The new Prime Minister can unite the country behind the commitment to Net Zero
Ensuring that the transition to Net Zero is managed in a way that maximises benefits for society, in a fair way, will need to be a key focus for Government and industry to ensure a just transition which is politically achievable, says Alistair Phillips-Davies, Chief Executive of SSE.
Boris Johnson has entered Number 10 with a commitment to uniting the country. When the new Prime Minister begins tackling his significant “in-tray” I believe he will find an opportunity to achieve that ambition by leading a Government for Net Zero.
The UK is the first G7 country to enshrine in law a commitment to reach net zero greenhouse gas emissions by 2050. The new Government should take pride in that commitment and rally the country behind the effort to accelerate the end of the UK’s contribution to global warming. SSE believes there are three immediate priorities for the Government to focus on to show that it is serious about setting the UK on the right course for Net Zero
Lift the cap on the potential for renewable energy
Renewables will power the UK in a Net Zero future as we decarbonise large sectors of the economy, including transport and heat, by switching from fossil fuels to low carbon electricity.
The foundations have been laid with the Offshore Wind Sector Deal and commitment to regular low carbon contract auctions (CfDs) in the coming years. However, SSE believes that the Government will need to raise its ambition for these CfD auctions to deliver a minimum of 40 gigawatts (GW) of offshore wind by 2030 to stay on course for the 2050 target. Increasing the 6GW capacity cap in this year’s auction would mark a significant first step towards net zero by delivering more renewable power in a way that is straightforward and cost effective for consumers.
Onshore wind offers an even cheaper low carbon option and the Government should take the opportunity to look at how we can provide a subsidy-free route to market for both new onshore wind energy where it has community support.
‘Complementary technologies’, like nuclear and CCS, will play a role in supporting renewables, but should not be at the centre of our energy policy. Whilst I am supportive that Government is exploring a financing framework for nuclear power and other complementary technologies we must not build at any cost. A renewables- led approach will mean that we don’t have to.
Commit to a strong, long term price for carbon
A strong carbon price, comprised of the EU Emissions Trading Scheme and the UK’s Carbon Price Floor, has made a vital contribution to our success in decarbonising our power sector and driving investment away from fossil fuels towards low carbon generation. In the shorter term, we need to retain a robust carbon price during the forthcoming Budget and any Brexit transition.
However, it will continue to play a key role in the long-term effort to reach Net Zero, and a commitment to a strong UK carbon price post 2021, would be an important signal of intent from the Government at a time when we are looking to cement our position as a world leader in the fight against climate change.
Back our electricity networks to deliver Net Zero
Our electricity network infrastructure is often the overlooked part of the energy system, but the UK’s grid is already playing a crucial role in delivering Net Zero. A renewable powered, electrified economy will pose new challenges for the electricity network. But with innovative network trials like our Government backed LEO Project in Oxfordshire, and a regulatory regime that rewards innovation and efficient, timely investment, our networks will not be a barrier to increasing the pace of change in decarbonising heat and transport through electrification, but be a key enabler. It is for this reason, that a disruptive and costly nationalisation of the electricity networks would cause a multi year hiatus in our efforts to decarbonise and represent the greatest risk to the UK achieving Net Zero.
SSE is committed to playing a leading role in the transition to Net Zero and will support the bold steps necessary to get us there by 2050. Ensuring that this transition is managed in a way that maximises benefits for society, in a fair way, will need to be a key focus for Government and industry to ensure a just transition which is politically achievable.