Friday 04 March 2022 1:16 pm

UK to miss £50bn net zero investment target, says Lords report

The UK is not on target to raise the £50bn of investment needed to achieve net zero by 2050 according to a Lords Committee report.

The report concluded that the government is likely to miss its target for reducing emissions unless it puts credible plans in place to encourage investment by consumers and businesses. At present, targets are not matched by policies and clarity about the financial incentives which will be used to unlock the substantial private investment needed to fund new energy technologies, the Industry and Regulators Committee said.

“There is no point planning a carbon-free energy future if you haven’t got a clue how you will get there or how it will be paid for,” said committee chair Lord Hollick.

“These are basic questions that need to be answered before we will get the investment we need to get to net zero,” he continued.

Hollick called for urgent clarity around how the government intends to incentivise households to replace gas boilers with heath pumps, what plans there are for the 6m homes where heat pumps will be unsuitable and how upgrades to infrastructure to allow the use of hydrogen for heating will be funded. He also criticised government plans to raise energy bills to generate funds for the transition to net zero.

“The amounts that can realistically be raised via surcharges on energy bills is not enough. Bills are regressive as the poor pay more of their income on energy costs,” he commented, pressuring the government to use greater public borrowing to fund infrastructure costs associated with net zero.

The Committee called for the creation of an Energy Transformation Taskforce which will report directly to the Prime Minister and ensure that the UK is on track to meet its climate change commitments. The responsibilities of energy regulator Ofgem should be reviewed, according to the report, to ensure it is not creating barriers to a net zero energy system.