Net zero: Design incentives for business decarbonisation and let DNOs install fatter wires


The Committee on Climate Change has told government to urgently create a package of policies that incentivise businesses to invest in decarbonisation.

Business and industry, said the Committee, will be required to do much of the heavy lifting if the UK’s economy is to hit the net zero target now enshrined in law.

The Committee said government must “urgently establish a mechanism to incentivise widespread uptake of near-zero emissions technologies in industry, including the use of hydrogen, electrification, carbon capture and storage and bio energy carbon capture and storage, as well as support for energy and resource efficiency. The design of this mechanism must ensure it does not drive industry overseas, which would not help to reduce global emissions, and be damaging to the UK economy”.

The report also said electricity distribution network operators should effectively be allowed to lay much fatter cables and invest in bigger transformers, substations and other network infrastructure that can accommodate much higher levels of electrification.

The CCC pointed to analysis it commissioned from Vivid Economics that suggests the cost of adding more capacity than currently required is not much higher if the works are being done anyway.

“Future-proofing networks as and when they are upgraded can enable greater electrification at lowest cost,” sates the report. “It is essential, therefore, that when network capacity is increased, this is to a sufficient level to avoid having to upgrade the capacity again prior to 2050.”

Its recommendations may require a redesign of the current regulatory framework for networks to enable them to invest with an eye on 2050 rather than over a short-term price control.

The CCC says improvements in system flexibility will also be essential.

The report outlines a wide range of urgently required policy interventions across:

  • heat – develop a “fully fledged” decarbonisation strategy by 2020
  • transport – make the ban on new petrol and diesel engines 2030 if possible
  • energy – provide routes to market for onshore wind and solar, get cracking on CCS and hydrogen, create a workable nuclear strategy.

The Committee said decisions and policy cannot be left to individual departments such as Beis, the Environment Agency and Treasury, but taken across government, which must take the lead across its own estates.

See the report here.

Related stories:

Net zero: How to decarbonise heat?

Net zero: Bristol’s £5bn decarbonisation plan

Industry reacts to net zero

Committee on Climate Change recommends net zero emissions by 2050

Lift 6GW cap on offshore wind to hit net zero, says SSE

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