Net Zero Review report:

Industrial decarbonisation is a priority mission for reaching net zero and ensuring its economic benefits

Net Zero is an economic opportunity, but to ensure its delivery we need robust policy strategies and timely implementation. These are the two main messages underpinning ‘Mission Zero’, the final report of the Net Zero Review, which was launched by Chris Skidmore MP earlier this week.

The report calls for industrial decarbonisation as one of the priority ‘missions’ which will be crucial for reaching climate targets and unleashing the economic opportunities of net zero, and reiterates key concerns and recommendations from across the industrial decarbonisation community. Here, we summarise key messages for industrial decarbonisation.

A plan for delivery

‘Net zero isn’t just a tool to solve the climate crisis’, Skidmore stressed at the report launch, ‘it has become the primary economic tool to deliver growth, to restore industry and manufacturing, to create new jobs and regenerate regions and local communities’.

With commitments to support clean technologies ramping up in the US and across Europe, Skidmore warned of the costs of delay and inaction, and the resulting loss of investments going elsewhere, along with jobs and supply chains. To maintain the UK’s leading position, the report urges the government to prioritise the delivery of net zero by setting a clear, consistent, and stable transition plan.

Informed by over 1800 written evidence submissions and insights from 52 roundtables and site visits, the report outlines 192 recommendations for an ‘efficient and affordable’ transition to net zero, including 25 recommendations for immediate action by 2025.

The mission of industrial decarbonisation

Industrial decarbonisation is recognised as one of ten priority missions where public and private action need to be harnessed in the run up to 2035. Asked at the launch about his recommendations for the cluster sequencing, Skidmore urged action: ‘The reality is, when it comes to these industrial clusters, they are going to have to decarbonise anyway, so why not get on with the job?’.

A clear mission and comprehensive long-term strategy for industrial decarbonisation and industrial efficiency is therefore needed, making use of the natural advantages in geological storage and CCUS, to enable the decarbonisation of world leading clusters while also ensuring support for dispersed sites without such advantages.

We are pleased to see key messages in the report reflecting concerns and recommendations which IDRIC, along with its partners in academia and industry, have contributed to the review (for a summary of IDRIC stakeholders’ policy feedback, see also the IDRIC Policy Synthesis Report 2022):

1. Policy certainty, continuity, clarity and consistency

The report emphasises the need for policy certainty, continuity, clarity and consistency to ensure the level of private investment needed for scaling up low carbon technologies such as hydrogen and CCUS. Finalising the business models and updating of relevant regulation and standards for emerging net zero technologies, as well as a more joined-up approach across government departments and with the devolved administrations, were also key findings from IDRIC’s stakeholder discussions.

Among the report’s recommendations for immediate actions, was a call for the government to set out of clear roadmaps of future support for hydrogen and CCUS, and to establish an ‘Office for Net Zero Delivery’ by Spring 2023 to ensure clear leadership, coordination of cross-departmental priorities for net zero and to manage the strategic relationship between the UK government and devolved administrations.

2. A cross-sectoral strategy for critical infrastructure supporting a green economy

Echoing key concerns in the industrial decarbonisation community, the report calls for a long-term plan for developing the required infrastructure for electricity, hydrogen and CO2 networks in an integrated manner. As IDRIC’s stakeholder engagement has clearly shown, holistic network thinking is needed to enable companies to make sound investment decisions about the most effective decarbonisation and fuel switching routes, avoiding stranded assets as well as delayed action.

The report also calls for streamlining of planning processes for critical infrastructure to reduce lead times – a key issue to which IDRIC will develop further recommendations via an upcoming policy roundtable.

3. Clear roadmap for technology development and deployment

The report urges government to clearly identify decision points for developing and deploying critical R&D for low carbon technologies between now and 2050, specifying that the government should publish a technology roadmap by Autumn 2023.

To ensure a whole-systems approach informs such a roadmap, the report quotes IDRIC’s advice to also consider timelines for planning and consenting, legislative timelines, lead times for upgrades to new and existing infrastructure, in addition to the particular incentives and resources required for the development and deployment of new technologies.

4. Supporting research and innovation to deliver net zero

The report stresses the role of the UK’s world-leading university and research sectors to deliver the technologies of the future and capture growth. It highlights the need to better understand the potential of emerging technologies for decarbonisation and economic growth, restating IDRIC’s recommendation to ‘ensure [the UK] is identifying, nurturing, and supporting sectors in which we already have strengths and those of strategic importance with potential for future high returns, while ensuring a full toolkit of decarbonising options is available to industry’.

Furthermore, the report calls on the Government to establish three new R&D demonstrator projects and emphasises the role of regulators in facilitating technology development through agile regulatory approaches to testing.

Next steps

A clear and coordinated strategy is needed to ensure long-term investment in key technologies and networks, along with the infrastructure, skills, supply chains and materials requirements, and effective carbon markets, needed for a successful transition.

The report clearly sets out the routes for action across these areas, with considerable policy developments needed this year to stay on track for net zero. Speaking at the event, Climate Minister Stuart promised a full government response to the review and an update to the government’s ‘Net Zero Research and Innovation Delivery Plan’. The Government’s response is expected in March.

Many thanks to everyone who contributed to IDRIC’s input to the review and to the many policy discussions with participants from across academia, industry, and governments in the past year.

IDRIC will continue to help pool expertise across the industrial decarbonisation community to support effective policy-making. Our upcoming policy roundtables will address policy measures to support industrial electrification, net zero planning and consenting, and effective carbon accounting and carbon pricing.

For more info, please get in touch at policy@idric.org

The IDRIC Policy Team