gas emissions have declined 44% since 1990, while other countries have seen theirs rise – China has overseen a 321% increase in the same period. We applaud the policy successes that assisted in bringing about this decline, particularly in the power sector with the phase-out of coal.
But, there are still significant barriers to progress such as: patchy and inconsistent incentivisation, which has often resulted in mounting bills low-income households; a clashing of government priorities to the detriment of decarbonisation objectives; and poor decarbonisation in the heat and transport sectors.
We have put forward 21 recommendations which are bold but workable, including:
- Replacing the current “Contracts for Difference” regime with a system of “Carbon Contracts”, where delivery of low carbon generation is incentivised by pricing carbon emissions into the cost of electricity rather than through explicit government subsidies.
- Removing energy levies from consumer electricity bills and rebalancing VAT so that electricity, which has been significantly decarbonised in recent years, attracts zero VAT while highly-emitting gas is charged at 20% VAT. These changes would spur investment in low carbon heating options.
- Reforming Winter Fuel Payments, which are paid every year to all pensioners and cost the taxpayer £2 billion a year, into an Energy Efficiency Capital Grant scheme for fuel poor households to upgrade their insulation and energy efficiency.
- Plant 1.4 billion trees by 2050, 20 times the current rate of reforestation, by redirecting agricultural subsidies towards an expanded Woodland Carbon Guarantee scheme.
- End support for fossil fuel projects overseas through Overseas Development Aid and Export Finance. 96% of UK Export Finance for energy investment goes towards fossil fuel projects, costing taxpayers £2.5 billion of the overseas development budget.
- Improve coordination on decarbonisation across Government, by aligning the remit of key regulators to the net zero goal, and assessing the carbon impact of every Budget decision.
Within this report, we highlight the eye-watering and dangerous costs of the 2025 and 2030 net zero emissions targets called for by Extinction Rebellion and those on the left. Some highlights of these costings are given below:
- 2025 and 2030 targets would cost an absolute minimum of £200 billion (9% of GDP) and £100 billion (4.5% of GDP) respectively.
- We would require replacing gas boilers with low carbon alternatives such as electric heat pumps in 22.8 million homes, at a current cost of £8,400 a home (or £192 billion in total).
- It would require 270,000 more plumbers than the UK currently has in operation – as well as requiring a huge expansion of our power system to service the additional power demands.
- 2 million homes per year would require an energy efficiency upgrade, up from the current rate of improvements of 166,000 per year.
- This would cost in the region of £270 billion.
- The electrification of short haul air travel would require technology or low carbon fuels that do not currently exist, meaning a likely end to air travel as we know it if we are to eliminate greenhouse gas emissions by 2025.
It is not enough for the Government to set a target and be done with it. It needs to be followed up with a comprehensive, bold and practical plan to reach net zero emissions by 2050 that is rooted in belief in open-markets, prudence in government and faith in institutions.
For media inquiries please contact Will Tanner at [email protected]