Member Article

The government’s recently announced low-carbon industrial sector strategy, supported by over £1 billion in funding to cut emissions from industry and public buildings, if nothing else, shows great ambition but does it also deliver the wherewithal to achieve those objectives?

It builds on the proposals in the Energy White Paper which themselves expanded upon the Ten Point Plan for a Green Industrial Revolution announced by Prime Minister in November last year. Concentrating on the UK’s manufacturing and construction sectors, the measures announced in the Industrial Decarbonisation Strategy are described as an ‘ambitious blueprint’ to deliver the world’s first low-carbon industrial sector by cutting  emissions from industry, schools and hospitals by two-thirds in the next 15 years.

James Wood-Robertson, head of Shoosmiths Infrastructure and Energy sector practice, welcomes the ambition if not the scale of the announcement:

“It’s a step on the UK’s pathway to net zero and does set out where the focus of funding is required, although many consider £1bn insufficient investment to achieve the stated objectives. It does however provide some of the clarity that the market requires and as the UK prepares to host COP 26 it is an important signal that there is an intention to transition to a net zero society.”

Wood-Robertson notes that the signalling by government is now less confused as it seems that plans for the new coking coal mine in Cumbria will face a public inquiry, taking the issue off the agenda at least for a while. Indeed, on the very morning the Industrial Decarbonisation Strategy was launched, Business and Energy Secretary Kwarteng announced that there were “very compelling reasons” to scrap the plans for the mine.

Key elements of the Industrial Decarbonisation Strategy include:

• Supporting existing industry to decarbonise and encouraging the growth of new, low carbon industries.
• Building on the UK’s efforts in moving towards greener energy sources, with an expectation of 20 terawatt hours from low carbon alternatives to fossil fuels by 2030.
• Investing £171 million in nine green technology projects as part of the Industrial Decarbonisation Challenge.
• Funding over 400 projects across England to reduce carbon emissions from public buildings, including hospitals, schools and council buildings.
• Introducing new rules to measure the energy and carbon performance of the UK’s largest commercial and industrial buildings, with the aim to reduce annual carbon emissions by over two million tonnes.
  
  

While the UK has made significant progress is curbing power generation emissions from coal plants and is a leading exponent of offshore wind, significant emissions from the industries such as steel and cement continue. As well as the target to cut emissions in industry, schools and hospitals by two-thirds by 2035 – and at least 90% by 2050 compared to 2018 levels – the strategy also highlights an expectation that at least three megatons of CO2 per year will be captured within industry by 2030.

To kick start the process, £171 million has been allocated to nine clean energy projects that will investigate the development of Carbon Capture Utilisation and Storage (CCUS) and hydrogen to create low carbon industrial clusters in Merseyside, South Wales, Teesside, Humberside and Aberdeenshire.

It’s clear that the government sees CCUS as having crucial role in delivering net zero in the UK and while the recognition of the part hydrogen can play is welcome, far more sustained investment on a greater scale and over an extended period will be required If the UK is to participate meaningfully in the much discussed hydrogen revolution.

Wood-Robertson concludes:

“The strategy is a big step in the right direction to reduce carbon emissions – especially timely since COVID has changed so much of the way we work that we now have a once in generation opportunity to think differently about how the public sector and private businesses are powered. Smaller firms will need support to make sure they are able to make the changes necessary to ensure the UK meets its carbon targets but also so they too can benefit from the dramatic changes to the way industry will work in the coming years that this strategy proposes.”

 

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