Informer Issue 510 - 04/05/2021

Appointing a ‘carbon regulator’ to oversee monitoring and reporting of progress on emissions reduction across the economy would help accelerate the transformation of the UK’s energy system, according to a report. The Energy Systems Catapult, a not-for-profit organisation which looks to help decarbonise the energy system at the lowest cost, said a regulator could ensure that emissions reduction occurs in line with targets set under Carbon Budgets and the Paris Agreement. Such a system would also make sure that reductions in emissions are measured and rewarded appropriately by policy support measures and other incentives. Dr Danial Sturge, Practice Manager for Carbon Policy at Energy Systems Catapult, said: “Verifying carbon emissions can be straightforward when measured directly from a factory flue or when proxied through energy use, but challenges arise for sectors such as agriculture and land use where such measurements are not possible. “Consumption-based emissions, such as those embodied in imported goods and services yield additional complexity due to the supply chain life cycle analysis required.” Sturge said a carbon regulator that implements robust, economy-wide practices would remove barriers to innovation, and ensure that incentives drive technologies and processes that genuinely reduce emissions across all major emitting sectors. “This in turn can provide a robust basis for policy design, standard setting and reporting, and incentive mechanisms to drive investment and operational decisions aligned with Carbon Budgets and Net Zero.” Read more

A report from MPs on the Public Accounts Committee has concluded that HM Treasury and HMRC have a “very limited view of the role of tax” in achieving the Government’s aims on climate change. It said that only four environmental taxes were currently recognised by the Government department and they had not kept track of the impact of other tax measures. These include tax reliefs to support energy saving and clean technologies, or the impact of tax measures affecting the consumption of fossil fuels. The committee also highlighted what it sees as a lack of leadership and coordination. “Given the Treasury’s cross-government remit, it is “disappointing to see the silo thinking we often see in other Whitehall departments extending to the Treasury itself,” it said. Meg Hillier MP, Chair of the Public Accounts Committee, said: “The economic revolution required to abandon fossil fuels and reach net zero must be the greatest co-ordinated ask, of governments around the globe, in history. But the UK government has been blithely issuing ever more ambitious climate targets for years now, with no sign of a roadmap to reach any of them. The departments in charge seem stuck in a bygone era, with little sign of the innovative thinking needed to achieve all this. “Now we are six months from hosting the next major global climate summit and the climate storm is breaking all around us. HMRC and HMT need to catch up fast.” Read more

A group of UK corporate green groups have joined forces to launch a new alliance to bring greater focus on action on climate change. The launch of the UK Business Group Alliance for Net Zero (BGA), which includes organisations such as Business in the Community, the CBI, CDP, the International Investors Group on Climate Change, the UK Business Council for Sustainable Development and the UK Green Building Council, comes ahead of the COP26 climate talks in Glasgow. The groups have been working together informally since 2019 and the official launch was welcomed by the UK’s Net Zero Business Champion, Andrew Griffith MP. “With its influential membership, the Alliance will play a vital role in raising ambitions and persuading more British businesses to take part in the Race to Zero by setting science-based targets,” he said. The BGA is currently encouraging businesses to sign up to the Race to Zero Campaign which is backed by the United Nations and aims to mobilise leadership and support from businesses, cities and investors for a resilient, zero-carbon recovery. Read more

Regulator Ofgem has launched a consultation around its recently announced plans to rollout half-hourly settlement across the retail energy market. The consultation will focus on the implementation and governance arrangements for the move which the regulator said would be a major step towards the more flexible energy system needed to achieve net zero. Half-hourly settlement is already in place for medium to large non-domestic consumers, with elective half-hourly settlement for domestic and smaller non-domestic consumers.
Ofgem said the consultation will in particular cover the obligations that it intends to place on parties to “ensure that all parts of the industry move forward together”. The consultation is open until 25 June, and Ofgem plans to publish the outcome in summer or autumn. Implementation of the new system is expected to take place over the next fours years and to be complete by October 2025. Read more

The Government is being urged to do more to help community energy projects play a greater role in decarbonising the energy sector. The Environmental Audit Committee (EAC) said it was disappointed that the Government has failed to acknowledge the part community energy can play in prompting behaviour change and lowering emissions on the path to net zero. In a letter to the Business Secretary, The EAC said financial support is needed for community energy schemes to thrive, as was seen under the Coalition Government. The committee has recommended that BEIS introduces a minimum Smart Export Guarantee floor price above zero, extends the guarantee on the energy export price and removes regulatory and grid-connection barriers to allow community projects to sell their energy to their local communities. EAC Chairman Philip Dunne, said: “There is no shortage of innovative ideas that could all play significant roles in helping the UK achieve net zero emissions. But what is lacking is Government support, a coherent plan, and recognition of current barriers. We have found that community energy is no exception. “For net zero Britain requires us to change our behaviour and adapt to a low-carbon lifestyle. Community energy can help achieve this – not only powering homes and businesses up and down the country but by engaging local citizens on the benefits of renewable energy and – in many ways – how we can do our bit to help keep the lights on ourselves.” Read more