Analysis of the UK government's latest net zero review

Last Friday, the government published Mission Zero: Independent Review of Net Zero, the result of an enquiry into the business case for net zero across the UK commissioned by Jacob Rees-Mogg, the Business, Energy and Industrial Strategy (BEIS) Secretary of State under former prime minister Liz Truss.

Jacob Rees-Mogg probably didn’t intend for former energy minister Chris Skidmore to produce such a scathing report. Mission Zero indicts the government on its failure to provide certainty, consistency, clarity and continuity to businesses on net-zero policies. The review lays out a clear business imperative for the government to invest in net zero now, concluding that “net zero is the growth opportunity of the 21st century” and the “industrial revolution of our time”.

Mission Zero contains 129 recommendations to the government, from creating a new ‘Office for Net Zero Delivery’ to establishing a new public engagement plan on net zero. Quite a number of Skidmore’s recommendations are already in the government's pipeline. What is new is a sped-up agenda for delivery, a focus on holistic ‘systems thinking’, and the need for long-term government financing commitment. The CLA has examined how the report’s recommendations might affect members.

The review found that “many emissions reductions measures in agriculture are productivity enhancing, with the potential to boost growth by saving farm businesses £170m per year by 2035, rising to more than £1.5bn per year by 2050”. Environmental Land Management (ELM) schemes are the review’s chosen vehicle to fund these emission reductions, and the review recommends that the government publish full details of all schemes by the end of 2023. The CLA is calling for these details to be published even sooner, with some expected next week. The review also recommends that ELM schemes do not crowd out private finance.

On carbon sequestration, the review endorses previous analysis by the UK Climate Change Committee that 20% of the UK’s net-zero target will be met through tree planting and a further 20% through other ‘nature-based solutions’ – though it says little else about them or woodland creation. The CLA has emphasised to Defra that landowners will not be able to meet these goals without consistent, trustworthy measurement and verification of carbon sequestration. The review acknowledges these concerns and recommends that the government develop robust measurement of emissions and sequestration across food supply chains, and that carbon be accurately monitored across more habitat types.

According to Skidmore, standardised measurement would allow the government to establish mandatory, standardised ecolabelling on food and other products by 2025, and a national regulator for carbon credits and offsets by 2024. While ecolabelling could accelerate the shift in customer preferences away from higher carbon foods like red meat, consumer-led demand reductions would alleviate concerns about leakage and offshored emissions for members wanting to transition into environmental markets, and reward emissions reductions.

One of Skidmore’s recommendations that is gaining traction is for the government to “publish a Land Use Framework as soon as possible, and by mid-2023”. The CLA considers that there is a need to sense check all the government policies that use land, including for food security, and a framework will support that. There are already many controls on land use at a local level and the CLA advocates building on those to ensure that there is accessible and up-to-date data, guidance on local priorities, and economically viable options.

The review calls for crucial improvements in grid infrastructure as well as cross-sector coordination to minimise disruption from installing new electricity cables, which the CLA supports. Most of the review’s recommendations on energy involve turbocharging what was already detailed in the government’s April 2022 British Energy Security Strategy. For instance, the 70GW solar installation target appeared in the April 2022 strategy, but Skidmore has reframed it as a ‘solar revolution’, calling for more on-roof solar.

We are awaiting a government consultation on a review of the permitted development rights for on-roof solar, which could prove crucial for the deliverability of Skidmore’s recommendation. It’s a similar story on expanding nuclear to secure a low-carbon, non-weather-dependent baseload, and onshore wind. Skidmore’s ‘onshore wind revolution’ is a beefed-up version of what is now being consulted on through proposed changes to the National Planning Policy Framework. On bioenergy, Skidmore calls for the government to publish its Biomass Strategy, timetabled for the second quarter of 2023.

The review recommends bringing forward to 2033 the already unrealistic minimum energy efficiency standard of Energy Performance Certificate (EPC) rating ‘C’ for all domestic properties. For all non-domestic buildings, the target remains EPC-B by 2030. These recommendations are not yet set out in legislation, and there is a real danger that Skidmore’s targets are not rural-proofed, a point the CLA has consistently raised with BEIS. Skidmore’s review echoes earlier government proposals that heat pumps are the future of heating, with little investigation into the realities of delivering these in rural areas, and no alternative fuel-type offered. Decarbonising heating and energy is a complex challenge, requiring appropriate investment in skills and jobs, which cannot be encompassed in a one-size-fits-all policy. We will continue to highlight to government its neglect of rural areas in policymaking.

For instance, the word 'rural' only appears eight times in the entire 340-page review (excluding references) whereas quotes from big corporates pepper the text. The same imbalance is reflected in the report’s recommended government investment: enhanced capital allowances and research & development would still remain inaccessible to sole traders and small businesses.

The review contains recommendations to help local authorities be ambitious about getting to net zero, and suggests reforms to the planning system to make net zero an integral part of decision-making. There is a recommendation to introduce net zero Neighbourhood Plans, but it is unclear how the Skidmore review proposes to help communities enact and implement these plans without hindering development beneficial to the rural economy.

Overall, the Skidmore review is an ambitious document which the government should take seriously if the UK is to meet its net zero by 2050 target and remain internationally competitive to investment. However, it remains focused on big business and urban areas: the rural economy, outside a couple of important recommendations for environmental land management, appears forgotten. The government must be careful to ensure sufficient funding, personnel and technology is available for small and medium enterprises, particularly in rural areas, before legislating on a sped-up, mission-focused delivery agenda. Finally, it remains unclear what the current government will do with the review and how seriously they will take it, given it was commissioned by a former minister in a former administration.

The CLA will keep alert.